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The clampdown on corruption in the state sector is reportedly set to continue, with looming changes to Russian legislation to force all offshore companies - especially those affiliated with state company management - to reveal their ultimate beneficiaries. However, in typical fashion, it's unclear just which "offshore" territories will be affected.

Following large-scale anti-government and anti-corruption protests in December, the Kremlin has made a big noise around its anti-corruption crusade. The changes to the civil code should be finalised by February 1, reports Vedomosti before being submitted to parliament.

In particular, it has appeared to target management and the mechanisms they use for embezzlement or to simply siphon cash out of state companies. Earlier in January, an order went out making state managers subject to the same disclosure of income requirements as state officials, whilst any companies doing business with state firms and banks (except Rosneft) must declare their beneficiaries.

Now it seems that Russia's twenty-year love affair with offshore companies, equally convenient for hiding beneficiaries as for evading taxes, may be coming to an end.

Vedomosti quotes chairman of Russia's Supreme Arbitrage Court, Anton Ivanov - a close friend of President Dmitry Medvedev - as saying that last minute revisions to Russia's civil code, to be completed by February 1, will force offshore companies to reveal their beneficiaries. Two sources present at a meeting headed by justice minister Aleksandr Konovalov confirmed the story.

The term "offshores operating in Russia" will also encompass offshore companies owning assets in Russia, Ivanov said. Beneficiaries will comprise the natural persons in true control of the companies and influencing the appointment of company officers.

According to Sergei Sarbash, a member of the presidium of the Supreme Arbitrage Court, in the event that an offshore does not reveal the true beneficiaries, the individuals acting on behalf of the company will be liable for its actions, and the offshore itself may be qualified as having acted in bad faith during an acquisition and forced to return assets.

The most notorious recent case involving opaque ownership of assets in Russia was brought to light when terrorists bombed Moscow's main airport Domodedovo one year ago. In the wake of the bombing, Medvedev complained that he did not know who owned the airport - which authorities claimed had routinely failed in its security obligations - due to beneficiaries hiding behind offshore companies, and it' still unknown who really controls the airport.

As ever in such a situation, vested interests feel threatened by the proposal. According to the newspaper, some lawyers and economists argue that forcing owners to reveal themselves will frighten off investors.

However, in classic fashion, it remains unclear just how many offshore companies will actually be affected by the new legislation, because the definition of "offshore" in the revised civil code is unknown. The only current official definition of "offshore" in Russian legislation is offered in a negative sense, by black lists - detailing territories that have a higher risk of money laundering - defined by the Finance Ministry and the Central Bank of Russia.

Among the most favoured jurisdictions for shell companies are "respectable" territories such as Britain, New Zealand and certain US states, while three notoriously opaque jurisdictions - Cyprus. Liechtenstein and Switzerland - are also European countries.

Cyprus clearly stands out as the overwhelming favourite for Russian companies. Whilst the island does not accompany Denver and Wyoming on the Central Bank's black list, it does feature on the Finance Ministry.