Frequently asked questions

HOW TO START THE IMPLEMENTATION OF THE INVESTMENT PROJECT?

It should be started by drawing up a business plan or a feasibility study. These documents serve as the basis for identifying the investment effectiveness of the project. The future prospects of the project and its profitability depend on how accurately the analysis has been conducted. At the stage of the feasibility study, you can determine the source of financing: banks, private funds, co-investors, own funds.

 

At the stage of preliminary analysis of prospects of the project implementation, it is necessary to carefully evaluate the potential sales market and promising trends that will be relevant in a few years, when the enterprise is commissioned.

 

A poor feasibility study or a poor-quality business plan means risks, costs and a possible denial of the bank to provide credit financing even for a potentially attractive investment project.

 

Next, go to the section “Investor’s Personal Account” register and submit an application to support the investment project or to select a land plot.

 

WHAT IS THE INVESTOR’S PERSONAL ACCOUNT REQUIRED FOR?

The Investor’s Personal Account is an electronic service for joint work of investors with regional authorities on the implementation of investment projects.

 

For new projects

 

If an investor begins the implementation of an investment project in the Nizhny Novgorod Region, he/she can use the Personal Account to:

 

  • Submit an application (the investor can submit an application for the support of the investment project according to the Regulation of Support of Investment Projects)

 

  • Find out the result of consideration of his/her application (to track the status of the filed application and to receive feedback from authorities on the results of its processing)

 

  • Get access to the project (after the application is approved, the project will be taken for support, and additional functions of the Personal Account will become available to the investor)

 

For supported projects

If the investor is already the initiator of projects supported by the “one-stop shop” principle, he/she will be able to:

 

  • See information about all supported projects

 

  • Learn the contact details of the team members supporting the project

 

  • Monitor the implementation of action plans developed for each type of investment project support

 

  • Ask questions and discuss their solution in a general chat with members of the support team

 

  • Involve the regional head of the relevant branch ministry in solving "unsolvable problems"

 

  • Assess the effectiveness of the support team by each question or problem posed

 

  • Store and retrieve all project documents directly in the Personal Account in a specially created section
HOW TO CHOOSE A LAND PLOT?

The Development Corporation of the Nizhniy Novgorod Region can help the investor in this matter. It will present options for investment sites in accordance with technical specifications of the project.

 

The investor can also select the site independently – using an interactive mapThis is a bilingual map of the region, which displays general information about the region, data on investment sites, infrastructure and existing investment projects by municipalities.

 

Today, the database of promising investment sites contains more than 600 brownfields and greenfields.

HOW TO REGISTER THE RIGHTS TO THE LAND PLOT?

The procedure and terms for the registration of rights to a land plot depend on the ownership of the land and the current urban development situation in the territory.

 

  • If the site is privately owned, it is enough for the investor to buy the selected territory from the owner

 

  • If the site is in municipal ownership, the investor must contact the administration of the respective municipality

 

 

Find the list of documents to file and application (with filling instructions) and file the application in electronic form on the website of the Ministry of Property and Land Relations of the Nizhny Novgorod Region. Based on results of consideration of the application, the council makes a decision on the feasibility of implementation a particular investment project on the land plot selected by the investor and determines the procedure for allocating the land: through participation in tenders or without tenders. In addition, an action plan for the provision of a land plot to the investor should be approved with the indication of terms and responsible persons.

 

According to the law, a plot can be provided by the Council without bidding for placement of social and cultural facilities or the implementation of large-scale investment projects.

 

According to the Land Code of the Russian Federation, the land is leased to the investor for the period of construction of the facility (3-5 years). After commissioning of the facility, the land plot can be bought out or registered as a long-term leasehold (up to 49 years).

HOW TO CONNECT TO UTILITY NETWORKS?

Approaching the design stage, the investor should have a complete understanding of the points of connection to the gas, electricity, water and wastewater networks.

 

The investor should receive information on the cost of utility networks at the stage of selecting a site, since the connection costs are a rather significant share in the total volume of investments.

 

The investor (owner or tenant of the land plot) needs to contact the utility company to obtain technical conditions for connecting to the networks and enter into a technological connection agreement. The technical specifications contain information about the scheme and cost of connection, as well as estimated dates for the completion of network laying.

 

Calculation of the connection costs is made according to the tariffs approved by the Regional Tariff Service

 

  • The technical conditions for connecting to gas pipelines are issued by Gazprom

 

  • Matters related to the water supply and disposal are resolved at the municipal level, and the technical conditions will be issued by local authorities

 

  • Technical conditions for connecting to the power grids depend on the owner of the grid located in the vicinity of the land plot.

 

Nizhny Novgorod Region Development Corporation has administrative resources and is able to communicate with utility companies. It will assist the investor in the preliminary study of the possibility and estimated cost of connecting to utility networks, and after the investor makes the final choice of the land, it will support the project in cooperation with infrastructure companies.

