What is company registration in Russia?
Russia is very appealing to the foreign investors due to its advantageous legislation and taxation system. The tax rate for individual entrepreneurs is as low as six percent. Foreign entrepreneurs are treated equally like any other local investor for granting benefit for opening companies in Russia. Despite tough competition in Russia, it remains a wonderland of opportunities for further growth and business development. However, before starting a business, it is best to verify all the legal requirements.
There are several forms to start a business in Russia for a foreign investor. A Foreign investor may set up a Russian legal entity in the form of limited liability company, joint-stock company (can be either private or public) or partnership. The other way to set up a business is to register a representative or branch office of a foreign company in Russia.
What is Limited Liability Company registration in Russia?
The most popular form to set up a business in Russia is the limited liability company, which can be established by maximum 50 shareholders, and with a minimum share capital of 10,000 rubles. A half of the share capital is required to be paid at the time of registration and the other half must be paid in maximum three months from the incorporation.
If any of the shareholders wants to leave the company, the consent of the shareholders is not necessary. If the limited liability company is taking any major decisions has to be taken the general meeting of the company. However, decisions relating to the the ordinary course of business are taken by the general director and, in certain cases, by a board of directors and an executive committee may be appointed.
What is Joint Stock Company registration in Russia?
The Russian joint stock company registration has two types, Open or Closed. Open joint stock companies are allowed to transfer their shares to the public, while the closed companies can only transfer shares between its existing shareholders. The minimum share capital in case of Open joint stock companies is 10,000 rubles and for closed ones, it is 100,000. At least A half of the share capital is required to be paid at the time of registration and the other half must be subscribed within a year after the incorporation.
A limited liability company with more than 50 shareholders can and must be reorganized as a joint stock company.
What is General Partnership registration in Russia?
It is a form of business, established between two or more corporate bodies or individuals with equal rights and liabilities in the entity. It is based on a partnership agreement. The liability of the entity can be met with the personal assets of the individuals (when there are not sufficient funds to cover the claims from the entity’s property). The capital of such business is declared in the agreement of incorporation and at least half of it is required be paid by the time of contribution, while the other half shall be paid by the time specified in the foundation agreement.
What is Limited Partnership registration in Russia?
The Limited Partnership is formed by two types of partners: General and Limited. The general partner is fully liable for the entity’s debts and profits, while the silent partner has the liability limited to its contributions to the partnership’s capital.
How To register a Company in Russia?
The very first step while incorporating a company to do is to choose a name for the company in Russian. There are some specific rules in Russia regarding the naming of companies, including restrictions on using the name “Russia” as part of your name and using foreign abbreviations.
Documentation shall be submitted with the proof that you have a commercial address for your company in Russia. It is also required to provide a list of all proposed business activities. An initial minimum capital required must be deposited into a Russian bank to establish the financial basis for the company.
If the director of the company is a foreign citizen, he or she is required to obtain a valid Russian work permit and visa. The director will be held responsible for all administrative and criminal actions of the company.
Procedure for Company registration in Russia?
Company registration in Russia has following steps:
1. Notarize foundation documents
Copy of the charter, a copy of the decision of setting up of the limited liability firm, a copy of the foundation agreement. And the application for registration needs to be notarized while filing the application. A minimum of four copies of the listed documents is required to be notarized.
2. Deposit capital in the bank and get proof thereof
Before company incorporation, a minimum of fifty percent of the charter capital needs to be deposited. In the 1st year of operation, the remaining balance will be paid.
3. Pay registration charge
The registration charge is required to be paid for the registration of the legal entity with the State Tax Inspectorate. Once the payment is made, this registration charge will then be sent to the account of the State Tax Inspectorate.
4. The next step is to get the company be registered with the unified register at the Federal Tax Service on the local level, to obtain the single number of state registration and the number of tax registration (identification number of taxpayer, INN)
Documents required for Company registration in Russia
- Decision of the founders meeting;
- Charter(Article of Association) (2 copies);
- Registration Application, notarized;
- Receipt of payment
A number of prerequisites are put in place by the tax authorities, and failure to follow these could lead to the application be rejected. Only a verified copy of charter(Article of Association) is granted by tax authorities. Consequently, if the firm has to file the copy of the Charter with any other state organizations, another copy of the Charter needs to be requested by the tax authorities on each occasion.
- NotarizeTax Payer Identification Number Certificate, Registration Certificate, and Bank Signature Card. Documents needed include:
- Certificate of registration, notarized;
- Taxpayer Identification Number (INN) certificate, notarized;
- Charter, notarized;
- Documents which confirm approval of the signatories (decision on the founders on appointment/election of the Director etc.), notarized.
- Open the company bank account with any bank in Russia
- Inform Federal Tax Service of the company bank account number and receive a special letter of confirmation from them.
- Register the company with Moscow Center of Quotation of Work Places
All legal entities and individual entrepreneurs who are employing personnel in Russia are required to be registered with the Moscow Center of Quotation of Work Places having its local departments in each district of Moscow irrespective of whether such companies are obliged to comply with the quotas (if the staff represents more than 100 persons) or not.