Adguard Cyprus - Didn't Expect This

gotitbro

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I was recently going through Adgaurd T&C (https://adguard.com/en/eula.html) and then I saw this:
Rightholder (owner of all rights, whether exclusive or otherwise to the Software) means ADGUARD SOFTWARE LIMITED, a company incorporated according to the laws of the Republic of Cyprus.

So Adguard's rights gave been shifted from Performix to a company based in Cyprus now. While nothing wrong legally here morally the line isn't so clear.

Seems to me like Adguard's getting bigger and looks like they are getting too big for their own shoes :/
 
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Yep, we've moved the HQ to Cyprus a couple of months ago.

There're quite a few reasons for doing it.

1. Cyprus is in EU and EU privacy laws make us (as an ad blocker) feel much more comfortable than any other place.
2. Currencies conversion. AG is a global product and selling it from Russia leads to losing a lot.
3. Tons of small but annoying limitations and restrictions. For instance, Russian PayPal automatically blocks accounts with more than $10k, you should keep an eye on the balance and withdraw funds to not allow this situation.
4. Relatively (comparing to other EU countries) low taxes for IT companies and IP Box regime.
5. Fewer "KGB" accusations :)

Most of the dev team is still located in Moscow (including me, I love Moscow too much to relocate). However, we're slowly becoming more "global", there're people from Slovakia, Poland, Ukraine, South Korea and the UK on the team.
 
UMX

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Well, for now (until evil Putin finally finished his diabolical plan to take over and subdue poor, helpless Europe) fear NSA and friends *way* more than KGB (or North Koreans).
You didn't do EUropeans a favor when you put yourself under EU jurisdiction.
 
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gotitbro said:
Though companies in Cyprus and other tax havens generally tend to the shady side, making Adguard harder to reach also makes it seem like they are trying to subvert laws.
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Cyprus is not a tax haven anymore, but they've got a reputation indeed and time is required for the situation to improve.

gotitbro said:
And what is the deal with the Ireland company of Adguard that was recently shut down: https://www.solocheck.ie/Irish-Company/Adguard-Software-Limited-587678
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This is a good example of why you should first consult with lawyers and finance people to check if you're ready to bear the costs of establishing an office and transferring IP rights somewhere. What's unnoticeable for Google and Apple might be unbearable for a small company.
 
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gotitbro said:
I don't understand what you mean. Things didn't work out in the Ireland company as they were expected to?
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Yep, exactly. Basically, this was the first try to solve these 5 issues. We thought that we're smart enough to figure everything on our own, started the process and even registered a company there. Unfortunately, it appeared that having an office there is WAY more expensive than we were thinking in the beginning.
 
UMX

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gotitbro said:
companies in Cyprus and other tax havens generally tend to the shady side, making Adguard harder to reach also makes it seem like they are trying to subvert laws.
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Actually *every* worker (especially management!) of any corporate entity is legally obliged to maximize companies profit by any legal means. Using shitty laws and anti-social EU members is legal - so one committed a felony (and was personally liable) if one wouldn't use such loopholes. Nothing shady about this - except EU as an entity and the EU- and local laws.
 
gotitbro

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@avatar Thanks for being open about this . Though the corporate structure has changed I hope this wouldn't affect Adguard's relationship with its users.
 
gotitbro

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I also came upon a good explanation of offshore companies on Quora:
https://www.quora.com/What-can-be-learned-about-how-wealthy-people-park-money-offshore-from-the-Panama-Papers/answer/Ajit-Narayanan-1

It basically boils down to avoiding taxes and regulations in the country of operation by setting up an offshore entity. @avatar You love Moscow but don't want to pay taxes there, interesting.

Adguard as an offshore entity is concerning especially considering the recent news about Apple's avoidance of taxes basically paying nothing.
 
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gotitbro said:
It basically boils down to avoiding taxes and regulations in the country of operation by setting up an offshore entity.
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First of all, Cyprus is neither an offshore nor a tax haven. Please don't confuse it with some common offshore countries like Panama or Belize.

Also, it's hard to apply the "country of operation" term to software companies. I am sitting in Moscow; AG is being sold all over the world, half of the servers are located in Amsterdam (hopefully, all of them will be soon). And tomorrow I can decide to relocate to some other megapolis, London or NYC for instance.

gotitbro said:
@avatar You love Moscow but don't want to pay taxes there, interesting.
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Taxes are being paid here as well. A huge part of it is what company pays for the employees and as most of the devs remain in Moscow (at least for now), it's done here.

gotitbro said:
Apple's avoidance of taxes basically paying nothing.
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Taking into account the new office and employees on Cyprus, we now pay more. However, it is less than we would've if we had chosen another EU country.
 
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gotitbro

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@UMX What are you even trying to question here? That me protecting myself from adware and other things that are likely to harm me is equivalent to raising questions about Adguard's corporate structure. Get a level head alright.
 
UMX

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gotitbro said:
@UMX What are you even trying to question here? That me protecting myself from adware and other things that are likely to harm me is equivalent to raising questions about Adguard's corporate structure. Get a level head alright.
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Oh, I'm very sorry!
I misstook your reasonable questioning the "corporate structure" for unqualified bashing and unbacked accusations out of the blue ("morally the line isn't so clear.", "tend to the shady side", "trying to subvert laws", " You[...] don't want to pay taxes there")...
Clearly my fault and I again apologize.
 
gotitbro

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@UMX Get off the sarcastic tone will you. I am very happy to be part of a healthy community such as Adguard and raising questions which affect every user should very well be put up.

And the lines you quoted are exactly true. I myself have had to deal with Cyprus companies and it hasn't been very nice to say the least.
 
gotitbro

gotitbro

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@avatar Yes and again its nice that your are open to questions about it rather than deflecting them. This is what builds trust between users and a company.

You say you moved to Cyprus only a few months ago but according to documents it has been registered since 2014 under a different name: https://opencorporates.com/companies/cy/HE332952. What is with that?

Also what did you mean by "What's unnoticeable for Google and Apple might be unbearable for a small company."? That they are such big corporations things like changing offices don't affect them much?
 
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This is now an official business Q&A thread:)

gotitbro said:
You say you moved to Cyprus only a few months ago but according to documents it has been registered since 2014 under a different name: https://opencorporates.com/companies/cy/HE332952. What is with that?
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Shelf corporation is a common practice to save time while registering a company.

gotitbro said:
Also what did you mean by "What's unnoticeable for Google and Apple might be unbearable for a small company."? That they are such big corporations things like changing offices don't affect them much?
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Having an office with hundreds of employees is nothing comparing to how much they save on taxes.
 
gotitbro

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avatar said:
Having an office with hundreds of employees is nothing comparing to how much they save on taxes.
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Apple literally saved billions in dollars via offshore accounts https://www.bloomberg.com/news/articles/2017-11-07/offshore-leaks-depict-apple-s-quiet-shift-to-island-of-jersey. With the immense PR power they have this news seems to have been buried within only three days.

From what I understand you mean to say that managing an offshore company is hard for a small entity like Adguard but not so much for Google and Apple. Is that right?
 
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