Overview of Russian Corporate Law.

Russian law in general is based on statutes. Only laws and sublaws (so-called instructions issued by the relevant ministry on basis of an authorization under a law) are regarded as source of law. Case law is not a source of law. In practice, however, the judges use precedents or prior decisions on similar cases when preparing their decisions. If certain situations are not regulated by laws and sublaws, the judge, when preparing his decision in a court case, normally refers to court practice. Nevertheless, when drafting adjudications he may refer only to laws and sublaws and not to case law on similar matters, with the exception of the rulings of the Constitutional Court.

Company law forms part of civil law. The main source of company law is the Civil Code of the RF. Where appropriate, the Code makes references to statutes, most importantly Federal Law 208-FZ of 26 December 1995 "On Joint-Stock Companies" and Federal Law 14-FZ of 8 February 1998 "On Limited Liability Companies".

The Civil Code, which was introduced by Federal Laws 52-FZ of 30 November 1994, 15-FZ of 26 January 1996 and 147-FZ of 26 November 2001, provides a closed list of legal entities existing in Russia.

The Code distinguishes between commercial and non-commercial organizations. Commercial legal entities may take any of the following forms (collectively known as "economic partnerships and corporations"):

- public joint-stock company (otkrytoe akcionernoe obshchestvo, OAO);
- private joint-stock company (zakrytoe akcionernoe obshchestvo, ZAO);
- limited liability company (obshchestvo s ogranichennoj otvetstvennost'ju, OOO);
- additional liability company (obshchestvo s dopolnitel'noj otvetstvennostju);
- general partnership (polnoe tovarishchestvo);
- limited partnership (komanditnoe tovarishchestvo);
- industrial cooperative (proizvodstvenyj kooperativ); and
- state and municipal unitary enterprise (gosudarstvennoe i municipal'noe unitarnoe predprijatie).

In addition to the above-mentioned legal entities, individuals, simple and silent partnerships (which are not considered legal entities) may engage in commercial activities.

Non-profit organizations may take the form of institutions, public associations, consumers' cooperatives, social funds and religious associations.

The most important forms of legal entities are the limited liability company, the private joint-stock company and the public joint-stock company. In all three cases, the liability of the shareholders for the company debts is limited to the amount of their contributions to the nominal capital of the company.

Foreign investors may establish fully foreign-owned companies of any form, with the exception of unitary enterprises. Foreign companies may also register representative offices (for auxiliary and preparatory activity) or branch offices (for commercial activity). Please refer to the table comparing the most commonly used types of entities and offices.

More in details >>>