Open a Company in Russia
Open a Company in RussiaUpdated on Monday 03rd February 2020
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Russia is very appealing to many foreign investors due to its advantageous legislation and taxation system. Foreign entrepreneurs benefit from almost the same conditions for opening companies in Russia like any other local investor, however, it best to verify all the legal requirements before starting a business.
Our lawyers in Russia will guide you through the company registration procedure.
Types of companies in Russia
The following types of companies are available for registration in Russia:
- limited liability companies,
- joint stock companies,
- limited partnership,
- general partnership.
Foreign enterprisers can also establish sole traders in Russia, while foreign companies can open branch or representative offices.
Requirements for opening a company in Russia
The limited liability company is the most popular type of entity in Russia because of its incorporation requirements. Russian limited liability companies (Obshchestvo s ogranichennoy otvetstvennostyu- OOO) can be registered by at least one shareholder and a maximum number of 50 shareholders. The minimum share capital to open a limited liability company in Russia is 10,000 rubles (approximately 400 US dollars) and half it must be paid upon incorporation, while the other half within a year.
The Russian joint stock company can be open or closed. Open joint stock companies can transfer their shares to the public, while closed companies may only transfer shares between its shareholders. The minimum share capital in case of joint stock companies is 10,000 rubles for closed companies and 100,000 for open ones. The capital is divided into shares which will be registered with the Federal Securities Commission. At least 50% of the share capital must be deposited within 3 months from registration, while the other half must be subscribed within a year after the incorporation.
We can also assist with EORI registration in Russia.
You can also read about the opening of a company in Russia in the scheme below:
Company management in Russia
The management structure of a Russian company depends on the business form chosen by the investor. When it comes to private limited liability company and joint stock companies, these must have a board of directors and an executive body which must convene any time necessary. They must also organize a general meeting at least once a year. This meeting must also be attended by the shareholders of the company.
When it comes to the number of directors in the company, all types of companies must have at least one Russian resident director, who can be a natural person or corporate body.
Our law firm in Russia can offer nominee services for foreign investors in need of appointing a resident director.
The share capital of a Russian company
Apart from the different amounts of money which must be deposited as a share capital when opening a company in Russia, there are also other requirements which must be respected when it comes to the capital of the business. These are:
- at least 50% of the share capital must be deposited when the company is registered;
- the remaining 50% must be paid within 3 months from the company registration process;
- the share capital must be divided into several types of units which have a specific value;
- the decrease or increase of a company’s share capital must be announced with the Trade Register;
- only public companies are allowed to trade their shares on the Stock Exchange;
- private companies can also sell shares to other local or foreign investors; however, these cannot be publicly traded.
Our attorneys in Russia can offer more information on the share capital requirements when opening a local company.
Company registration steps in Russia
The following steps must be completed in order to have a fully operational company in Russia:
- drafting and notarizing the foundation documents and then filing them with the Trade Register,
- depositing the share capital with a Russian bank and obtaining a bank statement showing the deposit,
- paying the registration fee and submitting the receipt with the Trade Register upon the incorporation of the company,
- registering with the federal tax authorities (this step will be completed after the company is registered with the Companies Registrar),
- registering with the State Pension Fund, the State Fund of Social Insurance and the State Fund of Compulsory Medical Insurance,
- opening a corporate bank account which will be used for the company’s daily operations,
- registering with the Moscow Center of Quotation of Work Places.
Documents required to open a company in Russia
Local and foreign investors who want to open companies in Russia are required to file the following documents with the local Trade Register upon the incorporation of a new company:
- their ID or passport (with or without a Russian visa) in original and copies;
- the company’s Memorandum and Articles of Association of the new company;
- the decision through which the company’s director is appointed and his or her personal information;
- information about the Russian company’s legal address (the lease contract or property title);
- a bank statement indicating the deposit of the share capital in a Russian bank account;
- a power of attorney, if the company appoints a representative to complete the registration procedure.
Our Russian lawyers can help foreign investors in preparing the documents needed to open a new company in this country. We can also assist with VAT registration in this country.
FAQ on opening a company in Russia
Most of the foreign investors who want to open companies in Russia have questions related to the registration and licensing procedures. Our Russian lawyers have answered some of the most frequently asked questions on how to set up a business in this country:
- Do I need a local partner to open a company in Russia?
In most cases there is no need for a local partner, however, there are certain industries such as energy and telecommunications which have certain restrictions when it comes to full foreign ownership.
- Do I need a local address in Russia? If yes, how do I obtain it?
Yes, a Russian company must have a local address which must appear in the records of the Trade Register. If you need a local address, we can help you with virtual office services.
- Do I need to come to Russia in order to register the company?
No, our clients do need to travel to Russia for the incorporation procedures. We can help them register the company remotely through power of attorney.
- How long does it take to register a company in Russia?
The minimum timeframe for registering a company in Russia is approximately 2 weeks.
- What is the corporate tax in Russia?
The current corporate tax rate in Russia is 20%.
The video below presents the main steps to open a company in Russia:
If you need assistance with the company registration procedure, please contact our law firm in Russia.