Core Viewpoint - Chinese companies are increasingly entering the Russian market following the withdrawal of Western firms due to the Ukraine conflict, but new tax regulations may pose significant challenges for these businesses [1][3]. Group 1: Market Entry and Investment - After the outbreak of the Russia-Ukraine war, many Western companies exited the Russian market, creating opportunities for Chinese firms across various sectors such as automotive, appliances, energy, and finance [1]. - By mid-2024, over 3,700 Chinese companies were registered in Russia, accounting for 22% of all foreign enterprises, second only to Belarus [5]. Group 2: New Tax Regulations - The Russian Ministry of Finance proposed a new tax law, effective January 1, 2026, which mandates a minimum corporate tax rate of 15% for foreign companies with subsidiaries in Russia generating over €7.5 million in revenue [3]. - This new regulation aims to prevent profit shifting to other countries through various fees, thereby increasing operational costs for Chinese companies in Russia [3][7]. Group 3: Implications for Chinese Companies - The new tax law is expected to disproportionately affect larger Chinese firms, such as Haier and Geely, which have significant operations in Russia [5]. - The situation is likened to the "farmer and snake" fable, where Chinese companies, initially welcomed for their investments, may now find themselves at a disadvantage due to changing regulations and increased tax burdens [7].