How foreigners implement their business in the Russian Federation.

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Business leaves Russia mainly through the conclusion
of mergers or acquisitions of companies. Many companies announced in March
their desire to reduce investments in the Russian Federation, at the same time,
the actual projects implemented are no more than 50 percent of the announced
ones.

This trend shows that many Western companies want to
keep business in Russia, and they preserve their detail, reduce investments or
transfer management to local management. Which makes it possible to think about
the prospects of doing business in Russia in the future.

Moreover, the companies do not intend to lose a
significant part of the global business profits, after breaking off relations
with their Russian subsidiaries.

Another reason is the difficulties of selling the
asset in Russia. Many buyers are counting on a significant discount, which
Western business does not intend to give. Additionally, for the implementation
of each transaction with a foreign business, the approval of a profile
commission is required, because of collecting an impressive package of
documents.

Thus, we can distinguish two ways for Western business
to exit the Russian market:

1. Sale of the business to a Russian investor.

2. Appointment of local management.

The latter scenario
has been implemented by more than 40 percent of outgoing companies, which is
encouraging, as it clearly shows their intention to return after the
stabilization of the situation in Russia



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