02.12.2016 — Registration of Real Estate Rights: Faster and More Convenient after New Year
Starting from 1 January 2017, cadastral registration and property rights registrations systems will be significantly renovated. Apart from the creation of the Unified State Register of Real Estate, merging the currently divided systems of cadastral registration and real estate property rights registration, the registration procedures will be simplified, the time necessary for their performance will be shortened, and the resultant registration documents will be obtainable at any place in Russia at the applicant’s choice.
Starting from January 2017, documents for state registration of property rights and cadastral registration can be filed in any territorial office of the Federal Service for State Registration, Cadastre, and Cartography (Rosreestr), regardless of the real estate object’s location.
It will further be possible to obtain the registration documents at any convenient place and time by ordering a courier delivery service for an additional fee. As before, all of these services will be accessible online, and can be ordered through the unified governmental services website.
Apart from that, in 2017 the time necessary for registration procedures as well as for obtaining information from the State Register will be reduced. Cadastral registration and registration of property rights to real estate, if performed simultaneously, will take no more than 10 working days. If, however, the applicant requests these services separately, cadastral registration will take no more than 5 working days, while the registration of real estate property rights will take no more than 7 working days. The time necessary for obtaining official extracts on real estate objects from the State Register will be reduced from 5 to 3 working days.
01.12.2016 — The Number of Russian Disputes in British Courts Is Rising
According to the Financial Times, the number of cases initiated by residents of the former USSR considered by British courts is stably on the rise. Over the last year, slightly more than half of court cases considered by British courts were initiated by the Great Britain’s own citizens. Other disputes revolved around citizens and companies from foreign jurisdictions, among which Russia, Kazakhstan and offshore zones are the leaders.
At the same time, the share of European companies among court cases considered by British courts has significantly lowered in the recent years. In 2012-2013, the disputes with their participation amounted to 35% of all disputes in British courts, whereas today their share does not exceed 20%. The number of British citizens among court case participants in 2015-2016 decreased almost by half.
The litigants’ citizenship also reflects the geography of offshore zones, in which corporate structures of the world’s leading holdings and oligarchs, filing claims to British courts, are registered. British Virgin Islands, Cayman Islands and Switzerland are among the top 10 countries from which British courts most often receive court claims for resolution.
30.11.2016 — Starting from January 2017, Information on Notarized Powers of Attorney Will Be Available Online
The Federal Notary Chamber (https://notariat.ru) will start publishing information on all Powers of Attorney certified by the notaries. The information will be accessible online for free on a day-round basis.
This tool will make it possible to find out which notary certified a given Power of Attorney, the date of such certification, and to verify its registration number in a specialized register. However, the contents of Powers of Attorney will not be published. Currently, the Federal Notary Chamber only publishes information on cancelled Powers of Attorney (http://reestr-dover.ru). Information from this register will also be accessible in 2017.
Using this novelty, businesses will be able to ensure that their counterparties’ representatives are duly authorized to enter into transactions, thus minimizing the risks of their challenging by shareholders or other interested parties.
29.11.2016 — 90% of Trade and Office Premises in Moscow to Be Taxed Based on Cadastral Value
The Government of Moscow plans to extend the list of commercial real estate objects subject to taxation per cadastral value. Starting from 2017, all objects located on land plots whose permitted use is accommodation of trade and office buildings, or other commercial estate, will be subject to taxation per cadastral value, regardless of the area of these objects.
Currently, only trade and office centers with total area exceeding 3000 sq. m. and located on land plots with permitted use of accommodating commercial real estate are subject to property taxes per their cadastral value. Objects located on other land plot types are subject to cadastral value taxation if their area exceeds 2000 sq. m. and they are in reality used for offices or trade.
Starting from 2017, the Government of Moscow intends to secure equal treatment of all commercial real estate owners by subjecting all objects to taxation per cadastral value, regardless of their total area. The only criterion that will be taken into account is the permitted use of land plots on which the real estate is located. As a result, more than 90% of all trade and office buildings in Moscow will be affected, totaling to more than 20 thousand objects.
Please be reminded that property tax rate in Moscow is currently 1.3% of cadastral value. In 2017 the tax rate will rise to 1.4%, and starting from 2018 property tax will be paid per 1.5% of cadastral value.
28.11.2016 — PLATFORMA: New Web Tool for Litigation Funding
Starting from November 2016, all participants of the Russian legal market can access a new multifunctional web tool Platforma (http://platforma-online.ru), connecting claimants seeking third party funding for litigation expenses with professional lawyers and investors, which are willing to invest into court proceedings for a “success fee”. In order to start, it is sufficient for clients to publish their case on Platforma, whereas lawyers and investors are to send an application to take part in the project.
Cases published on Platforma undergo prior due diligence assessment by Platforma’s experts. This includes legal analysis of the claim, verification of the client’s creditworthiness, analysis of the financing required for the court project and the chances of success. This preliminary check enables investors to take informed decisions on their participation in the projects.
A number of major court disputes have already been supported by private investors and lawyers through Platforma. This includes disputes in foreign jurisdictions with case value exceeding several million USD, whose successful resolution brought profits totaling to over 100% of the investment value for the participating investors.
Apart from engaging financing or legal support for business disputes, the service also has a dedicated pro bono section, which enables clients to seek financing or legal support for court disputes with a socially significant purpose, such as protecting the claimant’s own individual rights, rather than for deriving profit.
Platforma is the first and currently the only service of this kind in Russia. At the same time, in Western countries similar online platforms for engaging third party funding have for a long time been in good standing.