Russia: Update on current situation on DR conversions with Russian underlying shares
Note: This announcement is linked with the previous announcement A22079 published on DR conversions on 28 July 2022.
Clearstream Banking1 informs customers that clarification from the relevant competent authorities has been received with regard to depository receipt (DR) conversion. As a result, Clearstream Banking will resume DR conversion instruction processing of programmes for which the DR agent’s books are opened for cancellation.
Furthermore, the National Settlement Depository (NSD) released an announcement that no fees will be charged for the services of transferring Russian shares to or from custody accounts of DR agents. The fee waiver period is valid until 31 December 2022.
Impact on customers
Clearstream Banking will resume the processing of DR conversion instructions on 7 October 2022 for those DR programmes where DR agents are supporting the conversion and have their books open for cancellation.
Since some of these programmes are theoretically terminated as per their original termination date, in order to avoid any confusion, Clearstream Banking will announce new corporate action events to the holders of all applicable DRs for which the conversion is possible.
Also, provided that the forced conversion – as described in Announcement A22107 of 18 August 2022 - may still apply in parallel to DR holders with accounts at non-Russian custodians who are unable to convert DRs, Clearstream Banking keeps suspending the settlement of all DRs with Russian underlying shares until further notice in order to ensure that the DRs remain on the customer accounts until they are removed for mark down or delivery to the DR agents.
Customers holding Depository Receipts on CBF’s direct settlement DTCC, New York, remain unable to process DR conversions for the reasons communicated in Announcement D22051. Arrangements to enable customers to deliver holdings of Depository Receipts in order to convert them outside Clearstream Banking are under consideration.
Clearstream Banking requests customers to always make an appropriate determination that any action or instruction falls within the permitted activities and is in compliance with all applicable sanctions, including those of the EU, United Kingdom and the U.S.A.
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany, and registered in Register B of the Amtsgericht Frankfurt am Main, Germany, under number HRB 7500.