Protection against sanctions for listed companies

In order to reduce external sanctions pressure, a list of information that listed companies have the right not to disclose has been determined.

This list is contained in the Resolution of the Government of the Russian Federation dated 04.04.2019 No. 400 “On specifics of disclosing and providing information to be disclosed and provided, as required by the Federal law “On joint-stock companies” and the Federal law “On the securities market”.

Under the new rules, listed companies will be able to quickly respond to increased sanction pressure and remove their counterparties and partners from the “secondary” sanctions. This is due to the CAATSA law adopted in the USA in 2017, according to which companies from third countries cooperating with entities under sanctions may also be subject to restrictions.

At the same time, listed companies are not exempted from the obligation to disclose this information to the Central Bank of the Russian Federation.

Listed companies has the right not to disclose or disclose to a limited extent the following data:

• management;
• transactions;
• ownership structure;
• shareholders, including minority and majority;
• partners;
• financial investment;
• risks and their assessment;
• corporate disputes;
• counterparties, including their sectoral structure and geography.

Moreover, credit institutions got right not to disclose the data:

• on transactions in foreign currency;
• on distribution of funds in accounts depending on the type of clients;
• on business segments.

Listed companies are allowed not to disclose the mentioned data when:

• information on persons under sanctions may lead to restrictions against the listed company and other persons;
• the company itself is under sanctions;
• the listed company is a bank working with the state defense order;
• details of the transaction, on defense orders or military-technical cooperation are unveiling;
• information relates to company employees under sanctions or a bank serving defense enterprises.