One of the possible options for the sale of residential buildings (apartments) is the conclusion of agreements on equity participation in construction (investment) between the developer and the investing company, which subsequently cedes its rights under the agreement to individuals. However, with such a model for the sale of real estate objects, the investing company is faced with the need to pay VAT on its profits, i.e. the difference between the price of the assignment of the right of claim to an individual and the amount paid under the investment agreement (clause 2 of article 155 of the Tax Code of the Russian Federation).

Let us consider the tax consequences of a situation when such an Investor is a foreign company that acquires rights of claim at an early stage of construction at a price close to the cost price.

A foreign company enters into a construction investment agreement with a Russian developer and transfers funds to him. The investment funds listed to the developer essentially cover only his construction costs and include a very small remuneration for the developer, but help to continue construction and start “selling” the rest of the apartments at a higher price. The business goal of cooperation is obvious.

In practice, such a foreign investor also, closer to the end of construction, through Russian agents or a real estate agency assigns his rights under a contract to individuals. The difference between the amount of the initial investment and the price of the assignment is the profit of the foreign investor.

The peculiarity is that such a foreign investor does not have an obligation to pay VAT and income tax in the Russian Federation. Let's figure it out in order.

The exercise by a foreign organization of property rights, including for residential buildings, is subject to VAT in Russia, in two cases:

• The activities of a foreign company lead to the formation of a permanent establishment in the Russian Federation;
• Although a foreign company does not have a permanent establishment in Russia, the place of implementation of property rights is the Russian Federation.

However, the activity of a foreign investor to obtain income from the assignment of rights of claim under investment (equity participation) agreements will not lead to the formation of a permanent establishment in the Russian Federation, unless he concludes such transactions through any (branch) in Russia, or a resident agent RF, acting on behalf of and in the interests of a foreign investor (clauses 2, 9, Article 306 of the Tax Code of the Russian Federation), except for the cases when property rights are exercised through a special agent whose main activity is real estate transactions.

Thus, the foreign investor must conclude all transactions through a real estate agency.

A useful tool for financing a Group of Companies can be not only a loan, which is used everywhere, but also a factoring agreement. For more information on financing a business with the participation of a foreign company, see this link in our TaxBUK

The second important aspect is related to the determination of the place of realization of the rights under the investment agreement for the purpose of calculating VAT.

Note that the Tax Code of the Russian Federation contains only the rules for determining the place of sale of works and services (Article 148 of the Tax Code of the Russian Federation), but there are no provisions explaining how to determine the place of realization of property rights when a foreign company acts as the seller.

According to the Ministry of Finance of the Russian Federation, the assignment of rights of claim for the purposes of VAT taxation should be considered a service, which means that the norms enshrined in Art. 148 of the Tax Code of the Russian Federation (1). It is difficult to agree with this point of view, since the transfer of property rights is an independent object of VAT taxation along with the sale of goods, works, services in accordance with paragraphs. 1 p. 1 of Art. 146 of the Tax Code of the Russian Federation.

(1) letter of the Ministry of Finance of the Russian Federation of 18.06.2012 No. 03-07-08 / 154

But even if the assignment of the right of claim by a foreign organization to a Russian company is recognized as a service, following the explanations of the Ministry of Finance, the place of sale of such a service is not the territory of the Russian Federation and, therefore, it is not subject to VAT on the basis of the following provisions:

• assignment of rights of claim to services (works) directly listed in Art. 148 of the Tax Code of the Russian Federation, does not apply;
• place of sale not specified in art. 148 of the Tax Code of the Russian Federation of services is determined by the place of operation of the organization providing such services;
• the place of implementation of the organization's activities is not recognized as the territory of the Russian Federation, if it is not registered in Russia (clause 2 of article 148 of the Tax Code of the Russian Federation).

This position is confirmed by the letters of the Ministry of Finance dated 17.10.2013 No. 03-07-15 / 43359, dated 18.06.2012 No. 03-07-08 / 154, dated 19.05.10 No. 03-07-08 / 152 and dated 26.06 .08 No. 03-07-08 / 154. Moreover, in the letter of the Ministry of Finance of the Russian Federation of 10/17/2013, among other transactions on the transfer of property rights, the transfer of rights to shared construction projects, carried out by a foreign organization that is not tax-registered and does not have a permanent representative office in Russia, is directly mentioned.

In other words, the Ministry of Finance of Russia does not classify the assignment of property rights under investment agreements (equity participation in construction) to services directly related to real estate and specified in paragraphs. 1 p. 1 of Art. 148 of the Tax Code of the Russian Federation, the place of sale of which for the purpose of calculating VAT is the Russian Federation. As a result, the risk that the tax authorities would consider such an assignment a service directly related to real estate in Russia and charge additional VAT is very small.

With regard to income tax, income from agreements on the assignment of claims under an investment agreement by a foreign investor to the final buyer is not subject to income tax in the Russian Federation on the basis of clause 2 of Art. 309 of the Tax Code of the Russian Federation, provided that the activity of the foreign investor does not form a permanent establishment in the Russian Federation.

An important point in relation to income tax is that a foreign investor, under an assignment agreement, transfers to buyers precisely the property rights to future real estate objects. Such an operation should be distinguished from the sale of real estate located in Russia, which in turn is subject to income tax in the Russian Federation on the basis of clause 6 of Art. 309 of the Tax Code of the Russian Federation and Art. 6 international agreements on avoidance of double taxation. Until the completion of the construction of real estate objects and the developer obtaining permission to commission the facilities, the facilities under construction cannot be called real estate in accordance with the Urban Planning Code of the Russian Federation and clause 2 of Art. 2 FZ "On participation in shared construction". Therefore, the rules providing for the taxation of income from the sale of real estate in the Russian Federation are not applicable to this situation.

