On January 1, 2012, new internal funds (capital) requirements
came into force, requiring the amount of internal funds (capital)
to open a new bank to be 300 million rubles. In addition, to obtain
a license to perform banking operations with rubles and foreign
currencies, as well as to raise funds in rubles and foreign
currency, banks will be required to have not less than 900 million
rubles in internal funds (capital).
Comments: operating banks may gradually increase internal funds
(capital) to 300 million rubles, but must meet the new requirements
by January 1, 2015.
Russian companies to report their financial figures in
accordance with international financial reporting standards
From January 1, 2012, certain Russian companies are required to
report their financial results according to international
On December 12, 2011, the Ministry of Finance officially
recognized IFRS. All public joint stock companies, insurance
companies and banks must report under IFRS starting from January 1,
All companies in Russia will be subject to IFRS starting from
This is a positive step for Russian companies, given that IFRS
is recognized around the world and is perceived as an important
indicator of management transparency, credibility and stability.
Local standards are often ignored by investors and foreign credit
institutions as they are considered uncertain and sometimes
irrelevant. Using international standards should improve the
investment climate and make it easier for companies to attract
Franchising regulations have undergone major changes. The stated
goal of these changes is to remove barriers to development of
franchising operations in Russia.
granting the franchisor the right to determine the resale price
and the territory on which the franchisee is entitled to sell
goods, perform work or render services;
Under Russian competition law, the franchisor already has this
right, but prior to the amendments, such right was not recognized
by the RF Civil Code. The amendments to the RF Civil Code have
eliminated the discrepancy between antitrust and civil law
regulation of franchise agreements.
providing parties the right to alter the terms and conditions
of a franchise agreement when executing an agreement for a new
Prior to the amendments, parties were entitled to execute an
agreement on new terms using only the same terms and conditions,
although in practice amendments were often re-negotiated.
providing for the possibility of unilateral termination of the
franchise agreement executed for a fixed term by either party;
Such right may be applied by the parties at any time, subject to
the following conditions: 1) prior notification of the counterparty
in writing, no later than 30 (thirty) days before termination; 2)
franchise agreement shall provide parties the right to terminate an
agreement by paying a termination fee
Amendments to transfer pricing rules
On January 1, 2012, new transfer pricing rules came into force
requiring taxpayers to notify the tax authorities of all controlled
transactions, including cross-border transactions involving oil,
oil products, certain metals, fertilizers, as well as transactions
involving foreign entities registered in special-tax districts (as
determined by the Finance Ministry).
The purpose of such rules is to prevent the loss of taxable
earnings from transactions when earnings and expenses are
reallocated between the parties to a transaction, which are
interdependent only for the purposes of tax savings.
Transactions that don't exceed 3 billion rubles ($100
million) in 2012 and 2 billion rubles ($71 million) in 2013 will be
exempt from reporting rules. Starting from 2014, the threshold will
be 1 billion rubles ($35 million) in a calendar year.
* Elvira Danilova is a paralegal in Dechert's Moscow
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