On 19 July 2016, the Bank of Russia’s Regulation No. 546-P dated 1 June 2016 came into force. This document establishes a list of corporate information submitted by issuers to National Settlement Depository (NSD), Russia’s central securities depository, and regulates the procedure and deadlines for submitting the information.
This Regulation introduces a new implementation phase for corporate actions reform by assigning the functions of the corporate information center (CIC) to NSD.
Pursuant to the Regulation, issuers shall submit information related to exercising rights to securities to the central securities depository in the following cases:
- If a CSD nominee account is opened with the register of holders of securitues;
- If the CSD is an entity carrying out centralized mandatory safekeeping of an issuer’s bonds.
The new Regulation establishes key parameters for interactions between issuers and NSD as part of this process. In accordance with the document, data on shares and registered bonds can be sent by issuers to the CSD via their registrars. However, information on documentary bearer bonds with centralized mandatory safekeeping shall be submitted by issuers directly to NSD. The information interchange should be held electronically.
Eddie Astanin, Chairman of the Executive Board, NSD, stressed the importance of the CIC for Russia’s financial market: “By gradually creating an attractive investment infrastructure, we have done a great job and formed a single source of corporate data with “golden copy” status. Legal and technological solutions that made it possible to build the CIC are far from being available in all jurisdictions. Strategically, this is a brand new level of Russia’s transparency, reliability, and competitiveness in global competition on capital markets.”
It should be noted that on 1 July 2016 the new law stipulating key provisions of the corporate actions reform went into effect. In particular, NSD was assigned the status of a single source of official information on corporate actions taking priority over any other data. This will solve the problem of multiplicity and inconsistency in corporate actions data, and reduce security market participants’ labor costs and expenses for monitoring and checking information received from multiple sources.