30 April 2024

Representative Offices and Branches of Foreign Legal Entities in Russia

April 30, 2024

BRACE Law Firm ©

Foreign companies have the right to open branches and representative offices in Russia. Such separate subdivisions of foreign legal entities must be accredited in the Russian Federation, possess all necessary documents, pay taxes, and file tax returns within the terms and in the manner established by tax legislation.

Branch or Representative Office?

In accordance with Art. 3 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation (the "Law on Foreign Investments"), the legal regulation of foreign investments in the territory of the Russian Federation is carried out by this Federal Law, other federal laws and other normative legal acts of the Russian Federation, as well as international treaties of the Russian Federation.

The concepts of a branch and a representative office of a legal entity are defined in the Civil Code of the Russian Federation.

Representative offices and branches do not have the status of a legal entity; rather, they are separate subdivisions of a foreign legal entity in Russia.

According to Article 55 of the Civil Code, the main differences between a branch and a representative office are as follows:

A representative office is a separate subdivision of a legal entity located outside its location, which represents the interests of the legal entity and protects them [1].
A branch is a separate subdivision of a legal entity located outside its location and performing all or part of its functions, including the functions of a representative office [2].

Thus, branches and representative offices differ in the volume of functions and powers they may perform on behalf of the legal entity that established them.

Permanent Establishment of a Foreign Organization

For the purposes of paying taxes and filing tax returns in Russia, the Tax Code of the Russian Federation defines the general concept of a "permanent establishment of a foreign organization" [3], which includes a branch, representative office, department, bureau, office, agency, any other separate subdivision, or other place of activity of a foreign organization through which it regularly carries out business activities in the territory of the Russian Federation related to:

the use of subsoil and (or) the use of other natural resources;
contractual work on construction, installation, assembly, adjustment, maintenance, and operation of equipment, including slot machines;
the sale of goods from warehouses located in the territory of the Russian Federation and owned or leased by this organization;
the performance of other works, provision of services, and conduct of other activities in Russia.

A permanent establishment of a foreign organization is considered formed from the moment regular business activity begins through this separate subdivision and ceases to exist from the moment business activity through it ceases.

The norms of the Tax Code of the Russian Federation, including those regarding separate subdivisions of foreign legal entities, apply unless otherwise established by international treaties of the Russian Federation [4]. Since the operation of articles on permanent establishments contained in 38 bilateral Double Tax Treaties (the "DTTs") with unfriendly countries (USA, Canada, Japan, South Korea, Singapore, Australia, New Zealand, the United Kingdom, European Union states, Albania, Macedonia, Montenegro, Iceland, Norway, Switzerland) was suspended by Decree of the President of Russia No. 585 dated August 8, 2023, and agreements with certain countries have terminated completely (with Ukraine from January 1, 2023 [5], with Latvia from January 1, 2024 [6]), the norms of the Tax Code of the Russian Federation apply to separate representative offices of these countries. In other cases, it is necessary to verify the existence of a valid DTT.

The Ministry of Finance of Russia explained that "in the Tax Code of the Russian Federation, the concept of 'permanent establishment' does not have an organizational and legal meaning, but a meaning qualifying the activities of an organization, with which the obligation of this organization to pay profit tax in the state where its activity is considered as leading to the formation of a permanent establishment is associated" [7]:

Place of activity should be understood as any premises (part of a room), facilities, equipment, or installations used by an organization to conduct business activities. It does not matter if they are used solely for this purpose or not. A place of business may exist without a separate room; having some space at one's disposal is sufficient. Even premises belonging to another enterprise and territory (space) that the organization did not have the right to use can be a place of activity.
Activity is considered entrepreneurial if it is aimed at generating profit; however, the activity does not necessarily have to be related to production or be continuous, as long as it is regular. The regularity of activity is determined by taking into account the nature, quantity, and content of transactions in each specific case. Isolated transactions do not indicate regular activity. For example, if a foreign company purchased securities of the Russian Federation, this is not an independent ground for recognizing the existence of its permanent establishment in the Russian Federation [8] (unless the operations are repeated periodically).

A foreign organization is considered to have a separate subdivision in Russia in cases where it [9]:

supplies goods belonging to it from the territory of Russia, obtained as a result of processing in the customs territory or under customs control;
regularly conducts business activities in Russia through a dependent agent, provided such agent is not a person acting within the framework of their main (ordinary) activity (broker, commission agent, etc.).

Thus, the concept of "Permanent Establishment" for tax purposes implies any constant, regular business activity of a foreign company in the territory of Russia, which entails an obligation for the foreign company to pay taxes.

How to Create and Accredit a Representative Office (Branch) of a Foreign Legal Entity in Russia?

The general norms of the Law on Foreign Investments, as well as the Procedure for Accreditation, Amendments to Information Contained in the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities, and Termination of Accreditation of a Branch or Representative Office of a Foreign Legal Entity Conducting Activities in the Territory of the Russian Federation, approved by Order of the Federal Tax Service of Russia No. ED-7-14/691@ dated July 27, 2021 (the "Accreditation Procedure"), apply to all branches and representative offices of foreign companies.

The creation and activities of representative offices of foreign banks and other credit organizations, as well as representative offices of foreign organizations carrying out activities in the field of civil aviation, are regulated by special norms [10]. Special requirements are also established for branches (representative offices) of foreign insurance companies [11].

A branch or representative office of a foreign company in Russia is created in the following order:

adoption of a decision by the authorized body of the foreign company to create a branch or representative office in the Russian Federation;
development and approval of the regulation on the branch or representative office;
appointment of the head of the branch/representative office and issuance of a Power of Attorney to them;
determination of the location of the branch (representative office), formalization of rights to the premises (territory): purchase and sale, lease, etc.;
payment of the state duty for accreditation;
preparation of documents for accreditation;
certification of information on the number of foreign employees at the Chamber of Commerce and Industry of the Russian Federation;
submission of documents for accreditation to the authorized tax authority;
receipt of the document on accreditation of the representative office/branch;
receipt of the tax registration certificate;
receipt of the notification of registration from the Federal Social Fund;
opening a current account in a Russian bank;
obtaining visas for foreign specialists to enter Russia and work permits, or accreditation of foreign employees of the representative office (if any will work in the branch (representative office)).

Accreditation of branches (representative offices) of foreign legal entities is carried out by the Interdistrict Inspectorate of the Federal Tax Service of Russia No. 47 for Moscow [12] (the "authorized tax authority").

The deadline for submitting documents for accreditation is no later than 12 months after the decision to create the branch/representative office is made [13].

To accredit a branch or representative office of a foreign legal entity in Russia, it is necessary to prepare and submit an application in Form No. 15AFP [14]. The application is completed in Russian [15] and signed by an authorized representative of the foreign company (the head of the foreign legal entity, the head of the representative office (branch), or another authorized person) [16].

