Changes in legislation

31 December 2018
In 2018, there have been changes in the Russian legislation regarding the activities of special economic zones residents.

New Customs Code

On January 1, 2018 the new EAEU Customs Code entered into force. This document for the first time spelled out the norms of the customs procedure of the free customs zone used on the SEZ territory. The document incorporated all previously adopted legal documents at the national and supranational levels. The EAEU Customs Code replaced the agreement on special economic zones in force since mid-2010, the Russian law on special economic zones, and a number of orders..

There had been no major changes to the current customs regulation procedure. The new Customs Code contains an entire chapter on the customs procedure of the free customs zone (FCZ). It reflects the same provisions as in the current agreement between the member countries of the Customs Union on issues of customs regulation in the SEZ. Among the innovations in the customs procedure of the FCZ, we can note the possibility of exporting goods placed under the customs procedure of the FCZ from the SEZ territory on the territory of EAEU without completing the FCZ customs procedure and, accordingly, without paying customs duties. This innovation concerns such cases as the need to export equipment for the purpose of repair, products for demonstration at exhibitions, and for carrying out separate production operations. Also, a simplified procedure for the goods movement under the customs procedure of the FCZ between the SEZ territories appeared. These innovations certainly make the customs procedure of the FCZ more convenient for residents.

The customs service has been systematically working on simplifying the current legislation on customs regulation in the SEZ for many years and the results of this work are visible every year. The openness of the customs authorities to the SEZ subject and the willingness to solve the problems of residents, to simplify customs regulation in the SEZ - this is a special pride of the SEZ project. Therefore, for many companies, the ability to carry out all customs operations in the SEZ at a specialized customs office that operates only for SEZ residents is in itself an advantage when choosing a site for implementing a project in Russia.

Assessment of investor’s business plans

In April 2018, changes were made in the methodology of assessing the business plans of potential residents by the expert council on special economic zones (Order of the Ministry of Economic Development of Russia dated 05.04.2018 No. 159). According to the changes, residents’ business plans are now evaluated by an additional criterion for the degree of production localization and use of domestic raw materials and components.

The localization coefficient of production and use of domestic raw materials and components is based on indicators of the cost of components, materials and raw materials of foreign origin, as well as the costs of services of foreign organizations. If the localization coefficient of the enterprise varies from 100% to 60%, then the business plan is assigned 3 (three) points to the overall score of the project, if from 59% to 30% or production is not planned by the business plan of the project, the business plan is assigned 2 points, and if the localization coefficient is below 29% - 1 point.

The procedure of evaluating the functioning effectiveness of the SEZ

A number of changes have been made to the procedure of evaluating the functioning effectiveness of special economic zones, established by Government Decree of 07.07.2016 No. 643:

  • An additional indicator of the functioning effectiveness of the SEZ has appeared, which reflects the planning effectiveness in creating a special economic zone.
  • Absolute and relative quantitative indicators of efficiency are added. For example, a volume of benefits used by SEZ residents to pay insurance premiums is allocated as a separate indicator (of the total benefit ratio); appeared indicator reflecting the amount of insurance premiums paid.
    Furthermore, the indicators now reflect the activities of the management company. In particular, the management company is assessed according to the following indicators: the number of jobs created, the amount of funds received from economic activities and invested in the creation of infrastructure, the amount of taxes paid, customs payments and insurance premiums.
  • The calculation of the effectiveness assessment of touristic SEZs is now carried out using a separate formula, which allows a more objective assessment of the SEZ operation of this type.
  • Also, an innovation is the procedure of data exchange between the Russian Ministry of Economic Development, Russian Federal Customs Service and Russian Federal Tax Service on taxes and customs duties paid by residents and management companies.

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