Russia is ranked 52nd on the Human Development Index, with a universal healthcare system and free university education. It is a recognised nuclear-weapons state, possessing the world's largest stockpile of nuclear weapons, with the fourth-highest military expenditure. It is a permanent member of the United Nations Security Council, a member of the G20, the SCO, BRICS, the APEC, the OSCE and the WTO, as well as the leading member of the CIS, the CSTO, and the EAEU. Russia is also home to 30 UNESCO World Heritage Sites.
Russia has a mixed economy. Russia's extensive mineral and energy resources are the world's largest, and it is among the leading producers of oil and natural gas globally. It has the world's eleventh-largest economy by nominal GDP and the sixth-largest by PPP. Russia has a low unemployment rate of 4.1%. Russia's foreign exchange reserves are the world's fifth-largest. It has a labour force of roughly 70 million, which is the world's sixth-largest. Russia's large automotive industry ranks as the world's tenth-largest by production.
Russia is the world's twentieth-largest exporter and importer. The oil and gas sector accounted up to roughly 40% of Russia's federal budget revenues, and up to 60% of its exports in 2019. In 2019, the Natural Resources and Environment Ministry estimated the value of natural resources to 60% of the country's GDP. Russia has one of the lowest external debts among major economies, although its inequality of household income and wealth is one of the highest among developed countries.
Russia has a relatively low level of foreign debt and it has amassed the fourth largest foreign currency reserves after China, Japan and Switzerland. In conjunction with prudent macroeconomic policies and renewed government efforts to advance structural reforms through major projects, this aims to improve business and investor confidence, and develop such sectors as telecommunications, retail, agriculture, food processing, pharmaceuticals and the power industry.
The banking system of the Russian Federation is a set of interrelated elements comprised of the Central Bank, lending agencies (the latter includes commercial banks and other credit establishments and settlement institutions that could be consolidated as holding companies), as well as banking infrastructure and banking legislation.
The Russian tax system tends to use moderate flat or regressive tax rates. It is highly centralized for a federal state and relies heavily on proceeds from oil and natural gas corporations, who themselves are mostly state owned.
Individuals are supposed to pay in income tax (13 percent), land tax (0.3 percent of the land's cadastral plot which is calculated by a special formula) and vehicle tax (which is linked to the vehicle's engine power). Most small businesses are eligible for simplified taxation and can choose one of the following taxes: income tax (6 percent) or profits tax (15 percent) or unified agricultural tax (6 percent, farmers only) or tax on imputed income (calculated by a special formula, certain companies only). Corporate taxes for medium and large businesses include profits tax (20 percent), value added tax (20 percent), property tax (0-2 percent) and some other taxes like water tax and mineral tax.
In recent years, the Russian government has been actively promoting investments in certain industries with a view to greater localization, development and deployment of innovations, broader economic diversification, as well as accelerating the development of specific territories.
To do so, federal, regional and municipal authorities establish territories with a special status, execute various investment promotion and public-private partnership (PPP) agreements, offer tax benefits and subsidies, grant preferential access to public procurement and run various government-sponsored programs.
Generally, such incentives apply irrespective of whether the investments are of a domestic or foreign origin. However, most of them require the establishment of a Russian legal entity.
The Russian Federation as every other civilized country, does not limit foreigners legally living in the country, in law to conduct business. Moreover, for attracting foreign investments, business in Russia for foreigners is governed by the same rules as for Russians. Still, there are nuances.
Despite the manifestations of crisis, national currency devaluation, commodity dependence of the Russian economy and numerous other problems, including problems of bureaucratic character, the Russian federation still continues to be attractive for foreign investments. During the previous decade, their volume changed unevenly, but there are logic and regularity patterns in this.
Russian legislation provides for many forms of ownership, available also to foreigners. The most
-popular are the following:
-Individual proprietorship (IP);
-Limited Liability Company (LLC);
-Joint Stock Company (PJSC, JSC).
