What is the difference between a department and a branch. What is the difference between a branch and a separate division

19.10.2018

Absolutely all legal entities that are registered in Russia have the opportunity to open one or several separate divisions at once. This is where the question arises: what is the difference between a separate division, a branch and a representative office?

Not the same

So, branches and representative offices, as well as stationary workplaces, are equated to separate subdivisions. The procedure for opening them, along with the requirements that apply to them, as well as their definitions, is fully described in the current Russian legislative acts.

What is the difference between a separate division and a branch? Let's dwell on this issue in more detail.

Separate divisions

The Russian Civil Code allows the creation, as well as the existence of legal entities, which, together with other business entities, are directly involved in carrying out entrepreneurial activity or created to achieve certain goals.

Absolutely all organizations operating in Russia have the right and opportunity to open separate divisions. It should be borne in mind that separate subdivisions do not act as legal entities. For this reason, they are deprived of the legal capacity that is inherent in legal entities. You can feel the difference between a branch and a separate division.

Jobs for more than a month

It should be remembered that separate subdivisions must be located at an address that is different from the location of the main institution, in addition, they must have stationary workplaces. In this case, the creation of jobs for a period of more than one month is implied. A separate subdivision created by a legal entity is a branch, representative office or stationary workplace. Here you can already understand the difference between a branch, a representative office and a separate subdivision.

Information about each separate subdivision, excluding stationary jobs, is recorded in the unified state register of legal entities. To do this, the institution that creates them must present in tax office completed applications according to the established forms.

So what is the difference between a branch and a separate division? Let's look at the course of the article and find out the controversial points.

What are separate divisions?

Civil law distinguishes two structural divisions, namely a branch and a representative office. The norms of the Civil Code do not contain any other structural divisions that are separate from the main organization. Is the branch a separate division? In the course of the already studied material and the newly arrived, we will find out this to the end.

Link to law

But at the same time, the list of divisions that are separate from the main institutions is also contained in other legislative acts. So, in the tax legislation there is a reference to the possibility of recognizing as separate parts of the main organization any territorially separated structure that has stationary jobs. The workplace, including stationary, is a place that is controlled by the organization and in which the employee performs his labor obligations, which is discussed in the article of the Labor Code No. 209. What is better, a branch or a separate subdivision? Let's understand further.

In the public domain

Today, the list of structures that can be recognized as separate is open and is not limited to a branch and a representative office. Each type of structural units has not only its own hallmarks but also in general characteristics.

So what is the difference between a separate division and a branch? Let us first dwell on the very concept of the latter.

What are branches?

Under the branch of a company, it is customary to mean a structure belonging to it, which, like a separate division, is located in another territory. At the same time, it carries out activities that, in their content, fully correspond to the functions of the main office. Next, we will consider the difference between a separate division from a branch and a representative office, and many other unclear points.

In the same way as in the situation with separate subdivisions, the creation of branches takes place at the level of local regulatory and legal acts of the institution. This is the difference between a branch and a separate division. True, such a procedure, as a rule, is much more complicated than that which determines the establishment of structures of the first type. In particular, an executive hired under a labor document, for example, a general director, does not have the right to establish branches. In addition, at least two-thirds of the total the owners of the company in the case of LLC. The charter of the company may provide for the creation of branches according to decisions made by the board of directors.

The statute must contain

Unlike institutions of separate divisions, the creation of a branch provides for the indication of information about it in the company's charter. In addition, information about the relevant changes in the constituent documents of the company must be submitted to the tax authorities so that the mentioned service subsequently makes all the required adjustments to the Unified State Register of Legal Entities. In addition, it is also important for tax authorities to send copies of documents in which changes were made to the charter of the organization. Or you can provide copies of the relevant constituent paper. Based on information about the branch of the organization, which is entered in the Unified State Register of Legal Entities, new structure companies are taxed according to their location.

Information about the establishment of a branch, as in the case of separate representative offices, should be transferred to the pension fund, and, in addition, to the tax authority. The branch of the company needs to have its own manager, who will hold his position in accordance with the power of attorney issued by the head office. Edition also required CEO order for the appropriate decision. Powers within the framework of the appointment of the head of the branch may be transferred to other management bodies of the company. So, which is better a branch or a separate division? The following material will help draw conclusions.

