INDUSTRIAL SPECIAL ECONOMIC ZONES IN RUSSIA STATE MANAGEMENT

INDUSTRIAL SPECIAL ECONOMIC ZONES IN RUSSIA STATE MANAGEMENT COMPANY «SPECIAL ECONOMIC ZONES»

GEORGAPHY 6 14 Industrial Parks Holiday Parks Industrial and production zones Tourist and recreational zones 3 Industrial parks in port areas 5 Technoparks Technology and innovation zones Port zones 2

SUCCESS STORY Number of investors in SEZ 370 306 326 249 207 143 53 12 2006 2007 2008 2009 2010 2011 2012 2013 2014, January: § 370 Companies (Residents in SEZ)* § Companies from 28 countries: Germany, Turkey, USA, Japan, etc* § Over 13 billion USD of private investments* § 63 foreign investors, about 4 billion USD of foreign investments (Companies established with the participation of foreign investors)* * including Companies at the stage of Agreements signing 3

SEZ BENEFITS FOR MANUFACTURING AND R&D Federal and Regional Government Support Comfortable Administrative Procedures Tax benefits Free Customs Zone Full-scale infrastructure supply Russia SEZ Profit tax, % 20 0 -15, 5* Property tax, % 2. 2 0* Land Tax, % 1. 5 0* 0. 1 – 3. 5 0* Transport Tax, EUR per hp Social taxes, % Land purchase price Tax Benefits 30 100% market price Working staff 30 SEZ Infrastructure: § Free connection to energy resources § Electricity, heating, water, gas, roads Attractive lease and buying rates: § Office space (lease) R&D staff 14 4 - 50% cadastral price § Land plots (lease and purchase) The costs of the project realized in SEZ are in average 30% less compared to Russian general practice * Depending on the types of zones 4

BENEFITS IN SPECIAL ECONOMIC ZONES Comfortable administrative procedures Infrastructure supply • Сlear legislation and management (Federal Law #116) • Minimized administrative barriers • Single -window system • Guarantees from the State • Professional managing Company • Triple agreement on mutual commitments between the Ministry of economic development, the Managing Company and a Resident • Ready-to-use infrastructure for residents, opportunity to reduce investments on new project • Free access to infrastructure and grids (no connection fees for resources granting) • Reduced and incentive prices for land plots and offices lease • Opportunity to buy land plots on special and incentive prices Tax benefits Free customs zone • Special tax benefits for SEZ Residents • Tax vacations for the construction period • No import duties on equipment, components and materials imported in SEZ • No VAT on equipment, components and materials imported in SEZ • No export duties on finished goods (products) exported outside the Customs Union

HOW TO BECOME A RESIDENT 4 STEPS TO BECOME A RESIDENT STAGE 1 STAGE 2 STAGE 3 STAGE 4 Registration of a legal entity (a company) in the Municipal region, where SEZ is located. Submission of the set of documents which are established by the Legislation of RF to SEZ JSC or directly to the Ministry of Economic Development. Consideration of the Application by the Supervisory Board of SEZ* (preparation for Expert Council examination in the Ministry of Economic Development). Signing of Agreement on activities in a SEZ, issue of a Certificate of SEZ Resident registration. * This procedure is not obligatory according the Federal Law #116, but is strongly recommended in the frame of the preparing for Expert Council examination as well as getting additional feasibility opinion from the SEZ personnel. Resident in Industrial Zone is obliged to invest not less than RUB 120 millions (capital investments), including RUB 40 millions during the first 3 years of activities (Federal Law #116 on SEZ) 6

INDUSTRIAL ZONES Acting SEZ Alabuga (Republic of Tatarstan) Lipetsk (Lipetsk region) Togliatti (Samara region) Recently established SEZ Current stage The infrastructure is ready-touse (Stage 1 and 2). The Residents are acting. Engineering network, transport infrastructure, communal zone are to be finished by III Q 2014. (Stage 1). First Residents launch production in July 2014. SEZ Titanium valley (Sverdlovsk region) Ludinovo (Kaluga region) Moglino (Pskov region) Current stage The infrastructure is under construction. Stage 1 to be finished in 2015. Established in December 2012. Design works. Stage 1 to be finished in 2015. Established in July 2012. Design works. Stage 1 to be finished in 2015. 7

ALABUGA SEZ, REPUBLIC OF TATARSTAN Project overview Alabuga SEZ Established: 21 December, 2005 Lifecycle: 49 years Total area: 4 000 hectares Ready areas: § «Synergy» industrial Park will be launched in September 2014. The total area is 24 500 m 2 § «A Plus Park Alabuga» industrial park will be launched in Q 4 2014. The total area is 200 000 m 2 Number of Residents: 42 companies Business of Residents: : § Cars, trucks, components § Machinery, tools and instruments § Chemicals and petrochemicals § Construction and composite materials § Consumer goods § Agriculture Distance to Moscow: about 1 036 km http: //www. alabuga. ru/en/ 8

