Set Up a Franchise Business in Russia

Enterprisers who want to open companies in Russia have several choices: from setting up new business ventures to entering into franchise agreements and even to purchase an existing business or a shelf company through which they can start operating as soon as possible.

As one of the largest countries in the world, Russia offers many investment opportunities which is why a large number of international brands want to enter such a large market. One of the most suitable option for them is entering into franchise agreements with local companies. This also bring many benefits to Russian small and larger companies which can have a business with years of experience behind and with an established name.

If you want to set up a franchise business, our Russian lawyers can explain the steps.

Legislation applicable when opening a franchise business in Russia

Franchises are primarily governed by the Russian Civil Code in which these types of ventures are known as concessions. Secondly, franchises are governed by the laws on business entities (Russia has no Commercial Code) as a Russian or foreign entrepreneur must carry out the franchise business’ activities through a commercial entity.

A particularity about Russia is that there are several types of franchise businesses which can be set up. These are:

• –          direct or single-unit franchises;
• –          multi-unit concessions;
• –          joint ventures;
• –          development franchises.

No matter the type of franchise business one wants to create in Russia, a franchise or better said a concession agreement must be drafted and signed by the parties.

Registering a franchise business in Russia

The first thing to do upon setting up a franchise business in Russia is to register a company. Following that, the concession or franchise agreement must be drafted and signed by the franchisor (the company owning the brand) and the franchisee (the company selling or distributing the goods or services of the brand).

The grant of rights under the concession agreement must be registered with Rospatent (the Federal Service for Intellectual Property) in order to be able to use the name of the franchisor.

Foreign investors who want to set up franchise businesses in this country can rely on our law firm in Russia for assistance with the registration of their companies. Please contact us for more information on how to create a franchise business.