The Ministry of Economic Development of the Russian Federation 2014 Russia for investors: the key points

2 Russia and Other Countries: International Rankings The World bank’s Doing Business ranking World Economic Forum’s Global Competitiveness Index Bloomberg’s Best for Doing Business 2010 DB DB DB DB DB 2015 Russian Federation (4↑)112 (8↑)92 (20↑)62 (30↑) Measures regulations affecting 10 areas of the life of a business across 189 economies: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across boarders, enforcing contracts and resolving insolvency Russian Federation 6366 (3↓)67 (1↓)64 (3↑)53 (11↑) The analysis of economies by the following criteria: macroeconomic environment, complexity of business, development of the financial markets, infrastructures, health care, education, ect Russian Federation (8↓)43 (13↑) Ranking progress of Russia Defines the best countries for doing business. The ranking is based on an assessment of an overall business activity, commercial activity and condition if the trade. Estimates 157 economies. For the last 2 years Russia shows POSITIVE DYNAMICS in the rankings estimating a business environment

3 Public debt. % of GDP International reserves of Russia increased more than 35 times. $ bn Total value of assets of Russian banking System rose 27 times. $ bn November, Capitalization of the Russian Stock Market grew almost 12 times. $ bn November, 2014 Sources: IMF, Cеntral Bank of Russia, Russian Federal Treasury, Rosstat, Moscow Exchange, UNCTAD, World Economic Forum Global Competitiveness Report 11,5% 99,0% $ 420,5 Bn $ 12 Bn 1999 $ 1, 597 Bn $ 59 Bn 1999 $ 498 Bn $ 40 Bn 1999 The dynamics of financial indicators November, 2014

Created in 2014, will start up in 2015 will replace Eurasian Economic Communion Members : Russia | Belarus | Kazakhstan Applicants: Armenia | Kyrgyzstan Eurasian Economic Union 170 mln people 3,6% world exports 2,6% world GDP 2,3% world imports 25% world gas reserves 11% world raw exports 9% world oil reserves 14% world energy exports REGIONAL MARKET FACTS:

5 Measures to Improve the Investment Climate Road maps of National Business Initiative Access to Infrastructure Enhancement of the availability of the energy infrastructure Demand for Production Support of the access to foreign markets and supporting export Expansion of medium business access to procurement of infrastructure monopolies and publicly owned companies Tax and Customs Regulation Improvement of customs administration Improvement of tax administration Dealing with Construction Permits Improvement of urban planning legal regulation and business climate in the construction industry Registration procedures Optimization of property registration procedure Optimization of legal entities and entrepreneurs registration procedures Regions’ Development Implementation of working Standard for executive bodies of the Russian Federation to ensure a favorable investment climate in the region Institutional reforms Development of competition and improvement of antimonopoly policy Improvement of business regulatory Improvement of valuation activities 11 adopted roadmaps 788 events

6 Structural reforms: Starting a Business Russia’s Doing Business Rank: Changes of indicator’s data: Dynamics of change of the rank in the ranking: - abolishing the requirement to have the bank signature card notarized before opening a company bank account; -eliminating the requirement to deposit the charter capital before company registration; -eliminating the requirement to notify tax authorities of the opening of a bank account DB DB DB DB DB 2015 Russian Federation ( ↑ 54) DB 2011 DB 2012 DB 2013 DB 2014 DB 2015 (compared to DB 2011) Procedures ,4 (↑ by factor of 2) Time (days) ,2 (↑ by factor of 2,5) Cost (% of income per capita) 2,62,321,3 1,2 (↑ by factor of 2) Paid-in min. capital (% of income per capita) 1,91,61,41, REFORMS WHICH AFFECTED A RANK IN THE DOING BUSINESS RANKING: The best dynamics of 2014 GROWTH ON 54 POSITONS

7 Structural reforms: Registering Property Russia’s Doing Business Rank: Dynamics of change of the rank in the ranking: – reducing the term of the state registration and implementation of the state cadastral account from 43 to 18 days; – possibility to file the application for registering property and for making amendments in Cadastral Register in electronic form; – eliminating the requirement of the document confirming the payment of the state duty along with the application for registration and enforcing possibility of making the payment after submission of such application DB DB DB DB DB 2015 Russian Federation ( ↑ 5 ) DB 2011 DB 2012 DB 2013 DB 2014 DB 2015 (compared to DB 2011) Procedures (↑by factor of 2) Time (days) (↑ by factor of 2,3) Сost (% of property value) 0,10,2 0, REFORMS WHICH AFFECTED A RANK IN THE DOING BUSINESS RANKING: Changes of indicator’s data: Russia shows ONE OF THE BEST world practices

8 Structural Reforms: Paying Taxes Russia’s Doing Business Rank: Dynamics of change of the rank in the ranking: – simplifying the methods of accounting; – creating the form of cross function transfer; – promoting the use of tax accounting software and electronic services; – possibility of filing of the uniform adjustment invoice in case of changes of the cost of shipped goods specified in two or more initial invoices – unifying of codes of the reporting period in various tax declarations and calculations; – creating the interactive service called Private office of the taxpayer – legal entity DB DB DB DB DB 2015 Russian Federation ( ↑ 7) REFORMS WHICH AFFECTED A RANK IN THE DOING BUSINESS RANKING: Changes of indicator’s data: DB 2011 DB 2012 DB 2013 DB 2014 DB 2015 (compared to DB 2011) Payments (number per year) (↑1) Time (Hours per year) (↑ by factor of 2 ) Total tax rate (% profit) 46,546,954,150,72 48,9 LOWEST corporate income taxes among BRICS

9 Foreign Investment Advisory Council THE KEY INSTRUMENT: in promotion of interests of the companies at the government level INCLUDES 51 INTERNATIONAL COMPANIES AND BANKS:

10 LOWER CONTROL OF BUSINESS lifting restrictions for Russian business, freeing it from obsessive control launch of special information register for transparency strengthening supervising vacation within 3 years for small business proved to be law-abiding OFFSHORE AMNESTY Total amnesty for businesses returning capital to Russia. They won’t face criminal and administrative prosecution. TAX FREEZE Existing taxes in Russia unchanged for next 4 years. TAX INCENTIVES FOR SMEs Small businesses starting from scratch should get a 2-year tax exemption FAR EAST and ASIA Vladivostok is granted free port status Russia will work closely on economic integration with fast-growing Asian countries President’s address to the Federal Assembly “Freedom for economic development, social services and citizen initiatives is the best response to both external constraints and our internal problems.” Vladimir Putin, December 4, 2014 MAIN POINTS ON ECONOMY AND LIBERALIZATION: