Hi-Tech Companies Need “Green Channel”

Lawyers from the customs and foreign trade regulation practice of Pepeliaev Group, headed by Galina Balandina, are delighted to announce completion of a project entitled “Green Channel” for innovation companies. The assignment was ordered by the Russian Corporation of Nanotechnologies (RUSNANO). The project proposes a “Green Channel” for innovation companies, which will help remove a number of customs barriers and thereby expand the foreign economic activities of Russian hi-tech companies and also enhance the international exchange of research data between scientific and research institutions.

Summarising the results of the project, experts from Pepeliaev Group note that the most sensitive barriers are attributable to the application of customs procedures, compliance with various controls, tax administration regarding the application of VAT at 0% on exports and tax deductions on the acquisition of goods for the manufacture of products for export. These factors not only prevent the development of the foreign economic activities of existing hi-tech enterprises and inhibit international sharing of research data, but also act as a deterrent for the establishment of new export-oriented production companies in Russia. According to Galina Balandina, “implementation of the ‘Green Channel’ will enable Russian companies to reach a new level of technology development and lead to the widespread modernisation of production facilities”.

Galina Balandina presented a report “‘Green Channel’ for Innovation Companies” based on the results of the research. The report was approved on 23 November 2009 at a session of the Committee for Innovation Policy of the Russian Union of Industrialists and Entrepreneurs. 

Anatoly Chubais, RUSNANO CEO and head of the Committee explained: “We do not plan to try and reform the whole system of foreign trade regulation in Russia. We are simply seeking to resolve a very specific task: to remove excessive administrative barriers and thereby facilitate the access of Russian innovation companies to international markets.”

The session was also attended by: Valery Draganov, first deputy chairman of the industry committee of the State Duma of the Federal Assembly of the Russian Federation; Alexander Abramov, chairman of the board of directors of Evraz Group; Anatoly Karachinsky, president of IBS Group; Valentin Gapanovich, senior vice-president and chief engineer at Russian Railways; Mikhail Gamzin, CEO of TECHNOPROM Innovation Corporation; Mikhail Rogachev, executive director of ONEXIM Group, and many others.

After discussions, the participants of the Committee agreed on a number of proposals and recommendations aimed at creating the “green channel” for innovation companies. In particular, they proposed defining high value-added products subject to simplified export procedures that would facilitate access to international markets for the innovation companies developing these products, first and foremost, small and medium businesses. When high value-added products cross the border, the administrative formalities for such products should be comparable (in terms of the timeframe and requirements on documentation and data) with the conditions for clearing similar products from other countries (USA, European Union, China, Israel and Japan).

Based on the prepared research, the Committee recommended that the RF Government implement a number of reforms in the sphere of customs law and foreign trade regulation during 2010.

The Committee approved a package of regulatory initiatives presented by RUSNANO and passed a resolution to propose that the Bureau of the Russian Union of Industrialists and Entrepreneurs consider at its next session the establishment of a “green channel” for innovation companies.