The Conversion Of The Defence Industry In The Russian Federation

Original Language Title: О конверсии оборонной промышленности в Российской Федерации

Read the untranslated law here: http://pravo.gov.ru/proxy/ips/?doc_itself=&infostr=x&backlink=1&fulltext=1&nd=102052485

Expired-the Federal law from 22/08/2004, no. 122-FZ (January 1, 2005 onwards), the Russian Federation Federal law on conversion of the defence industry in the Russian Federation adopted by the State Duma March 20, 1998 the year approved by the Federation Council of the year April 1, 1998 (as amended by the Federal law dated 10.01.2003 N 8-FL) this federal law establishes the legal bases and principles of State policy in the field of defense industry conversion rights and responsibilities of State authorities of the Russian Federation in the field of State regulation and State support for the conversion of the defence industry and is aimed at carrying out the conversion of the defence industry on the basis of the most efficient capacity utilization, scientific and technological capacity and manpower to conversion organizations and providing social protection for workers subject to conversion organizations.
This federal law regulates relations of bodies of State power of the Russian Federation, bodies of State power of the constituent entities of the Russian Federation, subject to conversion organizations, workers ' organizations in the implementation of the conversion the conversion of the defence industry.
Chapter i. General provisions article 1. Basic concepts for the purposes of this federal law uses the following concepts: defence conversion (hereinafter referred to as conversion)-regulated State process of institutional, legal, technological, scientific, technical and socio-economic transformation of the defence industry to partial or total reorientation on the issue of civilian products previously involved in defense manufacturing capacities, scientific and technical capacities and labour organizations in the defence industry;
konversiruemaja Organization-Organization of defense industry, scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation shall be reduced or discontinued, and in which activities by developing new technologies, including dual-use technologies, production of civilian products and disposal of weapons and military equipment;
Organization of the defence industry-organization, irrespective of the legal form and form of ownership, carrying out scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation;
scientific activity and production activities (defence production) for Federal State needs in the area of the maintenance of defence and security of the Russian Federation-scientific research in the field of armament and military equipment; development, production, testing, repair and maintenance of weapons and military equipment, including missile-space used in the armed forces of the Russian Federation, other troops, military formations and organs;
dual-use technologies-technologies that can be used in the creation of both weapons and military equipment and civil products;
Federal target program conversion-socio-economic, legal, institutional and other measures on realization of the State policy in the field of conversion and restructuring of the defence industry;
the regional target program conversion-socio-economic, legal, institutional and other activities in support of the State authorities of the Russian Federation, the conversion of the defence industry organizations located in this subject;
Organization of defense industry conversion rates-a comprehensive index which determines the depth of the conversion, the rate of change of mobilization capacity, coefficient of dual-purpose technologies, other parameters and depends upon or according to the numerical value of which is determined by the amount of State support for the konversiruemoj organization;
depth conversion-metric defines the ratio of production (works, services), withdrawn from defense production, total production of goods (works, services) of konversiruemoj organization in the preceding year of conversion;
the rate of change of mobilization capacity, a figure which defines change ratio of mobilization capacities to total production capacity konversiruemoj organizations in the current year compared to the previous top year of conversion;
coefficient of dual-purpose technologies-an indicator that identifies the proportion of dual-use technologies in the konversiruemoj process of the Organization, as well as share the technologies to be applied in terms of conversion.
Article 2. Legal regulation of conversion

