On February 8, 2022, the Ukrainian government announced the introduction of the long-awaited beneficial economic regime for the IT industry, which was called Diia.City. On the same day, President Volodymyr Zelenskyi declared that thanks to Diia.City, the share of the IT industry in the GDP of Ukraine would increase from 4% to 10%, and the profit – up to USD 16.5 billion.
The full-scale Russian invasion, which started two weeks later, ruined not only these plans. At present, it is impossible to actually evaluate the effect of Diia.City on the economy According to the estimate of the research done by IT Research Ukraine, in 2023, the share of IT in the GDP of Ukraine was 4.9%, and the contribution of the IT industry to the gross added value (GAV) – USD 5.5 billion. , but two years after its launch, the special legal regime, envisaging lower taxes and easier employment, is being used by almost 900 IT companies The website of Diia.City presents a larger figure because the Ministry of Digital Transformation does not consider the companies which ceased being the residents of Diia.City, for some reason. .
One of the key requirements for the residents of Diia.City is the absence of any relations with the aggressor country. This was emphasized by Mykhailo Fedorov, the Minister of Digital Transformation, many times.
“Prior to becoming the residents of Diia.City, there is a check in the registers to see whether there are any Russian assets and citizens of Russia among the owners. If a person is somehow involved in the Russian business, this company surely cannot be in Diia.City, if its owner is Russian. If they are somehow involved in it or have entered Diia.City with another legal entity, the law enforcement bodies should deal with it,” said Fedorov in an interview for LB.ua in June 2022.
It is obvious that, in addition to Russia, which was given the status of the aggressor country in 2015, since February 24, 2022, Belarus should have been under restrictions as well, as it provided its territory and air space for attacks on Ukraine in the first months of the invasion.
However, having analysed the owners of almost 900 companies that are residents of Diia.City, NGL.media found 24 companies, whose owners are directly related to Russia and Belarus; some of them still do their business and pay their taxes in full there while enjoying the tax benefits in Ukraine.
The list of questionable residents of Diia.City
This company develops the SmartVista platform for the processing of cashless transactions. The Swiss company “BPC” has its representative offices in Switzerland, Great Britain, India, Egypt, etc. The owner of the Ukrainian company, “BPC Ukraine”, is a Russian, Anatoly Loginov, who has been a citizen of Malta since 2016. Loginov controls the Ukrainian BPC via the Dutch “BPC NL B. V.” which was created by the Cyprian “BPC BT Holding LTD” owned by Loginov, which was previously reported by NGL.media. The Russian company “BPC” is related to Loginov and is still working; the two respective legal entities are still active – “BPC Processing” and “BPC Innovative Software Solutions”. According to the data of the Russian service “Checko”, at the end of 2022, the Cyprian “BPC BT Holding LTD”, owned by Loginov, was among the owners of these companies, but now they belong to the Russian company “Innovative Software Solutions”. The founders of the latter include a Russian entrepreneur, Dmitry Bubnov; since 2017, he holds the position of director in one of the Russian companies related to Loginov (“BPC Innovative Software Solutions”).
This company produces forensic equipment and software for the authentication of documents. The Latvian company “Regula” has its representative offices in Latvia, the USA, Poland, Germany, the Netherlands, and Brazil. The founder of the Ukrainian company “Regula Forensics UA” is the Latvian “Regula Baltija”; its owners include the citizens of Belarus, Yuriy Rogozhynsky and Ivan Shumsky. Shumsky is also a citizen of Israel, which is specified in the Latvian register. “Regula” still works in Belarus, has its office, an active legal entity “Regula” and is a resident of the Park of High Technologies. The owners of the Belarusian “Regula” are the same Yuriy Rogozhynsky and Ivan Shumsky. In April 2023, the employees of this company made a presentation in the Belarusian National Technical University, and previously Yuriy Rogozhynsky personally guided an excursion in the “Regula” for the students of the same university. In the RF, Shumsky and Rogozhynsky have CJSC “Regula-Rus”, according to the Checko, in 2022, the Latvian “Regula Baltija” and Leonid Gapotchenko, a Russian entrepreneur, were still named among its founders. Due to the fact that by its organizational legal form, this entity is a closed joint-stock company, we haven’t been able to find out who the owner of “Regula-Rus” is at the moment. However, Gapotchenko is still the director of “Regula-Rus”, he has been holding this position since 2010.
