Information

on the Special economic port zone (SEPZ) in Ulyanovsk Region

SEPZ, based at the Ulyanovsk-Vostochny airport, is designed to use the region's aircraft construction potential, and there are plans to develop such activities, as: Repairs, maintenance, modernisation of aircraft, aviation technology, including aircraft engines and other component parts; Production of aviation technology and aviation parts; Airport and transport logistics services.

In June 2008 Ulyanovsk Region was one of the winners of the competition for creating a special economic port zone in the region.

The Russian Government Resolution of 30.12.2009 No. 1163 proposed the creation in the Ulyanovsk-Vostochny airport of the first stage of a SEPZ with an area up to 120 ha, with potential development of a second stage up to 640 ha from 2012.

The SEPZ project is under the personal control of Elvira Nabiullina, the Minister of Economic Development of the Russian Federation.

Between 29.09.2010 and 22.03.2011 the Supervisory Board of the special economic port zone met three times, during which discussions were held on creating and developing a SEPZ in the municipal district Cherdaklinsky District in Ulyanovsk Region.

At the meeting on 22.03.2011 business plans of potential SEPZ residents were examined: Volga-Dnepr Technics Ulyanovsk LLC, Aviation plant Vityaz LLC and NPK Irkut. The business plans of the above mentioned potential residents were recommended by the SEPZ Supervisory Board to be examined by the SEPZ Advisory Board. Volga-Dnepr Technics Ulyanovsk LLC, Aviation plant Vityaz LLC and NPK Irkut are recommended to prepare and submit applications for operating in the SEPZ in accordance with Federal Law No. 116-FZ dated 22.07.2005 "On Special Economic Zones in the Russian Federation".

During 2011, a project was developed for SEPZ infrastructure objects and their construction began.

Completion of the first stage infrastructure objects and beginning of SEPZ operations is planned for the 3rd quarter of 2012.

• Distance from SEPZ to:
  • The federal highway – 7 km
  • Cargo river port which can take sea-river passenger and cargo vessels – 17 km
  • Railway station, connected to Ulyanovsk-Vostochny airport railway line – 7.5 km
  • Ulyanovsk-Vostochny airport runway – 1.5 km
  • Aviastar-SP CJSC – 9 km
  • Zavolzhye industrial zone – 7 km
  • Future residential development – 8.5 km
• Conditions provided to SEPZ residents at the Ulyanovsk-Vostochny airport

  Investment for the first start up complex, million roubles 2010-2012

  • federal budget funds 762;
  • regional budget funds 375.

  Residents and projects:
  	Business activities	1 start up complex SEPZ 2011-2014
  	Repairs, maintenance and modernisation of aircraft	1. Volga-Dnepr Technics Ulyanovsk Project goal: create a service hangar complex for maintenance and repair of foreign and Russian wide body and ramp aircraft with capacity above 120 tons (such as Boeing 747, AN-124, etc.). 2. Irkut Corporation Project goal: create a line for converting Airbus 320/321 aircraft from passenger to freighter aircraft. Presale and after sale service of Тu204, SSJ
  	Production of aircraft and aviation parts	Air corporation Vityaz Project goal: create an assembly centre for maintenance of regional aircraft DHC-6 Twin Otter Series 400, a Canadian 19 passenger aircraft. Foreign producers of composite material Producers of parts for interiors Import-substituting production of aviation parts for SSJ, MS-21
  	Transport logistics services	Investment group Osnova Project goal: construction of a transport logistics complex for loading aircraft freight to land transport and vice versa. AirBridge Cargo (ABC) Polet Airlines
  	Possible activities of potential residents from 2014-2020	1. Boeing conversion 2. Airbus conversion 3. Pre and aftersale service of MS-21 Production of aircraft parts in international cooperation with Boeing, Airbus, etc. 1. Export and import logistics 2. Logistics hub 3. Customs transit Resident profile: DHL, FedEx, UPS etc.

  Construction of all necessary infrastructure (roads, electricity supply network, gas pipeline, water supply, sewerage, etc.) and connection to the electricity supply network at the expense of the budgets of the Russian Federation and Ulyanovsk Region.

  Tax and customs relief:

  • Reduction in corporate tax by 4.5% (20 – 4.5 = 15.5%) for 10 years from the moment the tax base is formed;
  • Property tax – 0% for 10 years from the moment the property is registered;
  • Land tax – 0% for 10 years from the moment of obtaining land property ownership rights;
  • Vehicle tax – 0% for 10 years from the moment of registering the vehicle;
  • No customs duty and VAT on goods (including for equipment and machines) entering the SEPZ from outside Russia and going from the SEPZ to outside Russia (goods imported into the SEPZ may remain there as long as necessary without entering Russia).
  • When goods produced in Russia are placed in the SEPZ VAT is refunded;
  • Value added at the SEPZ is VAT exempt (when exporting the goods outside Russia).
• SEPZ Management Bodies
  
  

  1. Special Economic Zones JSC (www.oao-oez.ru) and its branch in Ulyanovsk Region (special economic port zone management company)

  2. Department of special economic zones and project financing of the Russian Ministry of Economic Development

  3. Government of Ulyanovsk Region

  4. Supervisory board

  5. Advisory Board

• How to become a special economic zone resident?
  
