The Legal Status of Foreign Representative Offices in Russia
The term "representative office" was introduced into legal usage and first employed with reference to commercial organizations in new Russian legislation in the 1999 Russian Federation Law on Foreign Investment in the RSFSR, where it was applied to Russian enterprises operating with foreign investment funds.
- The representative office is a discrete subdivision of a legal entity, situated in a different location, that represents and protects the interests of that legal entity.
- A subsidiary office is a discrete subdivision of a legal entity, situated in a different location and exercising all or part of its functions, including the functions of a representative office. Representative offices and subsidiary offices are not legal entities. They are endowed with property by the legal entities that created them, and act on the basis of the status authorized by those legal entities.
The persons in charge of representative and subsidiary offices are so designated by the legal entity and act on the basis of its power of attorney.
- Representative and subsidiary offices must be designed as such in the charter documentation of the legal entity that created them.
In other words, the Russian legislation currently in effect specifies that the representative office of a legal entity is established to enable that legal entity to function, and to represent and protect its interests in a location other than its own. This legal formula is universal in nature, applying equally to commercial and non commercial organizations, and Russian as well as non-Russian legal entities.
Procedures for Legalizing a Foreign Company's Representative Office in Russia
- The representative office of a foreign company is not a legal entity under Russian law and acts in the name and at the instruction of the company it represents, the name of which is indicated on the authorization to open a representative office;
- A representative office may not engage in independent entrepreneurial activity within the territory of the Russian Federation;
A representative office has the right to open bank accounts and engage in activity to facilitate its work within the territory of the Russian Federation;
The representative office of a foreign company is considered open from the moment authorization for its opening is issued. The authorization becomes null and void in the event that the representative office fails to take action to engage in activity within six months of the date of issue;
Authorization to open a representative office may be issued on the basis of the personal application of a foreign company, or on the basis of an international agreement with a foreign government, when one participant is the Russian Federation; A representative office of a foreign company is opened for a term of up to two years with a subsequent extension in the event that such extension is deemed advisable;
The representative office of a foreign company, regardless of the department under which it is accredited, must be entered in the Composite State Registry;
The head of a representative office acts on the basis of a power of attorney from the foreign company;
- The accreditation of the foreign specialists of a foreign company's representative office is effected by the State Registration Chamber according to the number of business cards submitted. The head of a representative office must inform the Chamber of staffing changes in a timely manner.
In order to obtain authorization to open a representative office of a foreign company, the following documents must be presented:
- Application
- Two letters of recommendation from Russian partners
- The charter documents of the foreign company
- An extract from the trade registry of the foreign company's country of origin, or another document certifying the registration of the foreign firm in that country
- Confirmation of solvency
- Information card about the representative office
- Documentation of state tax payment
- Documentation confirming the location of the representative office within the Russian Federation
The information card about the representative office is filled out by the representative office in Russian with the indicated data about the foreign company and its founders, the Russian firms recommending the foreign company, and also about the representative office itself and its personnel.
The letters of recommendation from the company's Russian partners should provide a short business description of the foreign company and the results of their joint activities.
The representative office of a foreign company dealing with the issue of opening a representative office must have the appropriate power of attorney from that foreign company.
For preparation of a set of documents for opening a representative office in Russia a US company must provide the following supporting documents:
- original letter from the bank (notarized);
- certified copy with Apostille of Certificate of Incorporation, Business Certificate, Partnership Certificate (whichever is applicable), or other proof of registration; *
- certified copies with Apostilles of any subsequent Amendments or Addenda;*
- original Certificate of Goodstanding with Apostille;
- a photostatic copy of the company's By-laws (Charter, Articles of Association), certified as to their authenticity by the company’s principal officer whose signature has to be notarized;
- notarized resolution of the Board of Directors (or consent of the sole Director) on opening a representative office (we provide a sample);
- notarized application for opening a representative office (representative office only) (we provide a sample);
- notarized Regulations of the representative office (we provide a sample);
- Power of Attorney to head of the representative office (notary’s signature has to be certified by Secretary of State - Apostille) (we provide a sample);
- Optional - Power of Attorney to a representative of the foreign company in Russia (notary’s signature has to be certified by Secretary of State - Apostille) (we provide a sample);
Registration of Accredited Representative Offices
Accredited Representative Offices should register with the State Registration Chamber (with the Ministry of Justice of the Russian Federation), and also register with the Russian Chamber of Commerce and Industry. Several Russian government agencies and ministries supervising the industry in which a company operates may also require accreditation. Such agencies include the Central Bank, the Ministry of Economic Development and Trade, the Ministry of Finance, the Ministry of Transportation, and the Ministry of Industry, Science and Technologies of the Russian Federation.
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 |
