New law forcing foreign companies to “land” in Russia

Federal Law No. 236-FZ “On the Activities of Foreign Persons in the Information and Telecommunications Network “Internet” in the Russian Federation” (the “Law”) entered into force on July 1, 2021.

The new Law creates legal basis for the activities carried out by foreign persons (companies and corporations, non-corporate entities, individuals) on the Internet in the Russian Federation.

In accordance with the requirements of the new Law foreign persons whose activities are carried out on the Internet and aimed at distributing content among or offering services to the Russian audience may, subject to meeting certain criteria, be required to create physical presence in Russia and take other necessary actions.

The requirements of the new Law may apply to the providers of various online services, including messengers, social networking platforms, media content distributors, Internet search engines, online gaming, online marketing resources, cloud storage platforms and other similar services providers and owners of Internet resources.

To comply with the requirements of the Law, any foreign person meeting the criteria provided for by the Law shall:

1. Post an online contact form to enable Russian users to send their feedbacks;
2. Register an account on the Roskomnadzor official website and use it for communicating with the state authorities;
3. Open a branch or representative office or incorporate a local legal entity in Russia.

The activities of foreign persons on the Internet will be monitored by Roskomnadzor (Russia’s Internet and mass communications regulator) and non-compliance with the requirement of the Law may involve various sanctions, including suspension of access to Internet resources, prohibition of advertisement distribution, personal data processing restrictions, limitation of financial transactions.

For those engaged in the provision of online services and other Internet businesses, it is highly advisable to check the Russian-related online activities for compliance with the requirements of the new Law.

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