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Bank of Russia recommends how to properly register securities issues

The Bank of Russia has updated its recommendations for issuers to avoid typical errors in securities issue registration. The amended recommendations will help issuers comply with the new law on simplifying the securities issue procedure and the revised securities issue standards.

The document prepared by the regulator provides answers to frequently asked questions, specifically about the cases when an issuer shall submit its securities issue decision; the document stipulating the terms of a securities offering and when it shall be submitted; how to properly specify the information on the rights attached to shares in the decision on their issue; and the aspects that should be the focus of attention where a securities issue decision is made by an issuer’s board of directors.

Furthermore, these recommendations describe typical errors in detailing the procedure for exercising the pre-emptive right to acquire offered shares, and the conditions to be taken into account when public assets are used to pay for shares. The Bank of Russia’s recommendations also list the documents to be submitted when shares are paid for by offsetting money claims to an issuer, and describe how to correctly name the type of a share offering in the case of an issuer’s reorganisation. In addition, the updated recommendations explain when an issuer is not allowed to make any changes to its share issue decision.

The Bank of Russia is continuously streamlining the procedures for securities issue registration by eliminating unreasonable administrative barriers and excluding excessive and duplicate information from issue documents. The objective of these efforts is to expand opportunities to raise investment through securities issue for companies having smaller turnovers, and not only for large businesses. The recommendations proposed are part of these efforts and help companies, especially new issuers, to avoid errors that might delay the registration of their securities issue.

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