Russian And Western Contract Law Distinctions

Russian and Western approaches to entering into and execution of contracts are different.  

We have different legal culture, which naturally has its impact. Unfortunately, in some cases transactions fall through, sometimes because a European entrepreneur does not understand the requirements put forward by the Russian colleague. 

Russian legislation specifies explicitly: transactions that are made between legal entities and with individuals must be executed as a written contract (Article 161 of the Civil Code of the Russian Federation). This applies directly to international (foreign economic) contracts made with foreign partners.

Only in this case, the written contract, which sets forth the subject matter of the arrangements, rights, obligations and liability of the parties, is not only a legal guarantee, but also an "authorization" document for completing formalities related to the performance of a foreign economic contract. 

For example, a bank acting as an agent of currency control requires submission of a written contract to perform currency transactions, which include, in particular, cash settlements between Russian (resident) and foreign (non-resident) parties. A foreign economic contract is also required for the customs clearance of the goods crossing the Russian border.

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Unel Legal Consulting

The Next President of Russia Will Be a Woman ...

Western media insist on the fact that after years of patriarchal in politics and economy of the Russian Federation only a woman may bring good order  to politics and economy and immediately call the first female candidates for President of Russia.
In particular, the publication of «The Independent» making big bets on the St. Petersburg Governor Valentina Matvienko, which, according to newspaper reporters, could be Russian Margaret Thatcher or Angela Merkel and has a lot of chances to win the presidential election, scheduled for 2012.
The key to the victory of Mrs. Matvienko media called the support of the current Prime Minister Vladimir Putin, who recently was not very pleased with his protege for the presidency, Dmitry Medvedev .



By materials of isra.com

Russian Company Severstal Returned to Profit Under IFRS in the II Qarter 2010

One of the largest Russian steel producer  "Severstal" returned to profit for the II quarter of 2010. The report prepared in accordance with International Financial Reporting Standards (IFRS) informs. During April-June this year the company earned $192 million compared to a loss of $290 million during the same period a year earlier.
In the previous quarter (January-March 2010) the company received a loss of $ 785 million  under IFRS for the I half of the year amounted to $ 593 million, down 38% compared to the same period last year.
Return to the quarterly earnings in the company attributed the increase in production volumes, higher prices for products of the company, as well as reduced costs for raw materials and transportation.
Despite the profits, the Board of Directors of "Severstal" does not recommend the payment of dividends for the II quarter of 2010. Nevertheless, management believes they could resume paying dividends in the foreseeable future.
Revenues in II quarter has decreased by 25%  amounting to $ 4.25 billion, while EBITDA amounted to 955 million dollars (compared to negative EBITDA of $ 5 million in April-June last year).
"Severstal" is a vertically integrated steel producer. The company's assets are in Russia, Ukraine, Kazakhstan, Italy, France, the United States and Africa. The company's shares are traded on the Russian RTS and the London Stock Exchange (LSE).
Last year "Severstal" has reduced steel production by 13% - to 16.75 million tons, getting a loss under IFRS amounting to 1.04 billion dollars since the beginning of the same this year, increasing its output against the recovery of world markets.

New Plant of Siemens in Voronezh Region of Russia

In the Voronezh region of Russia the first stone in the construction of a transformer factory "Siemens" was laid.

The ceremony, which took place in the industrial park "Maslovsky", was attended by Governor of the Voronezh region Alexei Gordeev, Director of the energy transfer of the energy sector department of the concern Siemens AG Duo Nihage and President of Siemens in Russia and Central Asia, Vice President of Siemens AG Dietrich Muller. 

On the place of this symbolic stone in the coming years will be industrial zone including 20-productions.

The plant will be fully integrated into the global technology and manufacturing network, of Siemens and will provide as a minimum of 300 new jobs. The company's products will be implemented in Russia and will go for export.

Voronezh region and Siemens also signed an agreement on cooperation in implementing projects in the sphere of high technologies, including the establishment of electronic government, electronic city, as well as improving energy efficiency.

In addition, the President of Siemens in Russia Dietrich Möller gave Alexei Gordeev certificate of donation from Siemens in the fund assistance to victims of fires in 2010 in the amount of 125 thousand Euro.

The first contract valued at almost 60 million Euro for the products of the future plant  was signed. Siemens has ordered 884 throttle network filters for approximately 5 years, 221 twin engine series 2ES10, whose production for the needs of "Russian Railways will soon be launched in LLC "Ural locomotives" - a joint venture of Siemens and a group Cinara.

On materials of the official site of the Voronezh region http://www.govvrn.ru/wps/portal

Revenues From Telecom Services in Russia Rose By 4.9 Percent

This is reported by the press service of Russian Ministry of Communications. The indicators are based on statistics of investments and fixed assets of  telecom companies, information exchange on communication networks, data service-level of comminvestment unications and economic indicators of the industry.
Revenues from telecommunications services amounted to 649.5 billion rubles. That is 4.9 per cent increase over the same period last year. Mobile operators' revenue increased by 6,4 percent  up to 284 billion rubles. The income of local telephone services in cities increased by 11.1 percent, rural areas - by 9.9 percent. 

GLONASS is Close to Operating Around the World

Formation of the space group of the Russian global positioning system GLONASS is near to completion. Rocket Proton-M launched on Thursday from the Baikonur Cosmodrome  launched to low earth target orbit  three satellites GLONASS-M.

