Translation – What Changed on January 1, 2010?

[Below is a partial translation of an article at ПРАВО.РУ, a website that is a great source of legal news, court decisions, and rankings of Russian law firms.  The article summarizes several new laws that went into affect on the first of the year.]

Tax and Customs Law, Finance

– Federal Law No. 212-FZ “On Insurance Premiums to the Pension Fund, Social Insurance Fund, Mandatory Medical Insurance Fund, and Territorial Funds of Obligatory Insurance” – repeals the Unitary Social Tax (Единый Социальный Налог) and instead introduces direct premiums for extra-budgetary funds.

Federal Law No. 383-FZ “On Amendments to Part I of the Tax Code and Other Laws of the Russian Federation” – increases the monetary threshold at which nonpayment of taxes becomes a criminal offense.  For individuals, the amount is RUB 600k or, if the unpaid amount exceeds 10% of the total taxable amount, RUB 1.8 mln.  For legal entities, it is RUB 2 mln or (if unpaid > 10% total tax bill) 6 mln.  Also provides amnesty to those who have fully paid their arrears and penalties/fines.

Federal Law No. 374-FZ “On Amendments to Article 45 of Part I and Chapter 25.3 of Part II of the Tax Code and Other Laws of the Russian Federation and the Repeal of the Law on Fees for the Issuance of Licenses” – this law increases all sorts of fees.  For example, the amendments double the following fees, many of which foreign companies encounter regularly while doing business in Russia: filing fees for litigants in courts of general jurisdiction and magistrates; renewal of a residency permit (to RUB 2,500); state registration of a legal entity (to RUB 4,000); accreditation of branch offices of foreign legal entities (to RUB 129,000); and, my personal favorite, the registration of an individual as an entrepreneur (to RUB 800).  That’s right folks, you have to pay over $25 just to walk around and say you are an entrepreneur.  This will come in handy as you navigate the 54 procedures, 704 days, and $2,141 it will take just to obtain a construction permit to build your store.

Defense of Business Interests

– Federal Law No. 224-FZ “On Amendments to Parts I and II of the Tax Code and Other Legal Acts of the Russian Federation” – establishes penalties for tax authorities who freeze or otherwise inhibit a taxpayer’s bank account for a time period longer than that provided by law

Federal Law No. 207-FZ “On Amendments to the Customs Code of the Russian Federation” – same as the previous law, but with regards to customs authorities

– Federal Law No. 137-FZ “On Amendments to Parts I and II of the Tax Code of the Russian Federation” – prohibits tax authorities from requesting documents during an audit that were already submitted by the taxpayer in previous or initial audit proceedings

Laws on Transparency and Data Access

– Federal Law No. 8-FZ “On Access to Information on the Activities of Governmental Organs and Organs of Local Self-Government” – general law defining the measures that government entities must take to ensure access to information on their activities.  Methods of achieving transparency include: posting to internet; town meetings for citizens; etc.

– Federal Law No. 294-FZ “On the Protection of the Rights of Legal Entities and Individual Businessmen in the Exercise of Government Control (Supervision)” – starting on January 1, 2010, the General Prosecutor must post a yearly plan on routine inspections on the General Prosecutor’s website.

– Federal Law No. 365-FZ “On Amendments to Certain Legislative Acts of the Russian Federation in Connection with Improving the Activities of State Bodies of the Subjects of the Russian Federation and Bodies of Local Self-Government” – legal entities and individual business owners are obligated to notify the authorities when they initiate a specified activity (e.g., production of bread, baked goods, and milk).  A yearly plan for the auditing of business was revised.  Federal bodies make decisions regarding the provision and performance of public services in the field of delegated powers, but senior regional officials alone have this power in the absence of a superseding federal regulation.

Construction, Land, and Real Estate

Federal Law No. 148-FZ “On Amendments to the Urban Planning Code and Other Legislative Acts” – the following activities no longer require licenses: designing, construction, and engineering of buildings and structures, except for seasonal and auxiliary facilities.

– Federal Law No. 342-FZ “On Amendments to Articles 2 and 3 of the Federal Law ‘On the Enactment of the Land Code of Russia’ and Article 7 of the Federal Law ‘On Amendments to Legislative Acts Clarifying the Conditions and Procedure for Acquiring Rights to Land Plots Located on State or Municipal Property'” – extends until January 1, 2012 the terms of re-registration of the right of legal entities to permanent (perpetual) use of land for leasing or purchasing these parcels (relates to parcels of land across which power lines, pipelines, etc. cross).  Postpones until January 1, 2013 the entry into force of a new article in Code of Administrative Violations, which provides for liability for violating the re-registration procedure.

– Federal Law No. 351-FZ “On Amendments to Article 3 of the Federal Law ‘On Enactment of the Land Code of the Russian Federation and Other Legislative Acts'” – postponed from January 1, 2010 to January 1, 2012 the entry into force of a new rule that if there are no documents on territorial planning and land use/building rights, the authorities are forbidden from withdrawing or reserving land for state or municipal needs.

Other Issues Concerning Business Activities

– Federal Law No. 381-FZ “On the Bases of State Regulation of Commercial Activity” – broadly sets out the basis for state regulation of commercial activity.  Includes prohibitions of certain practices (e.g., contractual provisions).


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