30 Oct 2023 10:27

New owners of shares bought from foreigners leaving Russia need time to put them on market - CBR

MOSCOW. Oct 30 (Interfax) - The Russian government is requiring public offerings of a portion of shares purchased from foreign investors when they leave the Russian market, but buyers have a year to three years to fulfil this requirement, Central Bank chief Elvira Nabiullina said at a press conference on Friday.

"Such a government commission requirement exists, applies, as far as I know. But why aren't we seeing initial and secondary public offerings? Because a time period is given there, from one year to three, as far as I remember," Nabiullina said.

This time is needed "because when a new owner comes in companies need to prepare corporate governance, the company itself for a public share offering, so a certain amount of time is provided there," she said.

The government commission will monitor compliance with these obligations, she said. "I hope that we will see the fulfillment of these obligations," Nabiullina said.

She was also asked whether the Central Bank might exert influence through administrative measures over companies' corporate governance to protect minority shareholders' rights.

"We see that, due to sanctions, external restrictions, in addition to the closure of information, certain procedures were also eased, including ones related to the protection of minority shareholders' rights, access to information and so on," Nabiullina said.

But administrative levers will not solve this issue, the solution lies more in the legislative establishment of rules, she said.

"The maximum standards that existed, from which we retreated, which were relaxed - bring them back. We can do this in the form of a recommendation," Nabiullina said.

"If these are state companies, the owners can influence corporate governance administratively. We're not owners of companies," she added.