Main differences

Here we come to the answer to the question of what is the difference between a separate division and a branch further in the text.

The concept of a branch is enshrined in the Civil Code in Article No. 55. According to this article, the branch is not only remote from the main organization in the territorial sense, but also performs all or part of the functions of the main institution, and also performs the tasks of representation.

It should be noted that the concept of representation and the definition of a branch differ from each other. These differences already follow from the characteristics of both structural units given in civil law.

So, let's consider the basic differences between branches and separate divisions, and also find out what are characteristics at stationary workplaces:

• functional differences. Within the framework of functional differences, it should be noted that branches perform all or part of the duties of the main institution. They also carry out the functions of representative offices. The activities of separate divisions are aimed at representing and protecting the interests of the main company. At stationary workplaces, employees perform their duties directly at their place.
• Business differences. When carrying out commercial activities, branches have the entire arsenal of powers and have the right to conduct it. As for separate subdivisions, they do not have such a right. Stationary workplaces also cannot carry it out, they can only deal with labor relations.
• Notice to the tax office. Branches are not required to notify the tax inspectorate of their establishment. With regard to separate divisions, such a need is also not provided. But stationary places must notify the tax authority within a month from the date of opening.
• Availability of information in the Unified State Register of Legal Entities. Information about separate subdivisions, as well as about branches, is contained in the Unified State Register of Legal Entities. As for the stationary workplace, then this information not specified in the Unified State Register of Legal Entities.
• The difference is in the order of creation. When opening branches, exactly like separate subdivisions, it is required to obtain permission from the owner of the institution. To launch a stationary place, you need an order from the sole executive representative of the organization.
• Doing accounting. Branches, as well as separate subdivisions, have the right to independently conduct accounting. Stationary places do not have such an opportunity.
• Opportunity to open your own bank account. Branches, along with separate subdivisions, can open their current account with a banking institution. Stationary workplaces cannot open their current account in the tank.

The difference is not only in the names

As you can clearly see, the differences between different types of separate structural units are much wider than just the difference in names. The difference between the existing types of structural divisions is of a fundamental nature. Mostly, the differences are in the functions for the implementation of which the required structural units are created.

It should also not be forgotten that between the structural units there are some common features. For example, they are not considered legal entities, information about them does not need to be indicated in the charters of institutions, and their heads have the right to perform their duties solely on the basis of a power of attorney. Structural divisions directly act on the basis of regulations. Any separate subdivision must have stationary jobs.

When there is a choice between a separate division or a branch, it is necessary to determine the assigned functions that the corresponding structure will have to perform. In addition, it is required to determine the goals for which it is created. In addition, the body of the main institution, which decides on the opening of branches, should also take into account the following factors:

Conclusion

So what is the difference between a separate division and a branch? I think everyone who has studied already knows the answer for himself.

Separately, it can be noted that the right to choose one or another separate subdivision belongs only to the organization that creates it. But before making a final decision on the form of a separate subdivision, it is necessary to study in detail all the features of each of the possible options.

• Can the head of an organization transfer to a representative the right to sign personnel documents on behalf of the organization?
• Can the director make any decision in his controlling stake of 98%, 2% in another shareholder, without the consent of the other shareholder (who has 2%)?
• Is it necessary to notify the debtor in writing that the rights of the original creditor are transferred to a new person?
• In what period and what should we do besides publishing the state registration in the "Bulletin" when converting from MUP to MCU?
• Is an LLC in the Far North region obliged to conduct an annual inventory of goods and materials, is a materially responsible person responsible for the shortage?

Question

Please tell me how to proceed in the following situation. Our organization is engaged retail and plans to open a second store in another city. How to legally register such a store as a separate division or branch? What is the difference between them?

Answer

In this case, it is quite possible to get by with the creation of a conventional separate subdivision - this is the least labor-intensive and simple option. In turn, the creation of a branch requires at least making changes to the constituent documents, allocating it to the balance sheet, preparing documents for the branch, and so on. Read more in the recommendations below.

The rationale for this position is given below in the materials of the Lawyer System.

