Russia

Why Trade or Invest in Russia?

Russia is the EU's third trading partner and the EU is Russia's first trading partner. Trade between the two economies showed sharp growth rates until mid-2008, when this trend was interrupted by the economic crisis and unilateral measures taken by Russia, which negatively affected trade between the EU and Russia. Since 2010, mutual trade has resumed growth, reaching record levels in 2012.

EU exports to Russia are dominated by machinery and transport equipment, chemicals, medicine and agricultural products. The EU's imports from Russia are dominated by raw materials, in particular oil (crude and refined) and gas. The EU is the most important investor in Russia. It is estimated that up to 75% of FDI in Russia comes from EU member states (including Cyprus).

The European Union and Russia have strong trade relations. Bilateral trade and investment continues to grow rapidly. Since 1997, the Partnership and Cooperation Agreement has been the foundation of EU-Russia relations governing political and economic relations between the EU and Russia. One of the main objectives of this agreement is to promote trade and investment, as well as the development of harmonious economic relations between the EU and Russia.

Various regions of Russia also provide business opportunities. These regions are increasingly competing to attract international investment. In some regions, significant improvements have been made to simplify business operations, such as Kaluga and Kazan.

Some features of the Russian legal system that you should know

Federal Law on Foreign Investment:

• Prevents foreign investors from gaining control or significant stakes in Russia's strategic strategies, such as in the mining and defense industries
• Indicates that the conditions for foreign companies investing in Russia cannot be worse than for Russian companies
• Protects investors from adverse changes in tax, customs and other legislation for up to 7 years

Russian legislation provides foreign investors with a number of advantages to ensure stability and legal protection of their business in Russia. Main advantages:

• Compensation for damage caused as a result of illegal actions or inaction of state bodies, local government bodies or officials of these bodies
• Protection of property from seizure, including nationalization or requisition
• Protection against negative changes in tax and customs legislation during the payback period of the investment project
• The right to the unhindered transfer of profits, income and other monetary amounts from investments

In accordance with Russian transfer pricing legislation, the transfer price is subject to monitoring by the tax authorities. The tax authorities control prices to ensure that they are created for commercial purposes, not to reduce the tax burden.

You must take into account the rules in different regions of Russia. There can be significant discrepancies and contradictions in legal practice admitted by authorities and commercial courts.

Intellectual property

Russia has signed the main international treaties on intellectual property rights.

Patent protection is granted for 20 years from the filing date of the application, subject to the payment of annuities. The protection of patents for medicines, pesticides or agrochemical products can be extended for up to 5 years with special permission.

Special economic zones (SEZ)

There are 28 SEZs that provide specific tax, customs and other benefits for residents.

Who do we work for

A-LAW Russia desk provides legal support to clients in various areas such as real estate, corporate and civil (family) law, traffic law, immigration law, liability law and debt recovery (bankruptcy, administrative fines).

An in-depth approach to various legal aspects of cross-border cooperation and trade, commercial agency, distribution and franchising of a wide range of products exported from Russia or imported into Russia was assessed by the dedicated A-Law team.