ulf schneider managing partner russia consulting group gothenburg, 4 th april 2013 seminar: how to...
TRANSCRIPT
Ulf SchneiderManaging Partner
RUSSIA CONSULTING Group Gothenburg, 4th April 2013
Seminar: How to do business with Russia
Starting a Company in Russia
Why to start business in Russia
Representative Office / Brach / Subsidiary
How to register an OOO / LLC
Typical issues during Start-Up
Content 2
Why to start business in Russia 3
Status symbols are important: RepOffice/OOO
Show commitment to the market
No DDP deliveries without Russian entity
Tax reasons incl. low tax rates 20% CIP 13% PIT
Why to register your company in Russia
4
Inexpensive labor force
I can delegate everything
We have problems on our home market, Russia should save us
No good reason to do business in Russia
5
Is everybody and everything corrupt? NO !
Can you cope with the Russian bureaucracy? YES !
Russia is not a part time job FULL ENGAGEMENT !
You need a million in order to start business ?
orYou start a business in order to make a million ?
Obstacles when starting in Russia 6
7
Representative Office
Branch
Regarded as prestigious in Soviet times
Today a sign for active market presence
Export Subsidiary / OOO
Transformation 8
BranchRep-Office
Subsidiary / OOO
Transformation possible (however, new
accreditation required)
Liquidation of branch and foundation of subsidiary
Liquidation of Rep-Office and foundation of subsidiary
Comparison 9
Subsidiary Branch Office
Active commercial activity
Legally independant
Active commercial activity
Legally not independant
VAT, CIT/Profit Tax, Property Tax VAT, CIT/Profit Tax, Property Tax
Entitled to deduct input-VAT Entitled to deduct input-VAT
Liability-protection;
Limitation to Russian entity
Liability of Swedish-Company
Capital infusion is rather difficult Capital infusion is rather easy
Profit repatriation subject to Dividend
Withholding Tax
Profit transfer to Sweden very easy
Currency Control with Swedish-entity Currency Control with Russian
clients and distributors
JV generally have major business risks Less control / not transparent Different understanding of business culture If JV, then JV entity should not be in Russia
General saying:
“First the Western partner brings the money and the Russians the experience”
“Later the Russians have the money and the partner a new experience”
Joint Venture 10
One or several shareholders
No double 100% structures
Minimum charter capital 10.000 Rubles (2.000 SEK)
Serious Legal Address required
General Director (can be outsourced)
Reporting and accounting from day one, quarterly 10-15 reports
Register an OOO / LLC 11
Opening a bank account can be so difficult
How to limit the rights of the General Director?
Who should become Chief Accountant – Friend of the GD?
How to structure the reporting to the HQ
Corporate reporting vs. Russian reporting Cash (invoice) vs. accrual (acceptance protocol) “Prepayment” vs. real prepayment
Register an OOO / LLC 12
Losses in several quarters can lead to an „invitation“ by the loss commission of the tax authorities
Now more civilized procedures
Relations with public authorities should be handled like with other business partners
Relation with public authorities 13
Grey Import - A no-go 14
Illegal important structures –
also financially a bumerang
Invoicing(with all official documents)Swedish AB
Sweden Russia
Import company
Subsidiary-OOO
Invoicing
Delivery
(Grey accounting)
(no deduction of input-VAT)
Illegal structures with payback Check for unserious consulting invoices
Payback – Obnalichka - Обналичка 15
95% payback in
cash
„Consulting“ OOO
Subsidiary-OOOIn
voic
ing
Ba
nk
pa
yme
nt
Russia grants great opportunities
Obstacles await you everywhere, however, Russia is much improving
Stick to your principles, take your time, insist on your rights and …..
….. never do dirty deals !
Conclusion 16
Clients and Memberships 17
Our office 18
Accounting Outsourcing
Tax Consulting
IT Services / ERP
Interim Management
Office Sublease
Recruiting
Outstaffing
Visa and Work Permit
Thank you for your Attention! 19
Ulf SchneiderManaging Partner
+7 / 495 / 956 55 [email protected]
Our Offices
www.russia-consulting.eu
MoscowUlf Schneider,
Lars Flottrong, Mike Allenul. Bakhrushina 32/1
115054 Moscow, RussiaT +7 / 495 / 956 55 57
HamburgUlf Schneider
Alstertor 1520095 Hamburg, GermanyT +49 / (0)40 / 226 33 760
St. PetersburgAndreas Bitzi
Finlyandskiy pr. 4a194044 St. Petersburg, Russia
T +7 / 812 / 458 58 [email protected]
KievSven Henniger
vul. Shovkovychna 42-4401601 Kiev, Ukraine
T +38 / 044 / 490 55 [email protected]
MinskPolina Meleshkoul. Surganova 29
220012 Minsk, BelarusT +375 / 17 / 290 25 57
AlmatyKirill Afanasyev
ul. Zheltoksan 111 A050000 Almaty, Kazakhstan
T +7 / 727 / 333 44 [email protected]
AktauKirill Afanasyev
Mangistauskaya oblast,District 14, building 61
130000 Aktau, KazakhstanT +7 / 7292 / 470038
WarsawPiotr Linke
Al. Jerozolimskie 8102-001 Warsaw, Poland
T +48 / 22 / 695 03 [email protected]