Representative or branch office in Russia
Ideal for foreign companies which require flexibility
and wish to gain a foothold in Russia with little effort
For you in Russia!
Are you planning to accredit a representative or branch office in Russia? We would be pleased to support you with our expertise and knowledge.
In contrary to the registration of a Russian limited liability company (OOO), an accreditation process takes place when a branch office is opened in the form of a representative office (Predstavitelstvo) or branch office (Filial) in Russia. This process must be carried out by the Federal Tax Service (FNS) of Russia.
In accordance with a new version of the regulations for the accreditation of representative offices and branches of foreign companies in Russia, a permanent accreditation of a branch office is possible since the beginning of 2015. Prior to this, the maximum duration was a maximum of three years before an extension of the accreditation had to be carried out. Both branches and representative offices are not legally independent legal entities, but are subject to and act directly on behalf of their parent company. As a result, the foreign company has to take full responsibility for liabilities of its branch office and no limitation of liability occurs.
Differences between representative office and branch office in Russia
A representative office in Russia may only serve the sole purpose of representing a foreign company locally, e. g. by carrying out external marketing activities, observing the Russian market and its participants or fostering contacts with business partners and customers. It may not engage in active business activities, such as the production of goods or the execution of services. Proof of the fact that no income is generated and that only non-commercial activities are carried out must be submitted to the authorities on an annual basis.
The branch office differs from a representative office in that it may basically pursue entrepreneurial activities. It is permitted to conclude contracts with clients and generate income. This makes it interesting for foreign investors wishing to establish a branch office in Russia, not only for representative but also for operational and commercial activities.
Advantages of a representative or branch office in Russia
Despite some restrictions, it might be interesting for foreign companies to accredit a branch in the form of a representative or branch office in Russia instead of an fully independent legal entity.
The accreditation of a representative office is particularly interesting for companies for whom it has been determined that their branch office should only carry out preparatory ancillary activities. Administrative expenses are considerably lower than those of branche offices or OOOs due to the company's exclusively non-commercial activities.
The main advantage of the branch office is the provision and subsequent return of funds. Since such a branch office is legally regarded not as an independent part of the parent company, funds can be transferred freely and without any taxation between the different company accounts, which is not the case with a Russian limited liability company without any corresponding taxation.
Our services in the area of accreditation of a representative or branch office in Russia
We would be pleased to support you with our expertise and knowledge in close cooperation with our multilingual partner law firm in Russia with the accreditation of a representative or branch office. Our offer includes:
Advice on the choice of the legal form suitable for your project
Accompanying the accreditation process
Provision of a legal address and a virtual office in one of our offices in Moscow or St. Petersburg
Short-term or long-term provision of the Director General
Opening of a Russian bank account
Do you have any questions regarding the accreditation of a representative or branch office in Russia? Do not hesitate to contact us. Please feel free to send us an e-mail, give us a call or make an appointment at one of our offices in Moscow, St. Petersburg or Vienna.
Further information on the accreditation of a representative or branch office in Russia as well as on numerous other topics relating to business in Russia can be found in the publications section or on our Russia Economy blog.
Business Set-Up, accounting and reporting in Russia
Ausserer & Consultants is an international tax and accounting company based in Moscow, St. Petersburg and Vienna. Since our foundation in 2012, we have made it our mission to support small and medium-sized companies in local accounting including tax returns, reporting, business Set-Up and expansion in Russia. We also advise on individual questions regarding the Russian market and support our clients at all times.