The application must contain certified information on the headcount of foreign employees of the representative office (branch). This is completed and certified by the Chamber of Commerce and Industry of the Russian Federation (the "CCI RF") [17]. Information on the headcount of employees must be certified at the CCI RF even if there are no foreign employees in the separate subdivision [18]. The certification procedure, deadlines, payment amount and procedure, necessary documents, and samples for filling them out are indicated on the CCI RF website. The term for certifying the headcount of foreign employees of a representative office (branch) generally does not exceed 3 days. The cost of examination and confirmation of the employee headcount when filling out electronic forms on the CCI RF website is 20,000 rubles; without filling out forms, it is 25,000 rubles [19].

The following documents must be attached to the accreditation application [20]:

constituent documents of the foreign legal entity;
an extract from the register of foreign legal entities of the country of registration or another similar document confirming the legal status of the foreign legal entity, issued no more than 12 months prior;
a document issued by the authorized body of the country of registration of the foreign legal entity confirming its registration as a taxpayer in that country with the indication of the taxpayer code (or its equivalent), or a document confirming the absence of such a code (or its equivalent) (submitting such a document is not required if the taxpayer code (or its equivalent) is indicated in the extract from the register, issued no more than 12 months prior);
a decision of the authorized body of the foreign legal entity to create a representative office (branch) in the territory of Russia, adopted no later than 12 months prior to the date of submission;
the regulation on the foreign branch/representative office, approved no later than 12 months prior to the date of submission;
a valid Power of Attorney granting necessary powers to the head of the foreign representative office (branch) in the territory of Russia;
a document confirming payment of the state duty (amount of state duty [21]: (a) for accreditation of branches and representative offices of foreign organizations from member states of the Eurasian Economic Union – 4,000 rubles for each branch/representative office; (b) for accreditation of branches and representative offices created in the RF by foreign organizations from states that are not members of the Eurasian Economic Union – 120,000 rubles for each branch/representative office). If this document is not submitted by the applicant, the authorized tax authority independently verifies the fact of payment of the state duty in the GIS GMP system;
an inventory of documents (in two copies). The second copy of the inventory with the mark of the authorized tax authority regarding acceptance is subject to return to the applicant. When documents are received by mail, the second copy of the inventory is sent to the foreign branch or representative office by registered mail.

Requirements for documents are established in Clause 4 of the Accreditation Procedure:

they are submitted in original or in the form of notarized copies;
they are submitted in Russian or in a foreign language with a translation into Russian certified by a notary;
documents issued by competent authorities of foreign states must be legalized (or have an Apostille affixed [22]), unless otherwise provided by an international treaty of the RF;
documents must be bound and numbered, with the number of sheets indicated on the back of the last sheet of each such document if the documents contain more than one sheet;
erasures and corrections are not permitted.

If not all documents are attached to the application, or if documents not meeting the established requirements are attached, then by decision of the authorized tax authority, the accreditation procedure is suspended for a period of up to 15 business days, during which the accreditation term is interrupted. The suspension decision is issued (sent) to the applicant no later than one business day following the day of its adoption. The decision is sent by postal mail to the address of the foreign branch or representative office, as well as in the form of a scanned image to the email address of the foreign branch or representative office indicated by the applicant when submitting documents to the authorized tax authority [23].

If the violations are not eliminated within the period specified in the suspension decision, accreditation of the branch/representative office will be refused [24].

Methods of submitting documents [25]:

directly to the tax inspectorate (personally or through a representative by Power of Attorney);
by mail with acknowledgment of receipt.

Accreditation of a foreign branch or representative office is carried out within a period of no more than 15 business days from the day of submission of all necessary documents [26]. Within the same period, the accredited foreign branch (representative office) is issued (sent by mail) an information sheet on the entry of a record into the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities in Form No. 15ZFP [27].

In the event of accreditation of a branch (representative office) of a foreign company, a certificate of tax registration of the foreign organization at the location of the branch (representative office) is also sent simultaneously with the information sheet [28].

How to Register a Branch (Representative Office) of a Foreign Organization for Tax Purposes and with the Social Fund of Russia?

To register a branch (representative office) for tax purposes, the foreign company does not need to take any actions. Within a period of no more than 3 business days from the date of entering the record of accreditation, amendments to the information contained in the register, or termination of accreditation of the branch or representative office of a foreign legal entity into the register, the tax inspectorate sends such information in electronic form to the state extra-budgetary funds for registration or deregistration of the branch or representative office of the foreign legal entity as insurers, as well as to the federal executive body exercising functions for the provision of public services and management of state property in the field of air transport (civil aviation), regarding the exercise of its powers, and to the Central Bank of the Russian Federation regarding branches of foreign insurance organizations [29].

Based on the information received from the authorized tax authority, the Social Fund of Russia (the "SFR") will register the foreign organization at the location of the representative office/branch. The SFR will carry out the registration within 3 business days from the date of receiving the information [30].

To register as an insurer for compulsory social insurance against industrial accidents, it is necessary to submit an application to the SFR indicating the main type of economic activity of the insurer no later than 30 calendar days from the day the subdivision was created. The SFR branch will carry out the registration within 3 business days from the day the application is received [31].

The SFR will send the notification of registration as an insurer at the location of the separate subdivision (together with the notification of the insurance rate for injury contributions) to the email address indicated in the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities within three business days from the day of registration with the SFR. Documents can be obtained on paper within three business days by sending a corresponding request [32].

What Documents Are Necessary for a Representative Office and Branch of a Foreign Company?

To conduct activities in Russia through a branch or representative office, the branch (representative office) must possess the following documents:

regulation on the branch (representative office) – original or notarized copy with a notarized translation into Russian;
original Power of Attorney of the head of the branch (representative office) with a notarized translation into Russian;
information sheet on the accreditation of the branch (representative office);
certificate of tax registration in Russia;
notification of registration as an insurer at the location of the separate subdivision;
notification of the insurance rate for injury contributions [33].

Article 22 of the Law on Foreign Investments establishes a list of mandatory information that must be in the regulation on the branch (representative office) of a foreign company:

name of the foreign legal entity;
name of the branch or representative office;
organizational and legal form of the foreign legal entity;
location of the branch or representative office in the territory of the Russian Federation;
address of the location of the foreign legal entity in the country of registration;
goals of creation, opening, and types of activities of the branch or representative office;
procedure for managing the branch or representative office of the foreign legal entity.

Other provisions are included in the regulation of the branch (representative office) of a foreign company at the discretion of that company.

Furthermore, for the purpose of providing them to counterparties as part of due diligence, upon requests, as well as for submission to controlling and supervisory authorities during inspections, it is recommended that branches and representative offices of foreign companies maintain copies of the following documents that were submitted to the authorized tax authority for accreditation:

constituent documents of the foreign legal entity in original or as notarized copies in Russian or in a foreign language with a translation into Russian certified by a notary;
extract from the register of foreign legal entities of the country of registration or another similar document confirming the legal status of the foreign legal entity, issued no more than 12 months prior, in original or as notarized copies in Russian or in a foreign language with a translation into Russian certified by a notary;
document issued by the authorized body of the country of registration of the foreign legal entity confirming its registration as a taxpayer in that country with the indication of the taxpayer code (or its equivalent) or a document regarding the absence of such a code (or its equivalent), issued no more than 12 months prior, in original or as notarized copies in Russian or in a foreign language with a translation into Russian certified by a notary;
decision of the authorized body of the foreign legal entity to create a representative office (branch) in the territory of Russia, adopted no later than 12 months prior to the date of submission, in original or as notarized copies in Russian or in a foreign language with a translation into Russian certified by a notary.