HOW TO OBTAIN A PERMISSION TO EMPLOY FOREIGN SPECIALISTS, WHEN REQUIRED?

Foreign citizens who came to the Russian Federation from visa-free countries work with legal entities and individual entrepreneurs according to a patent. This document can be issued if the person indicated the purpose of his/her visit to the country as “employment”. If the employment is based on the patent, the employers do not need to obtain a quota. However, when individuals come to the Russian Federation from countries that required a visa, the quota must be obtained.

 

Applications for the employment of foreign specialists are accepted with mandatory registration of the employer and generating an order in the automated information complex “Migration Quotas” (it is free for entrepreneurs).

 

Before making an application, you should settle the matter of reporting to the federal tax service of the Nizhny Novgorod Region, the Fund of Social Insurance of the Russian Federation and submit information on a special assessment of working conditions (or certification of jobs) to the Labor Inspectorate of the Nizhny Novgorod Region.

 

The applications are accepted by the Ministry of Social Policy of the Nizhny Novgorod Region (Nizhny Novgorod, Delovaya str., 9, room 704, tel. (831) 422−29−41, see full information here.

HOW TO OBTAIN TAX BENEFITS?

In the Nizhny Novgorod Region, according to the law No. 180-Z “On State Support of Investment Activities in the Nizhny Novgorod Region”, a project may be assigned the priority status. In this case, the investor can obtain financial or non-financial support.

 

Financial support includes income and property tax benefits and partial reimbursement of loan interest.

 

The amount of the income tax benefit depends on the share of revenues received from the implementation of the priority investment project in the Nizhny Novgorod Region in the total amount of revenues from the sale of goods (works, services).

 

IMPORTANT! The investor can obtain tax benefits and preferences, if he/she decide to place the enterprise in one of the three acting TASEDs in the region’s territory – in Volodarsk, Reshetikha or Sarov. TASED residents can be exempt from land and property taxes and apply a reduced income tax rate during 10 years (5% during the first 5 years and 10% during the next 5 years).

 

Catalogue "Support Measures in the Nizhny Novgorod Region"

 

HOW TO BECOME A SEZ RESIDENT

1. HOW TO BECOME A SEZ RESIDENT ?

 

- Who can apply for the status of a SEZ resident?

A commercial organization or an individual entrepreneur are able to apply for the resident status of an industrial-production special economic zone, registered in accordance with the legislation of the Russian Federation on the territory of the municipality where the SEZ is located (city of Dzerzhinsk) and implementing (planning to implement) industrial production or logistics activities (according to article 9,10 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation"). Also, it is possible to implement technical and innovative activities by the decision of the Expert Council.

 

- What is the minimum investment for a resident of the SEZ "Kulibin"?

The minimum investment for a resident of the SEZ "Kulibin" – RUB 120 million. During the first 3 years RUB 40 million also must be invested (according to article12 paragraph 3 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").

 

- What is the procedure for obtaining the resident status of the SEZ "Kulibin"?

The steps for obtaining a resident status (according to article 9,12,13,14 paragraph 4 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").

 

1. Search for the area for the project implementation together with a Management company.
2. Registration of a legal entity on Dzerzhinsk territory.
3. Submission of documents to a Management company, which includes an application for concluding an agreement, a business plan, copies of constituent documents, a certificate of legal entity registration and a certificate of the tax authority registration.
4. Defense of a business plan at the Supervisory and Expert Councils.
5. Conclusion of a tree-sided agreement with the Government of the Nizhny Novgorod Region and management company.
6. The enterprise must be included in the SEZ residents list (a commercial organization or individual entrepreneur is recognized as the SEZ resident from the date the corresponding entry is made in the list).
 

- What documents are necessary be to get resident status?

All following documents have to be approved by the Supervisory and Expert Council:

1) Business plan

2) Application for an agreement

3) Copies of constituent documents

4) Copy of the individual entrepreneur certificate of a legal entity registration

5) Copy of the tax authority registration certificate

(according to article 13 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").

 

- Is it allowed to implement entrepreneurial activities outside the SEZ territory being a SEZ resident?

The SEZ resident status excludes the possibility of setting up branches and representatives outside the special economic zone (according to article 10, paragraph 4 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation"). Individual entrepreneurs and commercial organizations that are not residents of the SEZ are able to implemententrepreneurial activities in the territory of the special economic zone (according to article 10, paragraph 3 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").

 

- What types of activities are permissible on the SEZ?

The allowed activities (according to article 10 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation"): 

  • industrial activities;
  • logistics, warehousing;
  • technical and innovative activities (by The Expert Council decision)

The prohibited activities:

  • production of excisable goods (excluding cars and motorcycles);
  • mining

 

- Is it possible to implement R&D activities on the SEZ "Kulibin"?

It is allowed to implement R&D activities on the territory of SEZ "Kulibin"(according to article 10 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation"). Technopark H2O will be a particular space for all activities within the territory of the SEZ. The infrastructure of the Technopark H2O will include: a modern laboratory complex for chemical and environmental purposes, offices, a capsule hotel, an art space, conference roomsand coworking. The rooms can be leased for required period for a resident. Building area – 7458 sq.m. The residents of the Technopark H2O will be provided with the same benefits as the SEZ "Kulibin"residents.

 

- What are the conditions for terminating the SEZ resident status?

• In the case of the termination of a legal entity or an individual entrepreneur activity (according to article 19 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").
• In case of preterm termination of a special economic zone regime (according to article 19 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").
In case of termination (including preterm) of the agreement on the activitiesimplementation (according to article 21 of the Federal law of July 22, 2005 No.116-FZ "On special economic zones in the Russian Federation").
 
 
2. BENEFITS AND SUPPORT MEASURES FOR SEZ RESIDENTS
 

- What kind of preferences can a SEZ resident claim?

A set of federal and regional support measures is provided for SEZ "Kulibin" residents. In particular, the reduced rate of income tax for the SEZ "Kulibin" residents is established for the entire period of its validity - 49 years.

An investor can apply for support measures as soon as he is included in the SEZ residentslist. In order to receive benefits, it is necessary to provide the tax authorities with an extract from the residents list.

 

Income tax (total value at regional and federal rates):
- 2% in the first 5 years (regular rate - 20%);
- 5% in the next 5 years (6-10 years);
-  14.5% thereafter (11-49 years).
 

In addition, 0% rate is set on the SEZ territory:

for the property tax within the first 10 years from the month following the month of registration of the specified property (according to the article 381 of the Tax Code of The Russian Federation);
for the land tax in the first 5 years from the moment of obtaining ownership of the land plot (the rate is established by municipal legislation);
on transport tax in the first 10 years from the month of registration as a resident (the rate is established by regional legislation).

 

- What is the procedure for obtaining benefits for SEZ residents?

An investor who has received the SEZ resident status, automatically receives the preferences of a SEZ resident. In order to receive benefits, it is necessary to provide the tax authorities with an extract from the residents list.

 

- What the difference between special economic zone (SEZ) and territory of advanced social and economic development (TASED)?

SEZ and TASED are territories with preferential conditions for doing business.There is a set of federal and regional support measures on both of them.

The main differences between SEZ and TASED:

The operating period of territories. The SEZ status is established for 49 years, and the TASED for 79 years.
Measures of support. Benefits provided to residents of TASED are limited to a period of 10 years. At the same time, individual benefits for SEZ residents can reach 49 years. Both SEZ and TASED have benefits for income tax, property tax and land tax. The SEZ also has transport tax benefits. TASED, unlike the SEZ, has benefits for social payments (7.6% instead of the regular30%).

The following preferences are available to residents of TASED:

- income tax: 1-5 years - 5%, 6-10 years - 13%;

- property tax: 0% for 10 years;

- land tax: 0% for 10 years;

- insurance premium rates: 7.6% for 10 years.

Territory boundaries. SEZ is an industrial zone with a separate territory set aside for it. TASED is being created on the territory of the entire municipality.
The minimum investment. The minimum SEZ threshold is RUB 120 million. The minimum threshold in TASED “Volodarsk” and “Reshetikha” is not less than RUB 2.5 million, in TASED “Sarov” - not less than RUB 5 million, what makes it profitable for small and medium businesses.
 
3. SEZ ACTIVITIES
 

- What services are provided to SEZ residents?

What are the conditions for connecting to engineering networks?

There are 3 power substations (the 14 MW capacity) available for investors on theSEZ territory: water supply, sewerage and heat supply networks.

Electricity connection tariffs are to be defined in accordance with the regulatory documentation of the Regional Tariff Service of the Nizhny Novgorod Regionunder the agreement of MRSK "Center and Volga Region", PJSC.

Water, sewerage and heat supply networks will be provided to the residents in accordance with approved tariffs of DPA "Plastic", JSC.

 

- What are the available opportunities of the special economic zone?

One of the advantages of the SEZ is its favorable geographic location:

The Nizhny Novgorod Region is located on the crossroad of the main highways and railways of the country from north to south and west to east.
Taking into account the nearby territories, the consumer market of the Nizhny Novgorod Region is one of the most large-scale in Russia. Within a 500 kmradius, the population is 43 million people (more than 30% of the population of Russia), which exceeds the similar indicators for Moscow and St. Petersburg.
The distance of the SEZ from the center of the city of Nizhny Novgorod (population - 1.3 million people) is less than 40 km, from the center of the city of Dzerzhinsk (population - 239 thousand people) - 7.5 km.
There is a federal highway M-7 near the SEZ (2 km), which connects Moscow with Ufa.
The cargo yard of Russian Railways is also located nearby. This logistic andtransportation hub connects western and eastern parts of Russia. The nearest railway station to the SEZ is Igumnovo station (4 km).
Strigino International Airport (25 km) provides access to almost all countries of the world, not only due to a convenient connection system with the international air hub in Moscow, but also by the availability of direct flights to various destinations. The flight from Nizhny Novgorod to Moscow takes 50 minutes. What is more, the international airport has admission to receive large cargo ships, making it one of the largest logistics centers.
The river port located in Dzerzhinsk (11 km), provides the opportunity to transfergoods by water transport.
 
4. SELECTION AND DECORATION OF A LAND PLOT
 

- How to acquire rights to a land plot?

In order to obtain rights to a land plot it is necessary to select suitable site for a future production. In order to do this, the investor can apply to " Nizhny Novgorod Region Development Corporation", JSC, which will provide the investor with placement options that fully meet his needs.

The total SEZ "Kulibin" area is 72.3 hectares. The areas provided to investors are the property of DPA "Plastic", JSC. There are green fields and brown fieldsavailable for investors. The lease or ownership rights for the land plot are to be transferred under the agreement with DPA "Plastik", JSC, what significantlysimplifies the procedures for obtaining land rights. The conclusion of the contract will be accompanied by "Nizhny Novgorod Region Development Corporation",JSC.

 

5. LABOR FORCE SEARCH
 

- How is it possible to attract labor force to the SEZ?

The main sources of labor force for the SEZ resident will be cities of Dzerzhinsk(11 km) and Nizhny Novgorod (40 km), as there is a high human potential and experience in training specialists for industrial production of various specializations and levels.

Universities and professional educational institutions of the Nizhny Novgorod Region and the city of Dzerzhinsk educating specialists for various industries in accordance with contemporary requirements.

Dzerzhinsk is the closest settlement to the SEZ to attract staff. This is the second city in the Nizhny Novgorod Region (after the regional center) in terms of numberof inhabitants and industrial importance.

Higher educational institutions of Dzerzhinsk are represented by 1 institute and 2 branches of nonresident universities. Secondary education process beingimplemented in 2 institutions of secondary education.

There is a range of organizations in Dzerzhinsk educating stuff for chemical complex, namely: the Dzerzhinsk branch of NNSTU named after R. E. Alekseeva (DPI NNSTU), Dzerzhinsk Chemical Technical School named after the Red Army, Dzerzhinsk Technical College. All educational programs meet the employersrequirements.

A number of special basic departments has been set up by the DzerzhinskPolytechnic Institute at the chemical enterprises ("GosNII, JSC "Kristall", "NIPOM", JSC). This allows to use the modern material base of enterprises in the educational process, attracting specialists as teachers.

 

- What are the staff centers for the recruiting and training in Dzerzhinsk?

The system of resource centers has been developed to recruit and train staff in the industrial sector, which is the main in the region. 32 centers have been created in the region, implementing more than 13 thousand workers per year for the directneeds of newly opened production facilities. One of these centers is located in the Dzerzhinsk Chemical College named after Red Army. It operates  together with theSverdlov factory and conducts training in "Technology of pyrotechnic compositions and products" and "Chemical technology of organic substances",aimed at provide staff for Dzerzhinsk manufactures. The volume of training and educational programs has been agreed with enterprises.

Educational organizations are open to interact with manufactures, they are ready to implement targeted training of specialists based on investorneeds.

 

 - Is it possible to attract foreign workers to production located on the territory of the SEZ "Kulibin"? What is the procedure?

Foreign citizens from visa-free countries who came to the Russian Federation to implement labor activities for legal entities, including those, who located on the SEZ territory, under a patent. To issue this document, a foreign citizens must indicate "work" purpose at the border when entering Russia.

Employers does not need to obtain a quota to hire foreign workers under a patent.

Applications for attracting foreign workers are accepted with the obligatory employerregistration and the application at the AIC "Migration Quotas"(accordance with order by the Ministry of Labor of Russia dated January 23, 2014 №27N "Approval of the rules for determining the need for attracting foreign workers for a constituent entity of the Russian Federation by Governmentauthorities").

 

Access to the information resource is implementing via website(http://www.migrakvota.gov.ru). The use of the information complex for employers is free.

 

Before submit an application to the authorized organs, it is necessary to resolve the issue of submitting reports to the federal tax service of the Nizhny Novgorod Region, the social insurance Fund of the Russian Federation and provideinformation about working conditions assessment ( workplace certificate) to the State Labor Inspectorate in the Nizhny Novgorod Region.