- Posted by Awara
- On October 9, 2017
- Comments 0
- Views: 457
The Unified State Register of Legal Entities (“USRLE”, or ЕГРЮЛ), which is maintained by the Federal Tax Service of the Russian Federation, contains all the important information on Russian companies: state registration of new entities, reorganization, and liquidation. Note that if the Register does not contain complete information on the location of the legal entity, the tax authorities may officially request indication of the full office address.
Let’s look at some examples:
- The information in the Register and the company’s Charter contains the address (e.g., Moscow, ul. Oktyabrskaya 5), but does not specify the premises. This means that if you rent or own a separate office (or several of them) in a business center, mall or another commercial building, your full address must include the exact location (office number). If the Tax Service determines that there are several companies registered with the same address and without any office number specification, such companies will be obliged to provide the full legal address that includes the office number. In this case, submitting the complete address is only required for the Register – there’s no need to make amendments to the Charter since the information stated in the Register does not contradict the information contained in the Charter, but only clarifies it.
- The Register and the Charter contain different information on the company’s location. In this case, you must submit the valid company’s address to the Register and make the required amendments to the Charter, if necessary.
Nevertheless, according to Russian legislation, specifying only the municipal entity (e.g., city) is sufficient for the company’s Charter. A detailed legal address is required only for the Register. For example, you can state the company’s address in the Charter as follows:
The principal place of location of the Company shall be: Russian Federation, Moscow.
This practice will help to avoid making amendments to the company’s Charter in the future in the event your company’s address changes within the same municipal entity. However, you will need to submit the new data to the Register.
What happens if you fail to provide the valid address
If the tax authorities detect any discrepancies in the legal address, the company will receive an official request to make changes to the Register or provide documents confirming the validity of the address within 30 days starting from the date of dispatch of the notice. If the required information is not provided within the specified time period, the Tax Service will mark the company’s profile in the Register as unauthentic which may result in a number of negative consequences for the business, such as:
Possible suspension of bank account
Tax authorities send warnings to local banks informing them that the company is not located at the official legal address. This can result in a bank decision to block the company’s settlement account.
If valid information has not been provided within 6 months from the date the company’s data in the Register was labeled as unauthentic, the company will be excluded from the Register and the Tax Service will start its liquidation.
Failure to submit or provision of false information about a legal entity to a body that carries out state registration of legal entities in cases where the provision of such information required by law will result in an administrative fine in the amount of 5,000 to 10,000 RUB.
Repeated violation, as well as submission to the body carrying out state registration of legal entities of documents containing knowingly false information, if such an act does not contain a criminal offense, will result in disqualification of the company’s officials for a period of 1-3 years.
Disqualification of executives
A CEO and shareholders of an LLC with a share in the authorized capital of at least 50% associated with such company won’t be able to register in the same status in any other legal entity (new and existing ones) for 3 years or until the valid data is provided to the Register.
Recovery of business partners’ losses
The company is obliged to compensate losses caused to their suppliers, contractors, and clients in connection with the absence of valid company information, its untimely submission, or any false information submitted to the Register.
If the company’s USRLE profile was labeled as incorrect this will be recorded in the Federal Register of facts of activities of legal entities. Both USRLE and the latter are publicly accessible via Internet, meaning that such records can harm the company’s image.
Specialists at Awara are ready to assist you with registration of changes of legal address and making required amendments to the Charter.