Companies from friendly countries and BRICS: that are entering the Russian market

Who is currently investing in Russia

The main investors to the Russian market are companies from Middle East (Turkey, UAE, Oman), Asia (Hong Kong, China) and CIS countries (Armenia, Kazakhstan, Belarus, Kyrgyzstan).

Often these are international divisions of Russian businesses, which were replaced by European firms with organizations from friendly countries.

At the same time, China, India and Turkey have powerful economies that allow their representatives to significantly expand their presence in various sectors of the Russian economy.

Also, companies from BRICS countries are opening their businesses in Russia in an attempt to escape the influence of USA and Europe and gain technological sovereignty.

Special and free economic zones

There are two ways for a foreign company to register in Russia:

• Open a subsidiary

• Accredit a branch

Such companies can receive tax benefits and state support by registering in special and free economic zones, as well as in advanced special economic zones.

There are 60 special economic zones in Russia, where reduced tax rates and exemptions from property taxes apply. For example, residents of the “Arctic Zone” have access to various support measures and administrative privileges.

In addition, an international holding company can be registered in special administrative regions, where favorable tax conditions also apply.

To receive tax benefits, one of the managing persons shall be a tax resident of Russia, and more than 70% of expenses shall be incurred on Russian territory.

The advanced development areas in Primorsky Krai are very attractive to foreign investors, especially from China. It is planned to create an advanced special economic zone with the participation of Russia, Belarus, China, some other “friendly” countries and approximately 20 foreign companies. Thus, despite sanctions and restrictions on currency transfers, the Russian market remains attractive to foreign investors, primarily from Asian “friendly” countries.