How to decide which separate division is best to work through

Before opening a separate division, it is necessary to determine the purpose of its creation. Namely, to understand what result the organization wants to get. Depending on this, the issue of choosing between a branch, a representative office and another separate subdivision (simple subdivision) will be decided.*

The first selection criterion is the conduct of business or representation of interests

Based on this criterion, a choice is made between a branch and a representative office.

So, a separate unit can be created:

• or for the purpose of conducting through this unit any economic activity organizations (for example, produce products, provide services, etc.);
• or with the aim of performing only actions to represent the interests of the organization, that is, actions aimed at achieving a legal, and not an actual result (concluding transactions on behalf of the organization, representing the interests of a legal entity in court, etc.).

If the organization intends to carry out all its functions through the division, including the functions of a representative office (or part of its functions), then you need to create a branch ().

If a division is necessary only to represent and protect the interests of a legal entity, then it makes sense to open a representative office (). However, it must be understood that, by law, an organization is not entitled to perform any actual actions through such a unit (for example, provide medical services at the location of the representative office, manufacture furniture for its further sale, etc.). However, the law does not establish any sanctions for violating such a ban. Therefore, in practice, organizations often conduct production activities not only through branches, but also through representative offices. However, it still makes sense for a lawyer to inform his/her management of the legal differences between a branch and a representative office and to advise choosing a representative office only when the organization does not intend to carry out production activities through the unit.

The second selection criterion is the introduction of amendments to the constituent documents or a simplified procedure for creating

Based on this criterion, a choice is made between a branch (representative office) and a simple separate subdivision.

The creation of a branch and the opening of a representative office are rather complicated procedures, requiring, in particular, making changes to the organization's constituent documents and registering these changes with the tax office (, "On State Registration of Legal Entities and individual entrepreneurs»; hereinafter referred to as the Law on State Registration). It is much easier to create another separate division (that is, a division that is neither a branch nor a representative office). To do this, you do not need to make changes to the constituent documents, just .*

At the same time, the law does not prohibit giving a simple division the same functions that the organization plans to provide for a branch or representative office. Therefore, at first glance it seems that it makes sense to give preference to a simple division. However, this conclusion is not always correct.

It is a branch (representative office) that must be created if it is planned that a separate subdivision will have its own current account.

Rationale

It is advisable to create a branch (representative office) even when a separate subdivision will:

• have a separate balance;
• independently accrue payments and other remuneration in favor of employees;
• have a fairly complex organizational structure and a large number of employees;
• be far away from the organization.

Alexander Porotikov

Vitaly Perelygin

JCC expert "Sistema Lawyer"

Mikhail Latushkin

Tip (mod=166, id=895)

It makes sense to document the fact that stationary workplaces are equipped. This will avoid possible disputes with the tax office related to the violation.

What kind of document needs to be drawn up upon completion of the equipment of workplaces, the law does not provide. It seems that it will be enough for the head of the organization to publish about the opening of a separate subdivision (on the beginning of the subdivision's implementation of its activities). The main thing is to fix in the order the date of completion of the equipment of workplaces.

Thirdly, to conclude employment contracts with new employees or organizations for work at the location of a separate subdivision.

Transfer to work at the location of the unit is possible if two conditions are met (, Labor Code of the Russian Federation):

• the employee gives written consent to such a transfer;
• the labor function of the employee changes and (or) the unit is located in a different area compared to the location of the organization. The term "other locality" means a locality outside the administrative-territorial boundaries of a settlement ("On the application by the courts of the Russian Federation of the Labor Code of the Russian Federation"). For example, if the office being created is located in Belgorod, and the legal entity is registered in Moscow, then an employee of the organization will be able to work in the office only on the basis of a transfer.

When transferring an employee to another job, it is necessary to conclude a change in the terms of the employment contract ().

The consent of the employee and the execution of an additional agreement to employment contract will not be required in the event of an employee moving, that is, in a situation where the following circumstances occur ():

• the unit is located in the same locality as the organization itself;
• the terms of the employment contract do not change.

How to register with the tax authority at the location of a separate subdivision

Registration at the location of a separate subdivision is the responsibility of a legal entity (clause , article 83 of the Tax Code of the Russian Federation). For its execution, it is necessary to submit to the tax office at the location of the organization a message on the creation of a unit (). messages and its completion are approved.

