RS Brief news New types of legal entity come to Russia

New types of legal entity come to Russia

August 2011

The Government has introduced the bills "On Investment Partnerships" and "On Economic Partnerships" to the State Duma. Economic partnerships are designed for joint investment in especially risky projects. They practically duplicate the "limited partnerships" that exist in Great Britain and the United States. The partners are not liable for the partnership's obligations, but they are bound to bear the risk of damages associated with its activities, albeit only up to the amount of their investment. An investment partnership is a special type of contract for a simple partnership. The parties to the contract combine their assets for joint investment activities, without forming a legal entity. The bill details two categories of participants–managing and passive partners–which differ in rights, duties, and liability. It is worth noting that economic partnerships and investment partnerships cannot engage in just any type of activity. For the former, the Russian Government will compose a list of prohibited activities (which require a licence)–and for the latter, a list of permitted activities.