Leasing in Russia
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Important reading : Derek Bloom's article on Legal and regulatory framework of leasing in Russia - click here |
Recent additions:
A report dated April 12, 1999 indicated that Prime Minister Yevgeny Primakov on Monday signed a document ordering the creation of the federal state unitary enterprises Russian Road Leasing Company Rosdorlizing.
The government's information department said that the new company's charter capital will be 400 million roubles.
The Federal Road Service of Russia has been instructed to provide funds for the purchase of road equipment needed for the implementation of the programme to build, modernise, repair and maintain federal motorways and transfer them to road organisations under leasing contracts.
State of the market:
Russia broke apart from the Soviet Union in 1991 and since then has been passing through touch economic times, with flight away of capital, political instability, high inflation, high levels of corruption and inequalities, etc.
Russian leasing market is characterised by high degree of aberrations where leasing is resorted to as a means of tax avoidance, avoidance of import duties and value added taxes. Thus, leasing carries a degree of stigma.
Leasing companies are required to obtain a license from the Ministry of Economy. Almost 400 companies are currently licensed - this number includes captives set up by manufacturing companies.
Leasing associations:
Law and regulations relating to leasing:
The 26th February 1996 regulations require a leasing company to be licensed.
The civil law of leasing is contained in Part Two of the Civil Code of the Russian Federation entered into force on March 1, 1996. For an excellent description of Russian leasing laws, refer to the article on Russian leasing regulations by Derek Bloom.
A leasing law was adopted by the Government in October 1998. Click on Derek Bloom's article for details.
1996 tax regulations permit acceleration of depreciation on assets acquired subject to a lease at rate thrice the normal depreciation rate.
VAT is also applicable on lease transactions. Derek Bloom's article describes the taxation of lease transactions in Russia as well.
Accounting:
Relevant links:
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Links about Russian leasing:
Leasing in Russia site and magazine, a joint effort of Unit Group, Rosleaing [russian association of leasing companies] and Agency of Business and Finance Information "Bussiness-Inform": (this page is i Russian)
Another site on Russian leasing by Anton Kuleshov: