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www.amcham.ru/president/april2006

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Apr 28, 2006: Risk Management, IPR and FDI Legislative Updates, and Door Knock 2006

April 28, 2006
Moscow

Members and Friends of the American Chamber of Commerce in Russia,

Russian Risk Management

Earlier this week in London I chaired a panel of Russia-based business executives and legal professionals on the business risk environment in Russia. Based on concrete experience, we offered advice on effectively managing risks, which include tax audits, property acquisitions, federal/state jurisdiction conflicts, intellectual property rights protection, licensing issues, shareholder disputes, and the growing tendency in large energy and industrial transaction negotiations for the Russian party to seek access to the U.S. market. The overall consensus was that risk is manageable and strong business performance sustainable.

Annual Door Knock

On May 2, I will lead a delegation of AmCham member company principals on the Annual Door Knock Mission to Washington, D.C., for two days of meetings with senior officials of the Departments of Commerce, Energy, Homeland Security, Defense and State, the National Security Council, and leaders of both houses of Congress. This annual visit serves to deliver a balanced on-the-ground perspective to U.S. public officials on the successes of and challenges for American business in Russia – a particularly timely effort given the current state of bilateral relations.

FDI Regulation

Our Washington schedule will include a briefing with Senator Richard Shelby (R-Ala.), the sponsor of a high-profile amendment to U.S. legislation regulating foreign direct investment (FDI) in sensitive areas of the American economy. Tighter regulation advocated by Senator Shelby following attempts by Chinese and United Arab Emirates state-owned companies to acquire U.S. assets coincides with efforts of the Russian government to develop its own system of regulating FDI in strategic sectors of the Russian economy. Beginning with an FDI regulation policy roundtable organized by AmCham and the Moscow Center for Strategic Research in October 2005, we have been actively involved in sharing the U.S. experience in this crucial area with the Russian government decision-makers. As draft legislation is reviewed in both countries, AmCham will continue to advocate striking a reasonable balance between effective FDI promotion and legitimate national security concerns.

IPR

A recent Russian government proposal to redefine and consolidate intellectual property legislation into Chapter IV of the Civil Code is causing concern among intellectual property rights (IPR) holders and legal professionals. Although well-intended, this proposal lacks real-life business perspective and may well cause confusion among law enforcement agencies. Independently and in cooperation with leading industry groups, AmCham has brought its concerns to the attention of the Russian government and will continue to pursue this issue.

Sincerely,

Andrew B. Somers
President