Streamlining securities issuance: Bank of Russia consultation paper
The Bank of Russia intends to streamline the admission of securities to trading, remaining only in charge of the registration of assets that may be risky for a wide range of investors. The initiatives are presented in the consultation paper. This approach will help companies enter the capital market and cut the cost and time of securities issuance. The disclosure requirements for issuers and investor protection guarantees will remain applicable.
The Bank of Russia will streamline the issuance procedures based on the status of an issuer (public or non-public), the category of target investors (qualified or non-qualified), the volume of issues, the par value of securities, and other factors. Specifically, the regulator proposes to exempt share issues of non-public joint-stock companies with no more than 50 shareholders from registration, while maintaining such companies’ obligation to have their securities recorded by a registrar. In addition, it is proposed to cut the period when shareholders may exercise their pre-emption rights to additional shares from 45 days to 15 business days. This will give issuers more flexibility and speed in raising capital when market conditions are favourable.
As for bonds, there will be changes with respect to plain vanilla instruments, i.e. bonds with fixed income (par plus coupon), fixed maturities, and subject to the centralised recordkeeping of ownership rights. Issuers will not have to register either issues or prospectuses of such bonds if the amount of borrowings does not exceed ₽3 billion
a year. Exchanges will be responsible for verifying compliance when admitting bonds to trading.
The regulator may delegate the registration of exchange- and OTC-traded structured bonds to exchanges and the central depository, respectively, provided that the bond issuance parameters are standardised, including the type of an underlying asset, income composition, and payment procedures. The regulator will be in charge of registering only issues with more complicated terms beyond the set templates. Alternatively, the regulator considers abandoning the registration of the issues of such instruments. In this case, exchanges will be responsible for verifying compliance when admitting securities to trading. Moreover, the Bank of Russia is prepared to eliminate the registration requirement for bonds intended for qualified investors if the bonds’ par value exceeds ₽3 million.
The Bank of Russia welcomes answers to the questions raised in the consultation paper as well as comments and suggestions through 31 March 2026.