The Russian real estate agency, in turn, receives remuneration for its services in finding buyers, which is subject to taxation in the Russian Federation.

Thus, cooperation with a foreign investor at the initial stages of construction allows the developer to receive the necessary impetus for construction, and for a foreign investor - in a fairly understandable way to invest and receive income with taxation only in the country of his residence.

Over the past few years, Western investment funds have been leaving the Russian real estate market - against the backdrop of a downturn in the economy and sanctions, risks are increasing, according to the JLL report. As an example, she cites the Finnish Sponda, which back in 2013 announced its intention to sell Russian projects. This year, the situation reached its peak: Austrian Immofinanz closed a deal for the sale of five Moscow shopping centers with an area of ​​over 500,000 square meters. m. The American fund Heitman is curtailing its activities in Russia: it is completing the sale of the only asset here - the office tower of the Metropolis complex at st. m. "Voykovskaya" in Moscow. Atrium European Real Estate, which is listed on the Vienna and Amsterdam stock exchanges, has put up for sale the entire Russian portfolio of seven Park House shopping complexes in Moscow and the regions. Who comes instead of them?

In 2017 alone, Asian investors spent over $ 20 billion on property purchases in Europe and the United States, according to JLL. They did not bypass Russia either. The Chinese Fosun Group together with the Russian Avica Management Company bought the famous Voentorg at Vozdvizhenka, and the Arab Mubadala Development together with the Russian Direct Investment Fund - 84,000 sq. M. m of warehouses in PNK Park - Bekasovo in the Moscow Region and PNK Tolmachevo in Novosibirsk. The Chinese Vanke Group continues negotiations to buy up to 51% in one of the largest owners of Moscow offices - O1 Properties.

Asian and Middle Eastern funds, unlike European ones, have so far been less represented in the Russian real estate market, and their interest has been limited to one-off acquisitions, says Olesya Dzyuba, head of the JLL department. The situation was aggravated by the 2014 crisis, when the real estate market stood up, adds Svetlana Kara, managing partner of Capital Global Partners: investors were interested in 30% more profitability than the market could offer.

Now their interest is so great that for the last two years, JLL has held every second meeting with companies from Asia and the Middle East, Dziuba notes. If in 2015 more than 95% of the $ 540 million of foreign investments accounted for Western capital, then almost 30% of the $ 700 million invested is Asian and Middle Eastern money, calculated Irina Ushakova from CBRE. Funds from Asia and the Middle East began to look closely at Russian assets as many years ago, Kara recalls, but transactions did not happen en masse due to long negotiations. For them, the Russian market is unconventional - it took time to study and search for objects, the partner confirms. Colliers International Stanislav Bibik.

Now, high-quality or even trophy assets can be purchased at a very attractive price, and their capitalization will definitely grow in the medium term, says Kara. The value of Russian assets is low, confirms Dzyuba. In addition, according to her, Chinese investors are trying to diversify their investments against the backdrop of slowing growth in the Chinese economy and the weakening of the yuan. In addition, Russia itself, against the backdrop of sanctions, is actively cooperating with the countries of Asia and the Middle East in many areas, she sums up. Therefore, for example, Fosun is not limited to the real estate market: now the company's priority is projects in infrastructure, logistics, healthcare, agriculture, food production, etc., lists the executive director of Fosun Russia Tanya Ann Ternavskaya. These investments will definitely be more significant, she notes.

1. Guarantee of compensation in case of nationalization and requisition of property of a foreign investor or a commercial organization with foreign investments ……………………………………………………………… ... …… 3

2. Creation and liquidation of a branch of a foreign legal entity …………………………………………………………………. ……………. 7

Literature ………………………………………………………. …… ..13

1. Guarantee of compensation for the nationalization and requisition of the property of a foreign investor or a commercial organization with foreign investment.

Investment protection in the Russian Federation is guaranteed by the state.

All investors, including foreign ones, are provided with equal conditions of activity, excluding the use of discriminatory measures that could impede the establishment and management of investments.

A foreign investor on the territory of the Russian Federation is provided with full and unconditional protection of rights and interests, which is provided by the Federal Law of July 9, 1999 N 160-FZ "On Foreign Investments in the Russian Federation", other federal laws and other regulatory legal acts of the Russian Federation, and also international treaties of the Russian Federation.

A foreign investor who initially imported into the territory of the Russian Federation property and information in documentary form or in the form of recording on electronic media as a foreign investment has the right to unhindered export of said property and information outside the Russian Federation.

A foreign investor has the right to compensation for losses caused to him as a result of illegal actions (inaction) of state bodies, local authorities or officials of these bodies, in accordance with the civil legislation of the Russian Federation.

Investments cannot be nationalized, requisitioned free of charge, and measures equal to the specified consequences cannot be applied to them. The application of such measures is possible only with full compensation for all losses caused by the alienation of the invested property, including lost profits, and only on the basis of legislative acts of the Russian Federation and its member republics.

Targeted bank deposits, shares or other securities contributed or acquired by investors, payments for acquired property, as well as lease rights in cases of their withdrawal in accordance with the legislative acts of the Russian Federation, are reimbursed to investors, with the exception of amounts used or lost as a result of the actions of the investors themselves or undertaken with their participation.

Property insurance against the risk of loss (destruction), shortage or damage to property, the risk of civil liability and entrepreneurial risk is carried out by a commercial organization with foreign investments at its discretion, and by a branch of a foreign legal entity at the discretion of the parent organization, unless otherwise provided by the legislation of the Russian Federation.