The legal regulation of the conversion is carried out in accordance with the Constitution of the Russian Federation, this federal law, other federal laws and other regulatory legal acts of the Russian Federation, as well as in accordance with universally recognized principles and norms of international law and international treaties of the Russian Federation.
Property and associated personal non-property relations based on equality, autonomy of the will and the property independence of their members and conducting conversion, are governed by civil law.
Article 3. The purpose of the conversion of conversion Goals are: technical re-equipment of industry based on the effective use of scientific-technical and production capacity of the defense industry for the production of high-tech and competitive on the domestic and foreign markets of products (works, services);
ensuring social protection of workers subject to conversion organizations released in connection with the conversion, including through the creation of additional jobs in the conversion organizations;
provision of scientific and technical progress at the expense of priority development of knowledge-intensive industries;
the development of an export capacity of the defense industry;
reducing economic dependence on the import of goods through the creation and development of production of similar import;
the creation of new competitive technologies, materials and equipment.
Article 4. Basic principles for the conversion of the main principles of conversion are: the preservation of the capacity of the defense industry at a level ensuring defense capabilities and security of the Russian Federation;
the responsibility of the State for socio-economic impact of its decisions on the holding of the conversion;
State support for conversion by providing konversiruemym return budget organizations and fee-for-service basis and budget allocations, public guarantees, other things being equal, priority placement in the conversion organizations of public orders for the supply of goods (works, services) for State needs, and through other measures;
the provision of public support for the Organization of the defence industry for a conversion in the amount determined on the basis of the basic directions of conversion and conversion rates for your organization.
preservation and use of the most effective at carrying out the conversion of the technological processes used by organizations in the defence industry;
the orientation of the converted to address priority science and technology by improving efficiency in the use of redundant production capacity and workforce;
rational use of natural resources and environmental protection Wednesday from man-made influences;
the creation and widespread use of integrated methods of conversion and conversion management;
the creation of economic conditions for the conversion organizations aiming at preservation and development of high technologies for the production of knowledge-based, technologically sophisticated products for civilian use, competitive on the domestic and foreign markets.
Article 5. Reason for a conversion 1. Grounds for a conversion are the decision of the President of the Russian Federation, the decision of the Government of the Russian Federation on the reduction or cessation of scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation in certain directions (products and services) or in the specific organization of the defence industry, taken in accordance with paragraph 1 of article 7 of this federal law.
The reason for reducing or eliminating the defense industry organization of scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation is to end the obligations of parties of government contract (contract) on the implementation of the activities or modification of such obligations. Released in connection with such termination or reduction of activities manufacturing facilities can be transformed the defense industry organization in consultation with the Government of the Russian Federation or by the Government of the Russian Federation, federal bodies of executive power in the field of conversion (hereinafter referred to as the federal bodies of executive power in the field of conversion). Treatment conversion organizations on the harmonization of their decisions on the conversion of redundant production capacities are to be considered within one month from the date of receipt.

2. Start the conversion was the year in which it is reduced or terminated in the konversiruemoj organization of scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation or begins reshaping production capacity. The completion of the conversion was the year of completion of the investment program of conversion. If the investment program of conversion in the prescribed manner not consistent with the Federal Executive Body in the field of conversion, the conversion period of such an organization shall not be more than two years.
CHAPTER II. The State management in the area of CONVERSION and CONVERSION FUNDING Article 6. The State management in the area of conversion 1. The State management in the area of conversion is carried out directly by the Government of the Russian Federation and (or) through the federal bodies of executive power in the field of conversion.
2. Federal bodies of executive power in the field of conversion within their powers: develop proposals on State policy in the field of conversion;
implement State policy in the field of conversion;
participate on the basis of the decision of the Government of the Russian Federation in the development and implementation of the federal target program conversion and federal target programs in related fields;
develop jointly with interested federal authorities and organizations, proposals for State support for the conversion and make them in the Government of the Russian Federation;
organize performing research, development and design work for civil purposes, including work to develop dual-use technologies, the introduction of military technology in the production of goods (works, services) for civil purposes, the creation of production (works, services) for civil purposes based on released production facilities;
develop activities to best use when carrying out the conversion of redundant production capacities, scientific and technical capacities and labour organizations in the defense industry and coordinate the execution of such activities;
together with interested federal authorities and organizations involved in the development and implementation of measures for the promotion of konversiruemym organizations in attracting investment, including foreign investment;
provide konversiruemym compensation organizations and the implementation of measures of social protection for their employees;
carry out other tasks entrusted to them by federal laws, regulatory acts of the President of the Russian Federation and the normative legal acts of the Russian Federation Government functions.
Article 7. State planning for conversion 1. State planning is carried out on the basis of conversion: the military doctrine of the Russian Federation;
the federal programme for the development, creation and production of weapons and military equipment on the ten-year period;
other federal programs;
the mobilization plan for the economy of the Russian Federation;
programmes of military and technical cooperation between the Russian Federation and foreign States in accordance with the international treaties of the Russian Federation.
Conversion metrics measuring the expected reduction and/or cessation of scientific and (or) production activities to ensure the Federal Government's needs in the area of the maintenance of defence and security of the Russian Federation in accordance with the directions of the activity (range of products, works, services) and in the organizations of the defence industry, in the medium term are defined and refined for the short period. Certain conversion rates in the medium term to be brought to the conversion of the defence industry organisations no later than two years prior to the conversion.
2. State planning of conversion is provided by the Government of the Russian Federation on the basis of the federal target program conversion and other federal programs in related fields.
Procedure for the development and implementation of the federal target program conversion and federal targeted programmes in related areas shall be determined by the Government of the Russian Federation.
3. State authorities of the constituent entities of the Russian Federation to implement the State support to conversion organizations located in the constituent entities of the Russian Federation, at the expense of the budgets of the constituent entities of the Russian Federation and extra-budgetary resources can develop and take regional targeted programmes of conversion. Regional targeted programmes of conversion can be included in the federal target program conversion.

