How a foreigner can open a business in Russia: rights, obligations and restrictions

Feb, 09 2022

A foreign citizen can register both an individual entrepreneur and an LLC. A foreigner can become a founder of an LLC regardless of their status.

In order to register with the tax authorities as an individual entrepreneur, a foreigner must be legally located in Russia: have a temporary residence permit (RVP) or a residence permit (residence permit) with a mark of registration at the place of residence.

It is possible to open an individual entrepreneur to a foreign citizen with both a RVP and a residence permit: A temporary residence permit is a document that allows a foreigner to live and work in Russia for three years. Residence on the basis of the RVP is, most often, the first stage of obtaining Russian citizenship. A residence permit is a special document that entitles foreigners and stateless persons to reside in the territory of the Russian Federation and work legally.

The same types of activities are available as for citizens of the Russian Federation: all except those requiring special permits and licenses that are not issued to individual entrepreneurs, and those that only legal entities can legally carry out. So, it will not be possible to sell alcohol and produce it (except beer), open a pawnshop or engage in insurance. The registration procedure is the same as for citizens of the Russian Federation, the difference is only in the number of required documents.

Both an individual and a company can register an LLC in Russia. For registration, the founder-an individual will not need a RVP or a residence permit — you can do business from abroad. A RVP or residence permit is required if you plan to become a director of the company. Also, a foreign director will need a work permit.

The founders of an LLC cannot be business companies consisting of one person. When creating an insurance company, the share of foreign investments should not be more than 50%. If the share of foreign investments exceeds 49%, the company will not be able to enjoy benefits for small businesses.

Foreign citizens and stateless persons can conduct business in the Russian Federation. They have the same rights and obligations as Russian citizens. Foreign citizens can register both sole proprietors and LLC, but you should take into account all the nuances and collect the necessary documents.

Author of the article
How a foreigner can open a business in Russia: rights, obligations and restrictions
Valentina Khlavich
Managing Partner
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