In order to create conditions for the inducement of foreign in-
vestments into the regional economy and to implement large-scale pro-
jects in the good-producing industries, the Legislative Assembly of
the Ivanovo Region has hereby resolved:
1. The stability of rights of business entities drawing in fore-
ign investments shall be guarantied.
2. May all know that the Decree of the President of the Russian
Federation "On the Improvement of Work on Foreign Investments" of
27.09.1993 No.3740 determines that newly issued legislative instru-
ments regulating the terms of operation of foreign and joint ventures
in the Russian Federation shall be ineffective for three years in re-
lation to businesses existing as of the day such instruments come into
force. This provision does not embrace legislative instruments which
ensure more privileged terms of operation for foreign and joint ventu-
res in Russia.
3. May all know that the legislation currently in force grants
foreign investors, after relevant taxes and fees, a guarantee of unim-
peded overseas transfer of payments effected in connection with their
investment activities if the respective amounts were received in fore-
ign currency, including:
- investment income received, in particular, as profit, profit
share, dividends, interest, royalties and commissions, remuneration
for technical assistance and maintenance, and other rewards;
- amounts paid on the grounds of monetary rights in action and
obligation performance requirements which have economic value;
- amounts recovered by the investors at partial or complete liqu-
idation or sale of investments;
- indemnities and compensations for losses.
4. Businesses involving foreign investments and operating in pri-
ority branches of the regional economy shall be entitled to tax privi-
leges in accordance with the currently effective regional law and fe-
deral tax legislation.
5. May all know that in accordance with the Russian Soviet Fede-
rative Socialist Republic Foreign Investments Act:
- businesses inducing foreign investment may set the terms of sa-
le of their products/works/services on the Russian market including
their price as well as the terms of delivery of commodities and servi-
ces from the Russian market on a contractual basis;
- assets imported to the Russian Federation as the foreign inves-
tors' contribution to the authorised funds of businesses inducing fo-
reign investments within the time limits foreseen in their constituent
instruments, as well as assets intended for own material production
shall be exempt from the customs duty and export tax;
- business fully owned by foreign investors, and joint ventures
with a foreign investment share comprising over 30 per cent of the
authorised fund, may export their own products and import commodities
for their own use without special licenses, except for cases foreseen
in an international treaty effective in the Russian Federation. Fore-
ign currency amounts recovered by such businesses from the export of
own products shall fully remain at their disposal;
- to set up a business with foreign investment which assumes lar-
ge-scale construction or a reconstruction, a respective examination
shall be carried out provisionally. In relevant cases, setting up a
business involving foreign investment requires a permit of sanitary
authorities and an ecological examination. For those businesses invol-
ving foreign investments which could bring about an environmental ef-
fect to bear upon the territory of the Ivanovo and adjacent regions,
such ecological examination must be carried out by a joint commission
established by competent authorities of the respective regions on a
parity basis.
6. Corporate shares redeemed, changed by, transferred to the fo-
reign investors shall be their property not subject to withdrawal.
7. Supervision over the promotion and allocation of foreign in-
vestments in the course of specific programmes shall be vested in the
boards of directors.
8. May it be hereby established that businesses involving foreign
investments shall be granted regional tax privileges and/or financial
support from the State, provided the following conditions are
observed:
- availability of a financial sanation plan (business plan) con-
taining provisions for efficiency maintenance measures and properly
approved and confirmed;
- investment of the owned assets in an amount no less than 25 per
cent;
- inducement of foreign investments.
9. May it be taken into consideration that the financial support
shall be granted by the State to businesses regardless of their form
of ownership for the purpose of:
- production restructuring;
- development, introduction or purchase of the newest technologi-
es, know-how, equipment and materials;
- settlement on target-oriented credits used for the purchase of
equipment and materials.
The procedure of granting short-term financial support to busi-
nesses carrying out production restructuring is approved by the Decree
of the President of the Russian Federation "On the Procedure of Gran-
ting Financial Support to Businesses from the Federal Budget" dated
08.07.1994 No.1484.
The procedure of applying incentives to foreign companies which
exercise commodity supplies, come out as founders of businesses to
produce similar articles in the Russian Federation with the use of do-
mestic materials and labour, and make direct investments into the Rus-
sian good-producing industries in an amount equivalent to no less than
100 mln. USD is approved by the Presidential Decree "On Additional
Measures for the Inducement of Foreign Investments in the Material
Production Industries of the Russian Federation" dated 25.01.1995
No.73.
10. May an introduction be submitted to the Government of the
Russian Federation in regard to the prolongation for 1995-1996 of item
1 of the Presidential Decree "On Certain Measures to Encourage Invest-
ment Activities Including Foreign Credits".
V.TIKHOMIROV
Chairman of the Legislative Assembly
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