Dear Clients,
We would like to inform you that Confidence Group continues to operate as usual and has all the resources to fulfill its obligations to the client.
Despite the introduction of sanctions against Russia, as well as legal entities and individuals of Russia, at the moment no additional, special restrictions have been introduced for foreign citizens living, arriving and / or working in Russia in connection with the special operation on the territory of Ukraine. All bodies of the Ministry of Internal Affairs on migration issues are working as usual.
As for foreign companies, doing business in Russia, the First Deputy Prime Minister of Russia, A.R. Belousov, said that Russia would not independently restrict the work of foreign companies on the territory of Russia, but he did not exclude the possibility of exerting pressure on them from other countries, and in this case, he proposed three options for interaction, namely:
- continue to work in Russia as usual;
- to transfer the share of the company to Russian partners and after a while to return to the market in Russia;
- termination of work in Russia with the intervention of the Russian authorities through the accelerated bankruptcy procedure, which implies the reorganization of the company and the mandatory preservation of jobs.
In addition, it is currently developing a package of measures to maintain industrial and business activity in Russia, as well as to maintain employment and quickly restore the work of enterprises, including the Government will help air carriers maintain a fleet of foreign aircraft, and in order to support IT companies, it imposed economic concessions (Federal Law of 08.03.2022 N 46-FZ "On amendments ...").
For foreign citizens, migration requirements have been relaxed:
- according to the Ministry of Internal Affairs of Russia, citizens of Ukraine, the Donetsk and Lugansk People's Republics have been simplified in obtaining a residence permit in Russia, as well as work patents and citizenship;
- without exception, all foreign citizens and stateless persons entering the territory of Russia from the republics of the Donetsk and Lugansk People's Republics and Ukraine are allowed to enter Russia and leave further to their countries without issuing a visa on valid documents proving their identity, while being allowed to stay in Russia up to 15 days from the date of crossing the border of Russia. You can read about it in our news;
- for foreign citizens working in the field of IT, measures will be developed aimed at simplifying the execution of documents permitting labor activity and obtaining a residence permit.
However, the emergence of risks for foreign business in Russia in connection with the measures that are being prepared by the Russian government is not ruled out. For example, the Prime Minister of Russia stated that the Government of Russia prohibits or restricts the export of assets and products, equipment, components and materials (more than 200 items in total). This ban does not apply to the countries of the EAEU, Abkhazia and South Ossetia. In addition, the Cabinet of Ministers will provide for the introduction of retaliatory restrictions for countries that prohibit Russian ships from entering their ports.
It is also necessary to take into account the possibility of risks arising in connection with the following changes in the legislation of Russia:
1. Vladimir Putin signed Decrees No. 79 dated 28.02.2022 and 81 dated 01.03.2022 "On the application of special economic measures ....", which affect foreign citizens, namely:
- from March 1, 2022, it is prohibited to carry out foreign exchange transactions related to the provision of foreign currency in favor of non-residents under loan agreements;
- from March 1, 2022, it is prohibited to credit foreign currency to one's accounts (deposits) opened with banks and other financial market organizations located outside the territory of Russia, as well as to transfer funds without opening a bank account using electronic means of payment provided by foreign suppliers payment services;
- from March 2, 2022, it is prohibited to export from the country cash foreign currency or monetary instruments in such currency in an amount exceeding the equivalent of $10,000 and calculated at the official exchange rate of the Bank of Russia on the date of export;
- a special procedure has been established for the implementation (execution) by residents of the following transactions (operations) with foreign persons associated with foreign states and territories, committing unfriendly actions in relation to Russia, Russian legal entities and individuals, and with persons under the control of these persons, regardless from the place of their registration or the place of their primary business activities:
- transactions (operations) for the provision of credits and loans to such persons in rubles - except for cases where the provision of credits and loans is prohibited in accordance with the regulatory legal acts of Russia;
- transactions (operations), entailing the emergence of ownership of securities and real estate, carried out (performed) with such persons.
The list of foreign states and territories that commit unfriendly actions against Russia, Russian legal entities and individuals was approved by order of the Government of Russia dated 05.03.2022 No. 430-p.
2. A draft law on the nationalization of the property of companies that left Russia is at the signing stage. Thus, the draft law allows the introduction of external management in such companies, based on the application of any member of the board of directors of the company or the Federal Tax Service (if the relevant decision is made by the interdepartmental commission of the Ministry of Economic Development). At the same time, the owner of the company has the right to refuse external management within 5 days and return to work, or sell his share to a person not associated with "unfriendly" countries. Otherwise, the court appoints a temporary administration for three months, then the shares of the new organization are put up for auction, and the old one is liquidated. The new owner will be obliged to retain at least 2/3 of the staff and continue the activities of the old organization for at least a year.
3. The President of Russia signed a law extending sanctions for violation of the rights of citizens of Russia to all foreigners and stateless persons, and not only to US citizens, as was the case before. The Russian authorities will be able to prohibit such persons from entering Russia, seize their financial and other assets in Russia and prohibit any transactions with property and investments, as well as suspend their powers on the boards of directors or other management bodies of Russian companies, suspend the activities of legal entities under control such foreigners.
In this regard, as a preventive measure, it is recommended to consider the possibility of transferring citizens of "unfriendly countries" from senior positions in companies to simple managerial positions. However, do not forget that such a transfer involves the adjustment of permits. Confidence Group consultants are ready to provide you with comprehensive support in organizing these processes, assessing risks and minimizing them.
In addition, when carrying out activities, it is necessary to ensure that in its course there are no signs of providing financial, logistical, consulting or other assistance to a foreign state, an international or foreign organization or their representatives in activities directed against the security of Russia, as this may be qualified as a crime under Article 275 of the Criminal Code of Russia (high treason). The Prosecutor General's Office of Russia warns about this. In this connection, we advise you not to transfer money to charity to the countries listed in the Decree of the Government of the Russian Federation dated March 5, 2022 No. 430-p.
We are closely monitoring the changes and will inform you about them.
For more information, please contact the consultants of the Confidence Group company.
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