– a producer of mobile games. The Swedish company, “G5 Entertainment’ has its representative offices in Sweden, Moscow, Kaliningrad, Kharkiv, Astana, etc. The owner of the Ukrainian company “G5 Holding Ukr” is Nijland Jonas Peter Erik, a Swede, who controls the company via the Swedish “G5 Entertainment AB”. As of 2022, the Russians Vlad Suglobov and Aleksandr Tabunov were among the stockholders of the latter company, which is known from the report on corporate management published by the company. Previously Suglobov and Tabunov lived in Russia and founded a company in Moscow (according to the information from the Russian mass media, but we didn’t manage to find out which citizenship they have now). In Russia, “G5 Entertainment” has at least two active legal entities “G5 Holding Rus” and “G5 Marketing Services Rus”, registered with the same Swedish “G5 Entertainment AB”. Since the beginning of the full-scale invasion, the website of “G5” posted the official position of the company, which had no words about supporting Ukraine, and the word “escalation” was used instead of the word “war”. Later, the company announced that it would gradually leave the RF market. However, according to the data of the Russian service “Checko”, in 2022, the total net profit of two Russian companies was RUR 41.7 million. And in October 2023, “G5 Entertainment” announced that it was coming back to the RF market (which it practically never left); it was reported by DOU.ua, referencing the corporate letter of Vlad Suglobov, the CEO, to the team of his employees.
– according to the data of DOU.ua, the company is related to the international company “Elinext” which is a software developer and an outsourcer. The owners of the Ukrainian “Elisoft” company are the citizens of Vietnam, Le Bik Thiam, Nguyen Van Khoa, and the citizens of Belarus Aleksey Shlyakhovsky, Vladimir Antonovich, and Vladimir Baranovsky. In Belarus, Antonovich, Baranovsky, and Shlyakhovsky are the co-owners of “Elilink Consulting”, which is also a software developer and an outsourcer. According to the information from the Belarusian job-seeking websites, in February 2024, “Elilink Consulting” recruited new employees in Belarus. On March 13, 2024, the company dropped the residency in Diia.City on its own.
– Software development and strategic IT consulting services. An international company “Itransition” has its representative offices in the USA, Lithuania, Great Britain, etc. The owner of the Ukrainian company “Itransition” is a citizen of Belarus, Sergey Gvardeitsev, who also has citizenship of Malta and controls his Ukrainian business via the British “Itransition Software Limited”. In Belarus, there is a company with a similar name CJSC “Itransition”, which is a resident of the Park of High Technologies, and we didn’t succeed in finding out its owner. Also, Gvardeitsev has his agricultural business in Russia; for instance, he is a co-owner of the Tula-based potato-cultivating company “Maksim Gorky Plus”.
– software development and IT consulting. The European company “Innowise” has its offices in Poland, Germany, France, Norway, etc. The founders of the Ukrainian company “Innowise” are citizens of Belarus, Pavel Orlov and Sergey Orlov, and a citizen of Russia, Vladimir Gladkikh. In Belarus, they are the co-owners of the company “Factory of Innovations and Solutions”, which is a resident of the Park of High Technologies. This company has 8 offices; in 2024, it already managed to hold numerous different events, including a hackathon for the students of the Belarusian State University of Informatics and Radioelectronics, some time later, it held training in Big Data for the students of the Belarusian State Economic University.
– development of applications for entertainment and mobile games. The owner of the Ukrainian company “Henes Technology” is a citizen of Belarus, Tatiana Bandarovich, who has an address in Kyiv. According to the data of DOU.ua, “Henes Technology” works under the brand name “Gismart”. The main office of “Gismart” is situated in Great Britain. Some of the owners of the British “Gismart” are the citizens of Belarus, Dmitry Lipnitsky and Aleksandr Minets, who also have citizenship in Great Britain. In Belarus, they are the co-owners of the company “Gismart”, which is a resident of the Park of High Technologies. According to the information from Belarusian mass media, “Gismart” has stayed in the market of Belarus.
– sale and maintenance of new and restored HP, Dell, and IBM servers, and other IT equipment. The owners of the Ukrainian company “Servermall” are the citizens of Belarus, Yevgeny Brogar and Aleksandr Konchak, who have Ukrainian addresses. In Belarus, there is a company with the same name, “Servermall”; its owner is a citizen of Belarus, Vitaly Slonsky, and Yevgeniy Brogar was its director in 2018–2020. The websites of the Belarusian and Ukrainian companies are very similar, and the Belarusian one presents information about the offices in Ukraine and their contact data, and the phone number of the Ukrainian company, specified there, coincides with the one currently posted on the Ukrainian website.
