RSPP Develops Conditions for Return of Foreign Companies to Russia

The Russian Union of Industrialists and Entrepreneurs (RSPP) is drafting comprehensive proposals for the conditions under which foreign companies may return to the Russian market. This initiative, launched at the request of the country’s leadership following an industry congress, aims to create a balanced mechanism that would attract foreign investment and technology while protecting the interests of domestic businesses that have filled the niches left by departing Western firms. The working group includes both Russian companies and representatives of the international business community. Business associations representing small and medium-sized enterprises are also preparing their proposals, reflecting a comprehensive approach to addressing this issue.

Terms of return

According to preliminary requirements, foreign companies seeking to resume operations in Russia will need to comply with a number of strict conditions.

These include:

• localizing production,
• transferring modern technologies to Russian partners,
• establishing a full value chain with production facilities and R&D centers in Russia,
• creating jobs for Russian citizens.

Legally, these proposals will be framed as special exemptions from current restrictions, effectively easing the existing regime for select investors.

Permission of governmental commission

The return of companies from certain countries will only be possible with approval from a special commission, which will consider the positions of relevant government agencies, market risk assessments, and feedback from the domestic business community. Particular attention is being paid to protecting Russian companies that have invested in business development following the departure of foreign brands. Participants in the process note that domestic businesses have successfully occupied the vacated market niches, and these positions are intended to be preserved.

Protection of Russian entrepreneurs

One key proposal is the introduction of a temporary moratorium on the return of foreign companies to market segments already occupied by Russian firms. This would allow domestic investors to recoup their investments. Business associations propose creating mechanisms to protect Russian investors, emphasizing that foreign companies would have a competitive advantage under equal conditions due to their greater capitalization. Special consideration is being given to companies that have retained their workforce and have no outstanding debts to partners, as well as to revising buyback terms for assets.

The interests of Russian businesses on this issue are often conflicting. For example, in the aviation sector, some market players are interested in the return of foreign manufacturers, while others promote domestic developments. Similar disagreements exist in other industries where Russian producers compete with potentially returning foreign companies.

Despite the challenging conditions, foreign companies remain interested in returning to the Russian market, particularly in strategic economic sectors. However, many Western firms have already lost control of their Russian operations and will be unable to return under previous terms.

The prospect of returning

Historical experience shows that the return of multinational corporations to local markets after the lifting of restrictions is possible but requires carefully designed conditions and transition periods. Different countries have implemented mechanisms for preliminary accreditation of investors, assessing their behavior during difficult periods, as well as requirements for production localization and infrastructure development participation.

Implementing the business community’s proposals will require significant legislative revisions. Amendments are being considered to regulations governing foreign investment in strategic industries, mechanisms restricting asset buybacks, and rules regulating parallel imports. However, some initiatives have been criticized for excessive rigidity, which could deter investors.

Experts highlight several key risks: pressure on Russian producers from more capitalized foreign competitors, ongoing restrictive measures from other states, and capital movement difficulties. These factors remain major obstacles for foreign investors.

The process of facilitating the return of foreign companies is a complex challenge requiring a balance between attracting modern technologies and investment, protecting domestic producers, safeguarding consumer interests, and accounting for geopolitical realities. The success of this initiative will depend on the ability to establish transparent and mutually beneficial rules that incentivize the return of high-quality investors while preserving the achievements of recent years in import substitution