Newsletter for the Brazilian businesses and investors (Issue 1, 2015)
Russia offers Brazil active cooperation for development of high technology.
Russian Deputy Prime Minister Dmitry Rogozin, who headed a Russian official delegation that visited Brasilia in December 2014, told reporters that Russia is offering Brazil its active cooperation for development of high-technology sectors, including space exploration, shipbuilding and aviation, and that the two countries are conducting “serious negotiations” toward agreements related to missile defense technology.
The Russian delegation met with Vice President Michel Temer, Brazil’s co-chair of the bilateral High-Level Commission on Cooperation, and Brazilian Defense Minister Celso Amorim, visited the GLONASS ground station for Russian global navigation system’s correction and monitoring at Brasilia University, and met with top managers of Brazilian companies in the aviation, shipbuilding and defense high-tech sectors.
Mr. Rogozin stressed that Brazil has shown a great deal of interest in technology at which Russia excels, and in reaching agreements for the transfer of Russian technologies and research and development to Brazil. According to him, talks are in progress for continued joint development of space services technologies, and there appears to be significant opportunities for co-development of technologies for oil and gas exploration. He expects that some initial agreements for strategic cooperation will have been reached before the scheduled 2015 visit to Russia by Brazilian President Dilma Rousseff.
Eurasian Economic Union is now in effect.
The Treaty for Eurasian Economic Union (EEU), which establishes a new level of economic integration among the Russian Federation the Republic of Belarus and the Republic of Kazakhstan, came into effect on 1 January 2015. The EEU Treaty continues a process of integration which began in 2010, when the three countries established a Customs Union.
The EEU Treaty contemplates free movement of goods, services, capital and labor throughout the EEU territory, as well as the conduction of coordinated, coherent and unified economic policies. Within the first ten years of the treaty, each of the EEU countries will have to adjust their respective national legislations to ensure harmony with the rules of the new Union.
The EEU agreements further contemplate achieving a unified pharmaceutical market for the region by 2016, a unified electricity market by 2019, and unified oil, gas and petroleum products market by 2025. An agency for regulation of the EEU financial market will be established in Almaty, Kazakhstan, and begin working in 2025.
Members of the Eurasian Economic Union will not be able to apply to each other trade restrictions such as tariffs, prohibitions, quotas, antidumping or compensatory measures. Exceptions are allowed in cases where such measures are deemed necessary to ensure national security and defense or to preserve life, health or the environment, but the agreement warns against using these exceptions as a pretext to impose unjustified discrimination or disguised trade restrictions.
In the past, the agreement for the countries’ Custom Union allowed the use of mutual protective measures, but the countries have not imposed any such measures since 2010. The EEU agreement does allow its member countries to impose sanitary, veterinary, quarantine or phytosanitary controls.
Under the terms of the Treaty, the Eurasian Economic Union is open to the admission of other States that share for its aims and principles, under conditions set by its participating countries. The Republic of Armenia joined the EEU on 2 January 2015, and the Republic of Kyrgyzstan is expected to become a member by May 2015. EEU members have pledged aid to Kyrgyzstan in order to accelerate its integration into the Union: US$300 million to improve its customs posts, and the establishment of a US$ 1 billion Kyrgyz-Russian Development Fund, meant to help Kyrgyzstan to develop its economy and offset any initial negative economic effects which may result from its integration into EEU.
According to Vladimir Putin, President of the Russian Federation, negotiations toward a free trade agreement with Vietnam are in the final stages, and similar agreements are being discussed with Turkey, India and Israel.
Brazil is now the main supplier of meat to Kamchatka.
According to the website of the regional government of Kamchatka Krai, in Eastern Russia, Brazil is now the main supplier of meat products to the Kamchatka region. This is a result of the ban that Russia imposed in 2014 on meat imports from a number of countries.
Since September 2014, the Kamchatka Krai territory has imported over 6.8 thousand tons of meat products. Brazil has supplied 37% of those imports, while Russian beef has accounted for only 26%.
Russian-owned Nordic Yards establishes a company in Brazil.
German shipbuilder Nordic Yards, which is owned and run by Russian investor belonging Vitaly Yusufov, has set up a Brazilian Company, Nordic Yards do Brasil, together with an unidentified Brazilian partner. Nordic Yards do Brasil reportedly will build a shipyard for construction and repair of large vessels, in the province of province of Camocim, in the northern Brazilian state of Ceara. The company will invest approximately 300 million Euros, and is expected to obtain tax incentives from the Brazilian government.
Nordic Yards is one of the world's leading manufacturers of technologically sophisticated ships, and is focused on Arctic shipping, offshore exploration and wind turbines. It has three shipyards in Germany in Wismar, Warnemünde and Stralsund. The company was acquired in 2009 by Mr. Yusufov, for 40.5 million euros.
Russian company Evraz exports rails to Brazil.
Russian metallurgical holding Evraz, which controls virtually the entire Russian market of rail products, has begun exporting rails to Brazil.
The company announced that it has signed two contracts, one with TIISA Construction for four thousand tons, and one with BR Railparts for three hundred tons. This marks the first time that Evraz has exported to Latin America. Together with another contract for exports to Iran, this also marks the first time that Evraz has made any sales outside the post-Soviet territory.
According to Maria Starovoyt, an Evraz representative, exports to Latin America and the Middle East are expected to account for 10% of Evraz’s output in 2015, and to grow up to 20% or 30% of the company’s output in the long run.
New rules for accreditation of branches and representative offices of foreign legal entities
Rules and procedures for accreditation in Russia for representative offices and branches of foreign companies have changed, effective 1 January 2015, In accordance with Federal law No. 106-FZ On Amendments to Certain Legislative Acts of the Russian Federation, dated 5 May 2014. Under the new rules, the Russian Federal Tax Service (FTS) is now in charge of accreditation and registry of branches and representative offices, while the Chamber of Commerce and Industry of the Russian Federation (CCI) is in charge of individual accreditation and visa support for foreign employees of branches and representative offices.
Certification of accredited foreign workers is now a prerequisite for accreditation of branches and representative offices. All foreign employees who work at branches and representative offices of foreign organizations now must obtain personal accreditation from the CCI. Any branch or foreign office seeking accreditation must obtain from CCI a certification of its number of accredited foreign workers before applying for accreditation from FTS.
New procedures for accreditation are now in effect. FTS has implemented new procedures for accreditation, including changes in required documents, information and forms.
Branches and representative offices which are already accredited will also be affected by the new rules and procedures. Branches and representative offices which are already accredited must provide FTS with updated information (and, in some instances, additional information) by 1 April 2015, or lose their accreditation thereafter.