Doing Business in Russia: A Guide for Entrepreneurs

Since the end of the Communist era, doing business in Russia has become increasingly accessible to international entrepreneurs. Businesspeople who are considering breaking into the Russian market will find a population of 144.5 million people, an emerging middle class, and a portfolio of resources to equip them for success. In this guide, you’ll get an overview of the legal and economic aspects of starting a business in Russia as well as actionable steps for taking the plunge.

The Economic Climate in Russia

Russia, while still having a sometimes-volatile economy compared to more developed Western countries, is becoming increasingly attractive to entrepreneurs. Despite some economic fluctuations due to the country’s own political unrest, the International Monetary Fund (IMF) predicts steady growth of the Russian economy in the coming years. Also noteworthy is the estimation of an 18% increase in purchasing power of the Russian public by 2021. All of this indicates that now is a great time to do business in the country.

What forms of Business Are Available in Russia?

When setting up business in Russia, entrepreneurs have several options for the form their business entity can take. The most common option is the limited liability company (OOO) or the LLC. This type of entity is popular for its flexibility and for its tax advantages. Alternatively, associations, partnerships, and corporate entities are other structures available to entrepreneurs. Be sure to consult a lawyer or accountant with experience in Russian business law before committing to a particular corporate structure.

Steps for Registering a Business in Russia

There are a few necessary steps for registering a business. The first is to register with the tax authority, the Federal Tax Service in Russia. Afterward, a business must register with the statistics agency and the local registrar, which requires a certificate of legal address. Then, enterprises must register with the Labor and Social Security Ministry, the Pension Fund, and the Social Insurance Fund. This must be done before the business can hire employees. Finally, businesses must obtain a seal of state registration, a unique number to identify the business, and other necessary licenses.

Protect Your Business

It’s essential that foreign businesses protect their intellectual property (IP) when doing business in Russia. To do so, businesses should register for copyright protection in Russia with the Federal Service for Intellectual Property (Rospatent). Other forms of IP that could be registered include trademarks and patents, or business owners may wish to establish licencing agreements with Russian partners.

FAQs

Q: How do I register a business in Russia?

A: To register a business in Russia, you must register with the tax authority, the Federal Tax Service. You will also need to register with the statistics agency, local registrar, Labor and Social Security Ministry, the Pension Fund, and the Social Insurance Fund. Once registration is complete, you will need to obtain a seal of state registration, a unique number to identify the business, and any necessary licenses.

Q: What forms of business are available in Russia?

A: The most common form of business entity in Russia is the limited liability company (OOO) or the LLC. Other structures available include associations, partnerships, and corporate entities. It is recommended to consult with a lawyer or accountant with experience in Russian business law prior to deciding on a particular corporate structure.

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