A foreign investor, after paying taxes and fees stipulated by the legislation of the Russian Federation, has the right to freely use income and profits on the territory of the Russian Federation for reinvestment or for other purposes that do not contradict the legislation of the Russian Federation, and to freely transfer income and profits outside the Russian Federation. and other lawfully received sums of money in foreign currency in connection with previous investments made by him, including:

• investment income received in the form of profit, dividends, interest and other income;
• sums of money in fulfillment of the obligations of a commercial organization with foreign investments or a foreign legal entity that has opened its branch in the territory of the Russian Federation, under agreements and other transactions;
• sums of money received by a foreign investor in connection with the liquidation of a commercial organization with foreign investments or a branch of a foreign legal entity, or the alienation of invested property, property rights and exclusive rights to the results of intellectual activity;
• compensations provided for in Article 8 of this Federal Law.

A dispute of a foreign investor arising in connection with the implementation of investments and entrepreneurial activities on the territory of the Russian Federation shall be resolved in accordance with international treaties of the Russian Federation and federal laws in court or arbitration court or in international arbitration (arbitration court).

The legal regime for the activity of foreign investors and the use of the profit obtained from investments cannot be less favorable than the legal regime for the activity and use of the profit obtained from investments, provided to Russian investors, with the exceptions established by federal laws.

The property of a foreign investor or a commercial organization with foreign investments is not subject to compulsory seizure, including nationalization, requisition, except in cases and on the grounds established by federal law or an international treaty of the Russian Federation.

In case of requisition, a foreign investor or a commercial organization with foreign investments shall be paid the cost of the requisitioned property. Upon termination of the circumstances in connection with which the requisition was made, a foreign investor or a commercial organization with foreign investments has the right to demand in court the return of the preserved property, but at the same time they are obliged to return the amount of compensation received by them, taking into account losses from a decrease in the value of the property.

In case of nationalization, a foreign investor or a commercial organization with foreign investments shall be reimbursed for the value of the nationalized property and other losses.

Local government bodies of the Russian Federation within their powers in accordance with the Federal Law of February 25, 1999 N 39-FZ "On investment activities in the Russian Federation carried out in the form of capital investments", as well as other laws and regulations of the Russian Federation, and also by the laws and regulations of the constituent entities of the Russian Federation, guarantee to all subjects of investment activity:

• ensuring equal rights in the implementation of investment activities;
• publicity in the discussion of investment projects;
• stability of the rights of subjects of investment activity.

An important instrument for the protection of foreign investment are bilateral agreements on mutual encouragement and mutual protection of foreign investment, which the Russian Federation has with most countries of the world. The main purpose of such agreements is to ensure an equally favorable treatment in relation to capital investments, establish the possibility of unhindered export of part of the profits and guarantees against non-commercial risks.

2. Creation and liquidation of a branch of a foreign legal entity.

1. A branch of a foreign legal entity is understood as a separate subdivision of a foreign legal entity located outside its location and performing all or part of its functions, including the functions of a representative office. A branch of a legal entity is not a legal entity, does not possess its own property, but is endowed with the property of the legal entity that created it, and acts on the basis of the approved regulation. The head of the branch is appointed by the parent organization and acts on the basis of a power of attorney.
The goals of the establishment and activities of the branch correspond to the goals of the establishment and activities of the parent organization - a foreign legal entity. The decision on the need to create and liquidate a branch is made by the parent organization.

2. The creation of a branch of a foreign legal entity on the territory of the Russian Federation is carried out by means of its accreditation. The temporary regulation "On the procedure for accreditation of branches of foreign legal entities established in the Russian Federation", accreditation and maintenance of the state register of branches of foreign legal entities accredited in the Russian Federation are entrusted to the Accreditation Department of the State Registration Chamber under the Ministry of Justice of the Russian Federation.

Temporary regulation "On the procedure for accreditation of branches of foreign legal entities established on the territory of the Russian Federation" (approved by the Ministry of Justice of the Russian Federation on December 31, 1999) // The text of the regulation was not officially published.

For the accreditation of a branch of a foreign legal entity, an organization that has made a decision on the accreditation of its branch on the territory of the Russian Federation shall submit the following documents to the Registration Chamber:

a) a written statement on letterhead signed by the head of a foreign legal entity, indicating: name, organizational and legal form, date of registration, location, type of activity and information on business relations with Russian partners, prospects for the development of cooperation of a foreign legal entity, purpose of opening a branch of a foreign legal entity and location in the Russian Federation. The application is drawn up in Russian;

b) the charter of a foreign legal entity;

c) certificate of registration of a foreign legal entity or an extract from the trade register;

d) the decision of a foreign legal entity to open a branch in the Russian Federation;

e) the regulation on the branch, which must indicate the name of the branch and its head organization, the organizational and legal form of the head organization, the location of the branch in the Russian Federation and the legal address of its head organization, the goals of creation and types of activities of the branch, the composition, volume and terms of investment capital in the fixed assets of the branch, the procedure for managing the branch and other information reflecting the peculiarities of the branch's activities;

f) a letter of recommendation from a bank serving a foreign legal entity and confirming its solvency.
If the documents submitted for accreditation are drawn up in a foreign language, their translation into Russian, notarization and legalization by consular institutions of the Russian Federation or apostille is required.

For the accreditation of branches of foreign organizations created on the territory of the Russian Federation, a state fee is charged in the amount of 60,000 rubles for each branch.

3. When a branch of a foreign legal entity is accredited, information about it is entered into the State Register of branches of foreign legal entities accredited on the territory of the Russian Federation, as well as a certificate of accreditation is issued. The State Register of Branches of Foreign Legal Entities Accredited on the Territory of the Russian Federation means a systematized collection of reliable information about the branches of foreign legal entities accredited on the territory of the Russian Federation. Accordingly, entering into the State Register of branches of foreign legal entities accredited on the territory of the Russian Federation means including information about a foreign legal entity in the automated database, assigning a register number, issuing a certificate of the established form and putting a mark on entering into the State Register on the position of the branch ( Clause 10 of the Provisional Regulations). It is the receipt of a certificate of accreditation and entry into the Register of information about a branch of a foreign legal entity that gives the branch the right to engage in commercial activities on the territory of the Russian Federation.