The notification must be submitted within one month from the date of creation of the separate subdivision. Such a moment is considered to be the moment of equipment in the division of stationary workstations.*

Rationale

The law does not directly establish from what day a simple separate subdivision is considered to be created. At present, the position of the courts is that a subdivision is created from the moment when stationary workplaces are equipped in it (decrees,). The onset of such a moment can be confirmed, for example, by the opening of a separate subdivision, by an act of completing work on the technical equipment of the workplace, etc.

Often, courts also pay attention to whether the organization conducts actual activities through a separate division or not (). If a legal entity provides services, performs work, or conducts other activities at the location of a separate subdivision, it is considered that the workplaces are equipped and the subdivision is created ().

How to notify the body exercising control over the payment of insurance premiums

A legal entity that has created a separate subdivision is obliged to notify the body exercising control over the payment of insurance premiums (“On insurance premiums to the Pension Fund of the Russian Federation, the Social Insurance Fund of the Russian Federation, the Federal Compulsory Medical Insurance Fund”; hereinafter - the Law on Insurance Premiums) .

The functions of monitoring the payment of insurance premiums are carried out ():

• the Pension Fund of the Russian Federation and its territorial bodies;
• FSS of Russia and its territorial bodies.

The organization must submit to the address of the territorial body of each of the funds on the creation of a separate subdivision. Messages must be submitted within a month from the date of the creation of the unit (i.e.). In case of violation of the notification period, a legal entity may be charged a fine of 200 rubles. for each unsubmitted document ().

The law does not establish any requirements for the content of messages. In both messages, it is advisable to indicate the name of the legal entity, address, TIN, KPP, registration number in the relevant fund, the date the decision was made to create a separate division and the details of such a decision, the date the division was opened (i.e., the date the equipment of stationary workplaces was completed), and also the location of the unit.*

Alexander Porotikov

PhD in Law, Judge of the Nineteenth Arbitration Court of Appeal

Vitaly Perelygin

JCC expert "Sistema Lawyer"

Mikhail Latushkin

PhD in Law, Head of Legal Department

branch "Central" JSC "Oboronenergosbyt"

* This is a part of the material that will help you make the right decision.

Companies that occupy a leading position in the sale of certain services and goods may operate on the territory of several administrative-territorial units or even countries. Separate structural divisions allow you to effectively promote your business away from the main production. Those firms that have not yet reached great heights are striving for expansion of production, growth in sales, market leadership and sky-high profits. On the way to success, the leaders of such companies come to the conclusion that without going beyond the boundaries of one settlement, it will not be possible to achieve their goals.

In order for the product to be promoted with maximum efficiency and the brand to become recognizable, it is necessary to meet potential customers halfway by opening company divisions in close proximity to their places of residence. When deciding to open a separate division, it is necessary to understand what organizational forms they are, and what are the differences between them.

Branch and representative office: definition of terms

Independent subdivisions, which are remote from the main office of the company, may be branches or representative offices.

A branch is a form of business organization in isolation, in which the division receives the right to perform part or all of the functions of the company.

The representative office is entrusted with the task of protecting the interests of the company, as well as representing them.

Basis for determining differences between separate divisions

The following documents are the basis for distinguishing a representative office from a branch. They provide for the rules by which the activities of independent structural units are carried out.

• Tax and Civil Codes.
• Instructions on opening and closing bank accounts.
• Company charter.
• The regulation governing the work of separate divisions.

Common features of branches and representative offices

It is impossible to determine the differences between phenomena without analyzing their similarities. It is necessary to understand the specifics of the functioning of remote units of any type. For the full-fledged work of both representative offices and branches, such measures should be taken.

• Provide divisions with isolation from the main enterprise by territorial distancing from the main office of the company and providing a certain degree of independence.
• To enable divisions to expand the scope of the company as a whole.
• Mention branches and representative offices in the company charter.
• Appoint directors and other representatives of the management team, issue them the necessary powers of attorney.
• Develop regulations on structural divisions.
• Provide property necessary for the implementation of activities.

The main differences between branches and representative offices

The representation is characterized by the following features:

• It is vested only with the authority to represent the company.
• Does not conduct business activities.
• Operates on the basis of its own position and the charter of the company.
• There is no own balance.
• Can't open a bank account.

