RS Brief news Small, accessible... and advantageous

Small, accessible... and advantageous

September 2013

It is now much simpler for foreign investors to be classed as small businesses, and benefit from a plethora of exemptions as a result. In late July, the president of the Russian Federation Vladimir Putin removed the restrictions imposed on foreigners owning shares in small businesses - up until then, they were only entitled to own up to 25 percent of small businesses, and if they took possession of more than this the business ceased to be regarded as a small business, along with the state exemptions and preferential treatment that go with it.

According to those behind the amendments, the restriction that was in place acted as a limiting factor on attracting investment into the Russian Federation.

Legislators did not stop there in their efforts to support and develop small businesses. At the end of July, the government approved a plan to increase the rate of growth in the economy, in which the issue of providing support for small businesses played a key role. The Ministry of Economic Development, which was behind the measures developed, proposed that lending be made more accessible by providing support to those banks which lent money to small businesses; and furthermore, that funds from the national wealth fund should be partially used to providing funding. Moreover, the Ministry of Economic Development is proposing to extend exemptions on insurance contributions for small businesses. And in order to support these business categories, the ministry deems it essential to set up a mechanism for expanding access for representatives of small and medium-sized businesses to cover state procurement. RS