IX. BUSINESS TRAVEL Business Customs Attempts to understand Russian business customs must always be rooted in the knowledge that Russia has lived for over a thousand years under authoritarian and autocratic rule. Unlike countries such as Hungary, Poland and East Germany, Russia has no institutional memory of democracy or market economy. In these rapidly changing times, it is difficult to generalize the business customs of this vast country, but the following are some of the most commonly followed customs. Russian business revolves around a system of unequalled red tape. Stamps, forms and signatures comprise a frustrating maze for western business which often sees no point in the exercise. Patience, long suffering and often the goodwill of Russian partners is the only key to success. Documents carefully notarized in the United States attesting the bank accounts or viability of a company will often be rejected by Russians. American business will be asked for notarization by the American Embassy. Though the Embassy can only notarize that the requestor states the documents are authentic, this is what seems to satisfy Russians. Russian businesses place a very high value on personal interaction and relationships. Business is rarely conducted on the phone, and decisions are almost exclusively reached in face-to-face negotiations. Such meetings usually begin with an exchange of business cards (it is helpful to have yours also printed in Russian) and progress through serious, seemingly endless speeches accompanied by tea and cookies early in the day or vodka toasts for later meetings. When invited for dinner meetings, the evening can often be very long and seemingly unproductive, but may be the necessary groundwork for an agreement signed at a later date. Russians put great stock in personal relations. A hand shake may be more binding for them than the actual signed agreement. Contract sanctity is not a well institutionalized concept in Russia with the signatory or with Russian courts. The embassy knows of cases where Russian businesses simply abrogated signed contracts when difficulties arose or they deemed the contract no longer advantageous to their side. Western business persons should be aware, though, that Russians are zero-sum thinkers. Though westerners expect negotiations to result in win-win agreements for both sides, Russians often think that they can only win in a negotiation if the other side loses. To succeed in business, Russians often have to scheme and plot ways to circumvent rules and find loopholes in government regulations. Often Russian businesses allow this approach to spill over into negotiations with private persons and firms. Travel Advisory and Visas The State Department issues travel advisories when political unrest warrants. In the past two years only during the October unrest of 1993 were visitors warned to avoid travel to Moscow for about two weeks. Political problems continue in the North Caucasus region of Southern Russia and along Russia's border with Azerbaijan and Georgia. Other areas of frequent armed violence include the Chechen Republic, the Ingush Republic and the North Ossetian Republic. A passport and a Russian visa are needed to travel to Russia. This visa must be obtained before leaving the United States and the cost of visas depends on the amount of time allowed for processing. Given a month's notice, a Russian visa theoretically costs $20. When asking for very fast service, a Russian visa can cost 100 dollars or more. Business travellers must have a letter of invitation from a Russian individual or organization which serves as the sponsor. Visas of short duration are stamped with exit dates which must be strictly observed. Allowing a Russian visa to expire can result in heavy fines and tedious work with the bureaucracy for permission to leave the country. If the visa is for a prolonged stay, then an exit visa must be obtained by the traveler's sponsor after his arrival in Russia. If travellers stay more than three days in Russia, they must register their visa through their hotel or their sponsor. Failure to do so can result in grave difficulty in leaving the country. Travellers should ensure that their visa is in order before leaving the United States. Americans can receive assistance from the Russian Embassy, Consular Division, 1825 Phelps Place, NW, Washington, DC, 20008. The Russian Embassy can be reached at (202) 939-8907. Travellers can also receive assistance from the Russian Consulates in New York, San Francisco or Seattle. Holidays Russian holidays include: Jan 1 New Year's Day Jan 2 New Year's Day Jan 7 Orthodox Christmas Mar 8 International Women's Day May 1 International Labor Day May 2 Spring Day May 9 Victory Day June 12 Independence Day Nov 7 Revolution Day In the event holidays occur on weekends, Russian authorities announce during the week prior to the holiday, if the day will be celebrated on the following Monday. It is likely that January 2 and 3 will be holidays since Jan 1 is a Sunday. Business Infrastructure Air transport to Russia on western airlines is becoming more accessible all the time. Several western airlines fly daily to Moscow and St. Petersburg. New flights have been initiated to Yekaterinburg and Novosibirsk. Alaska Airlines has summer flights to Magadan, Khabarovsk and Vladivostok. All major Russian cities can be reached from Moscow via Aeroflot. Moscow has four major airports which ring the city. International flights enter Moscow through Sheremetyevo II and travellers may continue to other Russian cities through any of the other three airports. Travel time to the departure airport can be as much as an hour and a half from Sheremetyevo II, and ample time must be allowed for passport control, customs clearance and baggage retrieval. A new taxi service has been initiated at Sheremetyevo II which is highly recommended. You can pay the set rate and avoid hassles with free lance taxi drivers. Travellers should not expect western standards on Russian airlines. With the breakup of Aeroflot in to many small airlines, travel within Russia is often unreliable. Domestic air travelers must often cope with unpredictable schedules and difficult conditions including deterioration of centralized systems of maintenance and quality of service, as well as overloading. U.S. Government officials have been instructed to defer routine travel and consider alternative means of travel. Western travellers will be required to pay a higher rate for their tickets and will generally be seated in the front cabin. This is not "first class". Travellers will find cramped, sometimes unsanitary conditions with very little space for carry on luggage. Though food and beverages are now sometimes served on internal flights, it often pays to bring your own refreshment if you think you will be hungry. An alternate method of getting around inside Russia is to travel by train. For cities as close as St. Petersburg, travellers can generally ride night trains. Trains generally arrive in the center of the city and save many of the baggage hassles that accrue in air travel. Trains are also far more reliable, since flights are often cancelled for lack of fuel. Unfortunately, increased incidents of theft and other crimes on trains has made this mode less safe -- especially for unaccompanied passengers. Car travel is not advised except for the cities very close to Moscow. Roads are often in very poor condition and fuel is sometimes very difficult to obtain. Within Moscow the metro system provides an excellent, inexpensive means of transportation. Most major attractions in the city are very close to metro stops. Signs are all written in Russian, so it can be challenging especially if you must change lines at any point. Be sure you can recognize the spelling of all destinations before embarking on a metro adventure. Marked taxis are often scarce. Muscovites simply stand on the side of the street and put out their hand for a ride. It often takes only a minute to find someone willing to drive you. As in other big cities, you are taking a certain risk in using this method. Be sure to negotiate the fee before you get in the car, and never get in a car occupied by more than just the driver. Crime Though crime in Moscow and St. Petersburg are said to be no worse than in some major cities of America, crime here is often targeted against foreigners since they are easily identified and perceived to be lucrative targets. Travelers should "dress down", and avoid loud conversation calling attention to themselves. Pickpocketing and muggings sometimes occur in broad daylight. Americans should exercise particular caution in airports, open markets, near major train and metro stations, and when hailing taxis. Groups of children who beg money sometimes pickpocket and assault tourists. Foreigners' hotel rooms and residences have also been targets, and some victims have been seriously assaulted during robberies. Extortion and corruption permeate the business environment in Russia. Organized criminal groups target foreign businesses in many Russian cities and demand protection money (under threat of serious violence). Many western companies hire security services, but this has not always been proven effective in avoiding armed extortion attempts. Language Many Russian entrepreneurs can speak at least some English. If your business is outside of Moscow and St. Petersburg or if you are dealing with large factories or institutes, it may be more difficult to find English speakers. For important negotiations U.S. businesses may want to hire a reputable interpreter. Russian interpreters often specialize in certain technical areas like oil and gas or biotechnology. Hotels Moscow, St. Petersburg, Novgorod, Sochi and Vladivostok have western style hotels. Most will cost $200/night or more. Russian state hotels often provide only the barest necessities and charge foreigners over a hundred dollars for rooms that may not even have hot water. Clothing Winters can be extremely cold in Russia with temperatures in the minus 30 range not unusual. Winter clothes can be needed as early as October and as late as April. Waterproof footwear is a must all year round, and rain gear is highly recommended from April to October. Health Diphtheria outbreaks have been reported throughout Russia. Travellers should be certain that all immunizations are up-to- date, especially their diphtheria and typhoid shots. Travelers should drink only boiled or bottled water throughout Russia. Current advisories can be obtained from the Disease Control's International Travelers' Hotline. Tel: (404) 332- 4559. Medical Facilities Medical care in Russia, even in the major cities, is often far below Western standards, with severe shortages of basic medical supplies. Access to the few quality facilities in major cities usually requires cash dollar payment at western rates upon admission. The US Embassy and Consulates maintain lists of such facilities and of English speaking doctors. Many Americans living in Moscow travel to the west for virtually all of their medical needs; such travel can be expensive if undertaken under emergency conditions. Travelers should know their insurance coverage and consider supplemental coverage for medical evacuation. Elderly travelers and those with existing health problems may be at particular risk. Food In the past local food was a great bargain in Russia. This is still the case in many restaurants in cities outside of the main cities. Currently, most Russian restaurants in Moscow and St. Petersburg charge as much if not more than western restaurants for food that is often of lower quality. Weekly the number of western restaurants increases. Currency Exchange Travelers' checks are not widely accepted in Russia, credit cards are only accepted at establishments catering to westerners in major cities; old or worn dollar bills (or bills with anything written on them) are often not accepted even at banks. In Moscow automatic tellers for American Express credit cards are located at the American Express Office and at the Mezhdunarodnaya (International) Hotel; an automatic teller for Visa cards is located at the Metropol Hotel. Dialog Bank at the Radisson Hotel provides cash advances for Mastercard holders, and cashes personal checks for American Express card holders. The American Express offices in Moscow and St. Petersburg can cash American Express Travelers' checks, and personal checks for card holders. The St. Petersburg American Express Office can provide cardholders with cash advances up to $500. Western Union has agents in Moscow, St. Petersburg and some other large cities which can disburse money wired from the United States. Customs Regulations Russian customs laws and regulations are in a state of flux and are not consistently enforced. A 600 percent duty is required to export any item with a value greater than 300,000 rubles which is just over $150 at June's rate of exchange (customs officials decide the value of what you purchased). All items of historical or cultural value (icons, rugs, old books, antiques, art, etc. may only be taken out of the country with prior written approval of the Ministry of Culture and a payment of 100% duty. Caviar may be taken out of Russia only with a receipt indicating that it was bought in a store licensed to sell to foreigners. Failure to follow customs regulations may result in temporary or permanent confiscation of the property in question.