Thinking about registering a corporation in Russia, but unsure the way to set about it? We’ve got you covered – here’s an inventory of belongings you should know before making any big decisions.
Luckily, the procedure for fixing business in Russia has been actively simplified by the govt. Today the method usually takes just three days and isn’t significantly different for a foreigner compared to a Russian citizen. Let’s take a glance at what legal options there are:
- Registering a private enterprise
The easiest and cheapest option is to register a business as a private entrepreneur. consistent with lawyer Alexei Tarasov from the Moscow-based European Law Services, to register such a business you’d got to submit a notarized translation of a passport, a document specifying the place of residence (i.e. residence permit or temporary residence permit), and a receipt of a state fee payment (800 rubles or $14).
Three days after applying with the general public services center, you’ll receive an excerpt from the Unified State Register of Individual Entrepreneurs and can be ready to add Russia.
“This particular sort of business gives foreign nationals legal rights and responsibilities but means he or she is going to be held liable for the business’s duties together with his or her property,” Tarasov says. “Yet this status means a lesser level of administrative duty if compared to other legal entities. On a positive note, it also frees an individual from an obligation to take care of accounting records and provides a chance to use the earned money together pleases, without paying a further tax on revenues.”
Selling such a business is going to be possible (but only as property held by a far off citizen) and it’ll be easy to liquidate it legally, but getting obviate the debts won’t be easy. After the liquidation, the debt repayment will remain the owner’s obligation.
What to stay in mind?
Starting a business from scratch isn’t that tough and anyone features a right to try to it, but if one must mark their presence on a specific territory it’d be an honest idea to shop for a stake in an existing firm – believes Sergei Voronin, lawyer, and managing partner at the “Pravovoye resheniye” company.
“Regarding the second option (buying a stake), one should decide the size of the potential involvement during a working business and take under consideration the world during which the corporate operates,” the expert points out. “If the choice has already been made then one can consider two ways of contributing to the business: Firstly, it’d be a financial contribution and, secondly, it is often a property or material investment.”
According to Voronin, it’s common for foreign companies to be registered in Russia as branches of foreign corporations or small private businesses. “If a corporation is about up by a far off entrepreneur it’s usually either individual entrepreneurship or a joint company with other stakeholders (LLC). If we mention a Russian branch of a world company, it’s usually a LLC,” he explains.
“First and foremost, one should examine if there are any limitations for foreigners doing business in a neighborhood you’re curious about. Then, it might be useful to explore if there are any limitations or conditions in your homeland on doing business in Russia (for instance, associated with cooperation’s with business in Crimea),” Voronin warns.
Unfortunately, there’ll always be risks connected to finding the proper partner in Russia or doing business within the country. Any of the above options don’t make sure that problems won’t occur, lawyers note.
What is important is to find out and study Russian laws and constantly follow any updates, says Voronin. “If a foreigner doesn’t fully speak Russian then it might be an honest idea to rent a translator or a representative in Russia which will look out of the company’s activities, especially if a far off owner cannot stay there permanently,” he recommends.
It’s also important to notice that many specialized firms provide guidance and help in registering a corporation. So, if you don’t want to spend an excessive amount of time on unraveling bureaucratic procedure, it’d be an honest choice to hire a lawyer to require care of the paperwork.