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Doing business in Russia
 

Doing Business in Russia

Introduction
The regulation of foreign investment in Russia has become the focus of legislative efforts lately. A series of normative acts have been adopted, including the July 9, 1999 bill, On Foreign Investment in the RSFSR (in Russian), that is currently the basic document in this area. This law deals with the same issues treated by similar legislation in other countries: legal procedures for foreign investment, legal guarantees against political risks, tax advantages, customs duties, etc.

This law, however, does not specify mechanisms for the establishment, registration and operation of joint ventures, branches, representative offices and other legal entities with foreign investment, which considerably complicates its practical application. The interpretation of this law differs greatly between documents issued by various legislative and executive authorities. Procedures and requirements essential to register a legal entity in Russia are highly specific. Among other things, the investor must submit a set of documents confirming that it is a legal entity and is solvent. The documents must be prepared and "duly legalized in accordance with Russian and international legislation"

Russian law offers several commonly used modes to conduct business:

  • Limited liability company (OOO),
  • A privately held, closed joint stock company (ZAO),
  • Publicly held, open joint stock company (OAO)
  • Representative or branch office of a foreign company,
  • Registration as an individual private entrepreneur.

Beginning July 1, 2002, companies should be registered with the local Tax Inspectorates. Documents for the state registration should be prepared and submitted to the local Tax Inspectorate in accordance with Chapter 12 of the August 8, 2001 Federal Law “On State Registration of Legal Entities”.

Note: beginning July 1, 2002, all legal entities that were established (registered) in Russian before August 8, 2001, are requested to reregister with local State Tax Inspectorates. If they fail to submit the necessary documentation for re-registration by January 1, 2003, they will be liquidated. Branches and Representative Offices do not fall under this requirement, because they are not considered to be legal entities under the Russian law.

Additional assistance with Preparation, Legalization and Translation the documents for the Russian Federation can be provided through A&M Logos International, Inc . 1-212-233-7061