Policy changes align license costs with R&D funding in the automotive sector
Russian automotive manufacturers have the option to obtain licenses to produce foreign vehicle models. The costs associated with obtaining these licenses are planned to be treated as part of localization expenses. This adjustment is outlined in a draft decree prepared by the Ministry of Industry and Trade. The key idea is that the expenses incurred for licensing, research, and development to create and manufacture automotive products will be recognized as R&D costs.
Under the current framework, 1% of revenue allocated to R&D translates to roughly 400 localization points. To participate in public tenders, a participant often needs to achieve around 3200 points. Previously, there was a proposal to raise the threshold to 4500 points starting in 2023 and to 5500 points starting in 2025. The latest draft, however, maintains the 3200-point requirement for now, while also applying a 1.3x multiplier to R&D points. The overall goal is to ensure continued access to government procurement for Russian-made equipment and to stimulate increased investment in R&D activities.
In practice, this means that the cost of licensing and the investments in development can be more effectively channeled into product innovation, potentially shortening the time from concept to market. The policy aims to balance incentives for localization with the need to keep foreign-technology licenses a feasible pathway for domestic producers who are upgrading or expanding their capabilities.
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