Real estate (immovable property) purchase and brokerage
(a) Non-Russian controlled companies are not allowed to acquire plots of land. Those companies, however, can lease plots of land for a period of no more than 49 years.
(b) As an exception to paragraph (a), non-Russian controlled companies can acquire plots of land in the cases when such companies are recognized as buyers in accordance with the Law of the Russian Federation on the privatization of state and municipal enterprises in the Russian Federation and other respective legislation and regulations, including the requirements of programmes of privatization:
- Within the framework of the privatization of state and municipal enterprises in the form of commercial investment tender and auction,
- Within the framework of the expansion and additional construction of enterprises in the form of commercial investment tender and auction.
Telecommunications
Telecommunication services including mobile and satellite services, construction, installation, operation and maintenance of communication devices are restricted.
Mass media services
Some limitations of foreign participation in mass media companies.
Professional activities
Some activities closed, limited or subject to special requirements for natural persons who are non-Russian nationals.
Lease of Federal property
The lease of Federal property whose value exceeds 100 million roubles to companies with foreign participation is effected with the permission of the state authority empowered to manage such property. This maximum is to be raised and will be expressed in convertible currency.
CROSS-BORDER SUPPLY OF SERVICES LIST OF SERVICES FOR WHICH THE PARTIES SHALL GRANT MOST-FAVOURED-NATION (MFN) TREATMENT
(a) Sectors to be covered, according to the provisional Central Product Classification (CPC) of the United Nations Organization:
Consultancy services relating to accounting review services: part of CPC 86212 other than 'auditing services'
Consultancy services relating to bookkeeping services CPC 86220
Engineering services CPC 8672
Integrated engineering services CPC 8673
Advisory and pre-design architectural services CPC 86711
Architectural design services CPC 86712
Urban planning and landscape architectural services CPC 8674
Computer and related services:
Consultancy services related to the installation of computer hardware CPC 841 Software implementation services CPC 842
Database services CPC 844 Advertising CPC 871
Market research and opinion polling CPC 864 Management consulting services CPC 866 Technical testing and analysis services CPC 8676
Advisory and consulting services relating to agriculture, hunting and forestry
Advisory and consulting services relating to fishing
Advisory and consulting services relating to mining
Printing and publishing CPC 88442
Convention services
Translation services CPC 87905
Interior design services CPC 87907
Telecommunications:
Value-added services including (but not limited to) electronic mail, voice mail, on-line information and database retrieval, data processing, EDI, code and protocol conversion Packet and circuit switched data services
Construction and related engineering services: site investigation work CPC 5111 Franchising CPC 8929
Adult education services by correspondence part of CPC 924 News and press agency services CPC 962
Rental/leasing services without operators related to other transport equipment (CPC 83101 private cars, 83102 goods transport vehicles, 83105) and relating to other machinery and equipment (CPC 83106, 83107, 83108, 83109)
Commission agents services and wholesale trade services related to import-export trade (part of CPC 621 and 622)
Research and development in software
Reinsurance and retrocession and the services auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services Insurance of risks relating to:
(i) maritime shipping and commercial aviation and space launching and freight (including satellites), with such insurance to cover any or all of the following: persons being transported, the goods being exported from or imported to, the same vehicle transporting the goods and any liability arising therefrom;
(ii) goods in international transit; and
(iii) accident and health insurance; and personal motor liability insurance in the case of crossborder movement.
(b) Data processing services CPC 843
Provision and transfer of financial information and financial data processing (see paragraphs B.11 and B.12 of Annex 6):
For the services listed under paragraph (b) MFN subject to Article 38 will be applied, without paragraph A of Annex 8.
A financial service is any service of a financial nature offered by a financial service supplier of one of the Parties. Financial services include the following activities:
A. All insurance and insurance-related services
1. Direct insurance (including co-insurance)
(i) life;
(ii) non-life.
2. Reinsurance and retrocession.
3. Insurance intermediation, such as brokerage and agency.
4. Services auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services.
B. Banking and other financial services (excluding insurance)
1. Acceptance of deposits and other repayable funds from the public.
2. Lending of all types, including consumer credit, mortgage credit, factoring and financing of commercial transactions.
3. Financial leasing.
4. All payment and money transmission services, including credit charge and debit cards, travellers cheques and bankers drafts.
5. Guarantees and commitments.
6. Trading for own account or for the account of customers, whether on an exchange, in an over the counter market or otherwise, the following:
(a) money market instruments (including cheques, bills, certificates of deposits, etc.);
(b) foreign exchange;
(c) derivative products including, but not limited to, futures and options;
(d) exchange rates and interest rate instruments, including products such as swaps, forward rate agreements, etc.;
(e) transferable securities;
(f) other negotiable instruments and financial assets, including bullion.
7. Participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues.
8. Money broking.
9. Asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial depository and trust services.
10. Settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments.
11. Provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services.
12. Advisory intermediation and other auxiliary financial services on all the activities listed in points 1 to 11 above, including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy.
The following activities are excluded from the definition of financial services:
(a) activities carried out by central banks or by any other public institution in pursuit of monetary and exchange rate policies;
(b) activities conducted by central banks, government agencies or departments, or public institutions, for the account or with the guarantee of the government, except when those activities may be carried out by financial service suppliers in competition with such public entities;
(c) activities forming part of a statutory system of social security or public retirement plans,
Except when those activities may be carried out by financial service suppliers in competition with public entities or private institutions.
FINANCIAL SERVICES
A. In respect of banking services referred to in Annex 6, Part B, the most-favoured-nation treatment granted pursuant to Article 28 (1), with regard to establishment by means of the setting up of a subsidiary only (excluding therefore establishment by means of the setting up of a branch), and the national treatment granted pursuant to Article 28 (3), by Russia means treatment no less favourable than the treatment granted by Russia to its own companies with the following exceptions:
1. Russia reserves the right:
(a) to continue to apply to Russian subsidiaries and branches of Community companies the ceiling limiting the overall share of foreign capital in the Russian banking system which is in operation on the date of signature of the Agreement;
(b) to apply to Russian subsidiaries of Community companies a minimum capital requirement higher than that applied to its own companies provided that this minimum capital requirement is not raised as compared with the one in force on the date of signature of the Agreement before national treatment is applied in respect of the minimum capital requirement;
(c) to restrict the number of branches of Russian subsidiaries of Community companies;
(d) to set a minimum level not higher than ECU 55 000 for balances on accounts of each physical person with Russian subsidiaries of Community companies;
(e) to prohibit Russian subsidiaries of Community companies from carrying out transactions with shares and instruments convertible into shares of Russian joint stock companies;
(f) to prohibit Russian subsidiaries of Community companies from carrying out transactions with Russian residents.
2. The exceptions in paragraph 1 may only apply under the following conditions:
(i) provided that they are applied to subsidiaries of companies of every country; and
(ii) for the exceptions mentioned in paragraph 1, subparagraphs (c), (d) and (e):
(a) until the expiry of five years from signature of the Agreement at the latest for the exceptions mentioned in subparagraphs (c) and (d) and three years for the exception mentioned in subparagraph (e); and
(b) where the proportion of the share capital of the Russian subsidiary of the Community company held by Russian nationals or companies does not exceed fifty percent (50 %); and
(c) to Russian subsidiaries of Community companies established after the entry into force of these exceptions;
(iii) for the exception mentioned in paragraph 1, subparagraph (f), until 1 January 1996 and only to Russian subsidiaries of Community companies established after 15 November 1993 or which have not commenced their operations with Russian residents before 15 November 1993.
