All legal entities in Russia can be classified into two main groups:
- Commercial, which imply activities aimed at making a profit
- Non-profit, in which making a profit is not the main goal. Social, cultural, or educational goals can be commercial alternatives
Russian legislation provides for many forms of ownership, which are also available to foreigners. The most popular are the following:
- individual entrepreneurship (IP)
- limited liability company (LLC)
- joint stock company (PJSC, JSC)
Individual entrepreneurship
An individual entrepreneur is an individual who conducts business without forming a company. Most often this form is used for micro and small businesses, for example, retail, private services, etc.This form is characterized by a simple procedure for registering / liquidating a business, freedom to use proceeds, a simplified reporting procedure and other advantages.
But there are also disadvantages. So, individual entrepreneurship is inseparable from the personality of an individual, therefore, for all obligations, a foreign IP is liable with his property. According to the law, registration of individual entrepreneurs is carried out at the place of residence. This means that only a foreigner who has a temporary residence permit or a residence permit in Russia can register as an entrepreneur - these documents confirm the fact of residence. We described in detail how to get a temporary residence permit / residence permit in Russia in one of our previous articles.
Limited liability company
The most popular form of legal entity in Russia. For a foreigner, this is the easiest and most convenient option for doing business in Russia. This legal form has the following advantages:- the minimum authorized capital, which must be contributed in money (10 thousand rubles)
- the possibility of establishment not only by individuals, but also by a foreign company
- limited liability - the founders are liable for the obligations of the LLC only by the value of their shares in the authorized capital
The registration procedure does not differ in any way from the establishment of an LLC by the Russians. The only feature is the legalization of documents by apostille and notarization. Our specialists can help you with the legalization of documents in Russia. Our many years of experience allows us to carry out the legalization procedure efficiently and in the shortest possible time.
Joint-stock company
The peculiarity is that the authorized capital in this case turns into shares owned by shareholders. A company can be public, then its securities are in free circulation and are acquired by a wide range of persons. Shareholders are liable for obligations only by the value of their shares and do not bear any personal responsibility.Joint-stock companies are established, as a rule, to conduct large and medium-sized businesses, but due to the complexity of the procedure for registering and issuing shares, they are not so popular.
An additional advantage of a joint stock company is the concealment of the ultimate beneficiaries. Information about the founders of LLC and individual entrepreneur is in the public domain, and JSC allows you to hide this data from the general public.
If a business in the Russian Federation is established by a company already existing abroad, you can also open a branch or representative office.
Opening a representative office in Russia on the basis of a business association will be an excellent solution for those who are just looking at the Russian market. It provides an opportunity to use the brand, knowledge base and reputation of the association, and also provides a full-fledged presence in the Russian market, without large financial costs.
For 10 years of work in Russia and Asian countries, the RAUIE has accumulated experience, business connections and contact base, and has also earned a high reputation and trust among the business community. Today the RAUIE offers a wide range of solutions for entrepreneurs seeking to enter the Russian market.If you still have questions or need advice on choosing a business format in the Russian Federation, you can leave a request in the feedback form or contact our specialists at the contacts below:
Maxim Kuznetsov - vice-president of the RAUIE
investment@raspp.ru
WeChat: maximkuznetsov