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New Bill to Help Small Businesses

The Economic Development Ministry is drafting a law to encourage small business by allowing more businesses to simply notify the authorities of the start of their operation, rather than apply for permits before starting, Minister Elvira Nabiullina said Wednesday.

The new law, Nabiullina said, will expand the list of types of activity that do not require advance approval and permits from the existing list that went into effect in 2008. It "will make it possible to expand the notification procedure and, in essence, make it the main procedure," she said in a speech at the Federation Council.

A law passed in December 2008 identified 13 broad categories of activity, including trucking, publishing, retail and wholesale trading and the operation of restaurants and hotels that were frequently engaged in by small businesses. Companies and individuals establishing a new business in one of those areas became able to notify the government of the setup after the fact, rather than seeking permits in advance.

Nabiullina told the senators Wednesday morning that 43,000 new businesses had been registered in that manner since 2008.

Nikolai Ostarkov, managing director of Delovaya Rossia, a small and midsized business association, commented that "there are no particular problems in that area today," thanks to the 2008 law, which had a "broad positive effect" on the business environment in Russia.

Ostarkov noted that the new procedure had the effect of reducing corruption and leveling out the playing field for all businesses, since it reduced the number of intermediaries involved in the process and the time required to register a business became the same for all.

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