Russia Exclusive Economic Zone vs Special Economic Zones

Two different things with one name

An exclusive economic zone is a concept of the law of the sea. It sits beyond the territorial sea and gives the coastal state rights over resources rather than sovereignty over territory. A special economic zone is a domestic investment instrument: a defined piece of land, a management company, a register of residents and a set of tax and customs preferences.

Confusing them leads to real mistakes, because the practical questions are completely different. In the EEZ the question is who may take fish, hydrocarbons or minerals from the water and seabed. In a SEZ the question is where a legal entity is registered, what it may produce and what it pays.

• EEZ: maritime, resource rights, no registration of companies, no land title
• SEZ: onshore, residency-based, tax and customs preferences, contracts with state bodies
• A project can touch both - for example, onshore processing in a SEZ and offshore extraction under an EEZ licence - but they are always separate legal tracks

What Russia's EEZ actually is

Under the UN Convention on the Law of the Sea, the coastal state has sovereign rights to explore, exploit, conserve and manage natural resources - living and non-living - in the water column, on the seabed and in the subsoil, out to the standard outer limit of 200 nautical miles from baselines. Russia claims an EEZ in the Pacific (the Sea of Japan, the Sea of Okhotsk, the Bering Sea and the waters off Kamchatka and Chukotka), in its Arctic seas, in the Baltic and in the Black Sea. The Caspian is a separate case: it is a closed body of water governed by agreements between the littoral states, not by the EEZ regime.

The rights are not exclusive in every respect. Other states keep the freedoms of navigation and overflight and the right to lay submarine cables and pipelines. The coastal state holds jurisdiction over marine scientific research, protection of the marine environment, and artificial islands and installations. In practice Russia enforces its EEZ through border and fisheries authorities: vessel inspections, permit checks, detention and fines. That enforcement is the single most common operational risk for anyone moving assets or people offshore.

Russia has also made submissions to extend its continental shelf beyond 200 nautical miles in the Arctic and Pacific. Shelf claims and EEZ rights are legally distinct, and the boundary between them matters for licensing.

• Outer limit: normally 200 nautical miles under UNCLOS
• Foreign states keep navigation, overflight and cable-laying freedoms
• Coastal state controls research, environmental rules and seabed resource access
• Caspian Sea is outside the EEZ framework

What a foreign investor can and cannot do inside the EEZ

You cannot own land, register a company or hold title inside the EEZ. There is nothing to own in that sense. Access to resources is granted through licences, quotas, concessions, production-sharing arrangements or permits issued to Russian legal entities, with foreign capital usually joining through a Russian subsidiary, a joint venture or a long-term charter.

Offshore hydrocarbons are accessed through subsoil licences. Some acreage is reserved for companies with state participation, and foreign participation in a strategic subsoil asset requires government approval under Law 57-FZ. Fishing rights are allocated as quotas to Russian users, historically on the basis of catch history; foreign-flagged vessels need permits, and foreign investment in the fishing sector falls under the strategic-sector rules. Marine scientific research, cable routes and pipeline crossings all require separate approvals, and each takes time.

Investors from countries designated unfriendly in Russia face additional layers: special account regimes for certain transactions and government approvals for exits and disposals. These are compliance matters, not workarounds. Any structure in this area should be reviewed by independent Russian and international counsel before, not after, money moves.

Where special economic zones fit instead

If the objective is production, processing or logistics, the relevant instrument is a SEZ, not the EEZ. A SEZ is established by federal law, has a management company, and grants residents benefits that typically include customs relief, property tax relief and reduced profit tax. The headline corporate profit tax in Russia is 25%, while special regimes can apply a rate in the 0-5% range, and the standard VAT rate is 22% from 1 January 2026 - rates and conditions change, so they must be confirmed with an adviser for the specific zone and activity.

Russian SEZs come in several functional types, including industrial-production, technology-innovative, tourist-recreational and port zones. What a resident may do inside them is defined by the agreement with the management company and by the zone type. The key test is that the physical production or service must take place on the zone's territory; a shell entity with no operations does not qualify.

Beyond classic SEZs there are adjacent regimes worth comparing: the Free Port of Vladivostok, the Arctic Zone, special administrative regions used mainly for redomiciling holding companies, and special investment contracts that lock in incentives for long-term industrial projects.

• Free Port of Vladivostok: 2,130 projects (KRDV, 2026)
• Arctic Zone: 1,000 residents with ₽1.1T declared (KRDV, December 2025)
• Special administrative regions: 674 companies (Ministry of Economic Development, 2025)
• Special investment contracts: 90 contracts, ₽2T+ of investment (Government of Russia, 2025)

Where the Arctic and Far East bring the two concepts together

Arctic and Far East projects are where investors most often assume the offshore zone and the onshore regime are one package. They are not. The Arctic Zone and the Free Port of Vladivostok are onshore regimes with residents and agreements. The adjacent EEZ is where resource rights are licensed separately.

Navigation along the Northern Sea Route runs through Russian internal waters, the territorial sea and the EEZ, and is subject to Russian rules on notification, icebreaker escort and permits. A shipping or logistics project therefore needs both a maritime compliance track and, if it has a shore base, a territorial regime track.

In practice, the choice of regime follows the physical asset. A processing plant, a port terminal or a shipyard is a land asset and belongs in an onshore regime. A fishing quota, a subsoil licence or a research permit is a resource right and follows the EEZ and licensing rules.

Land and border restrictions that catch investors out

Several coastal restrictions have nothing to do with the EEZ but affect the same projects. Foreigners cannot own agricultural land in Russia; it can only be leased, for up to 49 years. Border areas, including Sochi, Anapa, Gelendzhik and Novorossiysk, are closed to foreign land ownership. This is a land-law rule, not a maritime one, but it regularly blocks plans for coastal facilities.

Investors should also separate the question of owning a Russian asset from the question of getting money back out. Sanctions and counter-measures mean that payments, repatriation and exit transactions need an independent compliance review, and the answer can differ by investor nationality, sector and the bank involved. Nothing in this article should be read as guidance on avoiding those rules.

A practical sequence before committing capital

Work in this order, and stop if any step fails.

• Establish which zone you are actually dealing with: maritime resource rights (EEZ, shelf, territorial sea) or an onshore regime (SEZ, Free Port, Arctic Zone, SAR, special investment contract)
• Identify the issuing authority for the specific right or residency agreement, and confirm whether government approval under Law 57-FZ applies to your sector
• Confirm the investor's classification and the resulting payment, account and approval requirements with independent counsel
• Check land-law eligibility separately if the project needs coastal or agricultural land
• Model the tax position on current rates and get written confirmation - profit tax, VAT and regime benefits are subject to change
• Budget time and cost for environmental, fisheries and navigation approvals if any activity touches the water

The short version

Russia's exclusive economic zone is a maritime resource zone, and it is not an investment regime. You cannot register a business there, and land ownership does not exist there. Access is granted as licences, quotas, permits and concessions, usually through a Russian entity. Russian special economic zones and the adjacent territorial regimes are onshore instruments where residency, tax rates and contracts with state bodies are the real subject. Investors who keep the two tracks separate, and who verify current rules with qualified advisers, avoid the most expensive category of mistake in this area.

This article is general information only and is not investment, legal or tax advice.

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