To date, there is no regulation specifically implemented within COVID-19 outbreak to support companies involved in construction activities.
However, on 16 April 2020 the Russian President announced certain measures to support the construction industry, namely:
- to provide reduced (6.5%) interest rates for personal mortgage loans partially subsidised by state to support residential construction;
- to ensure that bank loans to construction companies are available;
- to speed up construction and repair of public roads; and
- to continue implementation of large infrastructure projects in railways, highways, airports and sea ports construction.
On 23 April 2020, the Russian Government adopted the respective regulations on the above subsidised reduced interest rates for personal mortgage loans. This programme is in effect until 1 November 2020.
In addition, RUB 12 bln were allocated from the federal budget to compensate losses of banks issuing preferential loans to residential construction companies.
The Government has also allocated RUB 43 bln for construction and repair of public roads and bridges in 46 regions of Russia.
Whereas many other sectors were temporary closed until 12 May 2020 and people were strongly encouraged to work from home, it was acknowledged in most of the regions of Russia that construction companies relate to so-called “continuously acting” entities, and thus, the above restriction shall not apply to them. The only exception was Moscow and Moscow region where construction works (same as many other business activities) were generally suspended until 12 and 18 May 2020 respectively, save for construction of medical and public transport facilities. Thus, construction companies have resumed their work after these dates.
To ensure uninterrupted construction process, the Government has prolonged the validity term of all construction permits expiring by 1 January 2021, for one year.
New federal law adopted 8 June 2020 provides for simplified renewal of expiring land plot leases, which may relate to construction sites as well.
Construction companies may also currently rely on the following general regulation to the extent applicable in their particular case:
- in Moscow and Moscow region and some other regions of Russia, COVID-19 outbreak has been officially declared as a force majeure event (see below);
- temporary abandonment of administrative fines for violation of currency control regulations relating to certain import and export operations affected by COVID-19 outbreak;
- deferral of rent payments under federal property lease agreements for small and medium businesses; and
- temporary suspension (by 1 January 2021) of charging penalties and losses under agreements for acquisition of residential premises in “construction in progress” objects.
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