  

  The legal status of special economic zone residents is determined in chapter No. 4 of the Federal Law of 22 June 2005, No. 116-FZ On Special Economic Zones in the Russian Federation.

  Article 9. Resident of a special economic zone

  2.2. A resident of a special economic port zone shall be a commercial organisation, with the exception of unitary enterprises, registered in compliance with the laws of the Russian Federation on the territory of the municipal district, within whose borders the special economic zone is located (on the territory of one municipal district if the special economic port zone is located on the territory of several municipal districts), and which has made agreements with the bodies managing the special economic zones on performing activities in the special economic port zone according to the terms and conditions provided for by this Federal Law.

  3. A sole trader or commercial organization shall be recognised as residents of a special economic zone as of the date of making the appropriate entry in the register of residents of the special economic zone.

  4. Special economic zones management bodies shall register residents of the special economic zone within three days of the date of signing with an agreement with them on performing industrial and production or technological and innovative and tourism and leisure activities at the special economic port zone.

  Article 10. Procedure for performing business activities on the territory of the special economic zone

  2.2. A resident of a special economic port zone shall be only entitled to exercise on the territory of the special economic zone port activities as well as in accordance with the agreement on performing activities in the special economic port zone regarding construction, reconstruction and use of the infrastructure objects of the sea port, river port and airport. For the purposes of this Federal Law, port activities shall be defined as the following activities performed on the territory of sea ports, river ports and airports:

  1) lapsed;

  2) storage of goods and other services usually provided in sea ports, river ports and airports in accordance with international agreements of the Russian Federation and the laws of the Russian Federation;

  3) provision and equipping of ships or aircraft, including ship stores, aircraft stores, supplying of ships or aircraft;

  4) production, repairs, maintenance, modernisation of sea and river vessels, aircraft, aviation technology, including aircraft engines and other component parts;

  5) development of aquatic biological resources;

  6) preparing goods for sale and transportation (packing, sorting, repacking, separation of goods, marking and other such operations);

  7) simple assembly and other operations which do not significantly change the condition of the goods in accordance with the catalogue approved by the government of the Russian Federation;

  8) commodity trade;

  9) wholesale trade;

  10) guarantee the functioning of special economic port zone infrastructure objects.

  4. A resident of a special economic zone shall not be entitled to have branches and representative offices outside the territory of the special economic zone.

  Article 31.11. Terms and conditions of performing activities in a special economic port zone

  3. Performance of port activities by a special economic port zone resident is conditional on them guaranteeing to the customs authorities payment of customs duties as stipulated be the laws of the Russian Federation. Guarantee of customs duties and tax payments for performing port activities shall not be less than:

  1) thirty million roubles for performing port activities related to warehousing any goods, their storage, wholesale or commodity trade, including excisable goods or raw materials;

  2) ten million roubles for performing port activities related to warehousing goods which are not excisable or raw materials and to their storage, wholesale or commodity trade;

  3) two and a half million roubles when performing other port activities.

  Documents required for signing agreements on performing activities in the special economic port zone

  Article 31.12.

  1. An entity wishing to become a resident of a special economic port zone shall provide the management bodies of the special economic zone an application on concluding an agreement on performing activities in the special economic port zone, which shall contain:

  1) information on the applicant's proposed business corresponding to the type of special economic zone;

  2) information on the size of the land required for performing the applicant's proposed business;

  3) information on the proposed capital investment, including the capital investment which shall be exercised in the course of the year from the day of concluding such an agreement;

  4) information on acceptance by the customs authorities of guarantees for payment of customs duties and taxes, in cases as stated in article 31.11 of this Federal Law.

  2. The applicant shall attach to the application for concluding agreements on performing activities in the special economic port zone:

  1) a copy of the state registration certificate;

  2) a copy of the certificate of registration with the tax authorities;

  3) a copy of articles of association;

  4) a business plan, whose form shall be established by the federal executive body authorised by the government of the Russian Federation;

  5) favourable conclusion of the applicant's business plan, prepared by a bank or other credit organisation which comply with the criteria established by the federal executive body authorised by the government of the Russian Federation;

  6) a copy of licences for performing activities that require licensing in accordance with the laws of the Russian Federation;

  7) documents which confirm acceptance by the customs authorities of guarantees for payment of customs duties and taxes, in cases as stated in article 31.11 of this Federal Law.

  3. Documents mentioned in parts 1 and 2 of this article are accepted by the special economic zones management bodies in accordance with the list. A copy of the list with a note on the date the documents were received by the special economic zones management bodies are sent or handed over to the applicant.