{"id":416,"date":"2009-06-06T11:45:59","date_gmt":"2009-06-06T07:45:59","guid":{"rendered":"https:\/\/www.desertsun.co.uk\/blog\/?p=416"},"modified":"2010-11-17T20:02:29","modified_gmt":"2010-11-17T19:02:29","slug":"doing-business-in-russia-part-2","status":"publish","type":"post","link":"http:\/\/www.desertsun.co.uk\/blog\/416\/","title":{"rendered":"Doing Business in Russia – Part 2"},"content":{"rendered":"

A colleague forwarded this to me, sourced from here<\/a>.\u00a0 It describes the procedures, time, and cost to build a warehouse in Russia.<\/p>\n

Data as of: January 2008
\nEstimated Warehouse Value: RUB 26,120,000
\nCity: Moscow<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
No:<\/span><\/strong><\/td>\nProcedure<\/span><\/strong><\/td>\nTime to complete:<\/span><\/strong><\/td>\nCost to complete:<\/span><\/strong><\/td>\n<\/tr>\n
1<\/span><\/td>\nApply for an act of permission for use (\u00d0\u0090\u00d0 \u00d0\u02dc) to the Department of City Planning Documentation Development at the Architecture and City Planning Committee of Moscow (MoskomArchitektura).<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
2<\/span><\/td>\nRequest and obtain situation plan of district and conclusion for a District Land Commission from the Architecture Planning Department (APD)<\/span><\/td>\n15 days<\/span><\/td>\nRUB 43,680<\/span><\/td>\n<\/tr>\n
3<\/span><\/td>\nRequest and obtain a conclusion from Territorial Union of Land Use Regulation (TOP\u00d0\u2014)<\/span><\/td>\n15 days<\/span><\/td>\nRUB 4,330<\/span><\/td>\n<\/tr>\n
4<\/span><\/td>\nRequest and obtain a decision by the District Land Commission on land plot provision and city planning regulation<\/span><\/td>\n30 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
5<\/span><\/td>\nRequest and obtain clearance of draft disposition of Prefect with the Architecture Planning Department (APD)<\/span><\/td>\n7 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
6<\/span><\/td>\nRequest and obtain clearance of draft disposition of Prefect with the local government<\/span><\/td>\n7 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
7<\/span><\/td>\nRequest and obtain clearance of draft disposition with the Territorial Union of Land Use Regulation (\u00d0\u00a2\u00d0\u017e\u00d0 \u00d0\u2014)<\/span><\/td>\n7 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
8<\/span><\/td>\nRequest and obtain the disposition on preparation of an act of permission for use (\u00d0\u0090\u00d0 \u00d0\u02dc) by the Prefect<\/span><\/td>\n7 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
9<\/span><\/td>\nRequest and obtain a conclusion on compliance of the proposed building with specified city planning and territory use regulations<\/span><\/td>\n152 days<\/span><\/td>\nRUB 4,500<\/span><\/td>\n<\/tr>\n
10*<\/span><\/td>\nRequest and obtain technical conditions from water and sewage services<\/span><\/td>\n45 days<\/span><\/td>\nRUB 17,673<\/span><\/td>\n<\/tr>\n
11*<\/span><\/td>\nRequest and obtain technical conditions for an electricity connection with MosEnergo<\/span><\/td>\n30 days<\/span><\/td>\nRUB 5,490,520<\/span><\/td>\n<\/tr>\n
12*<\/span><\/td>\nRequest and obtain technical conditions to connect to telephone line<\/span><\/td>\n30 days<\/span><\/td>\nRUB 3,000<\/span><\/td>\n<\/tr>\n
13*<\/span><\/td>\nRequest and obtain approval from MoskomArchitektura on engineering of the facility<\/span><\/td>\n14 days<\/span><\/td>\nRUB 4,500<\/span><\/td>\n<\/tr>\n
14<\/span><\/td>\nRequest and obtain an act of permission for use (\u00d0\u0090\u00d0 \u00d0\u02dc) from MoskomArchitectura<\/span><\/td>\n30 days<\/span><\/td>\nRUB 6,700<\/span><\/td>\n<\/tr>\n
15<\/span><\/td>\nRequest and obtain disposition of Prefect on the inception of construction design (decision on construction)<\/span><\/td>\n60 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
16<\/span><\/td>\nRequest and obtain approval of design conditions by the Department of Well-Being of MoskomArchitektura<\/span><\/td>\n7 days<\/span><\/td>\nRUB 53,300<\/span><\/td>\n<\/tr>\n
17*<\/span><\/td>\nRequest and obtain approval of design conditions by the Department of Preparation of Project Approvals of MoskomArchitektura<\/span><\/td>\n14 days<\/span><\/td>\nRUB 12,100<\/span><\/td>\n<\/tr>\n
18*<\/span><\/td>\nRequest and obtain approval of design conditions by local government<\/span><\/td>\n7 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
19*<\/span><\/td>\nRequest and obtain approval of design conditions by the Prefect\u00e2\u20ac\u2122s Office<\/span><\/td>\n14 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
20*<\/span><\/td>\nRequest and obtain approval of design conditions by the Emergency Situation and Civil Defense Department<\/span><\/td>\n14 days<\/span><\/td>\nRUB 14,728<\/span><\/td>\n<\/tr>\n
21*<\/span><\/td>\nRequest and obtain approval of design conditions by Moscow State Expertise<\/span><\/td>\n14 days<\/span><\/td>\nRUB 7,364<\/span><\/td>\n<\/tr>\n
22*<\/span><\/td>\nRequest and obtain an act of the Moscow Geological-Geodesic Department<\/span><\/td>\n15 days<\/span><\/td>\nRUB 36,700<\/span><\/td>\n<\/tr>\n
23*<\/span><\/td>\nRequest and obtain approval of design conditions by the Sanitary Services (Rospotrebnadzor)<\/span><\/td>\n30 days<\/span><\/td>\nRUB 13,800<\/span><\/td>\n<\/tr>\n
