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VEGAS LEX Partner, Head of special projects Maxim Grigoryev has
discussed problems in implementing special investment contracts (SPIC) and ways
to avoid them, and the potential of SPIC for migration to best available
technologies (BAT) at the INNOPROM-2017 International Industrial Exhibition in
Yekaterinburg.
On July 12, 2017, VEGAS LEX Partner, Head of special
projects Maxim Grigoryev spoke at Russia’s largest international industrial exhibition,
INNOPROM-2017*, which focuses on the latest technologies and developments in
industry.
Mr. Grigoryev, who was directly
involved in the support of CLAAS SPIC deal and other SPICs, spoke at the roundtable
organized by the Russian Union of Industrialists and Entrepreneurs, Special Investment Contract as an effective and
demanded tool of the industrial policy. He listed a number of problems that
investors opting for this tool have faced and continue to face; he discussed
them in detail during a debate with Deputy Minister of Industry and Trade Vasily Osmakov and put forward proposals
on dealing with these problems.
The participants also discussed the
experience of concluding and applying the SPIC at the federal and regional
levels; the newly-adopted amendments to the Tax Code and Government Resolution No.
708 concerning: easing regulations which stipulate that 90% of the income of a
legal entity entering into a SPIC should constitute revenue from the investment
project; including objects of intellectual property into the list of investment
destinations itemized under SPIC; extending the tax break period under SPIC
(extension or waiver of the deadline stipulated under the Tax Code until 2025)
and the opportunity to enter into a SPIC for the term exceeding 5 years from
the date the project reaches its specified operating profit.
Other speakers included President of
the Russian Union of Industrialists and Entrepreneurs Alexander Shokhin; Vice-President of the Russian Union of
Industrialists and Entrepreneurs for Economic Policy and Competitiveness Maria Glukhova; First Deputy Energy Minister
Alexey Teksler; representatives of
the Ministry of Industry and Trade and the Industrial Development Fund, and representatives
of major businesses including Lukoil, Inter RAO UES, Uralkali, Kamaz, ABB
Russia, GeroPharm Group, Abbott Veropharm, and others.
Mr. Grigoryev also spoke at the session
of the Coordination Council of the Russian Union of Industrialists and
Entrepreneurs for the Ural Federal District, Prospects and challenges of transition to best available technologies
(BAT). In his report, The potential
of the SPIC for transition to BAT and expanding local production of equipment
for introducing them, the expert said that, with proper use, the SPIC
mechanism can solve the problems of transition to BAT. Firstly, using the “regular”
type of SPIC that involves creating or modernizing industrial production, it is
now possible to provide substantial support for expanding local production of
equipment necessary to introduce BAT. This would make such equipment more
affordable/less costly. Secondly, a relevant regulation envisages a separate
type of SPIC for the introduction of BAT. This type will only be used from the
beginning of 2019. Theoretically, this mechanism should provide an opportunity for
private parties of the SPIC to receive special preferences, different from
those that industrialists who have introduced BAT are entitled to under relevant
legislation. However, at the moment, there is no effective toolkit for the
second type of SPIC for voluntary stimulation of introducing BAT. This
mechanism still needs additional tuning.
During the meeting, the participants
also discussed interaction between businesses and local, regional, and federal
authorities; alleviation of regulatory pressure on businesses and other issues.
The meeting was attended by leading businesses and enterprises of the Ural
Federal District, representatives of federal and regional authorities.
***
* INNOPROM is an international
industrial exhibition in Russia, held annually in Yekaterinburg since 2010. In
2012, the Russian Government awarded the exhibition federal status. Its organizers
are the Sverdlovsk Regional Government and the Ministry of Industry and Trade.
The exhibition is attended by Russian and foreign companies presenting their
innovative developments and projects. Source: Wikipedia*
For more information on VEGAS LEX’s services and
support of investment projects, please go here.