Opening of a branch or representative office

A representative office is endowed with a minimum amount of authority and is not entitled to conduct business (Part 1, 3 of Article 55 of the Civil Code of the Russian Federation). It can only engage in marketing and advertising activities, search for potential partners, conclude contracts, resolve conflict situations, etc.

A branch can fully carry out the same economic activity as the parent foreign company (Part 2 of Article 55 of the Civil Code of the Russian Federation), i.e. the functionality of branches is basically the same as that of Russian companies.

1. Branches and representative offices may open and close accounts in Russian and foreign banks, conclude transactions, sign contracts.
2. Branches and representative offices are managed by the appointed heads/directors of these separate divisions.
3. When opening a branch or representative office, a foreign company will be considered a non-resident, and its taxation will be regulated by a bilateral agreement on the avoidance of double taxation, if such is concluded between the countries.
4. When renting an office by a branch/representative office in Russia, VAT is not included in the rent.
5. Material support of branches and representative offices is carried out at the expense of the property and assets of the parent company.

To start working in Russia, branches and representative offices undergo an accreditation procedure that lasts 25-30 working days and will require payment of a state duty of 120 thousand rubles.
Branches and representative offices are essentially a form of presence on the Russian market, popular with medium and large foreign businesses. By contacting these branches and representative offices, Russian customers understand that they are turning to representatives of a well-known brand whose reputation and reliability are well-known. For a foreign company, the presence of a branch/representative office in Russia definitely increases efficiency when interacting with Russian and foreign clients working in the Russian Federation.

The British company Forward 3D Limited works in the field of advertising and marketing. The company decided to cooperate with Google and Yandex in Russia. For these purposes, a branch was opened in Moscow, and employees who previously worked in the Russian direction at the head office in London began to work in Russia on a permanent basis. The presence of a branch of Forward 3D Limited in Russia allows you to carry out all these processes and interact with counterparties in our country more quickly. In addition, payments from the current account of a branch in a Russian bank are much faster than payments from the account of the parent company.