24*<\/span><\/td>\nRequest and obtain approval of transport routes from the Moscow City Transport Agency<\/span><\/td>\n30 days<\/span><\/td>\nRUB 8,837<\/span><\/td>\n<\/tr>\n
25*<\/span><\/td>\nRequest and obtain approval from the State Inspectorate of Road Safety (GIBBD)<\/span><\/td>\n30 days<\/span><\/td>\nRUB 8,837<\/span><\/td>\n<\/tr>\n
26*<\/span><\/td>\nRequest and obtain approval from the Department of Comprehensive Well-Being of the city<\/span><\/td>\n30 days<\/span><\/td>\nRUB 4,600<\/span><\/td>\n<\/tr>\n
27*<\/span><\/td>\nRequest and obtain approval from the Department of Nature Use under State Ecological Expertise<\/span><\/td>\n21 days<\/span><\/td>\nRUB 29,455<\/span><\/td>\n<\/tr>\n
28<\/span><\/td>\nRequest and obtain Sketch No. 2 from the Moscow Geological Institute<\/span><\/td>\n30 days<\/span><\/td>\nRUB 10,100<\/span><\/td>\n<\/tr>\n
29<\/span><\/td>\nRequest and obtain approval of Sketch No. 2 from the Moscow Architecture Committee (MoskomArchitektura)<\/span><\/td>\n30 days<\/span><\/td>\nRUB 4,000<\/span><\/td>\n<\/tr>\n
30<\/span><\/td>\nRequest and obtain the construction passport from the Moscow Geological Institute<\/span><\/td>\n30 days<\/span><\/td>\nRUB 8,837<\/span><\/td>\n<\/tr>\n
31*<\/span><\/td>\nRequest and obtain approval of volumes of \u00e2\u20ac\u0153outline of construction arrangement\u00e2\u20ac\u009d and \u00e2\u20ac\u0153GenPlan\u00e2\u20ac\u009d from MoskomArchitektura<\/span><\/td>\n30 days<\/span><\/td>\nRUB 6,500<\/span><\/td>\n<\/tr>\n
32*<\/span><\/td>\nRequest and obtain approval of volumes of \u00e2\u20ac\u0153outline of construction arrangement\u00e2\u20ac\u009d and \u00e2\u20ac\u0153GenPlan\u00e2\u20ac\u009d from the Prefecture<\/span><\/td>\n30 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
33*<\/span><\/td>\nRequest and obtain approval of volumes of \u00e2\u20ac\u0153outline of construction arrangement\u00e2\u20ac\u009d and \u00e2\u20ac\u0153GenPlan\u00e2\u20ac\u009d from the GenPlan Institute<\/span><\/td>\n30 days<\/span><\/td>\nRUB 12,200<\/span><\/td>\n<\/tr>\n
34<\/span><\/td>\nRequest and obtain Regulation No. 2 and certificate of approval of Architectural City Planning Decision<\/span><\/td>\n30 days<\/span><\/td>\nRUB 3,600<\/span><\/td>\n<\/tr>\n
35<\/span><\/td>\nRequest and obtain project approval by Moscow State Expertise<\/span><\/td>\n60 days<\/span><\/td>\nRUB 58,000<\/span><\/td>\n<\/tr>\n
36<\/span><\/td>\nRequest and obtain permission for construction (building permit)<\/span><\/td>\n10 days<\/span><\/td>\nRUB 11,460<\/span><\/td>\n<\/tr>\n
37<\/span><\/td>\nReceive inspection by the State Inspectorate of Architecture and Construction Supervision during foundation construction<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
38<\/span><\/td>\nReceive inspection by the State Inspectorate of Architecture and Construction Supervision during structure construction<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
39<\/span><\/td>\nReceive inspection by the State Inspectorate of Architecture and Construction Supervision during engineering works<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
40<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – I<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
41<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – II<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
42<\/span><\/td>\nReceive inspection by Union of Administrative Technical Inspection (UATI) – III<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
43<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – IV<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
44<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – V<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
45<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – VI<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
46<\/span><\/td>\nReceive inspection by the Union of Administrative Technical Inspection (UATI) – VII<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
47<\/span><\/td>\nConnect to water services<\/span><\/td>\n30 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
48*<\/span><\/td>\nRequest and receive inspection by the Energy Supervision Board<\/span><\/td>\n1 day<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
49<\/span><\/td>\nConnect to electricity and sign an agreement with Energosbyt<\/span><\/td>\n14 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
50*<\/span><\/td>\nRequest and connect to telephone services<\/span><\/td>\n5 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
51<\/span><\/td>\nRequest and convene the Approval Commission<\/span><\/td>\n30 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
52<\/span><\/td>\nRequest and receive the disposition on operation of building (occupancy permit)<\/span><\/td>\n10 days<\/span><\/td>\nno charge<\/span><\/td>\n<\/tr>\n
53<\/span><\/td>\nRequest and receive plans from the Bureau of Technical Inventory (BTI)<\/span><\/td>\n30 days<\/span><\/td>\nRUB 55,000<\/span><\/td>\n<\/tr>\n
54<\/span><\/td>\nRegister the building after completion<\/span><\/td>\n30 days<\/span><\/td>\nRUB 7,500<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
* Takes place simultaneously with another procedure<\/span><\/div>\n