The branch has the following characteristics:

• Partially or in full, the functions of the company are performed.
• Economic activity is underway.
• The basis for functioning is the position and charter of the organization.
• It has its own balance.
• As a rule, a bank account is opened.

The main difference between the forms of remote divisions is that the branch is endowed with greater independence than the representative office.

What kind of division should I choose?

To determine which division is better to open, it is not enough to know how they differ. It is necessary to clearly define the purpose and prospects for opening an office.

A representative office, for example, is better to open if it is necessary to perform tasks such as:

• Conclusion of contracts and their support.
• Expanding the circle of clients.
• Solution of problems.
• Increasing brand popularity.
• Promotion of the company's product.

A branch is opened when it is necessary to solve problems of greater complexity. However, one should first assess whether such a unit will generate income, since maintaining a branch is often quite expensive. In addition, when carrying out activities that require obtaining a license, you will have to incur costs for this. Often, a branch is entrusted with the independent payment of salaries to employees, so it is also necessary to register it with the relevant funds.

Business expansion can be carried out through the creation of a separate division or branch of the company. What are they?

What is a separate division?

Under separate subdivision It is customary for a company to understand a structure belonging to it, which is located in another territory, has a staff and represents the interests of the main office. In a separate subdivision, there must be stationary jobs (created for a period of 1 month or more).

Information about the relevant structure does not have to be included in the constituent documents of the company. At the same time, firms that form separate subdivisions must register with the Federal Tax Service at the location of each of the local institutions. For this in territorial structure The Federal Tax Service must send a notification about the opening of the unit. This must be done within 1 month from the date of creation of the relevant structure. Having received a message about the opening of a separate division of the company, the Federal Tax Service, within 5 days, registers the company on tax records in its territory and issues a notice of this to it.

In addition, within 1 month from the date of creation of a separate subdivision, the company must notify the Pension Fund and the Social Insurance Fund about this.

What is a branch?

Under branch It is customary for firms to understand the structure belonging to it, which, like a separate subdivision, is located in another territory. At the same time, it carries out activities that, in their content, fully correspond to the functions of the main office.

As in the case of a separate subdivision, the creation of a branch is carried out at the level of local regulatory legal acts of the company. However, this procedure, as a rule, is noticeably more complicated than the one that characterizes the establishment of structures of the first type. In particular, an executive hired under an employment contract (for example, a general director) cannot establish branches. In addition, at least 2/3 of the total number of votes of the company's owners must be given for the creation of a branch - if we are talking about an LLC. The charter of the company may provide for the creation of branches in accordance with decisions taken by the board of directors.

Unlike the establishment of a separate subdivision, the creation of a branch involves the indication of information about it in the charter of the organization. In addition, data on the relevant changes in the constituent document of the company must be transferred to the Federal Tax Service - so that the said body subsequently makes adjustments to the Unified State Register of Legal Entities. At the same time, tax authorities must also send copies of documents with the participation of which changes were made to the company's charter. Or - copies of the relevant constituent document. Based on the data on the branch of the company, which are entered by the Federal Tax Service into the Unified State Register of Legal Entities, the new local structure of the company is tax registered at its location.

Information on the creation of a branch, as in the case of a separate representative office, must be transferred to the FIU and the FSS.

The branch of the organization is required to have a head - he holds his position on the basis of a power of attorney issued by the head office, as well as upon the fact that the general director issues an appropriate decision. The authority to appoint the head of the branch may be vested in other management bodies of the company.

Comparison

The main difference between a separate subdivision and a branch is that information about the structure of the first type should not be entered into the constituent documents of the company and the Unified State Register of Legal Entities. In general, the establishment of a separate division is a simpler procedure than the creation of a branch. Above, we examined what this is - the need to make a decision on the formation of a branch at a meeting of founders, transfer copies of the charter or sources corresponding to it to the Federal Tax Service, and also appoint the head of the relevant structure.

At the same time, both local institutions under consideration have much in common. So, neither one nor the other is a legal entity independent of the head office. The property they use belongs to the main organization. Separate subdivisions of firms and branches are established, as a rule, for the same purposes - expanding the brand's representation, solving local problems related to business development.

Having determined the difference between a separate subdivision and a branch, we fix the conclusions in the table.

Table