It is advisable to update the specified copies of documents every 12 months, as well as upon any change in the information specified therein before the expiration of 12 months. Additionally, a valid Power of Attorney for the head of the branch (representative office) should be available.

In What Cases Can Accreditation of a Branch (Representative Office) of a Foreign Company Be Refused?

Accreditation of a branch or representative office of a foreign legal entity may be refused if at least one of the following grounds exists:

failure to eliminate violations within the period specified in the decision to suspend accreditation;
documents for accreditation are submitted later than twelve months from the moment the decision to create the branch (representative office) was made;
the submitted constituent or other documents contain false information;
the goals of creating or opening the branch or representative office of the foreign legal entity contradict the Constitution of the Russian Federation, international treaties of the Russian Federation, or the legislation of the Russian Federation;
the goals of creating or opening the branch or representative office of the foreign legal entity create a threat to the sovereignty, political independence, territorial integrity, and national interests of the Russian Federation;
the accreditation of a branch or representative office of a foreign legal entity, information on the accreditation of which was entered into the register, was terminated due to a gross violation of the Constitution of the Russian Federation, international treaties of the Russian Federation, or the legislation of the Russian Federation;
if the head of the branch or representative office of the foreign legal entity, or the representative office of a foreign legal entity carrying out activities in the field of civil aviation, is a natural person against whom there is an effective ruling in an administrative offense case, according to which said person has been imposed an administrative penalty in the form of disqualification, and the term for which this administrative penalty was imposed has not expired;
presence of arrears in taxes, fees, insurance contributions, penalties, fines, or interest totaling more than 3,000 rubles (taking into account any overpaid amounts for such mandatory payments) for the foreign legal entity or foreign legal entity carrying out activities in the field of civil aviation as of the first day of the month in which the accreditation application is submitted, considering information available to the federal executive body authorized for control and supervision in the field of taxes and fees regarding their repayment as of the date of receipt of the accreditation application.

A refusal to accredit a branch or representative office of a foreign legal entity, as well as a refusal to terminate accreditation, may be appealed in the manner established by Chapter 2.1 of Federal Law No. 210-FZ dated July 27, 2010, On the Organization of the Provision of State and Municipal Services, or in court [34]. A mandatory pre-trial appeal procedure is not provided.

An out-of-court complaint is submitted in writing on paper or in electronic form to the Directorate of the Federal Tax Service for the City of Moscow. The complaint may be sent by mail, through a multifunctional center (MFC), using the "Internet" information and telecommunications network, the official website of the UDFS for Moscow, the unified portal of state and municipal services, or may be accepted during a personal reception of the applicant.

The complaint is subject to consideration within fifteen business days from the day of its registration. No later than the day following the day the decision is made, a motivated response regarding the results of the consideration of the complaint is sent to the applicant in writing and, if desired by the applicant, in electronic form.

In judicial proceedings, a complaint is filed at the location of the authorized tax authority with the Arbitration Court of the City of Moscow on paper by mail, personally, or through the "My Arbitrator" system in the manner established by Chapter 24 of the APC RF, as a challenge to non-normative legal acts, decisions, and actions (inaction) of state bodies affecting the rights and legitimate interests of persons in the field of entrepreneurial and other economic activities. The application may be filed with the arbitration court within 3 months from the day the organization became aware of the violation of its rights and legitimate interests. Cases are considered by a judge solely within a period not exceeding 3 months from the day the corresponding application is received by the arbitration court.

Changes to Information Contained in the Register of Accredited Branches and Representative Offices of Foreign Legal Entities

The information contained in the documents submitted for accreditation of a branch or representative office of a foreign legal entity, information on changes made to said information, and on the termination of accreditation constitute the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities, which is posted on the website of the Federal Tax Service of Russia.

No fee is charged for access to information posted on the official website of the Federal Tax Service of the RF.

Interested persons have the right to obtain information contained in the register in the form of an extract from the register regarding a specific branch or representative office of a foreign legal entity or a certificate regarding the absence of the requested information. A request on paper is submitted by the applicant (their representative) directly or by mail to any tax authority regardless of the address (location, place of residence) of the applicant or the person regarding whom the information is requested [35].

The term for providing the specified extract or certificate on paper cannot exceed five business days from the day the corresponding request is received. The fee for providing the specified extract or certificate on paper is 200 rubles [36].

In the event of a change in the information specified in the application for accreditation of a branch or representative office, or in the event of termination of the activities of the branch/representative office or the foreign company itself, it is necessary to submit the corresponding applications and supporting documents to the MI FNS Russia No. 47 for Moscow.

When changing information contained in the register (including information certified by the Chamber of Commerce and Industry of the Russian Federation on the number of foreign citizens who are employees of the branch or representative office of a foreign legal entity) regarding a foreign legal entity or its branch or representative office, the foreign legal entity is obliged to submit an application in Form KND 1113402 [37] and documents confirming the changes within 15 calendar days from the day the information changed [38]. Changes are entered within 10 business days from the day the corresponding application and documents are submitted [39].

Termination of Accreditation of a Branch and Representative Office of a Foreign Legal Entity

The accreditation of a branch or representative office of a foreign legal entity may be terminated on the following grounds [40]:

in connection with the termination of the activities of the branch or representative office in the territory of the Russian Federation based on a decision of such foreign legal entity;
in connection with the termination of the activities of such foreign legal entity;
by decision of the tax authority.

The accreditation of a branch or representative office of a foreign legal entity is terminated by decision of the authorized tax authority if [41]:

the branch or representative office of the foreign legal entity has not submitted reporting documents provided for by the legislation of the Russian Federation on taxes and fees during the last 12 months preceding the moment of making the decision, and communication with the branch or representative office cannot be established at the address of the place of their activity in the territory of the Russian Federation contained in the register, and the branch or representative office has not carried out operations on at least one bank account opened in a bank or other credit organization holding a license from the Central Bank of the Russian Federation during the specified period;
a judicial act has entered into legal force establishing that the activities of the branch or representative office of the foreign legal entity contradict the Constitution of the Russian Federation, international treaties of the Russian Federation, or the legislation of the Russian Federation, or create a threat to the sovereignty, political independence, territorial integrity, and national interests of the Russian Federation.

Termination of accreditation by decision of the tax authority may be appealed in an out-of-court or judicial procedure, the same as the procedure for appealing a refusal of accreditation.

Termination of accreditation of a foreign branch or representative office by decision of the foreign legal entity, including in the case of termination of the foreign legal entity's activities in the country of registration, is carried out on the basis of the following documents [42]:

an application for termination of accreditation of the branch or representative office of the foreign legal entity;
a decision of the foreign legal entity to terminate activities in the territory of the Russian Federation;
tax returns, calculations (calculations on insurance contributions) for taxes (insurance contributions) payable by the foreign branch or representative office, compiled for the last tax (reporting, settlement) period preceding the date of termination of the activities of the foreign branch or representative office in the territory of the Russian Federation (termination of the foreign legal entity's activities in the country of registration).

