Important Update: on 1 July 2021, the bill was signed by the President and became law. So, large foreign IT companies have to open a representative office in Russia till 1 January 2022 in order to be compliant.
A bill has been submitted to the Russian parliament, obliging foreign Internet companies with a Russian audience of more than 500 thousand users to open branches in Russia. According to the commentary, Facebook, Instagram, Twitter, TikTok, Google AdWords, YouTube, WhatsApp, Viber, Telegram, Steam, World Of Tanks will fall under the law.
Rigid restrictions, including bans on advertising or payment acceptance, or even a complete blocking of the resource, can be applied against violators in case of non-compliance.
On May 21, 2021, a draft law, “On the activities of foreign Internet companies in the Russian Federation”, was submitted to the Russian parliament. This bill affects those foreign companies whose daily site audience exceeds 500 thousand people in Russia.
If the law is passed, such Internet companies will have to fulfil the following requirements:
- to create a branch, open a representative office, or establish a local legal entity in Russia.
- to register a company account on the Roskomnadzor website. Roskomnadzor is an authority responsible for the supervision of communications, information technology and mass media.
- to post on their website an electronic form for feedback from Russian citizens or organizations.
Requirements for representative offices of foreign Internet companies
A branch or representative office of a foreign company or a Russian legal entity established by a foreign company will have to perform the following functions:
- Respond to complaints from Russian citizens or organizations. Comply with the decisions of Russian courts and the requirements of state authorities in relation to such foreign companies
- Represent the interests of such foreign companies in Russian courts
- Restrict access to information or delete information from their information resource if such information violates the legislation of the Russian Federation
Sanctions for violation of the law
In case of violation of the requirements of the law, Authorities may apply one or more of the following sanctions:
- All users of the web resource should be informed that a foreign Internet company is violating the laws of the Russian Federation.
- The company would be forbidden to place advertisements on their web resource or advertise the resource itself.
- Money transfers and payment acceptance from Russian individuals and legal entities would be limited.
- Search engines would have to exclude such web resources from search results.
- The collection and transmission of personal data would be prohibited.
- Access to the web resource might be limited or completely blocked on the territory of the Russian Federation.
Earlier, Member of Parliament Anton Gorelkin, one of the authors of the bill, commented that resources such as Facebook, Instagram, Twitter, TikTok, Google AdWords, YouTube, WhatsApp, Viber, Telegram, Steam, World Of Tanks would surely fall under the requirements of the new law.
If approved, the bill will come into effect from the moment of official publication. However, the requirement to establish representative offices will come into force on January 1, 2022.
Update: on 1 July 2021, the bill was signed by the President and became law. So, large foreign IT companies have to open a representative office in Russia till 1 January 2022 in order to be compliant.