Company Redomiciliation to Russia. Legal Features and Practical Aspects

TL;DR: What is redomiciliation and why it matters

What is redomiciliation?

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What is Redomiciliation

Official Definition

According to Federal Law No. 290-FZ of August 3, 2018, “On International Companies and International Funds,” redomiciliation is the change of the personal law of a foreign legal entity through its state registration in Russia via redomiciliation, with the assignment of the status of an international company and the preservation of all previous legal obligations and assets.

After registration, the new Russian legal entity retains:

• Rights and obligations under previously concluded contracts, licenses, and lawsuits;
  

• Corporate structure and charter, with the possibility to apply foreign law internally (where not conflicting with Russian law).

Redomiciliation is not considered a method of legal entity reorganization under the Civil Code, although it includes an element of transformation (change of organizational-legal form).

Difference from Other Mechanisms

Redomiciliation ≠ registration of a new legal entity: the foreign company is not liquidated but transferred “as a whole,” maintaining legal continuity.

Redomiciliation ≠ change of residency: the process includes legal registration and change of personal law, not only tax status.

Redomiciliation in SARs

By law, after redomiciliation, an international company may operate exclusively from Special Administrative Regions (SARs) in Kaliningrad and Primorsky Krai, though its divisions and branches can be located throughout Russia.

Legislative Basis for Redomiciliation

Federal Law No. 290-FZ

Enacted on August 3, 2018, “On International Companies and International Funds” — the legal framework for redomiciliation in Russia. The law regulates the change of personal law, conditions of registration in SARs, legal consequences, reporting, and obligations of companies after relocation. The law has been updated multiple times (until 2023–2024), expanding possibilities, including broader criteria for assets and company origin.

Special Administrative Regions (SARs)

Registered international companies obtain the IC status exclusively in SARs: Russky Island (Primorsky Krai) and Oktyabrsky Island (Kaliningrad Region).

SARs operate a preferential tax system, export regime, the right to currency non-residency, and application of foreign corporate law until 2039.

Simplified Redomiciliation

Due to sanctions, a simplified procedure (only charter and resolution required) has been in effect since March 2022 and extended until December 31, 2025.

Exclusion of the Company from the Foreign Register

After registration in the Unified State Register of Legal Entities (USRLE), the company must be removed from the foreign register within two years. Non-compliance may result in loss of IC status and tax benefits. Extension of the period is possible via a government commission.

Key Changes and Deadlines

The simplified procedure is extended until the end of 2025, minimum company creation threshold postponed from 2022 to March 1, 2024. Requirements for international fund assets lowered from 5 billion to 500 million RUB.

Government and Federal Tax Service Decrees

Government Decree No. 611 of May 8, 2025, regulates reporting and registration features of IC branches and deadlines for submitting information.

Conditions for Redomiciliation

Company Age and Jurisdiction

The company must be registered no later than March 1, 2022 (later registration may require an incorporation route).
The base jurisdiction must be part of FATF or similar antitrust groups.

Investment Threshold

Obligation to invest at least 50 million RUB in Russia within 12 months after registration (capital investments in infrastructure or charter capital of other legal entities).
For companies applying for the status of an International Holding Company (IHC), the investment amount increases to 300 million RUB within three years.

Location of Activity

Management of IC/IHC must be conducted from Russian territory. An office in SAR of ≥50 m² and a staff of at least 15 Russian resident employees is required.

Surrender of the Foreign Register

After registration in the USRLE, the company must exclude itself from the foreign register within 2 years. Due to possible objective obstacles in the original jurisdiction, an extension by the Government Commission is allowed.

Corporate Documentation

Documents submitted for registration must include:

• Participants’ resolution on redomiciliation, IC charter, updated financial statements with audit opinion;
  

• Information on beneficiaries;
  

• Investment obligation statement;
  

• Documents confirming legal address in SAR.

Redomiciliation Procedure Stages

Redomiciliation Process

Preliminary Analysis and Jurisdiction Selection

• Analyze current corporate and contract structure, assets, KYC/AML procedures, and sanction status.

• Define strategic goals and choose jurisdiction — SAR (Kaliningrad or Primorsk) considering economic and tax attractiveness.

Planning

• Develop a comprehensive redomiciliation plan: stages, deadlines, risk minimization.

• Coordinate financial model and investment obligations (infrastructure, personnel, etc.).

Document Collection and Preparation

• Participants’ resolution, charter, translations, audited reports.

• Obtain Tax Clearance Certificate if needed, confirming no debts and readiness to be removed from foreign register.

• Obtain Certificate of Continuation

•  Prepare documents confirming office and staff in SAR.

Registration in SAR and USRLE Inclusion

• Submit documents to SAR registration authority (electronically via SAR US).

• Pay fees and obtain registration certificate of an IC or IHC.
  

Status Acquisition and Operations Launch

• Receive TIN, OGRN, currency non-residency status.

• Unrestricted transfer of legal management with possibility to apply foreign corporate law and SAR benefits.
  

Exclusion from Foreign Register

No later than two years from IC/IHC registration in Russia — removal from original foreign register. Government commission may allow deferment for objective obstacles.

Tax and Legal Consequences

Tax Benefits

Tax Benefits in SAR

• 0% tax on dividends and interest if conditions are met (IC/IHC).
  

• Exemption from profit tax on exchange differences and revenue from geological exploration projects.
  

• Ban on tax audits for periods before redomiciliation if company moved before January 1, 2025.

Fiscal Preferences for IHC

• Russian Tax Code (Chapter 25) benefits: reduced rates (5–10%) and exemptions: dividends, interest, royalties, CFC profits not counted until 01.01.2029.
  

• Benefits apply with “substance”: office in SAR, staff ≥15, investments ≥50 million RUB.

Transport, VAT, and Property Preferences

• Exemption from VAT, transport and property taxes on vessels and aircraft registered in Russian registers.
  

• Social contributions 0% for crew members until 2027.

Legal Risks and Challenges

Double Residency and Taxation
Ambiguous status possible: the company may be considered resident of both Russia and a foreign state — risk of double taxation and jurisdiction disputes.

Legal Conflicts and Litigation
Some foreign jurisdictions may have difficulty removing the company from registers — government deferment required, but status may remain disputed for years.
Disputes over asset ownership and obligations across jurisdictions are possible.

Risk Minimization Recommendations

• Verify jurisdiction and legislation of the originating country, consider double residency risk, taxes in both countries.
  

• File requests for deferment of removal from registers in advance and document the process.
  

• Maintain substance (staff, office, investments) to preserve benefits.
  

• Conduct legal and tax modeling with specialized consultants and auditors before starting the procedure.

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