In accordance with clause 10 of the Provisional Regulation, the certificate of accreditation and entry into the State Register of branches of foreign legal entities accredited on the territory of the Russian Federation shall indicate:

a) full and abbreviated (if necessary) name of the foreign legal entity in Russian;

b) the country of registration of the foreign legal entity;

c) the name of the settlement where the branch of the foreign legal entity is located on the territory of the Russian Federation;

d) the period for which a branch of a foreign legal entity is accredited on the territory of the Russian Federation;

e) certificate number;

f) date of issue of the certificate.

The certificate is certified by the official seal and signature of the Chairman of the Registration Chamber.

The accreditation of a branch of a foreign legal entity and the issuance of a certificate are carried out for a period of up to 5 years. The term may be extended upon a written application from the management of a foreign legal entity made thirty days before the expiration of the accreditation period for a branch of a foreign legal entity accredited in the Russian Federation. At the same time, an annual report on the activities of the branch is also submitted to the accrediting body.

4. Refusal to accredit a branch of a foreign legal entity is possible only if there are goals and grounds defined in the law:

a) the documents required for accreditation have not been submitted;

b) provided inaccurate or incorrect information about a foreign legal entity;

c) the activities of a foreign legal entity are contrary to the current Russian legislation.

A branch may also be denied accreditation in order to protect the foundations of the constitutional order, morality, health, rights and legitimate interests of others, to ensure the country's defense and state security.

5. The activities of a branch of a foreign legal entity accredited on the territory of the Russian Federation shall be terminated:

a) upon the expiration of the accreditation period, if the foreign legal entity has not applied to the Chamber with a request to extend the accreditation;

b) in case of liquidation of a foreign legal entity with a branch accredited in the territory of the Russian Federation;

c) by decision of a foreign legal entity that has opened a branch;

d) by a court decision;

e) if the activities of a branch of a foreign legal entity are contrary to Russian law.

Federal Law of 24.06.1999 N 119-FZ "On the principles and procedure for delimiting the subjects of jurisdiction and powers between the state authorities of the Russian Federation and state authorities of the constituent entities of the Russian Federation" became invalid due to the adoption of the Federal Law of 04.07.2003 N 95-FZ "On Amendments and Additions to the Federal Law" On General Principles of Organization of Legislative (Representative) and Executive Bodies of State Power of Subjects of the Russian Federation. " Ministry of Economic Development and Trade of the Russian Federation "lost force in connection with the publication of the RF Government Decree of 27.08.2004 N 443" On the approval of the Regulation on the Ministry of Economic Development and Trade of the Russian Federation. "

6. When accrediting a representative office of a foreign organization, the registering authority is provided with:

a) a power of attorney issued to a representative of a foreign company to negotiate the opening of a representative office of this company on the territory of the Russian Federation;

b) a written statement indicating: the name of the company, the time of its foundation, location, subject of activity, management and management bodies representing the company in accordance with the charter or statute, the goals of opening a representative office, information on business relations with Russian partners and on the prospects for developing cooperation.

c) the charter (in the event that, according to the legislation of a foreign state, the company does not have a charter, then a document confirming this legal provision issued by an authorized body is provided);

d) certificate of registration or an extract from the commercial register confirming the registration of the company;

e) the company's decision to open a representative office in the Russian Federation;

f) Bank certificate from the country of registration of the company, confirming its solvency;

g) regulations on the representation of the company;

i) a document confirming the legal address of the representative office (a letter of guarantee with a BTI mark or with a copy of a lease agreement or a certificate of ownership);

j) a card of information about the representation (issued by the Chamber, filled in on a typewriter in 2 copies)
The list of documents required for the accreditation of representative offices of foreign companies at the State Registration Chamber (approved by the State Registration Chamber of Russia) The text of the List has not been officially published.

7. Unfortunately, domestic regulations speak of the accreditation of branches (in rare cases, representative offices) of foreign legal entities only. However, the Law itself "On Foreign Investments in the Russian Federation" as a foreign investor names not only legal entities, but also organizations that are not legal entities under the laws of the country of origin. It should be agreed that strict formulations regarding foreign entities whose activities are accredited in Russia not only do not correspond to each other, but also do not take into account the differences between Russian and foreign legislation. For example, in Germany and Switzerland, general partnerships and limited partnerships are not legal entities. Thus, there is an urgent need to amend the domestic legislation.

Literature

1. Eremeishvili L.A. Some issues of legal regulation of foreign investment in the Russian Federation // State and law at the turn of the century. International law (materials of the All-Russian conference). M., 2000.S. 120.

2. Federal Law on Foreign Investments in the Russian Federation of July 9, 1999 No. 1bO-FZ

3. Analysis of the effectiveness of investment and innovation activities of the enterprise: Textbook. a guide for students on econ. specialties / Krylov E.I., Vlasova V.M. - 2nd ed., Rev. and additional - M .: Finance and statistics, 2003.

4. Askinadze V.M. Investment strategies in the securities market, Market DS Publishing House, 2004, Book, 106 pages,

5. Business plan of the investment project: Textbook. / Ed. V.M Popov ". M .: Finance and Statistics, 2001. Pp. 18-56,

6. Guskov NS etc. Investments. Forms and methods of attracting them. Moscow: Algorithm, 2001.384 p.

• 1. The property of a foreign investor or a commercial organization with foreign investments shall not be subject to compulsory seizure, including nationalization, requisition, except in cases and on the grounds established by federal law or an international treaty of the Russian Federation.
• 2. In case of requisition, a foreign investor or a commercial organization with foreign investments shall be paid the cost of the requisitioned property. Upon termination of the circumstances in connection with which the requisition was made, a foreign investor or a commercial organization with foreign investments has the right to demand in court the return of the preserved property, but at the same time they are obliged to return the amount of compensation received by them, taking into account losses from a decrease in the value of the property.

