ANNOUNCEMENT 22 Feb 2013In February 2013, the government of the Russian Federation announced changed rules for foreign investors.
NUMBER OF INTERVENTIONS
, , http://www.kremlin.ru/acts/17683
State Duma vote results, http://vote.duma.gov.ru/vote/79424
Law 116616-6, On amendments to some legislative acts of the Russian Federation (in particular, on the question of banning the opening of branches of foreign banks), http://asozd2.duma.gov.ru/main.nsf/%28Spravka%29?OpenAgent&RN=116616-6&02
"Russian business newspaper" 858 (29), http://www.rg.ru/2012/08/07/banki.html
On February 22, 2013, the State Duma, the Lower House of the Russian Parliament, approved amendments to the Federal Laws 'On banks and bank activity', "On the Central Bank of Russia", "On currency regulation and currency control". The amendments deprive foreign banks of the possibility to open a branch on the territory of the Russian Federation. On March 6, 2013, the changes were also approvedby the Federation Council, the Upper House of the Russian Parliament. Finally, on March 14, 2013, the President of the Russian Federation signed the amendments into Federal Law FZ Nr. 29.
Before these changes, bank subsidiaries (so-called daughter banks) of foreign banks, branches and representative offices of foreign banks were permitted to operate in Russia. However, unlike daughter banks, branches of foreign banks do not fall under the jurisdiction of the Russian Federation, and are therefore not supervised by Russian financial regulators. For example, they are not required to provide monthly reports to the Central Bank. In addition, they are not obliged to transfer resources to compulsory funds, which are supervised by the Bank of Russia in line with two accounting systems - the Russian and the international.
According to the Russian business newspaper, Issue 858 (29), three of the 10 largest Russian banks are subsidiaries of foreign banks: UniCredit Bank, Raiffeisen Bank and Rosbank. However, up to now,there are no registered branches of foreign banks on the territory of the Russian Federation.