54 different bureaucratic hurdles to overcome in order to build a warehouse.\u00a0 And it should be noted that the costs listed are the official costs only, which the authority in question can legally charge.\u00a0 Often before an authority will consider an application, the submitted documents must be checked and approved by a third party private company which is the only one the authority will recognise, and hence can charge what it likes.\u00a0 I have seen these companies charge $30k for “pre-approving” what the governmental authority charges $200 for, and it is not difficult to understand where a big chunk of this additional fee ends up.\u00a0 With so many authorities to satisfy the scope for corruption is enormous, and many of these approvals bodies have become industries in themselves offering lucrative careers involving little more than glossing over documents at ones leisure whilst accepting hefty backhanders either directly or via a third party company, which may or may not be owned by your brother.<\/p>\n

This list should give you some idea of how difficult it is to build an LNG facility or an offshore platform in Russia.\u00a0 Construction schedules in Russia are unlike anything you would experience in the west, which is made all the more difficult by the 4-month summer construction window (where groundworks are concerned) which exists in much of Russia including Sakhalin.\u00a0 For the last part of 2008 I was involved with the construction of a two-storey office building, the type of which would be thrown up in six or eight weeks in the UK.\u00a0 It took our Russian contractor over two years to complete, and still the building is not registered.\u00a0 A good chunk of this time was spent sitting about waiting for various authorities to review documents, turn up for inspections, and stamp bits of paper.<\/p>\n

If anyone wants to know why Russia remains poor despite a well educated population possessing impressive technical skills, looking at how long it takes to complete a simple construction project and what is involved is a good place to start looking.<\/p>\n

(Doing Business in Russia – Part 1 is here<\/a>.)<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

A colleague forwarded this to me, sourced from here.\u00a0 It describes the procedures, time, and cost to build a warehouse in Russia. Data as of: January 2008 Estimated Warehouse Value: RUB 26,120,000 City: Moscow No: Procedure Time to complete: Cost … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[57,3],"tags":[],"_links":{"self":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/416"}],"collection":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=416"}],"version-history":[{"count":2,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/416\/revisions"}],"predecessor-version":[{"id":823,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/416\/revisions\/823"}],"wp:attachment":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=416"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=416"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=416"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}