How to appoint a non-resident as a director of LLC in Russia

1. Appointment of a non-resident as a director

Russian legislation allows us to appoint non-residents as directors of LLC.
You cannot appoint a foreign citizen as the first director, because he can only be appointed after he and the employer receive permission to engage a foreign employee to work in Russia. The fine for work without permission can be up to 800,000 RUB.

1.1 To change the director of an LLC, you need the following documents:<

a) Minutes of participants’ meeting of an LLC (decision of the sole owner of an LLC has one owner) on the dismissal of the former and appointment of a new director. A majority shall make the decision of the total votes of the participants in the company. The minutes of meeting should be signed by the chairman of the meeting and the secretary of the meeting.
b) Order on the dismissal of the former director;
c) Order on the appointment of a new director.

1.2 An algorithm of registration of director change is the following:

To register a non-resident as a director of an LLC, you need to submit to the Federal Tax Service of RF (registration body) the following documents:
a) Application of required form;
b) Minutes on the appointment of a new director;
c) Charter of the LLC;
d) Payment order for government fee;
e) Orders on the dismissal of the former director and on the appointment of a new director;
f) Labor agreement;
g) Director’s passport;
h) Power of attorney for a representative who will submit the documents.
All the documents may be submitted by a representative who has a PoA from the LLC. The term of registration is five working days from the date of submission of the documents to the Federal Tax Service.
Important: change of director does not require the personal presence of the director in Russia.

2. Employment if non-resident in Russia

2.1 Entry to Russia

If the director performs his functions from the territory of Russia, the following information may be important:
The period of stay in Russia for citizens of countries that have a visa-free regime with Russia may not exceed 90 days for a total of 180 days. It can be extended for a term of labor agreement with an employer.
Duration of temporary stay of citizens of other countries, including maybe extended upon issuance of a work permit to a foreign citizen or upon extension of the validity of a work permit.

2.2 Documents which non-resident shall transfer to the LLC

The appointment of a director to the LLC provides for the conclusion of an employment contract in writing. The contract between the LLC and the director shall be signed on behalf of the LLC by the person who chaired the general meeting of the LLC participants, at which a new director was appointed.
For payroll administration, a non-resident shall provide an employer with the following documents:
a) passport or another proof of identity (with translation in Russian certified by a notary);
b) diploma;
c) agreement on mandatory medical insurance;
d) work permit.
Additional requirements for the conclusion of labor agreement:
a) When concluding an employment contract, the LLC shall receive information about the disqualification of an individual (deprivation of the right to hold positions, including in the executive body of a legal entity) in the Federal Tax Service. The respective certificate is free. Term – 5 working days.
b) Maintain a labor book of required form for the non-resident director.

2.3 Work permits

Citizens of the Eurasian Economic Union don’t need work permits.
For employment of other non-residents, it is mandatory to obtain (i) permit to attract and use foreign workers; (ii) permit to work in the Russian Federation.
Obtaining permits to attract foreign workers and work permits are carried out through the territorial ofiicials of the Ministry of Internal Affairs of Russia.
Government fee is the following:
a) for a permit to attract foreign workers – 10.000 RUB;
b) for a work permit – 3.500 RUB.

2.4 Tax number

After registration of a new director, the tax authority within five working days issues (sends by post) to non-resident a notification on registration with his individual tax number.

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