Doing Business in Russia 2015
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Doing Business in Russia 2015 Doing Business in Russia 2015 Baker & McKenzie - CIS, Limited Moscow Office White Gardens, 10th Floor 9 Lesnaya Street Moscow 125047, Russia Telephone: +7 495 787 27 00 Fax: +7 495 787 27 01 [email protected] St. Petersburg Office BolloevCenter, 2nd Floor 4A Grivtsova Lane St. Petersburg 190000, Russia Telephone: +7 812 303 90 00 Fax: +7 812 325 60 13 [email protected] www.bakermckenzie.com All of the information included in this document is for informational purposes only, and may not reflect the most current legal developments, judgments, or settlements. This information is not offered as legal or any other advice on any particular matter. The Firm and the contributing authors expressly disclaim all liability to any person in respect of anything, and in respect of the consequences of anything, done or not done wholly or partly in reliance upon the whole or any part of the contents of Baker & McKenzie’s Doing Business in Russia brochure. No client or other reader should act or refrain from acting on the basis of any matter contained in this document without first seeking the appropriate legal or other professional advice on the particular facts and circumstances. Baker & McKenzie – CIS, Limited is a member of Baker & McKenzie International, a Swiss Verein with member law firms around the world. In accordance with the common terminology used in professional service organizations, reference to a “partner” means a person who is a partner, or equivalent, in such a law firm. Similarly, reference to an “office” means an office of any such law firm. Doing Business in Russia Table of Contents 1. Russia – An Overview ................................................................... 1 1.1 Geography ......................................................................... 1 1.2 Population ......................................................................... 1 1.3 Political System ................................................................ 1 1.4 International Relations ...................................................... 4 1.5 Economy ........................................................................... 5 2. The Russian Judicial System ......................................................... 7 2.1 Introduction ....................................................................... 7 2.2 Courts of General Jurisdiction .......................................... 7 2.3 State Arbitrazh Courts ....................................................... 9 2.4 Administrative Judicial Proceedings ............................... 17 2.5 International Arbitration ................................................. 18 2.6 Enforcement of Judgments and Arbitral Awards ............ 19 2.7 Alternative Dispute Resolution and Mediation ............... 19 3. Promoting Foreign Investment in Russia ..................................... 21 3.1 General Provisions Regarding Foreign Investments ....... 21 3.2 Restrictions on Strategic Companies .............................. 23 3.3 Controlled Transactions .................................................. 25 3.4 Special Restrictions for Foreign States, International Organizations and Organizations under Their Control ... 28 3.5 Consequences of Violation of the Law on Strategic Companies ...................................................................... 29 4. Establishing a Legal Presence ...................................................... 30 4.1 Representative Office and Branch of a Foreign Legal Entity ............................................................................... 30 4.2 Forming a Russian Legal Entity ..................................... 31 4.3 Limited Liability Companies .......................................... 34 4.4 Joint Stock Companies .................................................... 37 5. Issuance and Regulation of Securities ......................................... 43 5.1 Introduction ..................................................................... 43 Baker & McKenzie i 5.2 Securities in General ....................................................... 43 5.3 Placement and Circulation of Foreign Securities in Russia .............................................................................. 44 5.4 Equity Securities ............................................................. 45 5.5 Debt Securities ................................................................ 45 5.6 Securitization .................................................................. 49 5.7 Russian Depositary Receipts (RDRs) ............................. 52 5.8 Investment Units of Mutual Investment Funds (“Investitsionniy Pai”) .................................................... 53 5.9 Infrastructure of the Securities Market ........................... 53 5.10 Organizers of Trade, Stock Exchanges, and Clearing Organizations .................................................................. 56 5.11 Regulation of the Securities Market ............................... 57 5.12 Regulation of Certain Securities Transactions ................ 58 5.13 Placement and Circulation of Russian Shares Overseas .......................................................................... 59 5.14 Regulations of Derivatives in Russia .............................. 60 5.15 Inside Information ........................................................... 61 6. Competition Protection Law ........................................................ 64 6.1 Abuse of Market Dominance .......................................... 64 6.2 Agreements, Concerted Actions and Actions of State Bodies Limiting Competition ......................................... 67 6.3 Requirements for Tenders and Price Quotations ............ 72 6.4 State Aid ......................................................................... 72 6.5 Establishment of Companies and Mergers & Acquisitions .................................................................... 74 6.6 Procedures and Timing ................................................... 81 6.7 Unfair Competition and Advertising............................... 81 6.8 Agreement on the Eurasian Economic Union ................. 82 7. Corporate Compliance ................................................................. 84 7.1 Overview of the Key Provisions Anti-Bribery Laws of Russia ......................................................................... 84 7.2 Administrative Offenses ................................................. 85 7.3 Criminal Offenses ........................................................... 87 ii Baker & McKenzie Doing Business in Russia 8. Taxation ....................................................................................... 92 8.1 Introduction ..................................................................... 92 8.2 Types of Tax ................................................................... 93 8.3 Tax Audits ....................................................................... 94 8.4 Transfer Pricing Rules .................................................... 96 8.5 Corporate Profits Tax ...................................................... 99 8.6 Taxation of Foreign Companies .................................... 108 8.7 Double Taxation Treaties .............................................. 113 8.8 Value Added Tax (“VAT”) ........................................... 124 8.9 Mineral Extraction Tax ................................................. 128 8.10 Taxation under Production Sharing Agreements .......... 132 8.11 Corporate Property Tax ................................................. 133 8.12 Social Security Contributions ....................................... 134 8.13 Individual Income Tax .................................................. 136 8.14 Regional and Local Taxes ............................................. 137 9. Customs, Trade and WTO Aspects ............................................ 139 9.1 Introduction ................................................................... 139 9.2 Accession to the World Trade Organization ................. 139 9.3 CIS Free Trade Agreement ........................................... 146 9.4 Eurasian Economic Union and Customs Union ............ 148 9.5 Unified Tariff Regulations of the Customs Union ........ 149 9.6 Preliminary Classification Decisions ............................ 150 9.7 Sanitary-Epidemiologic Measures ................................ 150 9.8 Technical Regulations (Confirmation of Compliance) . 151 9.9 Phytosanitary and Veterinary Control........................... 153 9.10 Import and Export Licensing ........................................ 154 9.11 The Russian Customs Authorities ................................. 155 9.12 Declarant (Importer of Record) .................................... 157 9.13 Registration of Importer of Record with Local Customs Authorities ..................................................... 158 9.14 Customs Brokers (Representatives/Agents) .................. 158 9.15 Authorized Economic Operator .................................... 159 9.16 Customs Clearance........................................................ 159 9.17 Electronic Declaration .................................................. 160 9.18 Customs Regimes ......................................................... 161 Baker & McKenzie iii 9.19 Customs Valuation Rules .............................................. 165 9.20 In-Kind Contribution .................................................... 170 9.21 Customs Inspection and Liability