Priority investment project status

WHO ISSUES

Government of the Nizhny Novgorod Region

and Legislative Assembly of the

Nizhny Novgorod Region

RECIPIENT

Organizations of investment activities

that implement PIP (without restrictions on

the type of activity)

PROFIT TAX

Lowering the rate to the

regional budget to

12,5%

LAND LEASE

Decrease/exemption from

payment for land lease in state/

municipal ownership

PROPERTY TAX

Exemption from payment for newly

created/purchased property to

0,55% – for modernized property

имущества

LAND TAX
Exemption from payment
The validity period of tax benefits is 5+2 years, but not longer than the payback period of the PIP
The amount of tax benefits ≤ the amount of investments
Guarantees of stability of regional legislative regulation and non-rise of regional tax burden during the PIP procedure

    

CONDITIONS FOR OBTAINING:

Amount of investments from 100 million rubles
or implementation of the project in a subsidized municipal district (subsidy — more than 5%)
Conclusion of the investment agreement
with the Nizhny Novgorod region on a competitive basis (reconciliation of the investment plan, forms of state support, rights, duties and responsibilities of the parties)
investment plan and business plan of the project
To conclude the investment agreement, it is necessary to develop the investment plan and business plan of the project in accordance with the form approved by the regional legislation
/
IMPORTANT! The investment project must comply with the Development Strategy of the Nizhny Novgorod Region and have an economic, budgetary and social positive effect.

Priority status criteria

The following industry priorities are provided for by the region’s investment policy:
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Automotive industry, scientific and educational complex and new economy, information technology, food industry, electronics and instrumentation, chemicals and pharmaceuticals
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Ferrous metallurgy, fuel industry, aircraft industry, chemical and petrochemical industry, tourism
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Building materials, medical industry, timber industry and pulp and paper industry, light industry, shipbuilding, agriculture
The main criterion for assigning the priority status to an investment project is of a positive effect from its implementation, which is evaluated by such components:
  • Economic efficiency in accordance with the project business plan

 

  • Budget efficiency, calculated as the tax assessment minus the measures of state support provided to the investment entity

 

  • Social efficiency (creating jobs, improving working conditions, the structure of production personnel, the level of public health, improving housing and living conditions, supply of certain types of goods, saving time of the population, etc.).

 

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IMPORTANT! A negative value of these indicators may result in rejection of the priority status application

Additional selection criteria for the provision of state support to investment projects are:

 

  • The absolute value of investments made or attracted

 

  • Short payback period of the project (projects with a payback period of 5 years or less are preferable)

 

  • Support of the investment project by the local government, on whose territory the implementation of the investment project is planned.

 

 

Social, environmental and other effects that cannot be quantified and valued are considered as additional indicators of integrated efficiency and are taken into account when justifying the state support for the investment project.

Status assignment procedure

The procedure for considering the application and assigning the priority status to a project is transparent and legislatively regulated.

The procedure for assigning the priority status to investment projects and providing state support includes the following main steps:
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The investor submits an application for assigning the priority status to the project together with a required package of documents to the Ministry of Economic Development and Investments of the Nizhny Novgorod Region
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The Ministry of Economic Development and Investment of the Nizhny Novgorod Region checks the application for compliance with formal requirements, after which, if the necessary package of documents is available, it registers it on the website of the Nizhny Novgorod Region Government.
/
The investment project is sent to obtains an industry expert opinion and the conclusion of the Ministry of Finance of the Nizhny Novgorod Region. Such documents are used for a comprehensive examination of the project and any comments made as a result of the examination (if any) are sent to the investment entity. The investment entity can improve the project business plan taking into account the comments provided and send it for the examination again.
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In case of a positive conclusion, the Ministry of Economic Development and Investments of the Nizhny Novgorod Region puts the issue on assigning the priority status to the project on the agenda of the meeting of the Presidium of the Strategy and Investment Council under the Governor of the Nizhny Novgorod Region. At the meeting of the Presidium of the Strategy and Investment Council the investment entity presents the project.
/
If it is decided to assign the investment project the priority status, the Ministry of Economic Development and Investments of the Nizhny Novgorod Region prepares:

  • an order to recognize the project as a priority investment project of the Nizhny Novgorod Region;

  • a draft investment agreement between the Government of the Nizhny Novgorod Region and the investment entity, which is sent to the investor for signing in electronic form in two copies;

  • a draft law “On approval of the investment agreement between the Government of the Nizhny Novgorod Region and the Investor”
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If the investment agreement provides for financial state support, the investment agreement is sent to the regional Legislative Assembly of the Nizhny Novgorod Region.
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The draft law “On approval of the investment agreement between the Government of the Nizhny Novgorod Region and the Investor” is considered at the meetings of:

  • The Committee on Economics, Industry, Enterprise Development, Trade and Tourism of the Legislative Assembly of the Nizhny Novgorod Region

  • The Committee on Budget and Taxes of the Legislative Assembly of the Nizhny Novgorod Region
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The meeting of the Legislative Assembly approves the Law "On Approval of the Investment Agreement between the Nizhny Novgorod Region Government and the Investor".
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The Government of the Nizhny Novgorod Region signs the “On approval of the Investment Agreement between the Government of the Nizhny Novgorod Region and the Investor”.
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The investment agreement comes into force from the day the Law is published, after which state support measures become effective.

List of priority investment projects

As of December 31, 2019, the full list of priority investment projects of the Nizhny Novgorod Region included 99 items.

  

Laws and regulations

Law of the Nizhny Novgorod Region No. 180-Z of December 31, 2004 “On State Support of Investment Activities in the Nizhny Novgorod Region” Download
Decree of the Nizhny Novgorod Region Government No. 56 of February 26, 2006 “On the Procedure and Conditions for Giving Investment Projects the Priority Status, Concluding Investment Agreements and Monitoring the Progress of Implementation” Download
Decree of the Nizhny Novgorod Region Government No. 374 of November 3, 2006 “On the Procedure for Compensating Some Interest Expenses for Bank Loans from the Regional Budget” Download
Decree of the Nizhny Novgorod Region Government No. 566 of August 24, 2016 “On approval of the procedure for granting subsidies from the regional budget to reimburse the costs of utility infrastructure Download