Interested in starting a business or staying in Russia but don’t know where to start? We spoke to Ivo van Rhijn, a Dutch lawyer who opened his practice in St Petersburg this year, to hear about what it’s like to live and work long-term in Russia.
The Russian legal system is especially intimidating and cumbersome for foreigners. Changing legal requirements, long lines, and getting juggled between bureaucratic offices can turn any simple errand into a Kafkaesque nightmare.
We met with Ivo van Rhijn, 35, to hear his personal and legal advice about living and working in St Petersburg.
Ivo moved to Russia in 2013 and worked at a Russian law firm before opening his own practice earlier this year—van Rhijn & Partners. His St Petersburg-based company specialises in helping foreigners open businesses, acquire real estate, apply for necessary documents like work permits and visas, and manage accounting and taxes.
What are some unusual aspects of the Russian legal system that foreigners should be aware of before coming to live and work here long-term?
A lot of foreigners aren’t aware of the obligation to register—within 7 working days after coming into the country, you need to get this paper called Уведомление о Прибытие Иностранного Гражданина (Notification of the arrival of a foreign citizen). Foreign citizens cannot do this themselves though, they need to get a Russian citizen or their inviting party to do it for them.
What happens if you don’t have it?
Normally nothing happens basically, but it’s like one of these many situations in Russia, there are so many rules, and a lot of people don’t comply with them. But there is a risk both for the foreign citizen and for the inviting party. Usually, nothing happens, but I would strongly recommend that people do not neglect this obligation.
What is the legal and business climate like in Russia since the events of 2014? Have things become more difficult for foreigners?
The patriotic part of Russia maybe is a bit more skeptical towards Western Europeans and Westerners in general—I’ve heard this from other people as well who have been in Russia longer than me, and they’ve said that they used to be really welcomed with open arms, and that’s no longer the case.
I would say that the position of a foreigner is not as comfortable as it used to be. For me personally, maybe that would mean it’s worse, but maybe, in general, it’s also normal because there used to be a bit of abnormal adoration for Western foreigners, so maybe from that point of view the situation has normalised a bit.
What sort of services does your law firm provide?
We help acquire necessary documents like work permits, work visas, and business visas, in order to visit, live, or work in Russia. We also help register businesses, do accounting, review any contracts needed, and help acquire licenses you may need for your business. For example, if you want to open a bar, you’ll need an alcohol license which we can help with. We can also do debt collection for foreign companies from Russian debtors, and for Russian companies from foreign debtors.
If you’re interested in buying real estate in Russia, we can help with that. Sometimes it makes sense to first open a company and to register the real estate under that company because a Russian company will always be a Russian tax resident. That has some benefits and it has some disadvantages, depending on your situation.
Who do you usually work with?
Most of our clients are small or medium-sized business, companies from the Netherlands or other Western European countries that are either just starting to look at Russia as a new perspective or are already here and want to expand a little bit.
What is the advantage of your company?
We are a very fair priced firm, which is foreign owned, and that’s a rare combination. Usually, the foreign firms are expensive, but we offer high-quality services for a fairer price. I believe that’s what makes us unique. Also, at the moment, I am the only practicing Dutch lawyer in town.
What are some of the benefits of opening a business in St Petersburg?
St Petersburg is a city with potential, for a foreign business owner it’s cheaper here to open a business than it is in Moscow, rent is cheaper, also some special tax rules make it cheaper to run a business here in St Petersburg from a tax fiscal point of view.
The business climate is quite good, I’m enthusiastic about it. There are many young people who are very motivated and who are trying to make something of their lives. In general, Russians are really mature in a way, more than young people in Western Europe. They often feel that if they don’t make something of their lives, no one else will. This understanding brings a certain dynamic to the city, I believe, that makes it attractive from a business point of view.
What advantages does St Petersburg have when compared to cities in Western Europe?
Compared to Western Europe—there aren’t many cities with over 5 million people in them. You have London, and then Paris and Berlin—which are smaller.
The scale of the city is an important advantage. It brings a lot of infrastructure here, I think if you want to test a certain product or service, a city like St Petersburg—which is relatively cheap but is big and has a lot of advantages like highly educated people—is a very good place to test a new product or a new business.
What advice would you give to someone interested in opening a business in St Petersburg?
Registering a company in Russia is hard if you don’t know what you’re doing. I’ve done this work for 3.5 years and it’s basically my job to register companies. It’s a complicated procedure; you need to know the steps. It’s also important to have a flexible attitude. You need to know how to talk to the people at the tax office, for example, they sometimes have a special attitude. You need to know what you’re doing.
It’s not for everybody, Russia’s not for everybody. If you just think that you want to open a business but you don’t know what and why you’re choosing Russia, then it’s not a very good idea. But if you have an idea about why you want to come to Russia and what you want to do here, then yes there are many great opportunities here.
Ivo runs a blog about legal questions specific to St Petersburg. You can also contact him using one of the links below: