Russian Securities Law

Statutory Foundations

Russian securities law is anchored in Federal Law No. 39-FZ of 22 April 1996 “On the Securities Market” (the “Securities Market Law”), which constitutes the primary legislative framework for the issuance, circulation, and servicing of equity and debt securities. The law defines key concepts including “security” (tsennaya bumaga), “issue-grade security” (emissionnaya tsennaya bumaga), and “public offering.” Supplementary regulation derives from Federal Law No. 208-FZ of 26 December 1995 “On Joint-Stock Companies” (governing corporate governance and shareholder rights) and Federal Law No. 46-FZ of 5 March 1999 “On the Protection of Rights and Lawful Interests of Investors in the Securities Market.”

The Central Bank of Russia as Mega-Regulator

Since the 2013 merger of the Federal Financial Markets Service (FFMS) into the Bank of Russia, the Central Bank of the Russian Federation (CBR or Bank Rossii) has functioned as a unified mega-regulator for the entire financial sector. The CBR’s Securities Market Department oversees registration of prospectuses, licensing of professional participants, enforcement of disclosure obligations, and supervision of exchanges and clearing houses. The CBR also sets eligibility criteria for qualified investors (kvalifitsirovannye investory).

Exchanges: MOEX and SPB

The two principal exchanges are the Moscow Exchange (MOEX) , formed through the 2011 merger of the Moscow Interbank Currency Exchange (MICEX) and the Russian Trading System (RTS), and SPB Exchange (formerly SPB Exchange, now Sanctions-affected). MOEX operates a regulated market (List Level 1 and Level 2, and the Third Tier), each with ascending corporate governance and disclosure requirements. MOEX lists equities, corporate and sovereign bonds (OFZ), derivatives, and structured products. SPB Exchange historically specialised in foreign securities (US-listed equities) but has been significantly impacted by Western sanctions.

Prospectus Registration

The Securities Market Law (Articles 19–28) governs the registration of a prospectus (or its equivalent, depending on the offering structure). A prospectus must be registered with the CBR for any public offering or admission to organised trading unless the offering is addressed solely to qualified investors or falls below the quantitative thresholds (a private placement not requiring state registration). The registered prospectus must contain information on the issuer’s financial condition, management, risk factors, use of proceeds, and terms of the securities. The CBR reviews the prospectus within 30 days. Since 2017, electronic filing through the CBR’s personal cabinet system has been mandatory.

Qualified Investors

Russian law distinguishes between qualified and non-qualified investors, with significant implications for access to offerings. Article 51.2 of the Securities Market Law sets the criteria for recognition as a qualified investor (either by application or by automatic recognition). Qualified investors include (a) professional securities market participants, (b) credit institutions, (c) insurance organisations, (d) non-state pension funds, (e) the Deposit Insurance Agency, (f) joint-stock investment funds, and (g) persons holding assets exceeding RUB 6 million or having relevant professional experience. Issuers may offer securities without prospectus registration to qualified investors only, and certain complex financial instruments (including structured bonds and foreign securities) are available exclusively to qualified investors.

Insider Trading and Market Manipulation

Federal Law No. 224-FZ of 27 July 2010 “On Combating Insider Trading and Market Manipulation” (the “Insider Trading Law”) prohibits insider dealing (using inside information for transactions, advising others, or recommending securities), unlawful disclosure of inside information, and market manipulation. The CBR maintains a list of insiders (including issuers, management companies, exchanges, clearing houses, and rating agencies). Sanctions include administrative fines under the Code of Administrative Offences (CAO) and criminal penalties under Article 185.3 of the Criminal Code of the Russian Federation (market manipulation) and Article 185.6 (illegal use of inside information). Criminal penalties include fines of up to RUB 5 million and imprisonment of up to six years.

Depositary Receipts and Cross-Border Listings

Federal Law No. 310-FZ of 30 December 2015 introduced significant amendments regulating depositary receipts, restricting the issuance of depositary receipts representing shares of Russian issuers, and imposing limits on the ratio of depositary receipts to underlying shares (maximum 25% of total shares). Cross-border listings of Russian issuers were historically common (LSE, NYSE, Deutsche Börse) but have been severely curtailed by post-2022 sanctions and the CBR’s restrictions on foreign securities transactions.

Collective Investment Funds

Russian law recognises three principal collective investment vehicles: mutual investment funds (PIFy – Payevye Investitsionnye Fondy) , regulated under Federal Law No. 156-FZ “On Investment Funds”; non-state pension funds (NPFy) ; and closed-end mutual funds (ZPIF) . PIFs are subdivided into open-end, interval, and closed-end categories. Regulation covers fund authorisation, asset composition and diversification (investment declarations), depositary and custodian arrangements, and net asset value (NAV) calculation. The CBR’s collective investment department supervises compliance.

Disclosure and Corporate Governance

Issuers whose securities are admitted to organised trading must disclose annual and quarterly financial statements (IFRS for public interest entities; RAS for others). Disclosure is made through the CBR’s information disclosure system and, since 2021, through the Interfax accredited news agency network. Corporate governance obligations are set out in the Corporate Governance Code (recommended by the CBR in 2014) and made binding for MOEX Level 1 listings through exchange rules. Key provisions include independent director requirements, audit committee formation, related-party transaction approval by disinterested directors, and dividend policy disclosure.

Sanctions Impact

Since 2022, Russian securities markets have faced unprecedented international sanctions. Many Russian issuers were delisted from Western exchanges; foreign portfolio investors were restricted from trading Russian securities; and the CBR introduced temporary measures including restrictions on non-resident trading, mandatory sale of foreign currency proceeds, and central counterparty interventions. SPB Exchange’s suspension of trading in foreign securities in November 2023 marked a significant contraction of cross-border market access. Domestic MOEX trading in Russian equities and bonds has remained operational, albeit with structural limitations.

Key Legislation Table