Future expats: ask the experts

Konstantin Borisov
Managing Director, Morgan Hunt
Executive recruitment

What industries and positions are most common among expats? What is the salary level in Russia and how much do expats earn?

Expats are normally invited for two main reasons: first, they have skills still uncommon in Russia, like budget or project management; second, they have technical knowledge that is also needed here. Retail and telecommunication technologies are less advanced than in the West. They are often invited to take managerial positions.

Industries welcoming expats include financial institutions, telecommunications, retail, and until lately, development. Russia experienced a development boom and the industry needed project managers. The industries where you can hardly find an expat are manufacturing and the so-called strategic industries like defense and aviation. There are traditionally many expats in oil and gas, but they have recently hit snags in those industries too.

When people think about Russia, they tend to expect low salaries. But one should draw a line between agriculture and manufacturing in small towns and big banks in European cities such as Moscow and St. Petersburg. Salaries in major banks, financial institutions, telecommunication and oil and gas companies are similar to those in other world business centers. When we talk about expat salaries in Russia, it's an annual compensation of about $300-400k net.

Olga Lazareva
Deputy Director, Yakovlev & Partners Legal firm

What are the best courts for foreign commercial disputes in Russia?

Foreign businesses generally will not use Russian commercial courts because they fear corruption. Both foreign and Russian companies prefer the International Commercial Arbitration Court under the Chamber of Commerce and Industry of the Russian Federation (ICAC), the Arbitration Institute of the Stockholm Chamber of Commerce, or the ICC International Court of Arbitration.

Fees for Russian commercial courts are capped at 100,000 rubles or $3,900. An application to the ICAC costs $750, apart from arbitration fees, which depend on the disputed amount.

For a Russian defendant, commercial courts offer the simplest enforcement process. If an arbitral award is granted by a foreign court, it cannot be enforced in Russia without a mutual legal assistance agreement between Russia and the relevant country. However, Russia still does not have such agreements with some countries.

How to resolve disputes under an international trade contract? If a contract contains an arbitration clause, do the parties have to go to a Russian court and apply Russian legislation?

Movement of goods across the Russian border requires contract compliance with Russian law, which must be stated in the contract; wording is up to the companies. If this clause is missing, contractual parties may face a serious challenge. They should specify the court vested with jurisdiction to resolve commercial disputes. On the basis of such clear provisions, contractors can easily estimate costs both of defending their rights in court.

A contract should state the applicable law, or the Russian court will refer to the law of the country most closely associated with the contract. With sales contracts, the court applies the law of the seller's country. In a dispute regarding contract of carriage, the prevailing law will be that of the carrier's country.

We welcome your questions: editor.us(at)rg.ru

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