Amendments to the Law on Securities Market

On October 16, 2018, amendments to the Law on the Securities Market (hereinafter referred to as the “Law”) came into force.

Structural bonds are such bonds that provide for the right of their holders to receive payments on them depending on the occurrence or non-occurrence of one or several of the circumstances listed below:

1. Changes in prices for goods;
2. Changes in prices of securities;
3. Changes in the exchange rate of a certain currency;
4. Changes in interest rates;
5. Changes in the rate of inflation;
6. Changes of the values calculated on the basis of the prices of derivatives (derivative financial instruments);
7. Changes in the values of the indicators constituting the official statistical information;
8. Changes in the values of physical, biological and (or) chemical indicators of the state of the environment;
9. Occurrence of circumstances indicating the failure to perform or improper performance by one or more of the debtors of their duties.
10. Changes of the values calculated on the basis of the above parameters;
11. Other circumstances stipulated by legislation (exclusively at the level of federal laws) or acts of the Central Bank of the Russian Federation (hereinafter referred to as the “Central Bank of the RF”).

The size of payments on a structural bond may be less than its nominal value, but payments on it may not be made.

However, it is necessary to take into account that a structural bond cannot be repaid ahead of time by the issuer at his discretion (the exception is cases independent of the will of the issuer, provided for in the decision to issue structural bonds).

Structural bonds may be issued exclusively by credit organizations, brokers, dealers, specialized financial companies, if the objectives and the subject of their activities include the issuance of structural bonds.

Structural bonds can be purchased only by qualified investors, and the Law stipulates that individuals, who are not qualified investors and acquire structural bonds to be placed may terminate it unilaterally within 10 business days from the date of the conclusion of the contract and demand the return of the deposited funds. Link to service