MOSCOW, October 28 (RAPSI) – Russia’s Economic Development Ministry claims that mandatory 'deoffshorization' aimed at moving business activities of Russian companies from offshores back to the country entails considerable risks for the companies and the slowing economy of the country, Interfax reported on Tuesday, citing a letter sent to the government in mid-October.

According to the ministry, mandatory approach could undermine the global competitiveness of Russian companies and lead to the shutdown of some sectors. The approach also entails the risk of considerable expenses and failure to honor contracts with foreign companies.

At the same time, the ministry said that mandatory approach would be expedient for defense contractors and companies where state defense contracts accounted for over 50 percent of the revenue in the past three years.

In December 2013, President Vladimir Putin in his annual address to the Federal Assembly called for a crackdown on Russian companies that dodge taxes by registering in offshore jurisdictions.

Following a meeting with the management of the Russian Union of Industrialists and Entrepreneurs in June, the Finance Ministry along with the Economic Development Ministry was to come up with initiatives brining Russian companies back.

The first bill proposed by a group of lawmakers was submitted to the lower house of parliament, the State Duma, on October 22.