Forms of presence of foreign companies in Russia: a general overview / comparison

18.07.2013

1. Foreign representative office in Russian Federation

2. Foreign subsidiary company in Russian Federation

3. Limited presence on the Russian Federation territory of a foreign organization

4. Forms of presence of foreign companies in Russia: a general overview/comparison

The experts of the AS-Audit examined the presence of different types of foreign organizations in Russia. Based on this analysis, we can draw a general characterization and comparison of the types of foreign economic activity.

Agreement on mediation and promotion of products / services to a foreign company with a Russian company operating in the territory of the Russian Federation. In this case, any registration of a foreign company in the official bodies of the Russian Federation is not required, but allows export and import contracts on behalf of the foreign company. This form of presence of foreign companies in the Russian Federation is particularly useful in the case of export of services in Russia, for consulting companies, as well as for trade transactions, in which the recipient / sender of the goods, carrying out all customs operations is the Russian organization.

The opening of a Russian bank currency account type "I" for the sole purpose of trading in securities or investments in the Russian Federation. This form requires the presence of a foreign investor registration with the tax authorities at the place of opening the account. Accreditation of this representation is the most expensive of all forms of presence of foreign companies in Russia and is now used mainly for reasons of prestige. Benefits reserved only for foreign citizens, workers representatives.

Creation of a foreign company without the right to conduct business activities in the territory of Russia is one of the most popular at the moment. Compared with the organizations - residents of the Mission some benefits, such as currency gain is not subject to conversion, while wages may be paid to residents of the Russian Federation in foreign currency. Income tax is levied only that part of the profits of legal entities - non-residents, which is derived from his activities in the Russian Federation. Profits of foreign legal entity, resulting in foreign trade operations related to the procurement of goods to Russia, as well as exchange of goods and operations for export to the Russian Federation of goods and services.

Establishment of a branch of a foreign company (subsidiary company) - a form of presence of foreign organizations on the territory of the Russian Federation, carrying out all the functions of a foreign company or a part of them, including the functions of representation, but it is not a separate legal entity under Russian law.

Creating a separate legal entity under Russian law, with full or partial foreign ownership. Such a company is virtually no different from other Russian companies reporting capabilities and business activities, except for the possibility of free transfer of net profit (after tax) abroad at the expense of the foreign parent company.

Creating a separate legal entity under Russian law, with full or partial foreign ownership. The form of the presence of foreign organizations in Russia does not differ from other Russian organizations reporting capabilities and business activities, except for the possibility of free transfer of net profit (after tax) abroad at the expense of the foreign parent company.

 Summarizing all the above is possible to make a small plate that reflects the legal and tax burden on non-residents of different forms of presence on the territory of the Russian Federation:

	Registration / accreditation in Russia	VAT	Income Tax	PIT	STS	Implementation of all functions of the parent organization
Subsidiary company	+	+	+	+	-	+
Representative office	+	+	+	+	-	-
Limited presence	-	-	+	-	-	-
Legal entity	+	+	+	+	+	+

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Ссылки по теме:

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Limited presence on the Russian Federation territory of a foreign organization: characteristics and taxation 5