RUSSIAN FEDERATION

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RUSSIAN FEDERATION

General information about the jurisdiction:

Russian Federation is located in the Northern Hemisphere, in the north of Eurasia.

Russia is an industrial country with a vibrant economy. According to the World Bank , the GDP PPP for 2012 was $ 3.380 trillion ($ 23,549 per person). Currency - Russian ruble.

Russia - the federal republic presidential type.

The system of federation subject’s state power bodies is governed by the general principles established by the federation. In each region there is a legislative (representative) body (parliament, the legislative assembly) and the executive authority (the government). In many of them, there is also the Principal Officer (president, governor) who is empowered by the legislative authority of the subject of the Federation by the President of Russia, and may hold office indefinitely.

Russian foreign policy is determined by the President and implemented by the Ministry of Foreign Affairs. Russia is pursuing a multi-vector foreign policy. It has diplomatic relations with 191 countries and has diplomatic missions in 144 countries. Russia does not have diplomatic relations with Georgia (since 2008), Bhutan and the Solomon Islands, and Tuvalu, which, however, has already reached an agreement on establishing them.

1.          Legislation

Companies formation is regulated by the Federal Law "On state registration of legal persons", the Federal Law "On Limited Liability Companies" (LLC), the Federal Law "On Joint-Stock Companies" (JS) and other laws.

2.          Company formation

2.1.               Types of companies

The most popular form of the company are:

• Limited Liability Company (LTD);
• Joint-Stock Company (JS);
• Private enterpriser (PE).

2.2.               The main legal requirements

• Minimum share capital – 10 000 rubles. By the moment of registration 50% of share capital required to be paid.

• Shareholders – minimum one nature person or legal entity. No residential requirements.  

• Director – minimum one nature person. No residential requirements. But, in case director isn’t resident of Russian Federation, he has to obtain work permit.  

• Nominee service is not provided

• Company is obliged to keep records.

 3.          Taxation

There are following taxation rates in Russia:

• VAT  – 18% (reduced rate 10% applied to separate group of goods).
• Corporate tax – 20%.
• Income tax from individuals – 13%.

4.          Currency control (Exchange control)

Exchange control is applied to the following transactions:

• With the participation of residents and non-residents;
• With domestic and foreign securities;
• When transactions made in rubbles and foreign currency.

Exchange control in the Russian Federation is made by the Government of the Russian Federation, bodies and currency control agents.

Currency control authorities in the Russian Federation are the Central Bank of the Russian Federation, the federal agency (federal authorities) of executive power authorized (authorized) by the Government of the Russian Federation. In accordance with the Resolution of the Russian Government dated as of 15th June 2004 number 278 so the federal executive authority is the Federal Service of Financial and budgetary oversight.

Currency control agents are authorized banks reporting to the Central Bank of the Russian Federation, State Corporation "Bank for Development and Foreign Economic Affairs (Vnesheconombank ) and non- authorized banks of the professional participants of the securities market, including the holders of the registry (registrars), reporting to the federal executive government securities market , the customs authorities and tax authorities.

Double tax treaties

Russia has concluded double tax treaties with 80 countries