Registration of legal entities and individual entrepreneurs will be simplified

Pepeliaev Group advises that the Russian Government has approved a draft law to simplify the state registration procedure for legal entities and individual entrepreneurs.

At its session, the Russian Government approved a draft law[1] enabling entrepreneurs, when they register their businesses, to automatically submit their documents to the Federal Tax Service through a notary. The draft law has been developed in accordance with the Roadmap “Transformation of a business climate”.

The draft law stipulates that a notary who has certified the authenticity of a signature on the application for state registration of an individual entrepreneur or the establishment of a legal entity must individually send such application and other documents in the electronic form to the registration authority by the end of the business day at the latest.

Notaries certify the signature on the application and subsequently forward the relevant documents to the registration authority within the scope of a single notarial act. The draft law does not specify the amount of the tariff for such ‘single’ notarial act.

Please be reminded that at present the following persons can submit the documents to the registration authority: an applicant or his representative acting under a notarised power of attorney or a notary (for a fee). Documents can be sent to the registration authority electronically as well.

The document also stipulates that if several founders are involved in founding a legal entity, the notary who certified the authenticity of the last founder's signature shall send the necessary documents to the registration authority.

What to think about and what to do

It is anticipated that the law will help to reduce time and financial costs of entrepreneurs. Specifically, as notaries will be responsible for submitting the documents for state registration of individual entrepreneurs or legal entities, applicants will no longer have to engage representatives to file their documents for state registration and have a power of attorney issued to that end, or to apply to the tax inspectorate personally. Please also be reminded that since 1 January 2019 no state duty is required to be paid for the state registration of individual entrepreneurs or legal entities when the documents are filed electronically. As the draft law suggests that a notary sends such documents automatically once the authenticity of the applicant’s signature has been certified, no state duty will have to be paid for the state registration of an individual entrepreneur or a legal entity.[2]

We recommend following up the status of the draft law and taking into account in the future the new opportunities offered by the law.

Help from your adviser

Pepeliaev Group’s experts are ready to offer any legal support in registration procedures as well as to provide comments on contentious issues relating to the application of legal provisions.