LIPETSK SEZ, LIPETSK REGION Project overview Lipetsk SEZ Established: 21 December, 2005 Lifecycle: 49 years Total area: 1 024 hectares Number of Residents: 33 companies Business of Residents: : § Metalworking and machinery § Machinery and equipment § Electrical machinery § Automotive components § Construction materials Distance to Moscow: about 450 km 9

TOGLIATTI SEZ, SAMARA REGION Project overview Togliatti SEZ Established: 12 August 2010 Lifecycle: 49 years Total area: 660 hectares Number of Residents: 17 companies Business of Residents: : § Cars, trucks, components § Machinery, tools and instruments § Chemicals and petrochemicals § Metalworking and machinery § Pulp and paper industry Distance to Moscow: about 985 km http: //oeztogliatti. ru/en/ 10

SEZ «TITANIUM VALLEY» , SVERDLOVSK REGION Project overview Titanium valley SEZ Established: 16 December 2010 Lifecycle: 49 years Total area: 584, 4 hectares Number of Residents: 5 companies Business of Residents: : § Machinery, tools and instruments § Metalworking and machinery § Construction materials Distance to Moscow: about 1 870 km http: //www. titanium-valley. com/ 11

MOGLINO SEZ, PSKOV REGION Project overview Moglino SEZ Established: 19 June 2012 Lifecycle: 49 years Total area: 215 hectares Number of Residents: 1 company Business of Residents: : § Metalworking and machinery § Consumer electronics § Construction materials § Automotive components § Power engineering Distance to Moscow: about 740 km 12

LYUDINOVO SEZ, KALUGA REGION Project overview Lyudinovo SEZ Established: 28 December 2012 Lifecycle: 49 years Total area: 289 hectares Number of Residents: – 1 Business of Residents: § Machinery § Construction materials § Automotive components Distance to Moscow: about 188 km 13

DUBNA SEZ, MOSCOW REGION Project overview Dubna SEZ Established: 21 December 2005 Lifecycle: 49 years Total area: 187, 7 hectares Number of Residents: 92 companies Business of Residents: : § Nuclear physics (nanotechnology) § Bio- and medical technologies § IT (information technologies) § Complex technological systems design Distance to Moscow: about 100 km http: //dubna-oez. ru/eng/ 14

ZELENOGRAD SEZ, MOSCOW Project overview Zelenograd SEZ Established: 21 December 2005 Lifecycle: 49 years Total area: 145, 83 hectares Number of Residents: 35 companies Business of Residents: : § Microelectronics and optoelectronics § Nanotechnology § Bio- and medical technologies § IT (information technologies) Distance to Moscow: about 37 km 15

ST. PETERSBURG SEZ Project overview St. Petersburg SEZ Established: 21 December 2005 Lifecycle: 49 years Total area: 129, 4 hectares Number of Residents: 32 companies Business of Residents: : § § § Bio- and medical technologies IT (information technologies) Complex technological systems design § Energy efficiency Distance to Moscow: about 37 km 16

TOMSK SEZ, TOMSK REGION Project overview Tomsk SEZ Established: 21 December 2005 Lifecycle: 49 years Total area: 207 hectares Number of Residents: 60 companies Business of Residents: : • IT and Electronics • Nanotechnologies and New materials • Biomedical technologies • Energy efficiency 17

INNOPOLIS SEZ, REPUBLIC OF TATARSTAN Project overview Innopolis SEZ Established: 1 November 2012 Lifecycle: 49 years Total area: 294 hectares Number of Residents: Business of Residents: : • IT and Electronics • Other innovative industries Distance to Moscow: about 800 km 18

PORT ZONES Location Opportunities § Ulyanovsk-Vostochny SEZ 120 hectares, Ulyanovsk region § Soviet haven SEZ 290 hectares, Khabarovsk Moscow Ulyanovsk Khabarovsk Territory

ULYANOVSK-VOSTOCHNY SEZ, ULYANOVSK REGION Project overview SEZ «Ulyanovsk-Vostochny» Established: 30 December 2009 Lifecycle: 49 years Total area: 120 hectares Number of Residents: 6 companies Business of Residents: : • Maintenance, repair and operations • Aircraft assembling • Logistics Distance to Moscow: about 820 km 20

STATE MANAGEMENT COMPANY «SPECIAL ECONOMIC ZONES» IRINA SOSNOVSKAYA Head of Investor Relations Department Telephone: +7 (495) 645 27 31 isosnovskaya@russez. ru Address: 6 Tverskoy Boulevard, Moscow, 125009, Russia www. russez. ru