Russia Requires Foreign IT Companies To Open Branches And Own Legal Entities

Illustration. (Unsplash/Rami Al-zayat)

JAKARTA - Russian President Vladimir Putin signed a law requiring large foreign information technology (IT) companies to open branches or representative offices in Russia.

This obligation is as stated in a document published by the government's legal information site, Thursday, July 1 local time. A number of provisions are regulated in the document

Owners of internet resources, whose daily audience exceeds 500,000 Russian users, must create a branch, open a representative office or establish a legal entity in Russia, from January 1, 2022.

According to the document, the branch must fully represent the interests of the parent company. A set of measures were also introduced to force IT companies to comply with Russian laws, including blocking as an attempt, citing TASS.

A series of measures were also introduced to force IT companies to comply with Russian laws. Among these, informing users of Internet resources about violations of the laws of the Russian Federation, prohibiting the distribution of advertisements on informational sources, making payments for them, on search results, on the collection and cross-border transfer of personal data from Russian citizens.

"As a last resort, infringing resources are highly likely to be blocked in whole or in part," the document said.

The initial list of Internet resources, whose owners may be required to open a branch or representative office in Russia, includes 20 platforms. This includes social networks like Facebook, Instagram, TikTok and Twitter. Then there are video hosting (YouTube, Twitch.tv) to instant messengers (WhatsApp, Telegram, Viber)

Next that may be required to open a branch are email services (Gmail), search engines (Google, Bing.com), hosting providers (Amazon, Digital Ocean, Cloudflare, GoDaddy), online stores (Aliexpress.com, Ikea.com, Iherb. com) to Wikipedia.org. At the same time, this list is customizable.

To note, this legislative initiative was submitted to the State Duma on May 21 by a group of deputies from the Duma Committee on Information Policy and Senator Alexei Pushkov. The document is supported by the Russian government, the Bank of Russia and the Federal Antitrust Service.