25 Jul 2023 09:38

Russia to get "super pre-emptive right" to buy out foreigners' shares in strategic cos - draft decree

MOSCOW. July 25 (Interfax) - The Russian authorities have drafted a presidential decree that will give the government a "super pre-emptive right" to buy out shares in strategic companies from foreigners leaving the Russian market, meaning it will get priority over the pre-emptive rights of other parties.

"The pre-emptive right of the Russian Federation to acquire shares is exercised regardless of other parties having a pre-emptive right," the draft decree states, a source familiar with the document told Interfax.

The government will have this right as regards shares in companies included in the list of strategic enterprises and strategic joint-stock companies approved by presidential decree No. 1009, as well as joint-stock companies shares in which are owned by the federal government (determined by the government), the draft decree states.

Amendments will be made to presidential decree No. 520 of August 5, 2022, "On special economic measures in the finance and fuel and energy sectors in connection with the unfriendly actions of certain foreign states and international organizations."

A meeting was held this past April on the strategy for working with the assets of foreign investors and improving regulation of transactions between residents and nonresidents. The presidential instructions that emerged from this meeting, a list of which was signed in early June, included one to work out an arrangement by July 15 to give Russia, in the person of the Federal Property Agency, the pre-emptive right to buy out foreign assets that are being sold "at a significant discount for subsequent sale at a market price and transfer of proceeds to the federal budget."

The Finance Ministry confirmed to Interfax earlier that the draft decree had been prepared and said it was going through the approval process in the government.