Company Registration in Russia for Foreigners: Step-by-Step Process
Starting a Business in Russia: Your Guide to Company Registration and Takeover
Now is truly the best time to launch your business in Russia, and of course, the first thing you need is a company. Today, we're diving into how you can get a company in Russia, exploring the various ways, obstacles, peculiarities, and important details you should know. My job today is simply to lay out all the facts about incorporation and legalities in Russia, so let’s get started!
Two Main Paths: Registration or Takeover
There are two main routes for obtaining legal standing in Russia:
- Registering a new company
- Taking over or purchasing an existing company
Plan A: Company Registration
Whether you can travel to Russia is crucial here. If you’re able to make the trip, the process gets much easier. You’ll come to Moscow, land at the airport, and within two working days, you can have your company up and running. The steps are straightforward: find a notary, attend a notary office, and sign an application for company formation. Notaries in Russia use a special electronic program to send your application to the Tax Service, which then opens your company and gives you your company taxation number.
Here’s what you’ll need:
- Founders’ decision on establishing the company
- Choice of taxation system—the simplified tax system is often sufficient for new businesses (just 6% tax on all operations)
- Notification of application for the simplified system
- Documents confirming your company’s legal address—this is compulsory. You don’t need to rent an office, but you do need a legal address and documentation like a letter of guarantee or consent from the owner of the premises
- A company charter—you can use sample charters provided by the Ministry of Information on the Russian Tax Authority website, unless your business is unique and requires a custom charter
If you can’t travel to Russia, you’ll need a Russian resident who can attend the notary office in person to help with the formation. However, the future owner must attend in person for the actual registration. Afterwards, the company can be transferred to you—bringing us to Plan B.
Plan B: Company Takeover
In this scenario, there are three common situations:
- A Russian resident incorporates a legal entity and transfers ownership to you
- You already know which company you want to take over (perhaps you’ve negotiated with the current owner)
- You want to buy a ready-made company, possibly based on age, history, or business activity (like one already active in a marketplace)
Again, whether you can travel to Russia or not matters. You can take over a company by:
- Forming a sale and purchase agreement
- Increasing the share (charter) capital, becoming a new participant and eventually the sole owner
If you’re handling this from abroad, you’ll likely need a power of attorney issued at a Russian consulate in your country. The specific procedure depends on the method you choose, but both sale and purchase agreements and capital increases are possible with proper documentation and notary authorization.
Sale and Purchase Agreement
You (the purchaser) and the existing owner (the seller) are parties to this agreement, which must be authorized by a notary. If you’re married, your spouse must provide written consent for the purchase. Once complete, you assign a general director—either keeping the current one, appointing a new one, or taking the role yourself (but you’ll need a work permit for that).
Increasing Charter Capital
Here, the existing owner increases the company’s charter capital and authorizes you as another participant. You contribute to the capital, and once admitted, the previous owner can leave, leaving you in full control. The minimum charter capital for a limited liability company in Russia is 10,000 rubles.
Key Questions from Business Owners
- Nominee director services: These are illegal in Russia. The general director must genuinely run the company, or there may be criminal consequences, including fines or imprisonment for up to five years.
- Legal address: Yes, it’s compulsory. You may be asked for a rental contract or proof of address by the tax authorities.
- Transferring money to/from Russia: While SWIFT is mostly off, some banks can still use it. The situation is stable for BRICS currencies and many others, but always check with your bank and specify your jurisdiction and currency for the latest updates.
To sum up, you can either register a new company (if you can travel to Russia) or take over an existing one (either through a sale and purchase agreement or by increasing charter capital). Remember, the general director must genuinely operate the business, and a legal address is required. Banking is possible—you just need to check the current rules for your specific situation.
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Natalia Kovalenko
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Mehman Asadzade
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