The application, signed by the head of the foreign branch or representative office, and other documents are submitted by the foreign branch or representative office to the authorized tax authority no later than 15 calendar days from the day such decision is made.

The authorized tax authority terminates the accreditation of the foreign branch or representative office within ten business days from the day the specified documents are submitted, and within the same period, an information sheet is issued (sent) to the foreign branch or representative office [43].

According to Clause 5 of Art. 84 of the Tax Code of the RF and Clause 41 of the Specifics of Recording Foreign Organizations in Tax Authorities (approved by Order of the Ministry of Finance of Russia No. 293n dated December 28, 2018), deregistration of a foreign organization with the tax authority is carried out based on information contained in the State Register of Accredited Branches and Representative Offices within five business days from the day of its receipt, i.e., automatically without applying to the tax authority.

Taxes of a Representative Office (Branch) of Foreign Companies in Russia

Foreign organizations with branches in Russia pay the same taxes as Russian organizations if there are grounds for doing so [44].

However, there are restrictions and specifics for foreign organizations concerning individual taxes or tax systems. Foreign organizations cannot apply the Simplified Taxation System (USN) in Russia [45]. Consequently, they pay taxes in Russia under the General Taxation System:

Profit Tax;
VAT;
Corporate Property Tax;
Land Tax;
Transport Tax;
Excise Duties.

For payments to employees of branches and representative offices, Personal Income Tax (PIT) must be withheld and transferred to the budget, and insurance contributions must be paid [46].

For VAT purposes, if a foreign organization has several separate subdivisions in Russia, it selects one through which it will pay tax and file reports for all subdivisions. It must notify the inspectorates at the location of all separate subdivisions of its choice in writing. A notification of the choice of tax authority for submitting the declaration and paying VAT is also submitted to the inspectorate at the place of registration of the selected responsible subdivision [47].

A foreign organization conducting activities in Russia through a permanent establishment (department), including through branches and representative offices, independently calculates and pays profit tax on income from the activities of such subdivision [48].

If a foreign organization having departments in Russia receives income from sources in Russia not related to the activities of these departments, then the tax on such income is calculated, withheld, and transferred to the budget by the tax agent from whom such income was received [49].

In accordance with Article 7 of the Tax Code of the RF, if the norms of an international treaty of the Russian Federation provide for rules other than those established in Chapter 25 of the Tax Code of the RF, the provisions of the international treaty shall apply, taking into account Decree of the President of Russia No. 585 dated August 8, 2023, which suspended the operation of certain provisions of a number of international treaties as of August 8, 2023. Similar provisions on the suspension of international treaties with unfriendly countries are also contained in Federal Law No. 598-FZ dated December 19, 2023. At the same time, the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI), ratified by Federal Law No. 79-FZ dated May 1, 2019, must be taken into account.

A branch (representative office) of a foreign organization in Russia is subject to Profit Tax on [50]:

income from the main activities of the branch (representative office), reduced by the amount of expenses incurred by this branch (representative office);
income from the possession, use, and (or) disposal of property of the branch (representative office) minus expenses related to obtaining such income;
other income specified in Clause 1 of Art. 309 of the Tax Code of the RF related to the branch (representative office): dividends (including income from trust management of property constituting a mutual investment fund, paid to a foreign organization – unit holder based on its investment units in proportion to the share in the right of common ownership of this property), interest on debt securities, income from the use of rights to intellectual property objects in Russia.

To correctly calculate the profit of a branch (representative office), it is necessary to determine which income and expenses relate to its activities. For this purpose, the following is taken into account [51]:

whether the income was received in connection with functions the branch (representative office) performs in Russia;
whether the income was received in connection with the use of assets of the branch (representative office);
how economic (commercial) risks are distributed between the foreign organization and its subdivision(s) in Russia.

The listed circumstances are taken into account when distributing income and expenses between the foreign organization and its permanent establishment [52].

Income and expenses of a permanent establishment are recognized in tax accounting in the general order using the accrual method or the cash method [53].

Expenses are taken into account for tax purposes provided they are documented and economically justified [54]. Expenses of a branch (representative office) also include losses from previous years [55].

To calculate profit tax on the income of a permanent establishment (department) of a foreign organization in Russia, the tax base must be multiplied by the tax rate.

When calculating the tax base from the income of a branch (representative office), the following specifics must be considered:

income from which tax has already been withheld by a tax agent must also be included in the tax base, and the withheld tax must be deducted from the total amount of tax calculated based on the results of the reporting (tax) period [56];
for dividends, income from the distribution of profit and property, and interest income on state and municipal emission securities, the tax base should be calculated separately, since this income is taxed at a special rate [57];
the foreign organization calculates the tax base separately for each branch and representative office in Russia, unless the foreign organization has exercised the right to calculate profit for a group of permanent establishments as a whole [58];
if the branch (representative office) carries out activities of a preparatory and (or) auxiliary nature in the interests of third parties without receiving remuneration for it, a tax base still arises. It is equal to 20% of the amount of expenses for such activities [59].

Profit tax rates for a foreign organization depend on whether the taxable income relates to the activities of a permanent establishment of the foreign organization in Russia or not, as well as on the type of income received.

Income of a branch (representative office) of a foreign organization in Russia is taxed at the general rate of 20%, which is divided into two parts [60]:

3% – for calculating tax credited to the federal budget;
17% – for calculating tax credited to regional budgets.

Special rates apply for certain types of income related to a permanent establishment [61]:

15% rate – on dividends received from Russian organizations, other income from the distribution of profit or property in favor of a foreign organization, as well as on interest on state and municipal securities listed in Subclause 1 Clause 4 Art. 284 of the Tax Code of the RF;
9% rate – on interest on municipal securities issued before January 1, 2007, listed in Subclause 2 Clause 4 Art. 284 of the Tax Code of the RF, if the conditions of their issuance and circulation provide for receiving income in the form of interest;
0% rate – on interest on state and municipal securities listed in Subclause 3 Clause 4 Art. 284 of the Tax Code of the RF, if the conditions of their issuance and circulation provide for receiving income in the form of interest.

Tax calculated at special rates is fully credited to the federal budget [62].

Foreign organizations calculate and pay profit tax and advance payments in the same manner and within the same terms as Russian organizations [63].

How to Hire a Foreign Citizen as the Head of a Branch (Representative Office) of a Foreign Company

In accordance with Russian labor legislation, the employer in relation to employees of a representative office or branch is always the organization, since branches and representative offices are not legal entities; therefore, the foreign organization must be indicated as the employer in the employment contract, hiring order, and employment record book [64].

Consequently, there is no need to conclude an employment contract in Russia with the head of the representative office (branch) of a foreign organization.

A foreign citizen—the head of a branch (representative office) of a foreign company in Russia—can be hired:

on the basis of personal accreditation;
on the basis of a work permit for the branch (representative office);
as a Highly Qualified Specialist.

Foreign employees of representative offices of foreign companies accredited in Russia, within the headcount limits agreed upon during the accreditation of said representative offices by the authorized accrediting body, based on the principle of reciprocity in accordance with international treaties of the Russian Federation, do not require a work permit or patent; instead, they must undergo personal accreditation [65]. Personal accreditation is carried out by the Chamber of Commerce and Industry of the Russian Federation in accordance with the Procedure for Carrying Out Personal Accreditation of Foreign Citizens Who Are Employees of Branches and Representative Offices of Foreign Legal Entities, approved by Order of the CCI RF No. 89 dated September 30, 2019.

The following documents are submitted for personal accreditation:

a letter signed by the head of the branch or representative office requesting personal accreditation of the foreign employee, drafted on official letterhead;
certificate of entry of the corresponding record into the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities (original and photocopy submitted (original is returned) or a notarized copy; not required if the branch or representative office applies for personal accreditation repeatedly);
information sheet on the entry of a record into the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities (original and photocopy submitted (original is returned) or a notarized copy; not required if the branch or representative office applies for personal accreditation repeatedly);
autobiographical certificate for the employee in two copies with photographs affixed, personally signed by the employee (2 originals submitted);
two color photographs on a light background, size 3 x 4 (official style);
copies of pages of the document proving the identity of the foreign citizen and recognized by the Russian Federation in this capacity, containing the foreign citizen's personal data.

The term for the personal accreditation procedure cannot exceed 6 months.

The document confirming personal accreditation is the Certificate of Personal Accreditation.

The Certificate of Personal Accreditation is issued for a term of up to 3 years. For the period of the personal accreditation procedure, a Certificate of Personal Accreditation may be issued for a term of up to 6 months.

A fee is charged for issuing a Certificate of Personal Accreditation or issuing a duplicate Certificate of Personal Accreditation in accordance with established CCI RF tariffs: for issuing a certificate using electronic input forms – 8,000 rubles; without using electronic forms – 12,000 rubles.

If the state of residence of the foreign company does not have a corresponding international treaty with Russia but is a member of the World Trade Organization (the "WTO"), then according to Article 13.4 of Federal Law No. 115-FZ dated July 25, 2002, On the Legal Status of Foreign Citizens in the Russian Federation, a special procedure for obtaining work permits applies to foreign citizens of WTO member states when sent to work in a branch or representative office in the Russian Federation, including as the head of a branch (representative office), provided that such foreign citizens have performed labor activities for hire in the sending foreign commercial organization for at least one year during the period immediately preceding their assignment to the Russian Federation.

The total number of foreign citizens carrying out labor activities in a representative office of a foreign commercial organization in the Russian Federation on the basis of work permits cannot exceed five people, and in the banking sector – 2 people, within the limits of the headcount, information on which is contained in the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities.

A work permit is issued to foreign citizens for a term corresponding to the period for which the foreign citizen is sent to the branch or representative office in accordance with the decision of the foreign commercial organization on assignment, but for no more than 3 years. The specified validity period of the work permit may be repeatedly extended in the event of an extension of the powers of the head of the branch (representative office), but for no more than 3 years for each such extension.

To obtain a work permit, the branch or representative office submits the following documents to the federal executive body in the sphere of internal affairs:

a petition for issuing a work permit to a foreign citizen sent to a branch, representative office, or subsidiary of a foreign commercial organization (hereinafter, the petition for issuing a work permit);
a copy of the document proving the identity of the foreign citizen and recognized as such by the Russian Federation;
a document confirming the performance of labor activities by the foreign employee in the sending foreign commercial organization for at least one year during the period immediately preceding the assignment to the Russian Federation;
a decision of the foreign commercial organization to send the foreign citizen to its branch, representative office, or subsidiary of the foreign commercial organization;
information on the legal entity confirming its classification as a subsidiary of a foreign commercial organization in accordance with the legislation of the Russian Federation;
a draft employment contract between the assigned foreign citizen and the subsidiary of the foreign commercial organization;
a written obligation to pay (reimburse) the expenses of the Russian Federation related to possible administrative expulsion from the Russian Federation or deportation of the foreign citizen attracted for labor activities in accordance with this article;
a copy of the employment contract between the assigned foreign citizen and the foreign commercial organization (for foreign citizens sent to a branch or representative office of a foreign commercial organization);
a copy of the medical insurance contract (policy) concluded by the foreign citizen with an insurance organization or with a foreign insurance organization entitled, in accordance with insurance legislation, to carry out voluntary medical insurance in the Russian Federation, or information about it if concluded in the form of an electronic document, or a contract concluded by the employer with a medical organization for the provision of primary health care and specialized medical care to the foreign citizen.

In accordance with Subclause 24 Clause 1 Art. 333.28 of the Tax Code of the RF, the amount of the state duty for issuing a work permit to a foreign citizen or a stateless person is 2,000 rubles.

The term for considering a petition for issuing a work permit or an application for extending the validity period of a work permit constitutes no more than thirty business days from the day the petition (application) is received by the federal executive body in the sphere of internal affairs.

In other cases, the head of a branch (representative office) may be invited to Russia as a Highly Qualified Specialist (the "HQS") [66]. For this, they must have the appropriate qualifications and a salary level, generally, in the amount of at least 750,000 rubles calculated per 1 quarter. Qualifications are assessed by the employer independently and are not verified by the migration service [67].

In the case of attracting an HQS for labor activities in Russia, the employer is not required to obtain a permit to attract and use foreign workers [68].

Employers attracting foreign citizens for labor activities are obliged to notify the territorial body of the federal executive body in the sphere of internal affairs in the subject of the RF where such citizens work about the conclusion and termination (dissolution) of employment contracts or civil law contracts for the performance of works (provision of services) with them. The notification deadline is no later than three business days from the date of conclusion or termination (dissolution) of the corresponding contract [69].

Employers attracting highly qualified foreign specialists for labor activities are obliged to notify the federal executive body in the sphere of internal affairs or its authorized territorial body quarterly, no later than the last business day of the month following the reporting quarter, regarding the fulfillment of obligations to pay wages (remuneration) to the HQS [70]. The form and procedure for submitting such notification are established by Order of the Ministry of Internal Affairs of Russia No. 536 dated July 30, 2020.

Failure to notify or violation of the established procedure and (or) form of notification by the employer or customer of works (services) attracting a highly qualified specialist to the authorized body in the sphere of migration regarding the fulfillment of obligations to pay wages (remuneration) to the HQS entails administrative liability under Part 5 of Art. 18.15 of the Code of Administrative Offenses of the RF.

Head of Representative Office (Branch): Requirements for the Position and Powers

Russian legislation does not contain special requirements for heads of branches or representative offices of foreign companies.

