Free Trade
Zones/Warehouses
There are no actual free trade zones in Russia. However,
there are some free economic zones, free customs zones, and free
warehouses designed to encourage investment in specific areas. Federal
legislation on the development of free economic zones (FEZs) is no
longer a Russian priority, despite draft bills which periodically
resurface. In 1997, a bill attempting to harmonize tax holidays and
other concessions for FEZs across Russia passed parliament only to be
vetoed by the president. Previously-established FEZs, including the high
profile Kaliningrad FEZ, have generated little new investment.
More recently, with the onset of the financial crisis and the
government's emphasis on improving revenue collection, the concept of
FEZs has been criticized as a threat to federal budget revenues.
Alternatively, the government has turned to smaller-scale "free customs
warehouses" as in the case of the 1998 Automobile Industry Decree 135.
Customs duties do not apply in free customs zones and free warehouses.
Some production and wholesale transactions (but not retail sales) can
take place within these zones. The storage period is unlimited. Free
customs zones and free warehouses are located in customs areas
(airports, seaports, railway and truck terminals) and, according to
Decree 135, selected automobile factories
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