– the company provides public cloud services. The American company “Mirantis Inc” has its representative offices in the USA, Ukraine, Poland, Canada, etc. The founder of the Ukrainian “Mirantis Ukraine” is the American “Mirantis Inc” from California. One of the owners of the latter is a Russian, Aleksandr Fridland. In Russia, the “Mirantis” brand is represented by the Russian Mirantis IT”, controlled by the American “Mirantis Inc” from the offshore state of Delaware. According to the data of Opencorporates, the latter is the owner of the Mirantis brand and owns several subsidiaries in the USA, including the California-based “Mirantis Inc”, which owns a company in Ukraine (“Mirantis Ukraine”). NGL.media sent a letter to the company asking about their business in Russia. In response, the company said, “Immediately after the invasion of Russia into Ukraine in 2022, “Mirantis” started the process of legal suspension of all the transactions in Russia.” The company claims that it suspended its business in Russia and does not receive any profits, but as required by the RF government, it continues making payments for a limited number of employees, including the payment of the required taxes.
– software development for radioequipment management; the company has done some development for the defence complex – software for the EW systems, used by the armed forces of different countries. The French company “ATDI” has its representative offices in France, the USA, Poland, Ukraine, etc. The founders of the Ukrainian company “Laboratory of Information Systems” are two Ukrainian companies – “Mirual” and “ATDI Ukraine”. Among the founders of the latter is the Russian “ATDI Eurasia”. One of the founders of the Russian “ATDI Eurasia” is the French company “Advanced Topographic Development and Images”, owned by a citizen of France, Philippe Missud. In 2021, his French company was a sponsor of the Russian IT-forum in the metallurgy industry.
– PJSC “Kyivstar” is among the founders of Ukrainian companies. According to the data of the NACP, the owner of PJSC “Kyivstar” is a Russian, Mikhail Fridman, who controls it via “Veon Ltd” holding. Since October 2022, the sanctions on Fridman have been imposed in Ukraine for a period of 10 years, including asset blocking, restrictions of trade transactions, suspension of the fulfilment of economic and financial obligations, etc. In September 2023, the Security Service of Ukraine gave a notice of charges against Fridman for financing the RF aggression in Ukraine, and later put him on a wanted list. According to the data of the NACP, in the RF, the Cyprian companies “ABH Financial Limited” and “Alfastrakhovanie Holdings Limited”, owned by Fridman are among the owners of at least two active legal entities “Unc-Holding” and JSC “AB Holding”. In July 2023, the sanctions on the two abovementioned Cyprian companies were imposed in Ukraine by the Decree of President Volodymyr Zelenskyi for a period of 10 years, including asset blocking, prevention of capital removal out of Ukraine, etc.
– according to the data of DOU.ua, the companies belong to the “Playrix” holding, developing mobile and PC games. The website of “Playrix” mentions offices in Cyprus, Ireland, Serbia, Ukraine, Kazakhstan, and other countries. The owners of the business, registered in Ukraine, are Russians with Israeli citizenship, Igor Bukhman and Dmitry Bukhman, who live in Britain and control their Ukrainian companies via the Cyprian “Playrix Holdings Limited” and “Voki Cyprus Limited”. In October 2022, AIN.ua published a letter from Igor and Dmitry Bukhman, according to which “Playrix” announced its leaving the market of the RF and Belarus. And in September 2023, АIN.ua published the response of “Playrix” to the inquiry, in which the company claimed that it “had almost left” the market of the RF and Belarus – it closed all its offices there and either fired or relocated some employees. In Russia, the Cyprian company “Rimute Holdings Limited”, owned by the Bukhmans, is the owner of four legal entities that are under liquidation and one active legal entity, “ITdev Lab”. According to the information in the Russian analytical service Checko, in 2022, “ITdev Lab” suffered a loss of RUR 636.4 million.
– development of mobile and online games. The owners of the Ukrainian company “Vizor Games” are the abovementioned Russians with Israeli citizenship, Igor and Dmitry Bukhman, who control it via the Cyprian “Asmina Holdings Limited”. In Belarus, the company “Vizor Games”, which is a resident of the Park of High Technologies, is registered with the Cyprian “Asmina Holdings Limited”. This company is actively recruiting employees in Belarus. Previously, the Bukhmans announced that Playtrix was leaving the Belarusian market, so the search for the personnel in Belarus seems strange at the very least.
– This company is involved in computer programming. The owner of the “Dvash Soft” company is a citizen of Belarus, Maksim Kononovich. We didn’t manage to trace his activity in Belarus or Russia.