However, special requirements may be established for heads of branches (representative offices) of foreign companies carrying out certain types of activities. For example, Article 32.1 of Law of the Russian Federation No. 4015-1 dated November 27, 1992, On the Organization of Insurance Business in the Russian Federation, contains qualification and other requirements for the head of a branch (representative office). This includes the head of a branch (representative office) of a foreign insurance company. The following persons cannot be heads of branches (representative offices):

persons who performed the functions of the sole executive body of financial organizations or functions of the head of a branch of a foreign insurance organization at the time these organizations committed violations for which their licenses for relevant activities were annulled (revoked), or violations for which the validity of said licenses was suspended and said licenses were annulled (revoked) due to failure to eliminate these violations, if less than 3 years have passed since the day of such annulment (revocation);
persons regarding whom the period during which they are considered subjected to administrative punishment in the form of disqualification has not expired;
persons having an unexpunged or outstanding conviction for crimes in the sphere of economic activity or crimes against state power.

Furthermore, heads of branches (representative offices) of a foreign company must comply with business reputation requirements. A person does not meet business reputation requirements, in particular, in the following cases:

presence of an unexpunged or outstanding conviction for committing an intentional crime as of the day preceding the day of appointment (election) to the position or the day of filing an application for approval of the candidacy with the insurance supervision body (except for a candidate for the position of a special official responsible for implementing internal control rules in an insurance organization for the purpose of countering the legalization (laundering) of proceeds from crime, financing of terrorism, and financing of the proliferation of weapons of mass destruction);
presence of a guilty verdict of a court against a person who committed an intentional crime without imposing punishment due to the expiration of the statute of limitations for criminal prosecution, if the 5-year period from the day the guilty verdict entered into force has not expired as of the day preceding the day of appointment (election) of the person to the position or the day of filing an application for approval of the candidacy with the insurance supervision body;
holding the person liable in accordance with a judicial act that has entered into legal force for subsidiary liability for the obligations of a financial organization or liability in the form of recovery of losses in favor of a financial organization in accordance with the Federal Law On Insolvency (Bankruptcy), if the five-year period from the day the judicial act entered into legal force has not expired as of the day preceding the day of appointment (election) of the person to the position or the day of filing an application for approval of the candidacy with the insurance supervision body;
holding the person liable 2 or more times within 3 years preceding the day of appointment (election) to the position or the day of filing an application for approval of the candidacy with the insurance supervision body, in accordance with a judicial act that has entered into legal force, for administrative liability for unlawful actions during the bankruptcy of a legal entity, deliberate and (or) fictitious bankruptcy of a legal entity (except for cases where such administrative offense entailed punishment in the form of a warning);
holding the person liable in accordance with a judicial act that has entered into legal force for criminal liability for unlawful actions during the bankruptcy of a legal entity, deliberate and (or) fictitious bankruptcy of a legal entity, if the five-year period from the day the judicial act entered into force has not expired as of the day preceding the day of appointment (election) to the position or the day of filing an application for approval of the candidacy with the insurance supervision body.

A natural person cannot be the head of a branch (representative office) of a foreign legal entity if there is an effective ruling in an administrative offense case against them, according to which said person has been imposed an administrative penalty in the form of disqualification, and the term for which this administrative penalty was imposed has not expired.

The powers of the head of a branch (representative office) are defined by a Power of Attorney issued by the foreign company. Powers may also be contained in the regulation on the branch (representative office). However, the head of a branch (representative office) cannot act on behalf of the foreign company solely on the basis of the regulation on the branch (representative office); they need a Power of Attorney in any case.

Typically, the Power of Attorney of the head of a branch (representative office) indicates the following powers:

management of the activities of the branch (representative office);
signing orders and internal local acts;
signing personnel orders and employment contracts, hiring, dismissal, transfer, imposing disciplinary liability, rewarding employees of the branch (representative office);
signing contracts, agreements, protocols of disagreements, conducting negotiations, concluding transactions;
signing tax and other reports, representation in tax and other state bodies, courts;
opening and closing accounts in Russian banks;
disposal of funds and property of the branch (representative office) within the limits established in the Power of Attorney.

The Power of Attorney of the head of a branch (representative office) of a foreign company may contain restrictions on concluding contracts and agreements by type of transaction or by amount. The head of the separate subdivision is entitled to perform only those actions specified in their Power of Attorney.

Liability of the Head of a Representative Office (Branch) of a Foreign Company

Administrative, tax, criminal, and civil liability of the head of a branch (representative office) of a foreign company in Russia is the same as that of the head of a branch (representative office) of a Russian company, although there are some specifics.

As a general rule, liability for the actions of a company, as well as liability to the company for causing damage to it, is borne by the person authorized to represent its interests without a Power of Attorney. At the same time, the legal status of a branch head differs from the legal status of a sole executive body. In particular, a branch head cannot be held liable in Russia for damages under the general rules of Art. 53.1 of the Civil Code. As follows from Clause 1 of Art. 53.1, the subject of liability under this article is a person authorized to act on its behalf by virtue of law, other legal acts, or the constituent document of the legal entity. This list does not include the head of a branch acting on the basis of a Power of Attorney. However, a branch head who is a non-resident of Russia may be held civilly liable under the law of the country of which they are a citizen and/or where the foreign company is located.

Since the sanctions of the norms of the Code of Administrative Offenses of the RF do not contain such a subject as a branch of a legal entity, a branch cannot be held administratively liable for committing an offense. According to para. 1 Clause 3 Art. 55 of the Civil Code, a branch is not a legal entity. It is endowed with property by the legal entity that created it and acts on the basis of regulations approved by said entity. Consequently, the legal entity bears responsibility for administrative offenses related to the activities of the branch.

However, if the director of a branch (representative office) was entrusted by Power of Attorney and/or the regulation on the branch (representative office) with duties to exercise any organizational-administrative or administrative-economic functions, then in case of non-performance or improper performance of these duties, they will bear administrative liability as an official for violation of labor legislation, labor protection norms, environmental, sanitary-epidemiological, fire safety norms and rules, as well as other administrative offenses in accordance with the Code of Administrative Offenses of the RF.

Regarding the tax liability of a foreign company's branch, according to Art. 11 of the Tax Code of the RF, organizations for the purposes of applying tax legislation include branches and representative offices of foreign persons and international organizations created in the territory of the Russian Federation; consequently, a branch (representative office) of a foreign company may be held tax liable in the RF.

Accordingly, the head of a branch (representative office) of a foreign company may be held criminally liable for tax crimes (for example, under Art. 199 of the Criminal Code). Consequently, tax arrears not paid by the branch (representative office) may be recovered from them.

The head of a branch (representative office) of a foreign company may also be held criminally liable for other crimes, for example, under Art. 174 of the Criminal Code (legalization (laundering) of funds or other property acquired by other persons by criminal means), Art. 180 of the Criminal Code (illegal use of means of individualization of goods (works, services)), Art. 143 of the Criminal Code (violation of labor protection requirements), and others.

Also, the head of a branch (representative office) of a foreign company may be held disciplinarily and materially liable.

For example, according to Part 1 of Art. 81 of the Labor Code of the Russian Federation, an employment contract with a branch head may be terminated by the employer in the following cases:

adoption of an unjustified decision by the head of the organization (branch, representative office), their deputies, and the chief accountant, entailing a violation of the safety of property, its unlawful use, or other damage to the property of the organization (Clause 9);
a single gross violation by the head of the organization (branch, representative office) or their deputies of their labor duties. According to Clause 49 of Resolution of the Plenum of the Supreme Court of the RF No. 2 dated March 17, 2004, On the Application by Courts of the Russian Federation of the Labor Code of the Russian Federation, gross violation of labor duties by the head of an organization (branch, representative office) or their deputies should be considered, in particular, non-performance of duties assigned to these persons by the employment contract, which could entail causing harm to the health of employees or causing property damage to the organization (Clause 10).

