29 Mar '18
The Russian government has approved draft amendments to the law on small and medium-sized enterprises (SMEs) proposed by the Ministry of Economic Development which would remove the 49% limit on foreign ownership of Russian SMEs, the US-Russian Business Council reported.
The change would apply to non-offshore foreign SMEs—companies with no more than 250 employees and $34.8m in annual revenues.
Foreign firms currently own shares in nearly 14,000 Russian SMEs, according to the Federal Fax Service.
The proposal aims to attract foreign investment in and boost technological modernization of Russian SMEs, which enjoy a simplified taxation and regulatory regime. Since January, state companies have been required to grant at least 15% of their procurement contracts to SMEs, which amounts to a total value of $52.2m a year, according to some estimates.
According to OporaRossii, Russia’s leading SME association, the proposed measure would increase investment by European and Chinese high-tech companies into medium-sized Russian firms.