Choosing a particular form depends on the specifics of business — its size, the number of organizers, the level of capital investment, form of economic activity and other factors.
Over the years, Russia has demonstrated its willingness to reinforce its efforts in combatting the infringements of intellectual property rights.
Russia has been a Member of the World Trade Organisation since 2012. In the run-up to WTO accession, Russia adopted new legislation matching international standards for the protection of intellectual property rights by, in particular, increasing sanctions for, and improving legal mechanisms to combat infringements of intellectual property rights. The resulting legal framework in the field of intellectual property is generally in line with international standards, allowing right owners to adequately protect their intellectual property rights.
The Russian judicial system consists of federal courts (the Constitutional Court of the Russian Federation, courts of general jurisdiction and arbitrazh (state commercial) courts) and the courts of the Russian Federation’s constituent entities (constitutional courts and magistrates’ courts).
The Constitutional Court of the Russian Federation generally resolves issues relating to compliance with the Constitution of the Russian Federation, federal and some regional laws and regulations if they are related to issues within the competence of the federal authorities. The Constitutional Court of the Russian Federation is also empowered to review the enforceability of foreign and international court judgments and arbitral awards, as well as decisions of interstate bodies, to ensure their compliance with the constitutional system of the Russian Federation.
Constitutional courts of constituent entities resolve issues of compliance with the constituent entity’s laws, and the regulations of its state and municipal authorities, with the constitution of the constituent entity.
Arbitrazh (state commercial) courts have jurisdiction to resolve disputes in connection with business activities and disputes involving legal entities and self-employed entrepreneurs. Such courts are also entitled to resolve certain types of disputes irrespective of the nature of the parties, such as bankruptcy cases, corporate disputes, disputes from depositories’ activities in connection with recording title to the shares and other securities, certain disputes out of activities of public law companies, state companies and corporations, etc. Other disputes fall under the purview of federal courts of general jurisdiction and the courts of general jurisdiction of constituent entities (magistrates).
Our law firm VLO provides legal services for corporate and private clients in Russia. These services include mergers and acquisitions, business and debt restructuring, tax and tax disputes, corporate disputes, investments, bankruptcy, litigation and arbitration.
If you have questions, please us right now.
E-mail: vlolawfirm@gmail.com
Russia has a mixed economy. Russia's extensive mineral and energy resources are the world's largest, and it is among the leading producers of oil and natural gas globally. It has the world's eleventh-largest economy by nominal GDP and the sixth-largest by PPP. Russia has a low unemployment rate of 4.1%. Russia's foreign exchange reserves are the world's fifth-largest. It has a labour force of roughly 70 million, which is the world's sixth-largest. Russia's large automotive industry ranks as the world's tenth-largest by production.
Russia is the world's twentieth-largest exporter and importer. The oil and gas sector accounted up to roughly 40% of Russia's federal budget revenues, and up to 60% of its exports in 2019. In 2019, the Natural Resources and Environment Ministry estimated the value of natural resources to 60% of the country's GDP. Russia has one of the lowest external debts among major economies, although its inequality of household income and wealth is one of the highest among developed countries.
Russia has a relatively low level of foreign debt and it has amassed the fourth largest foreign currency reserves after China, Japan and Switzerland. In conjunction with prudent macroeconomic policies and renewed government efforts to advance structural reforms through major projects, this aims to improve business and investor confidence, and develop such sectors as telecommunications, retail, agriculture, food processing, pharmaceuticals and the power industry.
The banking system of the Russian Federation is a set of interrelated elements comprised of the Central Bank, lending agencies (the latter includes commercial banks and other credit establishments and settlement institutions that could be consolidated as holding companies), as well as banking infrastructure and banking legislation.
The Russian tax system tends to use moderate flat or regressive tax rates. It is highly centralized for a federal state and relies heavily on proceeds from oil and natural gas corporations, who themselves are mostly state owned.