Russian global navigation satellite system GLONASS operates on the principle similar to the American GPS. However, while this system works less stable and not on the whole territory of Russia, though, according to official figures, covering the whole country was achieved in 2008, when the total number of GLONASS satellites has been brought up to 18.

Until now orbit of the Earth has 21 operational satellites of the GLONASS system, and two reserve ones. The current launch brought the number of active GLONASS satellites in orbit to 24.
It is believed that in order to operate confidently around the world the system needs from 24 to 28 satellites.
In August, Prime Minister of Russia Vladimir Putin has assured that the GLONASS will work on a global scale before the end of 2010. Three more spacecrafts of GLONASS system are expected to be launched in addition to the already running ones.
According to Putin, in the next six years in the development of GLONASS  about 48 billion rubles (more than 1.5 billion dollars) will be invested.

Russian GLONASS sensors basically equip emergency vehicles, and state agencies. Communicators and smartphones with this system do not exist - cumbersome and expensive electronic board is used.
It is possible, however, that the suppliers of equipment fitted with navigation equipment, will have to accept the inevitable press the ban on distribution in Russia devices without chips GLONASS.

Coca-Cola Completed its Acquisition of Russian Juice Producer "Nidan"

Coca-Cola completed its acquisition of Nidan, said the American corporation. "Nidan Juices" unites all the production and marketing assets of the juice holding, including "Nidan-Gross"(Moscow) and "SP Nidan-Ekofrukt "(Novosibirsk).

The sellers were a British investment fund Lion Capital (75% plus 1 share) and the founders of the company. Lion Capital bought a stake in juice manufacturer in 2007, based on an assessment of $ 530 million for the entire company, said Interfax.
The deal with Coca-Cola is not disclosed, but the newspaper "Kommersant" on Wednesday, citing unnamed sources, reported that it had not exceeded $ 300 million excluding debt.

Information that "Nidan" was for sale appeared in January. Coca-Cola from the very beginning called the main contender for the acquisition of the company. In March, the American corporation reported on preparations for the transaction and the filing of the petition to the FAS. The document was filed on behalf of Coca-Cola Company European Refreshments. In early August the deal was approved by a Government commission of foreign investments monitoring.
"Nidan" is one of the four largest juice producers in Russia and manufactures products under the brands Caprice, Caprice Tea, My Family, Sokos, Champion  and Yes. Coca-Cola already owns a Russian juice producer Multon (brands Good and Rich).
 
Coca-Cola is confident in the potential of the Russian market and demonstrates  willingness to further investments in Russia. Since the beginning of 1990 the company invested in the Russian economy $ 2 billion, another $ 1 billion Coca-Cola intends to invest in their infrastructure in Russia in the next 3-5 years ", - stated in the corporation's press release.

By materials of forbes.ru

Head of Sberbank Intends to Sell a Stake of Russia's Largest Bank

The head of Russian "Sberbank" German Gref offered to sell a stake in Russia's largest bank on the open market and to consider privatization in favor of a strategic investor only if he offer premium to the market price.
"To sell on the market is the best. However, if a strategic investor offer a premium to the market price, it can be discussed. But while sales in the market is the most transparent," - agency Reuters quoted Gref.

Annual Forum IPO & SPO 2010 in Russia

Annual Forum "IPO & SPO-2010" - is Russia's largest conference dedicated to the problems and prospects of the organization of the primary public offerings of Russian companies, will be held on September 23 in Moscow, said in a press release.  The forum organizers are the Institute of Financial Markets (IRFR). 

"Forum  "IPO & SPO-2010" will take place against a background of growing Russian market IPO, and will continue to dialogue on issues of raising capital in Russia and abroad on a qualitatively new level. Event participants will have the opportunity to obtain information on the further development of the IPO market regulators, representatives of Russian and foreign exchanges, financial advisors and issuers themselves ", - the report said. 

The forum will also provide an overview of new financial products and instruments offered by Russian issuers. It will focus on new services intended to promote the IPO of  companies with an average capitalization (mid-caps). 

"Among the delegates and speakers of the Forum "IPO & SPO-2010" are representatives of CBR, Federal Financial Markets Service, the Ministry of Finance, the Ministry of Economic Development, FAS, as well as the largest issuers, banks, underwriters, and the organizers of IPOs, legal and consulting firms, rating agencies, investment companies and exchanges ", - stated in a press release.

Large-scale Privatization of State Owned Enterprises in Russia

Russian authorities may consider selling shares of state-owned Rosneft in 2011-2013,  Economic Development Minister Elvira Nabiullinasaid today.
"This is not in 2011, I'm talking about the program of 2011-2013" - Gref told journalists on Tuesday , quoted by Interfax.
The authorities are preparing a large-scale privatization evaluated of almost $ 30 billion and could reduce its stake in the largest state-owned enterprises, including Rosneft, in an attempt to patch up the budget deficit, sources in the Ministry of Finance said Reuters.

Vice-president of Rosneft, Peter O'Brien said earlier that the state should wait for the sale of shares before the introduction of the new tax system.

Nabiullina added today that in 2011 the company relating to the number of natural monopolies and defense industry will not be privatized.

"I'm not going to mention what exactly will be privatized in 2010. We intend to provide a sufficiently large bags and packages of large enterprises."