Registration of firm
Òoday 3 types of companies are started for the commercial activity in Russia – limited liability societies, close corporations and open joint-stock societies. Limited liability societies are more wide-spread due to their simple start-up. In order to register such society it is enough to register with the tax authority, whereas the joint-stock company or close corporation registration requires the additional registration of stock at the Federal Service for Financial Markets.
The order of the wholly foreign owned society registration is similar to the order of the Russian legal entity registration.
It must be noted that foreign companies and citizens can purchase and sell shares and stock of Russian companies, as well as can be founders. Russian legislation set only some limits for the participation of foreign legal entities in the activity of Russian companies, which play strategic role.
Except, foreign citizens can be general directors, members of the board and members of the board of directors of Russian companies.
The order of registration. The applicant (the founder of the legal entity) should make an application in the Federal tax agency's inspectorate, which registers all legal entities. This application should be notarized. As the founder of the company is a foreign legal entity, the application is attested with the consular institution or apostilled.
Together with the application, it is necessary to hand in to the Tax inspection the Articles of Association, which should be bound, numbered and signed, as well as the constitutive treaty (in case if there are more than one founders).
Together with the Application it is necessary to hand in the following documents:
- Decision on opening limited society (in case if there is one founder);
- Minutes of general meeting of founders (in case if there are more than one founders);
- Letter of guarantee of the owner and commercial property rental agreement (confirmation of company legal address);
- Extract from the Register of foreign legal entities of country of origin or other proof of the foreign legal entity legal status with the equal legal force;
- Registration documents of the Founder, a foreign company, the document on assignment of a taxpayer identification number;
- Document of the foreign company, the founder on making a decision of creating limited company in Russia;
- Document, confirming the power position of the head of the founder, the foreign company;
- Document on payment of the state duty (original).
In order to prepare documents for registration of limited company it is necessary to present copies of passports of all foreign individuals, participating in the procedure (founders and directors), translated into Russian and attested in the prescribed manner.
The procedure of documents preparation for starting up a company with the foreign owned company at the territory of the Russian Federation takes approximately 3 weeks. At that, the official state registration of companies in Russia is carried out by the tax inspections during 5 days following filing the documents.
After registration the tax inspection gives the following documents:
- Primary State Registration Number
- TIN (Tax Identification Number)
- Articles of Association, registered at the Federal Tax Agency’s Inspectorate;
- Extract from the unified State Register of Legal Entities
The comparative table of legal forms of organization
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Criterion
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Limited liability company (LLC)
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Private joint stock company (PJSC)
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OPEN joint stock company (OJSC)
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Legal status
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LLC, PJSC, OJSC are Russian legal entities. They may conduct any form of commercial activity, provided it is not prohibited by the Russian legislation. For conducting any licensed type of activity it is necessary to obtain license (e.g. construction). Any Russian and foreign companies and persons may be founders and shareholder in any number of Russian companies. The company may be established by a single founder, as long as the founder is not a company owned by a single legal entity or individual.
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Common or Civil Law
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Civil
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Registered Office
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Must be maintained in Russia.
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Minimum number of shareholders / participants
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One
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One
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One
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Maximum number of shareholders / participants
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Fifty
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Fifty
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Unlimited
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Minimum number of Directors / Managers
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One
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One
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One
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Registration
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Registration is done by the Tax authorities, which keep the United State Register. Company also shall be registered with State Committee for Statistics and three non-budgetary funds (Pension fund, Obligatory Medical Security fund and Social Security fund).
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Registration duties and charges
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Registration duty is 4000 RUR (~130 USD).
There are also charges for registration of company’s seal, registration of Charter, which amount in general to no more than 2000 RUR (~70 USD). |
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Terms of registration
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Standard terms of registration are 3 weeks.
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Issue of shares
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–
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Joint Stock Companies (PJSC, OJSC) may issue common or preferred shares and debentures. After the registration of PJSC or OJSC follows the issue of stock at the Federal Financial Market Service. Standard term of issue of stock is 1 month.
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Usual authorised Capital
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10,000 RUR/ 330 USD
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10,000 RUR / 330 USD
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100,000 RUR / 3,300 USD
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Paid up
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50% prior to registration
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50% within 3 months of registration
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50% within 3 months of registration
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Balance due
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Within one year of registration
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Management structure
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1. General meeting of participants or single participant (obligatory body)
2. Board of directors (optional body)
3. Individual executive body – General Director (Director) (obligatory body)
4. Collective executive body – Direction (optional body)
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1. General meeting of shareholders or the single shareholders (obligatory body);
2. Board of directors (optional body);
3. Individual executive body – General Director (Director) (obligatory body);
4. Collective executive body – Direction (optional body)
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Company Secretary
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No
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Local Directors
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No
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Local meetings
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No
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Shares/units
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The units can be sold to anyone, but there can be stipulated right of priority for the unit purchase.
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Shares may not be freely sold. Share transfers are subject to preemptive rights of other shareholders.
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Shares may be freely sold to third parties.
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Accounting and Tax compliance
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Companies shall file accounting and tax reports including reports on VAT with the tax authorities on a quarterly basis.
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Foreign staff
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In order to employ foreign citizens a company shall obtain Employment permit. Afterwards every foreign employee shall obtain personal work permit. A work visa is also required.
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Public report
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–
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Only in case of public placing debentures and other issuing securities.
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Obligatory public reports on activity, balance sheet, profit and loss account.
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Obligatory internal audit
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–
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Yes
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 Audit |
Legal |
Accounting |
Tax |