In case of nationalization, a foreign investor or a commercial organization with foreign investments shall be reimbursed for the value of the nationalized property and other losses. Disputes on compensation for losses shall be resolved in the manner prescribed by Article 10 of this Federal Law.

Guarantee against unfavorable changes for a foreign investor and a commercial organization with foreign investments of the legislation of the Russian Federation

1. In the event that new federal laws and other regulatory legal acts of the Russian Federation come into force that change the size of import customs duties (with the exception of customs duties caused by the application of measures to protect the economic interests of the Russian Federation when carrying out foreign trade in goods in accordance with the legislation of the Russian Federation) Federation), federal taxes (with the exception of excise taxes, value added tax on goods produced on the territory of the Russian Federation) and contributions to state non-budgetary funds (except for contributions to the Pension Fund of the Russian Federation), or are introduced into the current federal laws and other regulatory legal acts of the Russian Federation, amendments and additions that lead to an increase in the total tax burden on the activities of a foreign investor and a commercial organization with foreign investments for the implementation of priority investment projects, or establish a regime of prohibitions and restrictions in relation to foreign investments in the Russian Federation in comparison with the total tax burden and the regime in force in accordance with federal laws and other regulatory legal acts of the Russian Federation on the day of the start of financing the priority investment project from foreign investments, then such new federal laws and other regulatory legal acts legal acts of the Russian Federation, as well as amendments and additions made to the current federal laws and other regulatory legal acts of the Russian Federation, are not applied during the periods specified in clause 2 of this article in relation to a foreign investor and a commercial organization with foreign investments carrying out priority investment projects at the expense of foreign investments, provided that the goods imported into the customs territory of the Russian Federation by a foreign investor and a commercial organization with foreign investments are used for their intended purpose for sale tion of priority investment projects.

The provisions of the first paragraph of this clause apply to a commercial organization with foreign investments, if the share, shares (contribution) of foreign investors in the authorized (joint) capital of such an organization is more than 25 percent, as well as to a commercial organization with foreign investments implementing a priority investment project, regardless of from the share, shares (contribution) of foreign investors in the authorized (pooled) capital of such an organization.

• 2. Stability for a foreign investor carrying out an investment project, the conditions and regime specified in paragraph 1 of this article, is guaranteed during the payback period of the investment project, but not more than seven years from the date of the start of financing of the specified project at the expense of foreign investments. Differentiation of the payback periods of investment projects depending on their types is determined in the manner established by the Government of the Russian Federation.
• 3. In exceptional cases, when a foreign investor and a commercial organization with foreign investments implements priority investment projects in the production or creation of transport or other infrastructure with a total volume of foreign investments of at least 1 billion rubles (at least an equivalent amount in foreign currency at the rate of the Central Bank Of the Russian Federation as of the date of entry into force of this Federal Law), the payback period of which exceeds seven years, the Government of the Russian Federation makes a decision to extend the term of the conditions and regime specified in paragraph 1 of this article for the specified foreign investor and commercial organization with foreign investments.
• 4. The provisions of paragraph 1 of this article do not apply to changes and additions that are made to legislative acts of the Russian Federation, or new federal laws and other regulatory legal acts of the Russian Federation that are being adopted in order to protect the foundations of the constitutional order, morality, health, rights and legitimate interests of others. persons, ensuring the defense of the country and the security of the state.
• 5. The Government of the Russian Federation:

establishes criteria for assessing changes in the unfavorable for a foreign investor and a commercial organization with foreign investments in relation to the conditions for the collection of import customs duties, federal taxes and contributions to state extra-budgetary funds, the regime of prohibitions and restrictions on foreign investments in the territory of the Russian Federation;

approves the procedure for registration of priority investment projects by the federal executive body specified in Article 24 of this Federal Law;

exercises control over the fulfillment by a foreign investor and a commercial organization with foreign investments of their obligations to implement priority investment projects within the time frames specified in paragraphs 2 and 3 of this article.

In the event that a foreign investor and a commercial organization with foreign investments fail to fulfill the obligations specified in part one of this paragraph, they are deprived of the benefits provided to them in accordance with this article. The amount of funds not paid as a result of the provision of these benefits shall be refunded in the manner prescribed by the legislation of the Russian Federation.

“We need to learn the rules of the game. And then, you need to start playing the best. " A. Einstein

Foreign investments enjoy full and unconditional legal protection, which is provided by the legislation of the Russian Federation and international treaties in force on the territory of Russia (Article 5 of the Law on Foreign Investments). As indicated above, on the territory of the Russian Federation, foreign investors are provided with a national legal regime.

In some respects, foreign investment is even more secure than domestic investment. The so-called "grandfather's" (stabilization) clause can be applied to foreign investments - that is, the application of a normative act in force at the time of the start of project financing for a certain period of time, in the event of a new normative act being adopted that worsens the situation of a foreign investor.

In accordance with Art. 2 of the Civil Code of the Russian Federation (hereinafter - the Civil Code of the Russian Federation), the rules established by civil law apply to relations with the participation of foreign citizens, stateless persons and foreign legal entities, unless otherwise provided by federal law. A foreign investor has the right to compensation for losses caused to him as a result of illegal actions (inaction) of state bodies, local authorities or officials of these bodies, in accordance with the civil legislation of the Russian Federation (in accordance with article 1069 of the Civil Code of the Russian Federation, damage is compensated at the expense of the treasury of the Russian Federation , treasury of a constituent entity of the Russian Federation or treasury of a municipal formation). Responsibility arises in the presence of the fault of the inflictor of harm. The relevant financial authorities act on behalf of the treasury.

