Russia: Interest payment on Russian Government (OFZ) and Russian corporate bonds
Clearstream Banking1 informs customers that on 23 December 2022, the Board of Directors of the Central Bank of the Russian Federation published a decision about establishing requirements for the distribution of interest paid on Russian Government (OFZ) and Russian corporate bonds to the accounts of Foreign Nominee Holders (FNH), such as Clearstream Banking, held with National Securities Depository (NSD).
Pursuant to the Resolution, the payment of interest on Russian issuers’ bonds held in FNH accounts will be carried out in a different manner to the procedure established by paragraphs 4 and 5 of Article 8.7 of Federal Law No. 39-FZ dated 22 April 22, 1996 “On the Securities Market” and in accordance with the Russian Presidential Decree No. 95.
In order to pay the proceeds, the NSD must be provided with information about the legal entity or beneficial owner entitled to receive the proceeds in respect of securities whose rights are recorded in the FNH account, as well as information in the form of documents required for withholding tax purposes.
Customers may have the possibility to receive the payment of proceeds to their own Type C account opened with NSD or with a local Ruble cash correspondent bank; by default, the proceeds will be made to the C type account in the name of Clearstream Banking at NSD and reflected on a Sundry account in Clearstream Banking’s books.
Following the announcement by NSD, customers have a period of 70 Calendar Days (CDs) to instruct Clearstream Banking via the "Disclosure Template NSD" (attached below), three (3) CDs after the 70 CDs window, another 30 CDs window will be opened to allow customers to contact NSD directly; payment will be made, accordingly to information received by NSD, 150 CDs after the original announcement.
The customer must provide the relevant tax and supporting documentation directly to NSD at the following address:
National Securities Depository
Spartakovskaya Street 12
105066 MOSCOW
RUSSIA
The full list of the required information can be found on the NSD website.
Impact on customers
Upon receipt of notification from NSD, Clearstream Banking will send Swift MT564 notifications to the holders of Russian Government (OFZ) and Russian corporate bonds.
This announcement does not represent a legally binding description of the process set up by the Central Bank of Russia and cannot be relied upon as such. Customers may wish to seek independent legal advice on the interpretation of the above process.
Clearstream Banking shall not be liable, and customers electing to follow the above process shall bear sole responsibility, for any and all harmful consequences, losses or damages, which may be suffered by customers or the beneficial owner in connection with the above process.
Clearstream Banking requests customers electing to follow the above process to always make an appropriate determination that such process falls within the permitted activities and is in compliance with all applicable sanctions, including those of the EU, the United Nations, the United Kingdom and the United States.
Further information
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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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.