– “The investment group of a new type, which develops the technological business in the entire world,” this is how the company describes itself. The main office is located in Kyiv, and there are also representative offices in Paris, London, etc. Also, the company talks about its support for Ukraine. The owner of the “Roosh” company is a Russian, Sergey Tokarev, who controls it via the Cyprian “Roosh LTD”. According to the YouControl data, Tokarev has the citizenship of Romania, but in December 2022, he still had the citizenship of the RF. As per the data of the RBK-Ukraine, in 2016, Sergey Tokarev visited Moscow and the occupied Crimea several times. In 2016, the Decree of President Poroshenko imposed sanctions on Sergey Tokarev for one year, the prerequisite being as follows: “the actions of a person, which create a real threat to the national interests and infringe the interests of the society and the state”. In 2018, another Decree of President Poroshenko imposed sanctions on Tokarev again, this time for three years. However, in 2020, these sanctions were abolished by the Decree of President Zelenskyi.
– software development for the industry of financial services and digital assets. The Latvian company “Soft-FX” has its offices in Latvia, Ukraine, and Malaysia. The owner of the Ukrainian company “Soft-FX UA” is a citizen of Belarus and Cyprus, Aleksandr Klimenko, who controls it via the Latvian “Soft-FX Services”. According to the Latvian register, Klimenko’s country of residence is Malaysia. Previously, Klimenko conducted his business in Belarus, but in the middle of 2022, he sold two Belarusian companies which belonged to his Latvian “Soft-FX Services”, which was described in Belarusian mass media. Now Aleksandr Klimenko is under investigation in the USA, he is facing up to 25 years of imprisonment for money laundering and unlicensed provision of financial services.
– The company provides computer-assisted document flow services. The American company has its representative offices in Poland, Ukraine, Portugal, etc. The owner of the Ukrainian company “PandaDoc Ukraine” is a citizen of Belarus, Siargey Barysiuk, who controls it via the American “PandaDoc Inc”. Barysiuk lives in the USA. A company with a similar name, “Pandadoc”, worked in Belarus, but this company was closed on February 2, 2022.
– The company provides banking services (currency exchange, online card opening, and share trade) via its own online application. The founder of the Ukrainian company “Revolut Technologies Ukraine” is a British “Revolut Ltd”, the owner of the latter is the British “Revolut Group Holdings Ltd”, and a Russian, Nikolay Storonsky, is among its owners. As reported in October 2022 by The Telegraph from Great Britain, Storonsky renounced Russian citizenship, at present, he is a British citizen. Storonsky publicly supports Ukraine. So, the application “Revolut” stopped processing the transactions in Belarus and Russia. However, in Ukraine, the sanctions on Storonsky’s father, Nikolay Mironovich Storonsky, the director of “Gazprom promgas” have been imposed for 10 years: asset blocking, restrictions on transactions, prohibition on procurement of land for his ownership, etc.
“Soft-FX” company, owned by a Belarusian, Aleksandr Klimenko, stands out in this list. He is currently under investigation in the USA; he is facing 25 years of imprisonment. According to the press release published by the US Department of Justice in February 2024, Klimenko and Aleksandr Vinnik, an RF citizen, controlled the online platform of digital currencies, BTC-e, in 2011–2017. Klimenko is accused of BTC-e providing the consumers with the possibility of laundering the illegally obtained money; its clientèle mostly consisted of cybercriminals.
In December 2023, Aleksandr Klimenko was detained in Latvia on the grounds of the American order and extradited to the USA. In Ukraine, he still owns “Soft-FX UA” company, which is a resident of Diia.City, via the Latvian “Soft-FX Services”.
Another remarkable example is the involvement of “G5 Entertainment”, a producer of mobile games, in Diia.City. Formally, the owner of the Ukrainian company “G5 Holding Ukr” is a Swede, Nijland Jonas Peter Erik, but the stockholders of the main Swedish “G5 Entertainment AB” are Russians, Vlad Suglobov and Aleksandr Tabunov.
After the full-scale invasion of Ukraine, G5 announced its “gradual leaving from the RF”, but it actually went on working there. And in October 2023, Vlad Suglobov, the CEO of the company, informed the employees that “G5 Entertainment” was coming back to the Russian market (which it actually never left).
A Russian, Anatoly Loginov, is the owner of “BPC Ukraine” – another ambiguous resident of Diia.City. Formally, Loginov has had the citizenship of Malta since 2016 and controls “BPC Ukraine” via the Dutch “BPC NL B. V.” which was created by the Cyprian “BPC BT Holding LTD”, owned by the same Loginov. It was previously mentioned by NGL.media in the investigation about the circumstances of introducing the electronic ticket in the Lviv region.