In accordance with paragraph 5 of Art. 27 of the Arbitration Procedure Code of the Russian Federation (hereinafter referred to as the Arbitration Procedure Code of the Russian Federation), arbitration courts consider cases under their jurisdiction with the participation of Russian organizations, citizens of the Russian Federation, as well as foreign organizations, international organizations, foreign citizens, stateless persons engaged in entrepreneurial activities, organizations with foreign investments unless otherwise provided by an international treaty of the Russian Federation. Thus, enterprises with foreign investments are participants in the arbitration process, regardless of the existence of an agreement to refer the dispute to an arbitration court.

The Foreign Investment Law provides for the following guarantees for foreign investors:

1. Guarantee of the use by a foreign investor of various forms of investment in the territory of the Russian Federation.

A foreign investor has the right to make investments in Russia in any form not prohibited by the legislation of the Russian Federation (Article 6 of the Law on Foreign Investments).

At the same time, a mandatory preliminary approval of transactions made by foreign states, international organizations or organizations under their control has been established and as a result of which the right is acquired, directly or indirectly, to dispose of more than 25 percent of the total number of votes attributable to voting shares (stakes) of a Russian enterprise, or otherwise. the ability to block the decisions of the governing bodies of such a Russian enterprise. The procedure for preliminary approval is established in Articles 9 - 12 of the Federal Law of April 29, 2008. No. 57-FZ "On the Procedure for Making Foreign Investments in Business Companies of Strategic Importance for Ensuring the Defense of the Country and Security of the State". An exception that does not require mandatory preliminary approval of transactions is established in relation to international financial organizations created in accordance with international treaties to which the Russian Federation is a party, or international financial organizations with which the Russian Federation has concluded international treaties (The list of such organizations is approved by the Government of the Russian Federation).

Arbitrage practice:

A citizen of the PRC S. applied to the Arbitration Court of the Amur Region with a statement that the decision of the tax inspectorate to refuse state registration of a legal entity in the form of a limited liability company - an enterprise wholly owned by a foreign investor - was declared illegal, and asked to oblige the inspectorate to carry out such registration within five days from the moment the decision was made. The refusal to register the company was recognized by the court as illegal. The court found that according to Art. 6 of the Law on Foreign Investments, foreign investors have the right to make investments in the territory of the Russian Federation in any form not prohibited by the legislation of the Russian Federation. Thus, the argument of the tax authority that federal laws limited the right of a foreign citizen to create legal entities with foreign investments, in particular limited liability companies, was reasonably rejected by the court as inconsistent with the above legislative acts.

2. Guarantee of transfer of rights and obligations of a foreign investor to another person

A foreign investor, by virtue of an agreement, has the right to transfer his rights (to assign claims) and obligations (to transfer a debt), and on the basis of a law or a court decision is obliged to transfer his rights (to assign claims) and obligations (to transfer a debt) to another person in accordance with the civil legislation of the Russian Federation, established by Chapter 24 of the Civil Code of the Russian Federation (with the exception of industrial-production, technology-innovative or tourist-recreational activities carried out by residents of a special economic zone).

The right (claim) belonging to the creditor on the basis of an obligation can be transferred by him to another person under a transaction (assignment of the claim) or transferred to another person on the basis of the law (Article 382 of the Civil Code of the Russian Federation).

If a foreign state or a state body authorized by it makes a payment in favor of a foreign investor under a guarantee (insurance contract) provided to a foreign investor in relation to investments made by him on the territory of the Russian Federation, and the rights are transferred to this foreign state or a state body authorized by it (claims are assigned ) of a foreign investor for these investments, then in the Russian Federation such a transfer of rights (assignment of claim) is recognized as lawful.

3. Guarantee of compensation in case of nationalization and requisition of property of a foreign investor or a commercial organization with foreign investments

The property of a foreign investor or a commercial organization with foreign investments is not subject to compulsory seizure, including nationalization, requisition, except for cases and on the grounds established by federal law or an international treaty of the Russian Federation (clause 1 of article 8 of the Law on Foreign Investments).

No one can be deprived of their property except by a court decision. Compulsory alienation of property for state needs can be carried out only on condition of preliminary and equivalent compensation (part 3 of Article 35 of the Constitution of the Russian Federation).

In case of requisition, a foreign investor or a commercial organization with foreign investments shall be paid the cost of the requisitioned property. Upon termination of the circumstances in connection with which the requisition was made, a foreign investor or a commercial organization with foreign investments has the right to demand in court the return of the preserved property, but at the same time they are obliged to return the amount of compensation received by them, taking into account losses from a decrease in the value of the property.

In cases of natural disasters, accidents, epidemics, epizootics and other circumstances of an extraordinary nature, property in the interests of society, by decision of state bodies, may be withdrawn from the owner in the manner and under the conditions established by law, with payment of the value of the property (requisition) ( article 242 of the Civil Code of the Russian Federation).

In case of nationalization, a foreign investor or a commercial organization with foreign investments shall be reimbursed for the value of the nationalized property and other losses. Disputes on damages are resolved in accordance with international treaties of the Russian Federation and federal laws in court or arbitration court or in international arbitration (arbitration court) (Article 10 of the Law on Foreign Investments).

In the event that the Russian Federation adopts a law terminating the right of ownership, the losses caused to the owner as a result of the adoption of this act, including the value of the property, shall be reimbursed by the state. Disputes about damages are resolved by the court (Article 306 of the Civil Code of the Russian Federation).

