Moscow, 11 March, 2024 – Investitsionnaya Palata LLC announces the terms and indicative timeline of the purchase of foreign securities (FS) by non-residents from Russian private investors (also referred to as “sellers” or “owners”) for roubles, including those held on “S”-type accounts. Russian private investors can submit offers through their brokers, trust managers and mutual fund managers beginning from 25 March 2024.

On 2 February, the Government Commission for Monitoring Foreign Investment in the Russian Federation appointed Investitsionnaya Palata as the transaction organiser for the sale of FS held by Russian private investors to non-residents. The purchase transaction will be carried out in accordance with Presidential Decree No. 844 of 8 November 2023.

Russian private investors will be able to submit bids in respect of over 3,500 exchange-traded instruments for sale. The full list of eligible FS is published on the transaction organiser’s website: https://vykupicb.investpalata.ru/.

The purchase transaction consists of four stages.

Stage 1: Submission of offers from Russian private investors

Russian private investors, through their brokers, trust managers and mutual fund managers, submit irrevocable bids to the transaction organiser to sell their blocked FS. The sellers will not be charged a commission or incur other fees.

Russian private investors can offer for purchase FS with a total initial value of up to RUB 100,000. The starting price of each FS will be determined in roubles at the exchange rate of the Central Bank of Russia based on the market price as of close of trading on 22 March 2024. After submitting their offers, Russian private investors will be temporarily unable to dispose of the FS offered for purchase but will retain ownership of the FS.

Stage 2: Division into lots

The transaction organiser will form a pool of securities and divide it into lots of similar composition and value. The transaction organiser will then set the same starting bid for all the lots, which cannot be less than the average value of all the lots.

Stage 3: Collection of bids from potential non-resident buyers

Non-residents submit bids to the transaction organiser to purchase the lots for roubles at a price not lower than the starting bid. Bids can only be withdrawn to increase the bid price.

Stage No. 4: Determining the selling price and bid acceptance

Upon the result of a competitive selection of bids from non-residents, the transaction organiser determines the same final selling price for all the lots, which cannot be lower than the starting bid. Consequently, the final selling price of each FS will not be lower than the starting price of each FS, expressed in roubles at the exchange rate of the Central Bank of Russia as of close of trading on 22 March 2024¹.

If non-residents’ bids are approved, the FS will be credited to their special transit securities accounts, which allow for the purchased FS to be transferred from the Russian depository infrastructure to a foreign depository infrastructure without additional authorisations from the Russian side. Funds paid for the FS will then be transferred to the accounts of the brokers, trust managers and mutual fund managers for further distribution to the Russian private investors.

FS that were not sold as part of the purchase transaction will not be written off their owners’ securities accounts, while the funds of non-residents that were not used in the transaction will be returned to their rouble accounts (including “S”-type accounts). 

 

Indicative timeline of the purchase transaction

DAY	EVENT
11 March 2024   Russian private investors	Announcement of the transaction terms
10.00 Moscow time 25 March 2024	Start of submission period for offers by Russian private investors
19.00 Moscow time 8 May 2024	Deadline for submission period for offers by Russian private investors
Non-residents
10.00 Moscow time 3 June 2024	Start of submission period for bids by non-residents
19.00 Moscow time 5 July 2024	Deadline for submission period for bids by non-residents
Acceptance of Russian private investors’ offers and non-residents’ bids, and settlement
29 July 2024	Acceptance of offers from Russian private investors and bids from non-residents. Settlement procedures

Detailed information about the FS purchase transaction, including the mechanics of lot formation, is described in the Information Memorandum published on the transaction organiser’s website: https://vykupicb.investpalata.ru/.

 

About the Company:

Investitsionnaya Palata was founded in 1993. 

The Company’s main activities are brokerage services for private clients on Moscow Exchange and securities trust management.

Investitsionnaya Palata is one of the largest Russian brokers: as of 1 January 2024, client assets of more than RUB 120 billion are held in its custody.

Media contacts: press@investpalata.ru

 

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