The president of the Russian Federation has approved the legal framework behind the corporate actions reform in Russia. The changes will take effect from July 1 2016.
The reform was initiated in 2014 by Russia’s CSD and supported by securities market participants.
As a mark of the approval, the President of the Russian Federation signed Federal Law No. 210-FZ “On Making Amendments to Certain Laws of the Russian Federation and Repeal of Some Provisions of Certain Laws of the Russian Federation.”
These amendments apply to the Federal Laws “On the Central Securities Depository”, “On Joint-Stock Companies” and “On the Securities Market”.
These three laws reflect the main aspects of the corporate actions reform.
New provisions established within the approved legal framework include the introduction of a new procedure for exercising security holders’ rights through securities depositories or registrars, and new methods of participation in general meetings.
The new procedures for certain corporate actions mean that associated rights, such as securities redemption and acquisition of securities via the issuing company, can only be exercised via nominee holders.
Communications between the National Securities Depositary CSD, its clients and registrars in relation to these corporate actions, will be handled solely on an electronic basis.
Amendments to methods of participation in general meetings means that E-proxy voting, via the relevant security depository, has now been officially recognised within the law.
E-voting is now also an approved approach to participation.