Law on state support for entrepreneurs in the Arctic adopted in third reading
© RIA Novosti. Vladimir Fedorenko

Law on state support for entrepreneurs in the Arctic adopted in third reading

Deputies of the State Duma of the Russian Federation adopted a package of federal laws on state support for entrepreneurial activity in the Russian Arctic, in the third reading.

The documents will be submitted for consideration to the Federation Council and will enter into force 45 days after signing by the President and official publication.

After this package of laws is adopted, the entire Russian Arctic will become a special economic zone with a wide range of tax benefits and non-tax preferences for businesses. The main goal is to stimulate the creation of new enterprises and well-paid jobs.

Commercial organizations or individual entrepreneurs with at least 1 million rubles of implemented and planned capital investments will be eligible to become Arctic residents. Resident status will open federal, regional and local tax benefits and reimbursement of part of insurance fees to extra-budgetary state fund support. A number of administrative procedures will also be simplified for residents. The Russian Government will also be able to establish other support measures for them, including subsidies for the reimbursement of interest on certain loans, and subsidies for the reimbursement of expenses for paying coupon income on bonds issued as part of the implementation of investment projects.

In addition, the package of laws provides for establishing a zero VAT rate for icebreaking service assistance, shipping and transshipment of export-oriented goods, as well as the possibility of organizing a free customs zone in separate sections of seaports, airports, and on certain land property of resident companies.

A number of measures are also provided for the development and protection of the traditional economic activities of the indigenous peoples living in the Arctic. In particular, a public council will be created to conduct independent monitoring of interaction between residents and indigenous people and to develop measures to protect the environment.

Also, the following 31 territories will be added to the Russian Arctic: Kostomuksha city district, Segezha municipal district and Kalevala national district in the Republic of Karelia; Inta and Usinsk city districts and Ust-Tsilemsky municipal district in the Republic of Komi; the villages of Surinda, Tura, Nidym, Uchami, Tutonchany, Yessei, Chirinda, Ekonda, Kislokan, Yukta of the Evenki municipal district in the Krasnoyarsk Territory; and Leshukonsky and Pinezhsky municipal districts in the Arkhangelsk Region. Thus, the Russian Arctic will include four constituent entities of the Russian Federation and 45 municipalities.

The management bodies of the Russian Arctic zone include the Ministry for the Development of the Russian Far East and Arctic, and the management company, Far East Development Corporation. The Ministry will be able to carry out legal regulation and a number of other functions, and the management company will accept applications, conclude agreements on investment activity and keep a register of resident companies of the Arctic zone.