3. (a) After the expiry of five years from the date of signature of the Agreement, Russia will consider the possibility of:
(i) increasing the ceiling limiting the overall share of foreign capital in the Russian banking system which is in operation on the date of the signature of this Agreement, mentioned in subparagraph (a) of paragraph 1, taking into consideration all the relevant monetary, fiscal, financial and balance of payments considerations and the state of the banking system of Russia;
(ii) reducing the minimum capital requirement, mentioned in subparagraph (b) of paragraph 1, taking into consideration all the relevant monetary, fiscal, financial and balance of payments considerations and the state of the banking system of Russia.
(b) After the expiry of three years from the signature of this Agreement, Russia will consider the softening of restrictions mentioned in subparagraphs (c) and (d) of paragraph 1, taking into consideration all the relevant monetary, fiscal, financial and balance of payments considerations and the state of the banking system of Russia.
B. In respect of insurance services referred to in Annex 6, Part A, paragraphs 1 and 2 the most-favoured-nation treatment granted pursuant to Article 28 (1) with regard to establishment by means of the setting up of a subsidiary only authorized for the insurance operations is set out in the legislation and regulations applicable in Russia on the day of establishment taking into account the following conditions:
1. upon the expiry of five years from signature of the Agreement at the latest, Russia shall abolish the maximum foreign shareholding limit of 49 % in company capital;
2. during the transitional period of five years the abolition of the maximum foreign shareholding limit does not prevent Russia from introducing measures for granting licences to Community companies in some classes of insurance. These measures could be taken only in the field of compulsory insurance schemes in the social security, or for public procurement, or for the reasons described in Article 29 (2), and shall not nullify or substantially impair the effects of the abolition of the maximum foreign shareholding limit of 49 %.
PROVISIONS IN RELATION TO ARTICLES 34 AND 38 Part A
The consultations shall begin within 30 days of the request therefor by the first Party. They shall be held with a view to reaching agreement either on:
- Withdrawal by the other Party of the measures which have resulted in the significantly more restrictive situation, or
- Adjustments of the obligations of both Parties, or
- Adjustments to be made by the first Party to compensate for the more restrictive situation created by the other Party.
If agreement is not reached within 60 days of the request for consultations made by the first Party, such first Party may make appropriate compensatory adjustments to its obligations.
Such adjustments shall be made to the extent and for such time as is necessary to take account of the significantly more restrictive situation created by the other Party. Priority must be given to those measures which least disturb the functioning of the Agreement. The rights which economic operators have acquired under the Agreement at the time such adjustments are made shall not be affected by the said adjustments.
1. Acting in the spirit of partnership and cooperation the Government of Russia shall inform the Community, during a transitional period of three years following the signature of the Agreement, of its intentions to submit new legislation or adopt new regulations which may render the conditions for the establishment or operation of Russian subsidiaries and branches
Of Community companies more restrictive than the situation existing on the day preceding the date of signature of the Agreement. The Community may request Russia to communicate the drafts of such legislation or regulations and to enter into consultations about those drafts.
2. Where new legislation or regulations introduced in Russia within the transitional period mentioned in paragraph 1 would result in rendering the conditions for operation of Russian subsidiaries and branches of Community companies more restrictive than the situation existing on the day of signature of the Agreement, such respective legislation or regulations shall not apply to those subsidiaries and branches already established in Russia at the time of entry into force of the relevant act, until the expiry of a period of three years from such entry into force.
TRANSITIONAL PERIOD FOR PROVISIONS ON COMPETITION AND FOR THE INTRODUCTION OF QUANTITATIVE RESTRICTIONS
The circumstances mentioned in Article 53 paragraph 2.3 and in Annex 2, paragraph 2 are understood in respect of sectors of the Russian economy which:
- Are undergoing restructuring, or
- Are facing serious difficulties, particularly where these entail serious social problems in Russia, or
- Face the elimination or a drastic reduction of the total market share held by Russian companies or nationals in a given sector or industry in Russia, or
- Are newly emerging industries in Russia.
1. Russia shall continue to improve the protection of intellectual, industrial and commercial property rights in order to provide, by the end of the fifth year after the entry into force of the Agreement, for a level of protection similar to that existing in the Community, including effective means of enforcing such rights.
