This is the fourth edition of our Doing Business in Russia Guide (Guide), which provides an overview of the Russian legal system and explains key legal issues for foreign investors to consider.
A number of important factors have been shaping the investment landscape in Russia in recent years. These include: • Maturing legal system. Russia has been making progress towards building a modern legal system. In 2018, Russia was ranked 31st (of 190 countries) in the World Bank's annual Doing Business Ranking which reflects the overall ease of doing business in a country. The categories of the ranking include, among others, the ease of starting a business, registering property and enforcing contracts. This Guide discusses some recent changes to Russian law that have supported this success, along with some of the challenges that still remain. • Impact of international sanctions. The ongoing sanctions have had a negative impact on EU/US investments into Russia. For Russian businesses affected by the sanctions, obtaining EU/US equity and debt financing remains a challenge. Tailored exit mechanisms in the context of Russian joint ventures are required given the ongoing risk of new sanctions. On the other hand, since the introduction of the sanctions in 2014, investments in Russia by Chinese and other Asian investors have been on the rise. Eastbound investments by Russian majors have also increased. • Foreign investment review. A new law allowing for greater scrutiny of inbound investments was adopted in 2017. Under the new law, any acquisition of "control" over any Russian company (or its assets over a certain specified threshold) by a foreign investor may be subject to review on national security grounds. It is important to understand though that this reflects a global trend towards greater scrutiny of foreign investments across OECD. As at the date of this Guide, we are not aware of any deals that were blocked by the Russian regulator based on the new law. Given the complexity of the Russian legal system, this Guide can only ever be introductory in its nature but we hope that it will help clarify the key issues and allay initial concerns. As with all legal systems, Russian law and regulation are subject to regular change. This Guide reflects the law as at the date of publication and where possible highlights changes anticipated in the near future..