What is the difference between a Representative office and a Branch office of a foreign company?

An accredited representative office is not a Russian legal entity, but an officially recognised subdivision of a foreign legal entity. Representative offices of foreign entities are strictly limited to liaison and support functions. A branch’s legal status differs substantially from that of a representative office. Under Russian law, a foreign legal entity’s registered branch  is treated as “an enterprise with foreign investment”. Therefore, while a registered branch can hold certain types of licences to conduct regulated activities, a representative office or unregistered branch may not. Branch offices are free to perform all of a foreign entity’s activities. Many investors opt for branch offices at the outset because these entities are able to engage in any kind of commercial activity. Furthermore, they are subject to less onerous reporting requirements than those in place for Russian companies.