Regarding the subsidiary liability of the head of a branch (representative office) of a foreign company in bankruptcy, under Russian legislation, the legal entity itself can be declared bankrupt, not a branch or representative office separately. Consequently, such cases are not considered in the jurisdiction of the state where the foreign company is located.

Until recently, Russian arbitration courts did not consider bankruptcy cases of foreign companies. However, a Supreme Court Ruling dated February 8, 2024, in case No. A40-248405/22 appeared. The Supreme Court of the RF reminded that the APC RF allows courts to consider cases complicated by a foreign element if there is a close connection of the legal relationship with Russia. The existence of such a connection may be evidenced by: conducting constant activities in Russia, the company being oriented towards Russian citizens, the presence of the center of main interests of the company in the country, the presence of property assets of the organization in the Russian Federation, including real estate, lease rights to land plots, a significant part of creditors being Russian legal entities, citizens of the Russian Federation, and the organization concluding a significant number of transactions with the place of performance in the territory of the Russian Federation.

After determining competence, the court must determine whether the center of the debtor's main interests is in the Russian jurisdiction or outside it, and initiate main or secondary (local) proceedings in the bankruptcy case.

Main bankruptcy proceedings will create consequences for all other jurisdictions and extend to all property of the debtor. To initiate such proceedings, it must be proven that the center of the debtor's main interests is in Russia.

When the center of the debtor's interests is outside Russia, but its representative office, branch, or property is located in Russia, the court initiates secondary (local) proceedings. It extends only to creditors and property related to the activities of the legal entity in Russia. The purpose of introducing such proceedings is to protect the interests of Russian creditors in the absence of effective access to the jurisdiction where the main bankruptcy proceedings should be carried out. As examples, the Supreme Court cites the refusal of an arbitration court to recognize main proceedings initiated in a foreign state, international sanctions, disproportionately high costs of applying to foreign jurisdictions, etc.

Consequently, Russian creditors have more chances to hold heads of branches (representative offices) of a foreign company subsidiarily liable for the debts of this company if the heads of branches (representative offices) are recognized as controlling persons and it is proven that their actions led the company to bankruptcy. In particular, the head of a branch (representative office) may be held subsidiarily liable if the claims of tax authorities for the principal amount of debt arising from holding the branch (representative office) of the foreign company tax liable exceed 50% of the total amount of claims of third-priority creditors for the principal amount of debt included in the register of creditors' claims of the foreign company [71].

In conclusion, the following should be noted. A foreign legal entity has the right to carry out activities in Russia through a branch or representative office. Branches and representative offices of foreign companies may carry out business activities in the Russian Federation only after undergoing the accreditation procedure with the authorized tax authority and registering for tax purposes at their location.

A branch (representative office) operates on the basis of the Regulation on the Branch (Representative Office). When developing and approving it, special requirements established by the Law on Foreign Investments must be taken into account.

Accreditation of a branch (representative office) may be terminated not only by the decision of the foreign company but also by the decision of the authorized tax authority if the branch (representative office) does not file reports or pay taxes for 12 months, or if there is an effective court decision stating that its activity contradicts Russian legislation.

Branches and representative offices of foreign legal entities are required to pay all taxes and fees, file tax returns, withhold and transfer Personal Income Tax to the budget from the wages of their employees, pay contributions to the SFR, and comply with the legislation of the Russian Federation. Branches and representative offices of foreign companies pay taxes and contributions in Russia just like Russian companies, but with some peculiarities; for example, they cannot use the Simplified Taxation System. For non-payment or untimely payment of taxes, the branch (representative office) of a foreign company may be held tax liable, and its head may be held criminally and civilly liable.

Also, in relation to a foreign company carrying out its activities in Russia through a branch (representative office), a bankruptcy case may be initiated in Russia under certain circumstances.

In addition, the head of a branch (representative office) as an official may be held administratively liable. And if a penalty in the form of disqualification is applied to them, they will not be able to hold the position of head of a branch (representative office) until its expiration.

The head of a branch (representative office) of a foreign company represents the interests of the foreign company in Russia on the basis of a Power of Attorney issued to them by this company. Therefore, for successful activity in Russia, as well as for the possibility of holding the head of a branch (representative office) liable for improper performance of their powers, it is necessary to carefully approach the text of the Power of Attorney and the scope of powers indicated therein.

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References

[1] Clause 1 Art. 55 of the Civil Code.

[2] Clause 2 Art. 55 of the Civil Code.

[3] Clause 2 Art. 306 of the Tax Code of the RF.

[4] Article 7 of the Tax Code of the RF.

[5] Information from the Ministry of Finance of Russia "Informational message on the denunciation of the Agreement between the Government of the Russian Federation and the Government of Ukraine for the avoidance of double taxation of income and property and the prevention of tax evasion dated February 8, 1995.

[6] Federal Law No. 40-FZ dated February 28, 2023, On the Denunciation of the Agreement between the Government of the Russian Federation and the Government of the Republic of Latvia for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital.

[7] Letters of the Ministry of Finance of Russia No. 03-08-05/29284 dated April 3, 2023, No. 03-08-05/19776 dated March 16, 2022, No. 03-08-05/33662 dated April 30, 2021.

[8] Letter of the Federal Tax Service of Russia No. SD-4-3/7299 dated May 26, 2021.

[9] Clause 9 Art. 306 of the Tax Code of the RF.

[10] Art. 22 of Federal Law No. 395-1 dated December 2, 1990, On Banks and Banking Activities; Regulation of the Bank of Russia No. 467-P dated April 22, 2015, On the Procedure for Accreditation by the Bank of Russia of a Representative Office of a Foreign Credit Organization, Accreditation of Foreign Citizens Who Will Carry Out Labor Activities in a Representative Office of a Foreign Credit Organization, and Implementation of Control over the Activities of a Representative Office of a Foreign Credit Organization; Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation; Order of Rosaviatsiya No. 801-P dated October 20, 2021, On Approval of the Procedure for Adopting a Decision on Accreditation of Representative Offices of Foreign Legal Entities Carrying Out Activities in the Field of Civil Aviation, on Making Changes to Information Contained in the State Register of Accredited Branches, Representative Offices of Foreign Legal Entities, on Termination of Their Accreditation, on Accreditation of Foreign Citizens Who Are Employees of Representative Offices of a Foreign Legal Entity Carrying Out Activities in the Field of Civil Aviation in the Territory of the Russian Federation.

[11] Chapter IV.1 of Law of the RF No. 4015-1 dated November 27, 1992, On the Organization of Insurance Business in the Russian Federation.

[12] Clause 1 of Order of the Federal Tax Service of Russia No. MMV-7-14/668@ dated December 22, 2014.

[13] Clause 2 Art. 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation.

[14] The form of the application was approved by Order of the Federal Tax Service of Russia No. ED-7-14/633@ dated July 5, 2021.

[15] Clause 1 Art. 3 of the Law on the State Language of the RF, Clause 2 of Appendix No. 8 to Order of the Federal Tax Service of Russia No. ED-7-14/633@ dated July 5, 2021.

[16] Clause 2 Art. 21 of the Law on Foreign Investments.

[17] Clause 2 Art. 21 of the Law on Foreign Investments, Clause 32 of Appendix No. 8 to Order of the Federal Tax Service of Russia No. ED-7-14/633@ dated July 5, 2021.

[18] Clause 2 Art. 21 of the Law on Foreign Investments.

[19] Website of the CCI RF.

[20] Clause 7 of the Accreditation Procedure.

[21] Subclauses 5 and 5.1 of Clause 1 Art. 333.33 of the Tax Code of the RF.

[22] Convention Abolishing the Requirement of Legalisation for Foreign Public Documents (concluded in The Hague on October 5, 1961).

[23] Clause 14 of the Accreditation Procedure.

[24] Clause 5 Art. 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation; Clause 15 of the Accreditation Procedure.

[25] Clause 4 of the Accreditation Procedure.

[26] Clause 8 of the Accreditation Procedure.

[27] Clause 10 Art. 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation; Clause 8 of the Accreditation Procedure... approved by Order of the Federal Tax Service of Russia No. ED-7-14/691@ dated July 27, +-2021.

[28] Clause 37 of the Specifics of Recording Foreign Organizations in Tax Authorities... approved by Order of the Ministry of Finance of Russia No. 293n dated December 28, 2018.

[29] Clause 10 Art. 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation.

[30] Subclause 15 Clause 1 Art. 32 of the Tax Code of the RF; Subclause 3 Clause 1 Art. 11 of Federal Law No. 167-FZ dated December 15, 2001, On Compulsory Pension Insurance in the Russian Federation; Subclause "a" Clause 1, Clause 10 of the Procedure for Registration and Deregistration of Insurers... approved by Order of the Ministry of Labor of Russia No. 768n dated December 7, 2022.

[31] Subclause 2 Clause 1 Art. 6 of Federal Law No. 125-FZ dated July 24, 1998, On Compulsory Social Insurance against Industrial Accidents and Occupational Diseases; Subclause "a" Clause 1, Clauses 3 and 10 of the Procedure for Registration and Deregistration of Insurers... approved by Order of the Ministry of Labor of Russia No. 768n dated December 7, 2022.

[32] Clause 2 Art. 11 of Federal Law No. 167-FZ dated December 15, 2001, On Compulsory Pension Insurance in the Russian Federation; Clause 2 Art. 6 of Federal Law No. 125-FZ dated July 24, 1998, On Compulsory Social Insurance against Industrial Accidents and Occupational Diseases; Clauses 18 – 20 of the Procedure for Registration and Deregistration of Insurers... approved by Order of the Ministry of Labor of Russia No. 768n dated December 7, 2022.

[33] Clause 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation.

[34] Also, Clause 5.1 Art. 21.

[35] Clause 11 of the Procedure for Creating, Operating, and Maintaining the State Register of Accredited Branches and Representative Offices of Foreign Legal Entities... approved by Order of the Federal Tax Service of Russia No. ED-7-14/703@ dated July 30, 2021.

[36] Decree of the Government of Russia No. 1491 dated December 25, 2014.

[37] Order of the Federal Tax Service of Russia No. ED-7-14/633@ dated July 5, 2021.

[38] Clause 9 of the Accreditation Procedure... approved by Order of the Federal Tax Service of Russia No. ED-7-14/691@ dated July 27, 2021.

[39] Clause 6 Art. 21 of Federal Law No. 160-FZ dated July 9, 1999, On Foreign Investments in the Russian Federation.

[40] Also, Clause 7 Art. 21.

[41] Also, Clause 7 Art. 21.

[42] Clause 12 of the Accreditation Procedure.

[43] Also, Clause 12.

[44] Clause 2 Art. 11 of the Tax Code of the RF.

[45] Subclauses 17, 18 Clause 3 Art. 346.12 of the Tax Code of the RF.

[46] Clause 1 Art. 226, Subclause 1 Clause 1 Art. 419, Clause 11 Art. 431 of the Tax Code of the RF; Art. 3, Clause 1 Art. 5 of Law No. 125-FZ; Letter of the Ministry of Finance of Russia No. 03-15-06/96582 dated December 29, 2018, and Ministry of Labor of Russia No. 17-3/V-164 dated April 21, 2016.

[47] Clause 7 Art. 174, Subclause 18 Clause 3 Art. 346.12 of the Tax Code of the RF.

[48] Clause 1 Art. 246, Art. 307 of the Tax Code of the RF.

[49] Clause 4 Art. 286, Clause 1 Art. 309, Art. 310 of the Tax Code of the RF.

[50] Clause 2 Art. 247, Clause 1 Art. 307 of the Tax Code of the RF.

[51] Clause 9 Art. 307 of the Tax Code of the RF.

[52] Clause 9 Art. 307 of the Tax Code of the RF, Letter of the Ministry of Finance of Russia No. 03-08-05/27073 dated April 1, 2022.

[53] Arts. 271 – 273 of the Tax Code of the RF.

[54] Clause 1 Art. 252 of the Tax Code of the RF.

[55] Art. 283, Clause 5 Art. 307 of the Tax Code of the RF.

[56] Clause 7 Art. 307 of the Tax Code of the RF.

[57] Clause 2 Art. 274, Clause 6 Art. 307, Subclauses 1 – 3 Clause 1 Art. 309 of the Tax Code of the RF.

[58] Clause 4 Art. 307 of the Tax Code of the RF.

[59] Clause 3 Art. 307 of the Tax Code of the RF.

[60] Clause 1 Art. 284, Clause 6 Art. 307 of the Tax Code of the RF.

[61] Subclause 3 Clause 3, Clause 4 Art. 284, Clause 6 Art. 307, Subclauses 1 - 3 Clause 1 Art. 309 of the Tax Code of the RF.

[62] Clause 6 Art. 284 of the Tax Code of the RF.

[63] Articles 286 and 287, Clause 8 Art. 307 of the Tax Code of the RF.

[64] Part 3 Art. 55 of the Civil Code, Art. 20 of the Labor Code of the RF.

[65] Subclause 4 Clause 9 Art. 13 of Federal Law No. 115-FZ dated July 25, 2002, On the Legal Status of Foreign Citizens in the Russian Federation.

[66] Also, Subclause 1 Clause 5 Art. 13.2.

[67] Also, Subclause 3 Clause 1 Art. 13.1.

[68] Also, Subclause 2 Clause 4.5 Art. 13.

[69] Also, para. 1 Clause 8 Art. 13.

[70] Also, para. 1 Clause 13 Art. 13.2.

[71] Subclause 3 Clause 2 Art. 61.11 of Federal Law No. 127-FZ dated October 26, 2002, On Insolvency (Bankruptcy).