Govt submits bill on protection of investment to State Duma

MOSCOW, Nov 1 (PRIME) -- The Russian government has submitted a bill on protection and promotion of investment to the State Duma, the parliament’s lower house, aiming to attract at least 30 trillion rubles of investment, Deputy Finance Minister Andrei Ivanov told reporters on Friday.

“The government has submitted a bill on protection and promotion of investment to the State Duma today, and we have much work to do at the level of State Duma, we hope it will be constructive.

“The goal of the bill is to create an instrument that is much needed by the investment society that would be applicable from the moment the bill comes in force, so that the country’s economy receives at least 30 trillion rubles of investment projects.”

The deadline for signing of an agreement on promotion and protection of investment should be set at January 1, 2030. “We want to stimulate it, to tell our friends, ‘There is a window of opportunity when we need new investment. Take a look at what we offer, dive into the details, use the instrument’,” Ivanov said.

The bill encompasses two regimes – a common one for investment starting from 250 million rubles in the social sphere, from 1.5 billion rubles in industry, and agriculture, and from 5 billion rubles for the remaining sectors. An individual regime is for investment of over 10 billion rubles.

The authorities will guarantee that the corporate profit tax and property tax, as well as regulatory conditions won’t change for businesses for three years after the start of an investment project, and the government will compensate losses otherwise, he said.

The bill also foresees a special possibility of signing an agreement with the federal government, the region, or a state company that would fix conditions for six, 15, or 20 years. All projects with investment falling under one of the categories will be able to apply for protection under the law, and the government would have no reason to reject an application if it is filed, he said.

But projects in the production of oil and gas, in finances, alcohol, tobacco, and gambling will not be applicable for protection of investment, he said.

Foreign investors will be able to protect their investment under the bill only through a Russian legal entity, which the investor will be able to control, he said.

The Finance Ministry believes that the bill as a soft form of privatization.

“This is a good reason for a state-controlled company to issue additional shares in order to attract an investor to a new project. You raise capital, you sign an agreement on protection and promotion of investment, and this is some sort of soft privatization when we as the state don’t leave (a company) while using our ownership to attract additional investment and improve efficiency of the company,” Ivanov said.

The ministry expects the bill to attract investment amounting to 7–10 trillion rubles per year through 100–150 deals, he said, adding that the government has already started looking into the projects that may fall under the law.

“We already looked into more than 30 projects this year without waiting for the bill,” he said, adding that the total amount of investment under the project stands at about 10 billion rubles.

(63.7748 rubles – U.S. $1)

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