Russian investors are de facto forbidden to buy any securities abroad. This was reported to Forbes by the Central Bank.
From the statement of the regulator follows that under the presidential decree № 138, published on March 3, all transactions of Russian citizens with residents of the EU or the United States abroad must be approved by the state. However, it is impossible to check the status of sellers of shares and bonds on foreign stock exchanges, the publication writes.
“Transactions <…> with non-residents from ‘unfriendly’ countries, entailing the emergence of ownership of any securities are carried out regardless of the place of registration of such securities <…> on the basis of approvals of the Government Commission”, the Central Bank comment said.
The statement of the regulator confirms the fears of market participants that the presidential decree makes it impossible to trade in securities on western platforms. Foreign brokers and exchanges won’t be able to check whether a counterparty is a citizen of a country “unfriendly” to Russia.
NSP partner Aram Grigoryan confirmed the conclusions of the publication and added that outside of Russia citizens can enter into transactions with foreign assets, but within the country they will be considered invalid.
It is not entirely clear whether the restriction will apply to Russian citizens who have been living outside the country for more than six months, said an interlocutor of Forbes in one of the major management companies. After a Russian citizen has spent more than 183 days abroad, he ceases to be a tax resident and is not required to report on his foreign accounts and the movement of funds in them, he said.
According to the interlocutor of the newspaper, the meaning of the ban is to track the movement of large capitals in OTC transactions. The measure will also tighten the screws on speculators who buy cheap Eurobonds or receipts of Russian companies abroad, and then transfer them to Russia and sell them for high prices.