Legal status (establishment procedures, the scope of duties and obligations, procedures for operation, termination of activities, appointment and authorization of the head, etc.) of branches and representative offices of foreign legal entities is regulated by the law of the country of incorporation of the parent legal entity, i.e. by the law of the country where the parent legal entity was established. That is to say, a branch of a French company is established in accordance with the applicable laws of France. In Russia representative offices and branches undergo accreditation, i.e. obtain a permit to carry out activities on the territory of the Russian Federation.

A representative office is a subdivision of a legal entity located at a place other than the head office of the legal entity, which represents and defends interests of a legal entity.

A branch is a subdivision of a legal entity located at a place other than the head office of the legal entity, which performs all or part of the legal entity's functions, including representation.

Representative offices and branches share the following attributes:

  • Branches/representative offices of foreign legal entities are established as subdivisions; they do not enjoy the rights of a legal entity (the parent company) and operate on the basis of Regulations;
  • Branches/representative offices are located away from their parent legal entity;
  • Branches and representative offices are allotted property by the foreign (parent) legal entity, which is recorded both on their separate books and on the books of the foreign (parent) legal entity;
  • Branches and representative offices act on behalf of the legal entity;
  • Heads of branches and representative offices are appointed by the foreign (parent) legal entity and act on the basis of the issued Power of attorney;
  • Responsibility for the actions of branches and representative offices remains with the foreign (parent) legal entity.

The distinctions between representative offices and branches are as follows:

  • Branches have a wider scope of powers than representative offices: apart from representing and defending interests, branches perform the legal entity's functions, can produce goods and provide services, i.e. are engaged in production and business operations;
  • Branches are accredited for a longer period than representative offices;
  • In accordance with current legislation, licenses for some activities are granted solely to branches of a foreign legal entity. To obtain a license for the establishment of a branch/representative office out of Moscow, a preliminary consent of the local authorities is required.

After the submission of documents, the accrediting body decides whether to grant or deny accreditation to the branch/representative office of a foreign legal entity. If approved, the branch/representative office of a foreign legal entity is accredited and issued a permit for the establishment of a branch/representative office and a Certificate of inclusion in the Uniform State Register. (The procedure of inclusion in the Uniform State Register is obligatory for all representative offices and branches irrespective of the accrediting body and the time of accreditation). The Certificate of inclusion in the Register confirms the official status of a representative office at the federal level and is needed for opening bank accounts, registering with the tax authorities, obtaining Russian visas and custom procedures.

After the accreditation procedure is completed, a branch/representative office of a foreign legal entity is to obtain a Certificate of registration with the Statistics Register of the State Statistics Committee Rosstat (statistics codes), to register with the tax authorities (Federal Tax Service Interdistrict Inspectorate 47 for Moscow), to make a seal and obtain a notice of registration as insured by the Pension Fund and the Moscow City Mandatory Medical Insurance Fund.

Following registration with the tax authorities, a representative office or a branch is entitled to open bank accounts (a ruble settlement account and a currency account (depending on the currency) in a bank of choice

If necessary, a representative office or a branch can open its regional offices by permission of the accrediting body.

The accrediting body is the State Registration Chamber with the Ministry of Justice of the Russian Federation. Representative offices are accredited for a period of 1, 2 or 3 years; branches are accredited for a period of 1, 2, 3 or 5 years. This period can be subsequently extended.

Accreditation takes 21 business days, i.e. one calendar month, to complete. There is an accelerated procedure available at extra charge, which reduces this to 5 business days.

Amount of state duty:

Term of accreditation of a representative officeAccreditation fee charged by the accrediting body in currency units (CU) - conversion is effected at the Bank of Russia exchange rate on the date of paymentTerm of accreditation of a branchAccreditation fee charged by the accrediting body in currency units (CU) - conversion is effected at the Bank of Russia exchange rate on the date of
1 year 1, 000 CU 1 year 500 CU

2 years

1, 500 CU

2 years

1, 000 CU

3 years

2, 000 CU

3 years

1, 500 CU

 

 

5 years

2, 000 CU.

