The following laws form the basis of state support to small and middle business in the Republic of Karelia:
   - Republic of Karelia Law No. 53-RKL of 23.06.1995, “On state support to small business in the Republic of Karelia”;
   - Law No. 787-RKL of 26.06.2004, “On state support to investment activities in the Republic of Karelia”.

      The Law “On state support to small business in the Republic of Karelia” is aimed at promoting structural adjustment of economy of the republic, creating new work places, and raising the living standard.

 

It determines legal, economic and organizational principles of state policy in small business support and development in the Republic of Karelia, establishes forms and methods of state stimulation and regulation of small business subjects’ activities with the aim of  providing for them necessary conditions and opportunities for business realization as a full-authority subject of the competitive market system of management, as well as increasing their contribution in economic development in the Republic of Karelia.

 

The Law “On state support to investment activities in the Republic of Karelia” specifies types of state support to enterprises realizing investment projects in the territory of the republic, including small businesses.

 

Types of state support include tax remissions and state guarantees, as well as lax budget credits to realize investment projects.

 

Due to some changes made in federal legislation on state support to small business which resulted in abolition of the clause regulating the existence of the small business support Foundation, corresponding changes were made in the Republic of Karelia Law No. 53-RKL of 23.06.1995.

 

Karelian Government Decree No. 323r-II “On changing the objectives of activities and renaming the state non-profit institution ‘Foundation for small business support and development in the Republic of Karelia” was issued on 22.11.2005.

 

As a result of this, the institution mentioned above was renamed as the state institution “Business development Centre of the Republic of Karelia”. The Centre’s main goal is to perform functions of a business-incubator.

 

The Karelian Government adopted Resolution No. 111-P of 12 September 2005, “On Council on small business under the Karelian Government”. 

 

The Council is to solve problems having to do with coordination of activities of executive bodies of the Republic of Karelia and entrepreneurs’ public organizations while formulating and implementing coordinated policy aimed at small business support and development, including overcoming of administrative barriers.

 

According to the Law “On state support to small business in the Republic of Karelia”, financial support to small business is realizeded through corresponding special-purpose programmes.
The Sectoral special-purpose programme approved by Government’s Resolution No. 143-P of 16.12.2005 is currently being implemented, dealing with state support to small business in the Republic of Karelia for the years 2006-08.