Open an Investment Fund in Russia

The well-developed legislation which covers the financial industry in Russia has attracted many foreign investors during time which established investment funds here. The main law governing the Russian investment funds sector is the Federal Law On Investment Funds No. 156-FZ which was enabled in 2001. Apart from complying with the law, professional investors interested in setting up investment funds in this country must also obtain an authorization from the Russian National Bank.

Our law firm in Russia can offer information on the Investment Fund Law.

Types of funds acknowledged by the Russian Investment Funds Law

Foreign investors interested in opening an investment fund in Russia have a wide variety of structures to choose from. The Russian legislation provides for retail and hedge funds. Both types of funds are divided into other structures.

Russian retail funds are divided into the following categories:

• -          open-ended funds;
• -          closed-ended funds;
• -          exchange-traded funds;
• -          interval funds.

Hedge funds are categorized as:

• -          closed-ended funds;
• -          interval funds.

Our lawyers in Russia can explain the differences between these types of funds.

Requirement to set up an investment fund in Russia

No matter the type of fund one decided to open in Russia, it should be noted that the law does not recognize the fund as a legal entity, therefore the investor must comply with the Commercial Code which provides for the types of structures to be employed upon the registration of funds. The Commercial Law provides for the joint-stock company to be used as a corporate structure when opening an investment fund in Russia.

After registering the company with the Russian Trade Register, the fund must obtain the approval of the National Bank in order to start operating. A set of documents, among which the internal regulations of the fund must be filed with the Central Bank for approval. The fund must also have a manager who meets certain fit and proper criteria.

For full information on the requirements to establish an investment fund in Russia, please contact us. Our Russian lawyers can also offer information on the licensing requirements applicable to investment funds, as well as on the taxation of these entities.