To coordinate the implementation of regional target programs for conversion if necessary may be coordinating councils to conduct conversions to executive power bodies of constituent entities of the Russian Federation and others contributing to the conversion of bodies.
4. Konversiruemye organization develop investment conversion program. Investment konversiruemoj organization accepted conversion programme in consultation with the appropriate federal body of executive power in the field of conversion. Conversion programs are subject to review by the Federal Executive Body in the field of conversion within one month from the date of receipt.
Article 8. Funding for conversion 1. Funding for the conversion is carried out by: the federal budget;
loans mobilized under Government guarantees;
funds provided by international monetary organizations;
budgets of the constituent entities of the Russian Federation and local budgets allocated on the basis of decisions of bodies of State power of the constituent entities of the Russian Federation or local authorities to finance conversion;
trust funds of funds accumulated by organizations for financing research, development and design work for civilian use;
own and borrowed funds to conversion organizations;
means of Russian and foreign investors, including funds equity client organizations of civilian products, as well as other extrabudgetary sources.
2. In cases provided for by federal budget expenditures on the financing of the federal target program conversion costs are allocated separately: konversiruemymi organizations conducting research, development and design work for civil purposes, including work to develop dual-use technologies, the introduction of military technologies to civilian production, production of civilian products based on released production facilities;
the provision of funds from the federal budget to return and fee-for-service basis for the financing of investment programmes of conversion;
compensation konversiruemym organizations and social payments to their employees.
The amount of these expenses shall conform to the requirements of the economic security of the Russian Federation.
3. the funds of the federal budget for the return and paid basis are provided konversiruemym organizations in the financing of investment programmes of conversion of organizations on the results of the competitive selection of these investment programmes in a manner and under conditions determined by the Government of the Russian Federation, and transferred into special bank accounts to conversion organizations.
In the cases and pursuant to procedure established by the Government of the Russian Federation, Russian organizations can be granted associated budgetary loans for financing of targeted procurement for conversion organizations of their products (works, services).
4. Konversiruemym organizations in the form of business entities in the cases and pursuant to procedure established by the Government of the Russian Federation can be granted funds from the federal budget to finance the cost of implementing investment programmes of conversion on the modalities for the participation of the Russian Federation in the authorized capital of the converted organizations through the acquisition of federal property at nominal value of shares (interests in Charter capital) to the amount of funds provided to the subsequent sale of such shares (interests in Charter capital) at auctions in accordance with legislation of the Russian Federation on privatization of State and municipal property.
5. State support of investment programs of conversion may be effected through the provision of konversiruemym organizations on a competitive basis by the Government of the Russian Federation State guarantees under the loans (loans and bonds) attracted to invest in such programs.
6. funds from the federal budget to conduct research, development and design work for civil purposes, including work to develop dual-use technologies, the introduction of military technologies to civilian production, production of civilian products based on released production capacities, provided konversiruemym organizations on a competitive basis.
In the cases and pursuant to procedure established by the Government of the Russian Federation, konversiruemym organizations may be authorized to send part of the funds referred to in this paragraph on funding for the development and production of new products (works, services) for civil purposes, including works on modernization of equipment for dual-use technologies.
Article 9. Conversion funds

1. Continuous and targeted funding is provided by the State Fund conversion conversion of trust funds of funds accumulated for financing research, development and design work.
2. The State of conversion: the conversion investment programmes financed from the federal budget;
provides the attraction and use of extrabudgetary sources, including government guarantees for the financing of investment programmes of conversion;
konversiruemym provides organizations with other forms of State support and assist economic stabilization organizations the defense industry;
performs other actions in the interest of the State in accordance with its competence as defined by the Government of the Russian Federation.
3. the right to form organizations Konversiruemym trust funds of funds accumulated for financing research, development and design work for civilian use, as well as the development of new kinds of products (works, services). Deductions to conversion organizations in these trust funds may be included in the cost of production (works, services), which is taken into account when calculating taxable profit, within the norms established by the legislation of the Russian Federation.
Article 10. Features of the restructuring and privatization of the converted organizations 1. The Government of the Russian Federation is developing a State program of privatization of State property in the Russian Federation and the draft federal law on amendments and additions to the programme, subject to the provisions of the federal target program conversion.
2. Way, terms and limitations of privatization of State property konversiruemoj of the Organization shall be determined taking into account the investment program of conversion of this organization.
3. Privatization of State property subject to conversion organizations is generally carried out by such organizations in joint stock companies and the sale of their shares in commercial competition with the investment and (or) social conditions and in the cases provided by paragraph 2 of article 16 of the Federal law "on privatization of State property and privatization on the fundamentals of municipal property in the Russian Federation", exclusively on this contest. State property management agencies in approving privatization plans establish investment and (or) social conditions commercial contests, the order of execution of such conditions in accordance with the investment programmes of conversion.
4. In the process of privatization of State property subject to conversion organizations on the basis of the decision of the Government of the Russian Federation are federal property packages of shares of open joint-stock companies created through the conversion to conversion organizations of up to 51 per cent of the authorized capital of such companies can be made as a contribution to the share capital: economic society established on behalf of the Russian Federation by making these shares;
Open joint-stock company, created through the conversion of konversiruemoj organization and is the lead performer in the scientific and (or) industrial cooperation, with the participation of the companies, whose shares are made in its authorized capital.
5. Konversiruemye organization in the form of State unitary enterprises and business entities may in the conversion process in the prescribed manner to create on the basis of its structural subdivisions of the affiliated state unitary enterprises or affiliated business companies while maintaining technological integrity of defense production.
6. State property konversiruemoj organization that has purpose and mobilization is not used in the production of goods (works, services), not subject to privatization.
CHAPTER III. SOCIAL PROTECTION OF WORKERS SUBJECT to CONVERSION ORGANIZATIONS, compensation and benefits KONVERSIRUEMYM ORGANIZATIONS Article 11. Social protection of workers subject to conversion organizations 1. Workers subject to conversion organizations released in connection with the conversion, have the right to social protection in accordance with this federal law, other federal laws and other regulatory legal acts of the Russian Federation, laws and other normative legal acts of the constituent entities of the Russian Federation.
2. To ensure the social protection of workers subject to conversion organizations released in connection with the conversion, the period of receiving unemployment benefits on the basis of decisions of bodies of State power of the Russian Federation, bodies of State power of the constituent entities of the Russian Federation and bodies of local self-administration may be extended for a period of more than two years.

3. For workers subject to conversion organizations complement funds released in connection with the conversion, we reserve the right to use the former workplace of the social infrastructure, the right to health care and the right to housing.
4. Dismissal of employees of the converted organizations in connection with the downsizing of State employees, as well as in connection with refusal of workers to conversion organizations from continuing to work as a consequence of the change of the essential labour conditions caused by the conversion, in workbooks such workers recording simultaneously on the basis of the dismissal that dismissal is the conversion.
5. The requirements set out in paragraphs 1, 3 and 4 of this article shall apply to dismissed in connection with the conversion of social workers serving backbone infrastructure organization of the defence industry.
Article 12. Konversiruemym compensation and benefits organizations 1. Compensation and benefits granted by the State konversiruemym organizations are established by this federal law and other federal laws. Laws of constituent entities of the Russian Federation konversiruemym organizations may establish additional benefits compared to the benefits provided for by the legislation of the Russian Federation, at the expense of the respective budgets of the constituent entities of the Russian Federation.
2. Konversiruemye of the Organization in a manner and under conditions determined by the Government of the Russian Federation are eligible for accelerated depreciation portion of basic production assets and total withdrawal of the State Defence order and no funds can use the information in the production of goods (works, services) for civil purposes on their bezamortizacionnoe write-off and other organizations for the implementation of the established parties, with the exception of the price of the equipment, ensure that mobilization tasks (orders).
3. the Organization during the period of Konversiruemye investment programs for conversion to a cost-effective mode of operation within the deadlines established by the programme data, in accordance with the legislation of the Russian Federation may be fully or partially exempted from paying tax on profits of enterprises and organizations, enterprises, property tax, land tax.
Facilities provided for in this paragraph are granted konversiruemym organizations in accordance with the tax legislation of the Russian Federation. The amount of such benefits shall be determined by the tax legislation of the Russian Federation.
4. Konversiruemym organizations in connection with the reduction or cessation of scientific and (or) production activities to ensure the Federal Government's needs in the field of Defense and security of the Russian Federation provided State support in the form of compensation for non-refundable for: cost recovery (fully or partially) on the payroll of workers retrenched from defense industry organizations;
compensation for loss of profits from the withdrawal or reduction of the State Defense order if the condition for reparation of the damages stipulated the State contract (contract);
maintaining community temporarily not downloaded due to reduced defense production of unique equipment, test benches and dual-purpose polygons;
the content of social infrastructure (totally or partially).
5. Konversiruemym organizations may be granted State support for sale on the domestic market of goods (works, services) for civil purposes, produced as a result of the implementation of the investment, in the form of conversion programmes: inclusion as investment conditions in the sale of objects of privatization in commercial competitions winners competitions use commercial obligations products for civilian use to making investments in kind, if the quality of these products correspond to similar foreign products or exceed them or if the price of these products corresponds to the price of similar foreign products or lower prices;
structure of accounting prices for goods the subjects of natural monopolies justified the cost of such entities conversion products for technical re-equipment, modernization and expansion of production and the inclusion of these expenses in the cost of goods, such entities will be when calculating taxable profit;
other protectionist measures, including measures to be applied in determining the conditions of production-sharing agreements.
(Paragraph 6 deleted-the Federal law dated 10.01.2003 N 8-FZ)

6. the expenses for training, retraining and upgrading the skills of workers in educational institutions, released in conjunction with the conversion and sent to educational institutions konversiruemymi organisations in the framework of the implementation of investment programmes of conversion may be partially financed from the federal budget. (Paragraph 7 as subclause 6 as amended by federal law from 01/10/2003 N 8-FZ), chap. IV. FOREIGN ECONOMIC ACTIVITY SUBJECT to CONVERSION ORGANIZATIONS Article 13. Types of foreign economic activity subject to conversion organizations 1. Konversiruemye organizations are entitled, in the manner prescribed by the legislation of the Russian Federation, to carry out export and other foreign trade operations with respect to raw materials, materials, equipment, released during the conversion, provided cannot be used for the production of civilian products;
transfer (Exchange and sale) of technology, licences, inventions, scientific and technical information, which to a conversion used in the production of weapons and military equipment;
participation in conferences, symposiums, exhibitions and fairs with a demonstration of new materials, equipment, devices, advertising technologies that until a conversion used in the production of armaments and military equipment.
2. the Government of the Russian Federation in accordance with its powers directly or through authorized federal executive bodies and public organizations may implement measures: export conversion products (works, services) through the provision of targeted (export) loans or guarantees for such loans, based on risk insurance, as well as through the provision of trade information and assistance in the implementation of the conversion products (works, services) in the foreign market;
to promote konversiruemym organizations in attracting foreign investment, highly efficient foreign technology and foreign acquisition of equipment for the production of civilian products;
other measures for promoting foreign economic activity subject to conversion organizations.
Article 14. Protection of military-economic and scientific-technical potential of the Russian Federation to prevent damage to the military-economic and scientific-technical potential of the Russian Federation and to prevent the proliferation of weapons of mass destruction capabilities in the implementation of konversiruemymi organizations of foreign economic activity: implemented government regulation and export control of foreign trade activity conversion organizations in the manner prescribed by the legislation of the Russian Federation;
protects information constituting a State secret;
with regard to conversion organizations continue to pursue scientific and (or) production activities to ensure the Federal Government's needs in the field of Defense and security of the Russian Federation, may be established by federal laws and decrees of the President of the Russian Federation restrictions such as limiting the aggregate proportion of foreign participation in the authorized capital of companies; the restriction for foreign participants of the acquisition of shares of joint-stock companies, created in the process of privatization; limitation of attracting foreign investors as financial advisers, auditors, appraisers, as well as representatives of retailers, depositories, clearing and settlement centers in the privatization of State property subject to conversion organizations.
Chapter v. RESPONSIBILITY for VIOLATION of THIS FEDERAL LAW Article 15. Liability for violation of this federal law, violators of this federal law, shall be liable in accordance with the legislation of the Russian Federation.
CHAPTER VI. FINAL PROVISIONS Article 16. The order of this federal law's coming into force 1. This federal law shall enter into force on the day of its official publication.
2. From the date of entry into force of this federal law shall be declared null and void: the law of the Russian Federation "on the conversion of the defence industry in the Russian Federation" (records of the Congress of people's deputies of the Russian Federation and the Supreme Soviet of the Russian Federation, 1992, no. 18, p. 964);
the Decree of the Supreme Council of the Russian Federation "on the procedure of enacting the law of the Russian Federation" on the conversion of the defence industry in the Russian Federation "(records of the Congress of people's deputies of the Russian Federation and the Supreme Soviet of the Russian Federation, 1992, no. 18, art. 965.) Article 17. Bringing of normative legal acts of the Russian Federation in accordance with this federal law to propose to the President of the Russian Federation and to entrust the Government of the Russian Federation to bring into compliance with this federal law issued by their normative legal acts.

The Government of the Russian Federation to ensure that federal authorities their normative legal acts in compliance with this federal law.
Normative legal acts of the Russian Federation to bring them into compliance with this federal law applies to the extent that they do not contradict this federal law.
The President of the Russian Federation, b. Yeltsin, Kremlin, Moscow April 13, 1998 N 60-FZ