State duty of RUR 60,000 is charged for the accreditation of a branch in accordance with subparagraph 4 Paragraph 1 of Article 333.33 of the Tax Code of the Russian Federation.

Accelerating accreditation process to seven business days is charged at 500 CU 

All-inclusive services cover the following:

  • assistance in translation and notary certification of documents;
  • advice on drawing and apostilling documents;
  • accreditation of a representative office/branch;
  • registration with the Federal Tax Service Interdistrict Inspectorate 47;
  • registration with the funds;
  • registration with the state statistics funds;
  • production of a seal.

List of documents required for accreditation (establishment) of a representative office

Foreign language documents

  • A written application, signed by the head of the parent company, with information about the name of the company, the time of its incorporation, location, nature of its business, management and administration body that represents the firm under its Articles of Association, purposes of establishing a representative office, business cooperation with Russian partners, cooperation development prospects, address, telephone and fax numbers of a representative office in the Russian Federation (or a preliminary address, telephone and fax numbers) *;
  • Articles of Association or Memorandum of Association of the firm;
  • A Registration Certificate or extract from the Trade Register or other document confirming registration of a firm in accordance with the laws of the county of its location;
  • A Certificate issued by foreign tax authorities confirming registration of a foreign legal entity as a taxpayer in the country of incorporation with an indication of the Taxpayer Code (or its equivalent);
  • The resolution of the firm to establish a representative office in the Russian Federation*;
  • A Letter of recommendation from the bank servicing the company with information about the firm's financial status;
  • A duly executed power of attorney to the head of a representative office.

These documents are to be apostilled in accordance with the Hague Convention of 1961 or legalized by the consulate of the Russian Federation. The documents are to be enclosed with a notary certified translation into Russian. We can provide assistance in translation and notarization.

* In some cases documents can be drawn in Russian. For more information contact a Business Projects Promotion specialist.

Russian language documents:

  • Regulations of a representative office setting forth internal regulations, duties and obligations of a representative office with respect to its parent company.
  • Two Letters of recommendation (in free form) from Russian business partners (for representative offices only).
  • A document certifying consent of the administrations of the subjects of the Russian Federation (administrations of provinces, regions, republics and national districts) regarding the establishment of the representative office (submitted in the event that a representative office is established outside Moscow or St. Petersburg).
  • A Letter of Guarantee from the lessor, confirming lease or any lease/sublease agreement, a certified ownership certificate (for representative offices only).
  • Two copies of the Data sheet of a representative office of a foreign legal entity signed by a representative of a foreign legal entity and sealed with the company seal. We complete it with information provided by you.
  • A certified Power of attorney issued to our employee authorizing him/her to obtain permit for the establishment of a representative office of a foreign legal entity in the Russian Federation. We provide the text of the Power of attorney.

You will be also requested to furnish our specialists with the following information (in free form): SWIFT code and number of the parent company account; types of activities of the parent company; if the parent company's founders are legal entities, the following information is required: the name of the company with an indication of the form of incorporation, full address, Taxpayer Identification Number or its equivalent, stockholding (%), whether the parent company is registered in a special economic zone or in an offshore jurisdiction..

ServiceFee

Accreditation of a branch/representative office of a foreign legal entity with the State Registration Chamber with the Ministry of Justice of the Russian, including registering with Federal Tax Service Interdistrict Inspectorate 47

RUR 30, 000 (plus state and other duties)

Accelerated procedure

500 currency units.

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Реорганизация ГК "СБП"

С 14 августа 2017 года Ольга Пономарёва и Кира Гин, управляющие партнеры Группы компаний «Содействие Бизнес Проектам» объявили о раздельной работе с сохранением практик и компетенций по налоговым, юридическим и аудиторским вопросам.    

 Ольга Пономарёва   

Тел. 8 (495) 506-76-86, 8 (917) 579-92-96
e-mail: mail@formalex.ru
www.formalex.ru
  

Кира Гин

Тел. (495) 601-97-83, 8(926)203-92-57
e-mail: 1@ginlegal.ru
www.ginlegal.ru