Setting up a Business

Doing Business in Emerging Markets

There are several forms for a foreign investor to start business in the Russian Federation and other former Soviet Country.

Most often, the first step would be to set up a Virtual Representative Office, but it is also possible to form a Branch Office or a separate legal entity, or to find a local partner and create a joint venture.

Russia

In Russia Foreign Businesses are allowed to create the following legal entities:

• Joint Stock Companies (JSC)

• Limited Liability Companies (LLC)

• Partnerships

Interested in setting up a business in Russia? See how we can help you.

Company Registration (Russia)

Nominal Company Set up takes up to 5 business days (although it may take up to 12-14 days to finish with all the formalities).

A foreign investor may pay for his participation interest in a Russian company's equity capital (statutory minimum charter capital) either in roubles or in foreign currency.

The payment for the charter capital can be made directly from the foreign brokerage account, while for payment in roubles a special K-type account is needed. Normally most banks will open this special account in less than a week.

Some industries have special restrictions concerning foreign investment operations and many of them require a government approval.

Types of Enterprises

Russian Joint Stock Company (JSC) is very similar to Western corporate entities. Some differences can be found in the registration and operating procedures keeping intact the principle of a limited liability that only extends to the face value of their shareholding.

JSC are managed through a Shareholders' General Meeting and an Executive Body (represented by General Director or a Board of Directors).

Limited Liability Companies (LLC) are similar to the JSC but the registration procedures are simplified. Partnerships are very rare.

Contact us if you have any questions regarding foreign investment in Russia and other Soviet countries.

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