PRESS: Russian govt mulls stricter rules for foreign carmakers

MOSCOW, Jul 7 (PRIME) -- The Russian government has ordered the Economic Development Ministry and the Industry and Trade Ministries to develop stricter and more comprehensive rules of stimulating car assembly by foreign producers on local facilities by September, business daily Kommersant reported on Thursday citing several sources in the industry.

The first version of incentives to develop local car assembly was introduced in 2005, it envisaged import duty reduction for car components in exchange for building of a facility making 25,000 cars a year with a share of locally produced components at 30%. The second wave of agreements envisaged a 60% local content, investments in research and development, and a facility with a 300,000–350,000 annual car output.

The majority of all these contracts will expire in 2017–2018, a market source said.

New agreements must ensure investments in research and development targeted at Russia’s needs and will include a new criterion of “the scale of integration of local facilities in the global supply chain, which means not only car, but also car component exports,” Kommersant reported.

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