How does the Ministry of Digital Transformation explain all this?
NGL.media asked the Ministry of Digital Transformation which administers Diia.City to explain on which grounds these and other companies, controlled by Russians and Belarusians, managed to enjoy the benefits of the preferential economic regime, designed for Ukrainian IT companies.
The Ministry responded with a long answer, which can be summarized as follows: the companies mentioned in the inquiry of NGL.media, have a right to the preferential economic regime because the Ministry of Digital Transformation didn’t find the relations with the aggressor country sufficient for the prohibition, and the legislation does not prohibit Russians to own the companies-residents of Diia.City – on some conditions.
“[…] Due to the requirements of the law, a resident of Diia.City may be a legal entity, a direct or indirect owner of shares in the registered (equity) capital of which is a citizen of the aggressor country on condition that this private individual does not reside in the territory of the aggressor country,” says the response of the Ministry of Digital Transformation, sent to NGL.media.
Art. 5 of the Law “On Stimulating the Development of Digital Economy in Ukraine”, adopted specifically for the launch of Diia.City, does actually state that “a direct or indirect owner cannot be […] a private individual, constantly (mostly) residing in such a country”.
In other words, if a citizen of the RF mostly lives beyond the borders of Russia (though it is not quite clear how the Ministry of Digital Transformation should trace it), access to Diia.City regime is free for his companies. And the Ukrainian government is not worried about the fact that these people conduct their business in Russia and pay their taxes there, thus financing the war.
From the standpoint of the Ministry of Digital Transformation, the situation with Belarusians is even simpler. Russia was officially declared the aggressor country in 2015, while Belarus has not been. The draft decree about declaring this country the aggressor state was registered in the Verkhovna Rada in June 2023, but it has not been adopted yet. So, there are no restrictions whatsoever for Belarusians to enter Diia.City.
At the same time, Ukrainian diplomats officially deem Belarus to be the aggressor state, referring to Resolution 3314 of the UN General Assembly, which qualifies the permission to use one’s territory for an attack on another country as an act of aggression. Ukraine imposed sanctions on the defence industry of Belarus, the checkpoints at the border with this country are closed, and several intergovernmental agreements were abolished. Ukrainian government officials have called Belarus the ally of the RF, its satellite, and collaborator of terrorists many times.
Yet officially for the Ukrainian government, Belarus remains just like any other country, except Russia. So, Belarusians have the possibility to freely register their companies in Diia.City and receive their benefits at the cost of the Ukrainian budget. And some of these Belarusians have their business in Russia as well.
“There is no morality in it”
“It is very unpleasant that Ukrainian preferential economic regime is used by Russians and Belarusians; it should not be that way,” is the opinion of Sviatoslav Litynskyi, the co-founder of “Abto Software”, a Ukrainian company. He believes that enterprises working in Ukraine on general conditions should have some limitations instead of benefits if some of their founders are citizens of Russia or Belarus, and they still conduct their business in these countries. “Higher taxes or excise duty on their services, that would be right because a state should protect its own interests,” Litynskyi thinks.
Roman Lozynskyi, a people’s deputy, considers the question of the tolerability of the involvement of the companies with Russian or Belorusian owners in the preferential economic space of Ukraine to be the rhetoric one. “There is no morality in the involvement of these companies in Diia.City, there is as much morality in it as in Russia’s attack on Ukraine – that is zero,” Lozynskyi summed up.
Author Maksym Pikho, editor Oleh Onysko, page layout Nazar Tuziak, cover Rostyslav Abramets
P.S. After this investigation was published, the representatives of the Ministry of Digital Transformation asked NGL.media to publish an additional explanation of the Ministry’s position on the facts mentioned in the article, – the relations of some residents of Diia.City with Russia and Belarus.
“We have initiated changes to the legislation which enhance the anti-criterion regarding the relations between the company and Russia. In this case, it does not matter whether the direct or indirect owner of the company resides (is present) in Russia or not. The draft law No. 9319 was registered in the Verkhovna Rada on May 23, 2023, and has already passed the committee and the first reading is expected. Now, we are asking the society for more resolute support to have this draft law adopted sooner!
As for the companies that have their legal entities in the RF and still work there: we condemn it, and we are confident that it is far beyond any morality. Yet, this issue is in the plane of imposing sanctions on such companies which is the sphere of responsibility of the National Security and Defence Council (NSDC). We are willing to cooperate with the NSDC and make every effort to eliminate such situations.
The anti-criterion, specified in the law in force, refers to the aggressor states. So, if Belarus is declared the aggressor state, the anti-criterion will automatically be applied to Belarus.