4. Guarantee against changes in the legislation of the Russian Federation unfavorable for a foreign investor and a commercial organization with foreign investments

In case of an unfavorable change in Russian legislation (the entry into force of new federal laws or other regulatory legal acts of the Russian Federation that change the size of federal taxes, or entail an increase in the tax burden), the stability of the conditions for the implementation of investment projects is guaranteed in relation to:

1. foreign investors (commercial organizations with foreign investments, regardless of the size of the share or contribution of foreign investors in their authorized or pooled capital) carrying out priority investment projects;
2. commercial organizations with foreign investments with a share or contribution of a foreign investor in the authorized or joint capital of more than 25 percent, carrying out any investment projects.

The guarantee of the stability of the conditions for the implementation of the investment project lies in the fact that during the payback period (but not more than seven years from the date of the start of financing of the investment project) new or amended Russian legislation does not apply, which establishes a regime of prohibitions and restrictions for the entrepreneurial activity of foreign investors or leads to an increase in the total tax burden on the activities of a foreign investor (a commercial organization with foreign investments) in comparison with the total tax burden and the regime of prohibitions and restrictions in force on the day of the start of financing an investment project at the expense of foreign investments. In this case, the Government of the Russian Federation is endowed with the following powers:

• differentiate the payback periods of investment projects;
• extend the payback period over seven years, if the total volume of investments in the implementation of a priority investment project in the field of production or the creation of the necessary infrastructure (transport, communications, etc.) is at least 1 billion rubles (not less than the equivalent amount in foreign currency);
• establish criteria for assessing changes in unfavorable for a foreign investor and a commercial organization with foreign investments in relation to the conditions for levying federal taxes and contributions to state extra-budgetary funds, the regime of prohibitions and restrictions on foreign investments in Russia;
• approve the procedure for registering priority investment projects;
• control the implementation of obligations for the implementation of investment projects within the time frame of their payback.

In the event that a foreign investor and a commercial organization with foreign investments fail to fulfill their obligations to implement the investment project, they are deprived of the benefits provided to them in accordance with this article. The amount of funds not paid as a result of the provision of these benefits is subject to return in the manner prescribed by the legislation of the Russian Federation (Article 9 of the Law on Foreign Investments).

Arbitrage practice:

Between the Society and the Government of the constituent entity of the Russian Federation was concluded in 1999. an agreement on the implementation of investment activities, according to which the Company carried out an investment project, and the government of a constituent entity of the Russian Federation provided certain tax benefits, incl. exemption from income tax in the amount of 100% for the entire period of the actual return on investment and in the amount of 50% within two years after the end of the period of the actual return on investment.

In 2005. The company submitted to the Inspectorate the revised income tax declaration for 2004, in which it declared a tax benefit in terms of income tax payments credited to the constituent entity of the Russian Federation. The inspectorate suggested that he pay the income tax and penalty interest to the budget of the constituent entity of the Russian Federation. In support of the decision, the tax authority referred to item 1 Art. 8 of the Federal Law of 08.12.03 N 163-FZ "On Amendments to Certain Legislative Acts of the Russian Federation on Taxes and Fees" (hereinafter - Federal Law of 08.12.03 N 163-FZ), in accordance with which the benefit used by the applicant when calculating income tax was no longer in force from 01.01.2004.

The court satisfied the statement of the Society, stating that the use of the profit tax privilege provided by item 9 Art. 6 of the Law of the Russian Federation of December 27, 1991 N 2116-1 "On Tax on Profits of Enterprises and Organizations" refers to continuing legal relations, to which the Federal Law of December 8, 03 N 163-FZ is not subject to application as worsening the position of the taxpayer.

5. Guarantee of ensuring the proper resolution of a dispute arising in connection with the implementation of investments and entrepreneurial activities in the territory of the Russian Federation by a foreign investor

A dispute between a foreign investor arising in connection with the implementation of investments and entrepreneurial activities on the territory of the Russian Federation shall be resolved in accordance with international treaties of the Russian Federation and federal laws in court or arbitration court or in international arbitration (arbitration court) (Article 10 of the Law on Foreign Investments ).

The judicial practice of the resolution of disputes by arbitration courts related to the protection of foreign investments is set out in the information letter of the Presidium of the Supreme Arbitration Court of the Russian Federation (hereinafter - the Supreme Arbitration Court of the Russian Federation) No. 58 dated January 18, 2001.

The main provisions of this document are as follows:

1. The legal status of a foreign legal entity in the arbitration court of the Russian Federation cannot be confirmed by documents certified only by a foreign consular service
2. Refusal of state registration of amendments to the constituent documents of an enterprise with foreign investments is possible only in case of violation of the procedure for making such amendments established by the legislation in force in the territory of the Russian Federation.
3. The decision to terminate the activities of a joint stock company with the participation of a foreign investor cannot be carried out without the explicit consent of the foreign shareholder to liquidate such a company.
4. The legal regime of foreign legal entities cannot be less favorable than the legal regime of foreign investors from any third countries (most favored nation treatment)
5. The arbitral tribunal terminates proceedings in an investment dispute in which the defendant is a foreign state acting as a sovereign
6. The arbitral tribunal accepts a claim in a commercial dispute, in which the defendant is a person endowed with international immunities
7. Immunity does not apply to the commercial activities of an international organization not provided for by international treaties (its charter and headquarters agreement)
8. A foreign investor is subject to the principle of protection against toughening of national legislation regulating the investment regime for a specific period.
9. Foreign investors have the right to defend their economic interests as third parties in a case considered by the Arbitration Court of the Russian Federation
10. Payments paid to the customs authorities of the Russian Federation when importing property as a contribution of a foreign investor to the statutory fund of a business company with foreign investment, as well as property intended for its own material production, are taken into account when paying taxes in the Russian Federation by this enterprise with foreign investment
11. A foreign legal entity that has paid taxes to the budget of the Russian Federation, when fulfilling a monetary obligation under a foreign economic contract, cannot be considered as having failed to fulfill a monetary obligation
12. When considering disputes, the arbitration court should take into account that a foreign investor is provided with benefits in connection with the elimination of double taxation in accordance with the international treaties of the Russian Federation that have entered into force.
13. Foreign entrepreneurs are provided with tax incentives in accordance with the regulations on the creation of free economic zones
14. International regional tariff preferences to foreign investors are applied only if the investor comes from a state party to the Agreement on such preferences
15. An enterprise with foreign investments cannot be deprived of customs preferences in the absence of evidence of its illegal behavior
16. Penalties are not applied to a foreign company enjoying a tax benefit on the basis of an order of the executive authority adopted in excess of its powers
17. When concluding transactions in relation to real estate located in Russia, a foreign investor is obliged to comply with the requirements of the legislation of the Russian Federation on the registration of such transactions
18. Privatization transactions with the participation of foreign persons committed in violation of Russian law are invalidated on the terms of bilateral restitution
19. The arbitration court leaves the claim without consideration if there is an arbitration clause in the foreign economic contract that disputes under the contract are resolved in international commercial arbitration "ad hoc"
20. In the event of an appeal by the disputing parties, the arbitration court accepts for consideration a claim for the execution of an agreement with a foreign investor containing an arbitration record
21. The arbitral tribunal shall execute the decision of the arbitral tribunal in the presence of a clearly expressed will to transfer a private dispute to the arbitral tribunal
22. The arbitration court accepts a claim with the participation of a foreign person for consideration if there are rules on the jurisdiction of such disputes in an international treaty of the Russian Federation

