Through Circular C596, CySEC wishes to inform regulated entities of the new Russian Federal Law 319-FZ issued on the 14th of July 2022, affecting the owners of Russian issuers’ securities or persons for whose benefit the securities are held, including local shares, bonds and Eurobonds, which were blocked for transfers by non-Russian custodians due to the European Union Council’s Decisions and Regulations (EU Restrictive Measures) or other international sanctions.
As per the new Russian law 319-FZ, the aforesaid persons could transfer their rights in such securities from an account held with a non-Russian custodian opened with the Russian National Settlement Depository (the ‘NSD’) to an account opened with a Russian custodian (the ‘Forced Transfers’). In addition, as of the 1st of January 2023, the said law was changed to include additional eligible cases for transfers of Russian securities out of foreign custody services providers.
In practice, under these “forced transfers”, the owners of Russian issuers’ securities were able to submit a set of identification and security-holding confirmation documents to the NSD or to Russian investment firms which maintained an account for the Russian issuers’ securities with the non-Russian custodian (e.g. Euroclear, Clearstream or any CIF), effectively transferring the custody of such securities to Russia.
In light to the above, CySEC requests the Regulated Entities with customers that proceeded with ‘Forced Transfers’ to fill in the requested information included in the provided excel file and inform CySEC by Monday, 25th of September 2023 at the latest, using the email address firstname.lastname@example.org .
Lastly, a dedicated FAQ’s section can be found on the NSD website for applications on Forced Transfers under Law 319-FZ.