VEGAS LEX has organized a business breakfast on the
prospects for the development, implementation and experience of concluding
federal special investment contracts at the St. Petersburg International Legal
Forum 2017 (PILF 2017).

On May 18, 2017, the VEGAS
LEX law firm hosted a business breakfast named "Special Investment
Contracts (SIC)* as Incentive for local manufacturing of foreign products in
Russia: experience and prospects", as part of the St. Petersburg
International Legal Forum. Representatives of the Ministry of Industry and
Trade and the business community took part in the event.

Maxim Grigoryev, VEGAS LEX Partner, Head of special projects made a welcoming speech, outlining problems of
organizing local manufacturing, citing best practices for implementing SIC and
listing SIC types.

Nadezhda Karpova, Head of the Russian Ministry of Industry and Trade
Legal Department, spoke about the potential of SIC, key stimulation policies,
support for investors involved in the investment projects, and the ministry’s proposals
about new approaches to legal regulation of SIC.

Dias Asanov, Director for Legal Affairs at Siemens LLC, and Olga
Safonova, Director of the Legal Support and Control over Compliance with
the Law and Corporate Behavior Rules, Siemens LLP, Kazakhstan, discussed legal
regulation of SIC in Russia and talked about investment programs in Kazakhstan
aimed at developing local manufacturing of foreign brands.

Polina Zavyalova, Head of the Legal Department at GEROFARM LLC,
shared the experience of a company planning to conclude a federal SIC, and
talked about ways to improve the legislation to conclude SIC in the
pharmaceutical industry.

At the end of the event, Mr.
Grigoryev spoke about the specifics of structuring and concluding SIC at the
federal level, the pitfalls of applying SIC, problems faced by those who decide
to use this tool, and proposals for dealing with them. He spoke from his
practical experience of supporting the SIC signed by CLAAS** and other
companies.

***

* At the end
of 2014, Russia adopted Federal Law No. 488-FZ, On the Industrial Policy of the
Russian Federation, which introduced SIC as one of the measures of government support.
In the summer of 2015, the Russian Government issued Resolution No. 708, which
approved the standard form of a SIC and the rules for its conclusion. So far,
only eight such contracts have been signed. More than 16 applications for SIC
are being considered by the Russian Ministry of Industry and Trade and the
Industrial Development Fund. Foreign companies have been showing great interest
in this new mechanism.

This
instrument of state industrial policy provides for exclusive benefits,
preferences and other advantages that the public party to the contract – the Russian
Federation, its regions and (or) municipalities – grants to the private party
of the SIC in exchange for assuming the obligations to establish or modernize
industrial facilities for local manufacturing of foreign goods or new products.

** On June
17, 2016, CLAAS (part of the international CLAAS holding company) and the
Russian Federation, represented by the Ministry of Industry and Trade, entered
into the country's first federal special investment contract (SIC) at the St. Petersburg
International Economic Forum with the support of VEGAS LEX.

For
more information on VEGAS LEX’s services and support of investment projects,
please go here.

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