2. By the end of the fifth year following entry into force of the Agreement, Russia shall accede to the multilateral conventions on intellectual, industrial and commercial property rights to which Member States are parties or which are de facto applied by Member States, according to the relevant provisions contained in these conventions:
- Berne Convention for the Protection of Literary and Artistic Works (Paris Act, 1971),
- International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (Rome, 1961),
- International Convention for the Protection of New Varieties of Plants (UPOV) (Geneva Act, 1978).
3. The Cooperation Council may recommend that paragraph 2 of this Annex shall apply to other multilateral conventions.
4. From the entry into force of this Agreement, Russia shall grant to Community companies and nationals, in respect of the recognition and protection of intellectual, industrial and
Commercial property, treatment no less favourable than that granted by it to any third country under bilateral agreements.
5. The provisions of paragraph 4 shall not apply to advantages granted by Russia to any third country on an effective reciprocal basis and to advantages granted by Russia to another country of the former USSR.
PROTOCOL 1 on the establishment of a coal and steel contact group
1. A contact group is established between the Parties. The group is composed of representatives of the Community and of Russia.
2. The contact group exchanges information on the situation of the coal and steel industries in both territories and on trade between them, particularly with the purpose of identifying such problems as might arise.
3. The contact group also examines the situation of the coal and steel industries at world level, including developments in international trade.
4. The contact group exchanges all useful information on the structure of the industries concerned, the development of their production capacities, the science and research progress in the relevant fields, and the evolution of employment. The group also examines pollution and environmental problems.
5. The contact group also examines the progress made in the framework of technical assistance between the Parties, including assistance to financial, commercial and technical management.
6. The contact group exchanges all relevant information as to attitudes taken, or to be taken, in the appropriate international organizations or fora.
7. As and when both Parties agree that the presence and/or participation of representatives of the industries is appropriate, the contact group is enlarged to include them.
8. The contact group meets twice a year, alternately on the territories of each Party.
9. The chairmanship of the contact group is held alternately by a representative of the Commission of the European Communities and a representative of the Government of the Russian Federation.
PROTOCOL 2 on mutual administrative assistance for the correct application of customs legislation
1. Definitions
For the purposes of this Protocol:
(a) 'customs legislation' shall mean provisions applicable in the territories of the Parties and governing the import, export, transit of goods and their placing under any customs procedure, including measures of prohibition, restriction and control and adopted by the said Parties;
(b) 'customs duties' shall mean all duties, taxes, fees or any other charges which are levied and collected in the territories of the Parties, in application of customs legislation, but not including fees and charges which are limited in amount to the approximate costs of services rendered;
(c) 'applicant authority', shall mean a competent administrative authority which has been appointed by a Party for this purpose and which makes a request for assistance in customs matters;
(d) 'requested authority', shall mean a competent administrative authority which has been
Appointed by a Party for this purpose and which receives a request for assistance in customs matters;
(e) 'contravention', shall mean any violation of the customs legislation as well as any attempted violation of such legislation.
1. The Parties shall assist each other, within their competences, in the manner and under the conditions laid down in this Protocol, in ensuring that customs legislation is correctly applied, in particular by the prevention, detection and investigation of contraventions of this legislation.
2. Assistance, in customs matters, as provided for in this Protocol, applies to any administrative authority of the Parties which is competent for the application of this Protocol. It shall not prejudice the rules governing mutual assistance in criminal matters. Nor shall it cover information, including documents obtained under powers exercised at the request of the judicial authority, unless those authorities so agree.
1. At the request of the applicant authority, the requested authority shall furnish it with all relevant information to enable it to ensure that customs legislation is correctly applied, including information regarding operations detected or planned which are, appear or would be in contravention of such legislation.
2. At the request of the applicant authority, the requested authority shall inform it whether goods exported from the territory of one of the Parties have been properly imported into the territory of the other Party, specifying, where appropriate, the customs procedure applied to the goods.