Russia is "open for business" but "bureaucracy remains a major obstacle"- Andrey Goltsblat at RBCC Annual Business Forum.

28.06.2011

“Russia is open for business, but bureaucracy remains a major obstacle to attracting and developing investment projects,” said leading Russian Lawyer Andrey Goltsblat at a major conference on investing in the Russian market today (23 June 2011).

The Russo-British Chamber of Commerce (RBCC) annual Business Forum heard in a keynote address how Andrey believes that effectively managing Russian bureaucracy is a key factor for success for the increasing number of foreign investors who are attracted by Russia’s vast resources and high levels of skills.

The audience of leading businessmen and women included: Tim Eggar, President of the RBCC; Prince Michael of Kent, the Chamber’s Patron; the Russian Ambassador to the UK, His Excellency Alexander Yakovenko; and Dame Anne Pringle, the UK Ambassador to Russia. Chief executives and board members from many leading Russian firms, as well as senior executives from British firms investing in the Russian Federation, also attended.

Andrey Goltsblat is managing partner of the first Russian international law firm, Goltsblat BLP,  and  he also helped draft the Russian constitution in his previous role as Chief of Staff for the Constitutional Commission of the Russian Parliament.

He said: “Western businesses need to understand that, when doing business in Russia,  it is essential to have enough dedicated resources to manage the process of engaging with the authorities. You also have to allow adequate time for decisions to be reached, particularly when you are dealing at a regional and municipal level.”

Andrey continued: “Conditions have improved dramatically over the last few years and, despite the challenges of enforcing them on the ground, legal frameworks are in place to protect intellectual property and enable successful investment.”

“Bureaucracy and the perception of official corruption remain obstacles to companies considering investment and a major issue is that regional authorities have little motivation or incentive to facilitate the process. Often they are not able to reach decisions, holding up investments. As a result, you have to understand who exactly can and will support your project, and what the relationships are between them.

“At all stages, investors must comply with the law. Despite any frustrations or temptations to do otherwise, they should not be tempted to ignore legal issues or rely on promises from officials. Officials can change or others who are more senior may become involved so it is crucial that decisions are legally sound.”

He added: “Forward thinking international businesses in many sectors - for example technology, mining and natural resources - are taking advantage of the increasingly favourable investment conditions in Russia. Those who build relationships early and take time to understand the market will have an advantage going forward.”

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