Frozen assets are selected for an exchange plan – Kommersant FM

The Ministry of Finance expects to begin the exchange of frozen assets before the end of the year. Moreover, the transactions will take place voluntarily, the state will create conditions for this at the legislative level, said the director of one of the departments of the department, Ivan Chebeskov. The Ministry of Finance proposed such a scheme at the end of August. However, it did not specify how the mechanism would look in practice. It is only known that at the first stage, the authorities hope to unlock the assets of Russians in the amount of 100 billion rubles. And we are talking about securities of investors with small portfolios.

Is there a chance to arrange an exchange? And on what terms? Kommersant FM discussed this issue with the managing director of the Ivolga Capital investment company Dmitry Alexandrov:

“Let’s say some unfriendly non-resident owned Sberbank shares and received dividends, which are now frozen in type C accounts, and there are ruble balances there. In parallel, a retail investor could own shares in, for example, Apple. It is proposed to exchange frozen Apple shares for frozen rubles. As a result of such an exchange, a Russian retail investor will simply receive a cash, while a foreign investor will receive a security and theoretically be able to unlock it, transfer it, for example, to another depository located outside of Russia, or otherwise cash out.

How can this scheme really work in our current conditions? It is the most optimal achievable. It is difficult to imagine a situation in which type “C” accounts will simply be unblocked. This will undoubtedly lead to the collapse of the ruble and to additional withdrawals of funds from Russia, which is now unacceptable.

Unblocking now also has a single character, they require serious investments in lawyers, in the conduct of trials in the European Union, and this, of course, is not available to a mass investor. There is hope that such an exchange can indeed become voluntary, and not forced by unfriendly non-residents, because there are no other alternatives, how to withdraw assets and money from your C-type accounts.”

The Central Bank promised that the Russians would exit assets not at a discount, but even at a premium. However, the Central Bank warned that the transactions will only be possible if foreigners receive permission from their own regulators. The European authorities, in turn, said that they had not heard anything about the plans of the Ministry of Finance and had not received any proposals from Moscow. Given these facts, the process of exchanging papers may be delayed, says Alexander Nektorov, partner at the Nektorov, Saveliev and Partners law firm:

“As for the timing of the implementation of the voluntary exchange process, it may be long. In addition to the desire of the two parties to implement it, the approval of both the Russian and foreign regulators is necessary.

In order to make a transaction on the exchange of blocked assets, either a license from the Treasury of Belgium, or the Ministry of Finance of Luxembourg, or the Federal Bank of Germany is required. I do not think that this mechanism will solve the problems of all blocked investors, because there are much more frozen Russian assets abroad than foreign ones in Russia.”

In the meantime, the EU is planning to discuss a tax on profits from frozen Russian assets, Bloomberg learned. It is expected that securities and deposits will bring about €3 billion in income. The money is planned to be used for the restoration of Ukraine.

EU lawyers, judging by media reports, recognized such a scheme as legal, but it still worries officials in some eurozone countries. According to them, the introduction of the tax may cause concerns among states that keep reserves in euros.

Ivan Khorushevsky