For last twenty five years Russian legislation concerning business corporations’ registration has undergone tremendous changes. Last reform was carried out in 2014. It’s brought together Russian and American legislation in this branch.
Let’s see into options for foreign investors of setting up a business in Russia.
A fact of significant importance is that Russian legislation does not provide any restrictions for foreigners to establish commercial corporations.
There are two main forms of the corporations: limited liability companies and joint-stock companies.
The registration procedure consists of submitting a set of documents in tax department which issue a certificate of registration within 3 work days. Then the company establishes an account and obtains registration codes in the public pension fund, in the medical and the social insurance funds. For joint-stock companies it should be also necessary to register the primary security issue.
What are the features, pluses and minuses of these two corporate formations?
It’s important to add that a foreign commercial company not only can establish a separate Russian commercial corporation but also can open a representative office or a branch in Russia.
A representative office rights reduce to defense of parent corporation interests. It represents the company in Russia.
A branch can exercise all or some parent company functions. But as the civil responsibility is hardly be applied to the branch the legislation provide a complicated and long-time procedure of branch official registration. Following state control of the branch would be also strict.
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