Re: A company in Russia Dear Mr. Gonzales, You have requested information about setting up a company in Russia.

I can offer you the following advice. The facts are as follows: your company is planning to establish a business in Russia with a view to launching a new energy drink. The issue is whether the law offers you an optimal legal form of doing business. Generally, the law in Russia allows a foreign company to set up a business using one of the two alternative forms: a representative office and Wholly Foreign-Owned Entity (WFOE). A representative office is limited mostly to marketing. WFOE is a legal person and allows you to conduct real business in Russia. WFOE brings a lot of advantages. It allows you to conduct a commercial activity (i.e. producing, selling and exporting) and generate profits. WFOE exercises the rights of a Russian company and is able to make most business operations. However, WFOE has also disadvantages. WFOE is subject to the complicated taxation, reporting and company regulation what requires hiring experienced managers. In order to employ foreign employees, a company must to obtain an employment permit. To summarize, I recommend you to examine carefully your intentions and expectations before you make a decision of starting a business in Russia. Please contact us if you have any further questions. Yours sincerely, John Smith