In 2011, five key court decisions from the Supreme Arbitration Court (SAC) shaped the way taxpayers do business in Russia. But their real influence will only be felt throughout 2012.

The Russian tax environment keeps evolving following the growth and development of the economy. Listed below are the main themes that I am seeing unfolding in the Russian tax environment and how they can impact your business.

Early 2012 a number of important amendments to the tax legislation entered into force. The renewed transfer pricing rules are of special significance among them as they can significantly affect the activities of numerous large companies including those in the Ural region.

The Russian government has recently been talking more about the need to optimize groups of taxes, with high-quality economic growth depending on this. In particular, Prime Minister Vladimir Putin recently stressed that Russia must make its tax system more attractive to investors and competitive in comparison with the other countries of the Russia-Belarus-Kazakhstan customs union, even despite a risk of a shortfall in budget revenues.

The CMS/Mergermarket Deal Drivers survey of the Russian M&A market 2012 shows that the positive, if uneven, growth in deal-making activity starting from the first quarter of 2010 leveled out in 2011 and fell off in the final half. The overall number of deals dropped from 223 in 2010 to 214.

In early January, the Russian Federation's Supreme Arbitration Court published Presidium Ruling No. 8654/11 in the case of OAO Coal Company Severny Kuzbass. One of the main issues in the case was the application of Russian thin capitalization rules (in Article 269.2 of the Tax Code) in view of the nondiscrimination provisions of double taxation treaties.

Alongside actively developing cross-border economic, trade and customs law and adjusting to European standards and the WTO principles, Russia is seeing the adoption of rulings actually hampering foreign capital flow into the country. In January 2012, Russia's Supreme Arbitration Court (SAC) published a ruling prohibiting taxpayers with foreign capital from deducting interest they pay on loans "with a foreign element." Apart from the prospect of reducing foreign investments, this ruling may already entail considerable taxes being additionally assessed on Russian borrowers when tax audits are held.

The main function of a company's intellectual property is to individualize products and the company as well. Yet, as recent legal practice and the practice of antitrust authorities show, intellectual property can also be used as a weapon in legal battles against competitors.

The last financial crisis demonstrated that the problem of overfilled trademark portfolios has affected, in economic terms, not only big international corporations with a portfolio of several thousand trademarks but a number of Russian companies as well.

Pursuant to Federal Law of the Russian Federation of Dec. 7, 2011, No. 420-FZ, defamation and insult are no longer considered crimes prosecutable under the Russian Federation Criminal Code (hereinafter the "Criminal Code"). Such actions are now punishable instead under Articles 5.60 and 5.61 of the Russian Federation Code on Administrative Offences (hereinafter the "Administrative Code").