Individuals are supposed to pay in income tax (13 percent), land tax (0.3 percent of the land's cadastral plot which is calculated by a special formula) and vehicle tax (which is linked to the vehicle's engine power). Most small businesses are eligible for simplified taxation and can choose one of the following taxes: income tax (6 percent) or profits tax (15 percent) or unified agricultural tax (6 percent, farmers only) or tax on imputed income (calculated by a special formula, certain companies only). Corporate taxes for medium and large businesses include profits tax (20 percent), value added tax (20 percent), property tax (0-2 percent) and some other taxes like water tax and mineral tax.
In recent years, the Russian government has been actively promoting investments in certain industries with a view to greater localization, development and deployment of innovations, broader economic diversification, as well as accelerating the development of specific territories.
To do so, federal, regional and municipal authorities establish territories with a special status, execute various investment promotion and public-private partnership (PPP) agreements, offer tax benefits and subsidies, grant preferential access to public procurement and run various government-sponsored programs.
Generally, such incentives apply irrespective of whether the investments are of a domestic or foreign origin. However, most of them require the establishment of a Russian legal entity.
The Russian Federation as every other civilized country, does not limit foreigners legally living in the country, in law to conduct business. Moreover, for attracting foreign investments, business in Russia for foreigners is governed by the same rules as for Russians. Still, there are nuances.
Despite the manifestations of crisis, national currency devaluation, commodity dependence of the Russian economy and numerous other problems, including problems of bureaucratic character, the Russian federation still continues to be attractive for foreign investments. During the previous decade, their volume changed unevenly, but there are logic and regularity patterns in this.
Russian legislation provides for many forms of ownership, available also to foreigners. The most
-popular are the following:
-Individual proprietorship (IP);
-Limited Liability Company (LLC);
-Joint Stock Company (PJSC, JSC).
Choosing a particular form depends on the specifics of business — its size, the number of organizers, the level of capital investment, form of economic activity and other factors.
Over the years, Russia has demonstrated its willingness to reinforce its efforts in combatting the infringements of intellectual property rights.
Russia has been a Member of the World Trade Organisation since 2012. In the run-up to WTO accession, Russia adopted new legislation matching international standards for the protection of intellectual property rights by, in particular, increasing sanctions for, and improving legal mechanisms to combat infringements of intellectual property rights. The resulting legal framework in the field of intellectual property is generally in line with international standards, allowing right owners to adequately protect their intellectual property rights.
The Russian judicial system consists of federal courts (the Constitutional Court of the Russian Federation, courts of general jurisdiction and arbitrazh (state commercial) courts) and the courts of the Russian Federation’s constituent entities (constitutional courts and magistrates’ courts).
The Constitutional Court of the Russian Federation generally resolves issues relating to compliance with the Constitution of the Russian Federation, federal and some regional laws and regulations if they are related to issues within the competence of the federal authorities. The Constitutional Court of the Russian Federation is also empowered to review the enforceability of foreign and international court judgments and arbitral awards, as well as decisions of interstate bodies, to ensure their compliance with the constitutional system of the Russian Federation.
Constitutional courts of constituent entities resolve issues of compliance with the constituent entity’s laws, and the regulations of its state and municipal authorities, with the constitution of the constituent entity.
Arbitrazh (state commercial) courts have jurisdiction to resolve disputes in connection with business activities and disputes involving legal entities and self-employed entrepreneurs. Such courts are also entitled to resolve certain types of disputes irrespective of the nature of the parties, such as bankruptcy cases, corporate disputes, disputes from depositories’ activities in connection with recording title to the shares and other securities, certain disputes out of activities of public law companies, state companies and corporations, etc. Other disputes fall under the purview of federal courts of general jurisdiction and the courts of general jurisdiction of constituent entities (magistrates).
Our law firm VLO provides legal services for corporate and private clients in Russia. These services include mergers and acquisitions, business and debt restructuring, tax and tax disputes, corporate disputes, investments, bankruptcy, litigation and arbitration.
If you have questions, please us right now.
E-mail: vlolawfirm@gmail.com
Russia