6. Guarantee of use on the territory of the Russian Federation and transfer outside the Russian Federation of income, profit and other lawfully received sums of money

In accordance with Art. 11 of the Law on Foreign Investments, after paying taxes and fees stipulated by the legislation of the Russian Federation, a foreign investor has the right to freely use income and profits on the territory of the Russian Federation for reinvestment in compliance with the provisions of clause 2 p. 4 of the Law on Foreign Investments or for other purposes that do not contradict the legislation of the Russian Federation and for the unimpeded transfer of income, profits and other lawfully received amounts of money in foreign currency outside the Russian Federation in connection with his previous investments, including:

• investment income received in the form of profit, dividends, interest and other income;
• sums of money in fulfillment of the obligations of a commercial organization with foreign investments or a foreign legal entity that has opened its branch in the territory of the Russian Federation, under agreements and other transactions;
• sums of money received by a foreign investor in connection with the liquidation of a commercial organization with foreign investments or a branch of a foreign legal entity, or the alienation of invested property, property rights and exclusive rights to the results of intellectual activity;
• compensation for the nationalization and requisition of the property of a foreign investor or a commercial organization with foreign investment.

This article of the Law on Foreign Investments does not enshrine the freedom to transfer abroad another type of foreign investor's income - wages and other remuneration. Unlike her, Model agreement between the Government of the Russian Federation and the Government of a foreign state on the encouragement and mutual protection of investments, except for those specified in The law on foreign investment of types of income, secures the unhindered transfer abroad of wages and other remuneration received by the investor and individuals of the other Contracting Party who are allowed to work in connection with the investment in the territory of the first Contracting Party.

7. Guarantee of the right of a foreign investor to unimpeded export outside the Russian Federation of property and information in documentary form or in the form of a record on electronic media, which were originally imported into the Russian Federation as a foreign investment

A foreign investor who initially imported property and information into the Russian Federation in documentary form or in the form of a record on electronic media as a foreign investment has the right to unimpeded (without quotas, licensing and other measures of non-tariff regulation of foreign trade activity) export of said property and information outside the Russian Federation (Article 12 of the Law on Foreign Investments).

8. Guarantee of the right of a foreign investor to purchase securities

Article 13 of the Law on Foreign Investments provides for a foreign investor with the opportunity to purchase shares and other securities of Russian commercial organizations, as well as government securities in accordance with the legislation of the Russian Federation on securities.

9. Guarantee of participation of a foreign investor in privatization

A foreign investor can participate in the privatization of state and municipal property by acquiring ownership rights to state and municipal property or a share, share (contribution) in the authorized (joint-stock) capital of the privatized organization on the terms and in the manner established by the legislation of the Russian Federation on the privatization of state and municipal property (Art. 14 of the Law on Foreign Investment).

10. Guarantee of granting a foreign investor the right to land plots, other natural resources, buildings, structures and other real estate.

The acquisition by a foreign investor of the right to land plots, other natural resources, buildings, structures and other real estate is carried out in accordance with the legislation of the Russian Federation and the legislation of the constituent entities of the Russian Federation.

The right to conclude a lease agreement for a land plot may be acquired by a commercial organization with foreign investments at an auction (auction, tender), unless otherwise provided by the legislation of the Russian Federation (Article 15 of the Law on Foreign Investments).

11. Benefits provided to a foreign investor and a commercial organization with foreign investment in the payment of customs duties.

Privileges in the payment of customs payments are provided to foreign investors and commercial organizations with foreign investments when they implement a priority investment project in accordance with the customs legislation of the Customs Union, international treaties of the member states of the Customs Union, the legislation of the Russian Federation on customs and the legislation of the Russian Federation on taxes and fees (Article 16 of the Foreign Investment Law).

Separately, the existing customs privileges for the import of goods into the territory of the Customs Union and judicial practice in this area will be discussed in a special chapter devoted to the investment climate in the territory of the member states of the Customs Union.

12. Benefits and guarantees provided to a foreign investor by the constituent entities of the Russian Federation and local governments

The constituent entities of the Russian Federation and local self-government bodies, within their competence, may provide a foreign investor with benefits and guarantees, finance and provide other forms of support for an investment project carried out by a foreign investor, at the expense of the budgets of the constituent entities of the Russian Federation and local budgets, as well as extra-budgetary funds (Art. 17 of the Foreign Investment Law).