Current globalization processes promote the more common registration of the companies, the further functioning of which involves foreign investments. Trying to carry out the whole procedure by themselves, some registrars and applicants consider that a foreigner’s participation in the registration of the LLC (in Russian abbreviation - OOO) is a complex and time-consuming process. In fact, being characterized by a couple of specific features, the registration process of a legal entity in Russia with a foreign founder as well as making a foreign citizen the company’s partner differs just a little from the carrying out of the same procedure for the Russian residents.
According to the Russian legislation, citizens of other countries have the right to do business in Russia by choosing one of these methods:
- establish a Russian company with a registered capital or its part belonging to a non-resident;
- open a representative office or a branch on the Russian territory.
A common form of legal entity establishing in Russia for the business registration is an OOO.
OOO or Limited Liability Company is a form of the enterprise ownership, which may be established either by one or more persons with the registered capital divided into shares. Members of the company are not burdened with the responsibility for its obligations; everyone’s risks are directly proportional to the value of his share in the registered capital.
Both a company and an individual have the right to register as an OOO. If one of the OOO members is not a resident, then this form of business activity is called an OOO with foreign investments. It is worth noting that this definition does not only refer to those companies, which registration was conducted on behalf of a foreign citizen, but also to the companies with the registered capital divided into shares among the Russians and the foreigners. The first type of an OOO is considered to be a company with 100% of foreign capital, and the second – with a shared one.
The whole procedure required for a company registration in Russia is regulated by the Federal legislation. In accordance with the law, the amount of the state duty for the registration is 4,000 rubles.
The current legislation determines a number of certain actions for a non-resident founder, which are mandatory for a company's registration and its further activity. They are characterized by several distinctive features as compared to the residents:
- A non-resident has to make a monetary contribution to the company’s registered capital with the minimum sum of 10,000 thousand rubles;
- The deadline for making a contribution is 4 months after the company registration;
- The dividend tax for the non-residents is 2% higher than for the Russians – 15%;
- Such companies are not permitted to maintain the accounting records by the simplified scheme.
Company Registration in Russia by a Non-Resident Individual
If the founder is a citizen of China, it’s necessary to provide a specific set of documents.
The list of the required documents for the company registration in Russia:
1. The passport and its legally certified translation.
2. The application for registration of the company by a foreign citizen (form R11001), with a mandatory indication of the place of residence.
3. The act on the establishment, in which the applicant fixes the amount of the registered capital, the Articles of Association clauses and other moments important for the company’s functioning. If a company is registered by more than one person, a protocol showing all the shares should be also drawn up.
4. The Articles of Association in 2 copies with the detailed information about the company and its founders. One copy should be kept by the company, while the second – by the inspector.
5. The receipt confirming the fee payment.
6. The letter with the registered office granting. However, this letter is not required if the office belongs to the applicant’s property.
It is essential to take into account the following important points:
- to fulfill the procedure of a signing notarization, a non-resident has to be able to sign the necessary documentation in the Russian language;
- a foreign citizen has to be able to speak in Russian freely for communicating with a notary, or he should use a certified interpreter’s assistance. The number of the document confirming the interpreter’s qualification should be noted as well when signing the documents;
- temporary registration is required for the notarization procedure.
A Chinese citizen can hold the post of a CEO of the registered company in two cases only:
- having a temporary residence permit or a residence permit on the territory of the Russian Federation;
- having a work permit, when in lack of the two aforementioned permits.
In case a foreigner doesn’t have any of these permits, then only a Russian citizen may become a CEO.
If a company’s business activity requires the hiring of a foreign citizen, an employer should get:
- the quota for foreign labor hiring (not required for managers);
- the permission for use of foreign labor;
- the permission for hiring a particular employee, a citizen of a foreign state;
- the invitation for a foreign citizen’s entry to the Russian Federation territory.
In order a foreigner to be able to enter Russia, an employer should send him an invitation and a work permit.
Company Registration in Russia by a Non-Resident Legal Entity
When a company is to be registered by a legal entity, a standard document package should be complemented by an extract from the national trade register of the company’s country of residence.
For the companies registered in China, an extract from the register of entrepreneurs is a document confirming the status. It contains all the basic information about the organization: a legal entity number, a date of establishment, a form of organization, the location address, information of the registered capital and a CEO, as well as the data on the actual state of the company. The extract should be attached to its translation into Russian, certified by a notary. Other necessary documents for company registration in Russia are the same as for the individuals:
- an application (form R11001) with information coinciding with the extract from the register;
- a protocol or an act on the establishment;
- the Articles of Association;
- a receipt of payment;
- documents of the registered office granting.
Registration: Available Methods
In most cases, a founder and a citizen of a foreign state at the same time certifies the documents and submits them for registration to the tax office personally.
However, if it’s impossible for a foreign investor to arrive to Russia, there exist some other variants:
1. To sign and fill in the registration application (form 11001) at the consulate. It will be even better if there is a notary from Russia at the consulate. Still, the local notary can certificate an application as well. In this case, the application should also be translated into Russian and certified at the consulate. A certified translation of the passport is required, too.
2. To register an OOO without a non-resident individual or legal entity for his further inclusion in the company’s members.
3. To purchase a ready-made company, and then to change its members and include foreign citizens.
4. To make a Russian citizen one of the company’s founders. This partner can get a share of any size. In this case, any founder may become an applicant. When using this method, it is obligatory for a foreign citizen to sign a protocol of the company establishment; all the visits to the tax office are committed by a Russian partner. Such a handy scheme allows to make the procedure of a legal entity registration in Russia much faster. Moreover, if such a need arises, it is easy to withdraw a Russian citizen from the founding members (on the basis of an application) and divide his share among the other members.