21 December 2012, the State Duma of the Russian Federation adopted in the third and final reading the 418463-5 draft law «On amendments to certain legislative acts of the Russian Federation and the annulment of certain provisions of legislative acts of the Russian Federation» (hereinafter referred to as the «Law on liberalization of financial market»).
The Law on liberalization of financial market provides for the following:
-changing the order of the Central Bank’s supervision over 20 percent stake acquisition in the banks’ share capital (in particular, a procedure for subsequent approval of the acquisition of such shares within the public offering is introduced);
- simplification of the securities issue procedure as follows:
reducing the terms for exercising pre-emptive right during a shares public offering,
easing the securities registration procedure, including introduction of the possibility of obtaining a prospectus preliminarily approval by the FSFM (in the latter case, the FSFM is to give its final approval of the prospectus within 10 days after its submission date),
lifting of restrictions with respect to companies’ bond issuance, including the limitation of the exchange bonds maturity terms, as well as simplification of procedures for admission to public placement of foreign securities in Russia and issue of Russian depositary receipts; the complete list of the countries which companies and public authorities are eligible for placing their securities in Russia is significantly expanded,
- changing the regulation regarding preferred shares and convertible securities and introduction of specific provisions regulating the issue of bonds repaid by the company's shares;
- establishes the procedure for delisting of shares and protection of minority shareholders in case of delisting;
- specifies the disclosure requirements in the prospectus and suggests the possibility of registration of the securities programs prospectuses requiring the disclosure of the basic part of the prospectus (base prospectus) followed by the disclosure of supplementary parts, containing information related to particular issuance terms.
In addition, the Law on liberalization of financial market addresses a number of issues such as the matters related to the federal bonds (OFZ) and Russian corporate securities OTC circulation in the foreign accounting systems, such as Euroclear, supposedly starting in the very beginning of the next year.
The partners of Legal Capital Partners Michael Malinovsky and Yury Tuktarov have written an article on the basis of the adopted in the first reading draft of the law, which was published in Cbonds Review of June 2012.
A more detailed review of some provisions of the Law shall be prepared by our lawyers following the signing of the law by the President.