Protection of dignity or limitation of freedom of speech?

According to the amendments of the Criminal Code of Armenia, severe insult is henceforth a crime.

Insult and slander were previously criminalized in Armenia, but following recommendations and regulations of international organizations, such as the Regulation 1577/2007 of the EC, Armenia has decriminalized it in 2010.

The law gives the vague definition of severe insult, which is a swearing or insulting in another extremely indecent way.

  • Inflicting a severe insult is punished by a fine, ranging from $200 to $1.000.
  • Insulting by using information or communication technologies or related to the public activity of the person, is punished by a fine, ranging from $1.000 – $2.000.
  • If the perpetrator regularly targets one person, the fine can vary between $2.000-$6.000 or up to three months in prison.

In this context, the public activity includes journalism, performance of official duties, public or political activity.

According to some experts, the ultimate objective of the criminalization is not the punishing, but rather preventing such immoral behavior but other experts warn that the law will not serve for its purpose for several reasons:

  • Firstly, there is no clear definition of foul language and swearing. Probably the law will be applied arbitrary, which in turn will limit the freedom of speech and press.
  • Secondly, there is no clear mechanism how the police and investigative bodies are going to monitor and prosecute users on the internet, given the fact that many users have fake accounts and do not identify themselves.
  • Moreover, many users of social media are outside of Armenia and Armenian laws cannot by applied. Consequently, the law will create a discrimination and inequality between the people.
  • Another problematic point is that the criminal law differentiates ordinary people and public figures, providing a bigger fine in the case of the defamation of the latter’s. However, for years Armenian Civil law is moving in another direction, developing the idea that public figures must me more tolerant towards criticism, as their activity is of public interest.
  • Last, but not the least, more than two decades, the international community is moving towards the decriminalization of defamation, and current law is in opposition to the global trend.

Comparative Analysis: Is Cryptocurrency Legal in Armenia?

Despite the global development of cryptocurrencies, their regulation and legal status vary from state to state. Some states cautiously introduce laws and regulations, while others don’t and create a field of unregulated transactions. Even the regulation of the most famous crypto, bitcoin, is not unified and states’ approaches are radically different.

Here are three common ways how the states regulate bitcoin.


In the majority of the states the purchase, sale, use and holding of bitcoin is legal, due to either lack of regulation or special laws. Such states include France, Spain, USA.

2.  Legal, with banking ban

In some states bitcoin is legal, however financial institutions are not allowed to make crypto transactions. Such states include Canada, Russia, Turkey and China.

3. Illegal

In some states the purchase, sale, use and holding of bitcoin is considered illegal and punishable.

Such states include Egypt, Bolivia and Morocco.

In states, where the crypto is legal, it is considered as legal tender (money), virtual asset or commodity. States often refrain from calling bitcoin digital currency, virtual currency or digital money, because it would be misunderstood as a legal tender.

In June 2021, El Salvador became the world’s first country to adopt bitcoin as legal tender.

For example in the USA bitcoin is determined as commodity or digital commodity, according to the Commodity Exchange Act (CEA). Unlike securities, commodity markets operate with relatively little regulatory oversight and bitcoins are freely traded. In this case the bitcoin is taxed as a property.

There are states, for example Mexico, where bitcoin is considered as a virtual asset, which means that bitcoin is digital representation of value that can be digitally traded, transferred or used for payment. In this case, companies operating with bitcoin must register in competent authority, implement compliance programs, keep the required records, report suspicious and enforce an anti-money laundering transactions also bitcoin.

Currently, there are few states, like El Salvador and Paraguay where bitcoin is considered as a legal tender. In these states people can freely use bitcoin to pay for goods and services and recipients are obliged to accept it.

In Armenia, cryptocurrencies are under the attention of the regulator of financial markets, Central Bank. There is no direct law or regulation on cryptocurrencies and there are no license requirements for providing services related to cryptocurrencies. Consequently, it is totally legal to purchase, sale, use and hold it.

It is possible that, following the trends by some countries to regulate this field, the Central Bank may adopt relevant regulations for crypto in the future. Probably cryptocurrencies will be then treated by analogy with fiat currencies, i.e. the approach towards a foreign online cryptocurrency trading/investing platform will be the same as towards a foreign online FX trading/investing platform. However, it should be noted that the actual exchange of fiat currencies into cryptocurrencies may be treated as a currency exchange transaction. Thus, actual sale and purchase of cryptocurrencies to/from customers in Armenia may be treated as a sale and purchase of FX.

E-services, individual ads in Google, Facebook and Netflix to be taxed in Armenia

Armenia has approved the draft law on “Amendments to the Tax Code” that will make possible to tax some international tech companies in Armenia. This is an attempt to capture a slice of the foreign tech giants’ revenues from Armenia, such as Google, Facebook and Netflix.

First of all, the Law gives wide definition of electronic services, in accordance with the Treaty on Eurasian Economic Union:

  • e-services are the provision of services through the information and telecommunication network, including the Internet,
  • the provision of e-services is impossible without the use of information technology,
  • the list of e-services is defined by the Government.

Secondly, the Law specifies when the service is considered to be provided in Armenia, both for companies and for individuals.

For the companies:
  • when the e-service is received by the company located in Armenia,
  • when the e-service is received by the permanent establishment of the non-resident company in Armenia,
  • when the e-service is received by the permanent establishment of the executive body of the non-resident company in Armenia, which carries out business activities.
For the individuals:
  • place of residence,
  • place of the bank, used for e-service payments,
  • network address,
  • international code of the phone number, used for receiving e-services or making payments for it.

If the criteria indicate the different states, for example the place of residence is Armenia, but the bank is located in Cyprus, we need to find which country matches to more conditions. If the number is equal, the e-service provider decides where is the service delivery location.

The non-resident companies, who provide e-services in Armenia, have to take into consideration the following conditions:

For providing e-services in Armenia, there is no need to have a permanent establishment. However, companies must register in a special electronic platform.

Companies have to calculate the amount of VAT for each operation of the provision of e-services. The cost of e-services in foreign currency should be converted into Armenian drams at the exchange rate of the Central Bank of the Armenia on the last day of the quarter in which the payment was received.

Companies must pay VAT to the Armenian budget no later than on the 20th day of the month following the reporting quarter.

Companies must quarterly submit VAT declaration, no later than on the 20th day of the month following the reporting quarter.


  1. The new law creates a competitive environment for resident and non-resident IT companies, while previously only resident IT companies were paying VAT.
  2. The law limits the fraudulent behavior of users, as now VAT applies to e-services provided to both legal entities and individuals, while previously it was applicable to only legal entities.
  3. The simplified registration platform enables companies to operate without permanent establishment.


  1. There is no regulation on the special registration platform yet and its’ future is uncertain.
  2. VAT is generally paid by end users, so maybe the cost of the services will arise.
  3. Even if the product is paid in foreign currency, the VAT is calculated in Armenian drams, so there is a risk of exchange rate variation.