Create a Company in Forestry in Russia

Russia is not only one of the largest countries in the world when it comes to its surface, but also most of its lands are covered by woods which can generated high yields to those interested in starting a business in forestry. Russia’s forests represent a quarter of the global wood reserve.

It should also be noted that the Russian forestry industry is one of the most developed economic sectors of this countries. The timber industry alone contributes with close to 20 billion USD to Russia’s annual Gross Domestic Product.

Our lawyers in Russia can assist foreign investors interested in starting a forestry business here.

The Forest Code in Russia

The Forest Code is the main law governing the management and exploitation of woods in Russia. Those interested in opening a Russian company in the forestry industry must comply with the regulations imposed by the Code.

The Russian Forest Law provides for the following type of woods:

– protection forests;
– reserve forests;
– production forests.

The latter can be used by companies in the forestry industry.

Forest lands are in federal ownership, and the law provides for four types of rights to use forest plots in the Russian Federation:

– the right to permanently use a forest land plot;
– the right to use a land plot for a definite period of time free of charge (free fixed-term use);
– the lease right;
– the right of limited use of another person's forest plot (easement).

Our Russian lawyers can offer more information on the Forest Law.

Registering a forestry company in Russia

The registration procedure for a forestry business in Russia will be the same as for other types of companies. Following that, the company will need to obtain a forest lease (usually awarded at auction), an approved forest development project and a forest declaration to engage in activities related to the cutting of trees and production of timber or other wood products.

Russian companies are also allowed to build facilities used for the processing of wood. However, these are not the only activities a forestry company can carry out in Russia. Other activities include agricultural operations, cultivating certain species of medicinal plants, game hunting, exploitation of mineral resources. It is also common for Russian forestry companies to produce wood-based goods for export activities.

The forestry industry offers many investment opportunities and if you want to create a company in this sector we invite you to contact our law firm in Russia for assistance.