Following a meeting on economic issues held on April 11, the President of the Russian Federation instructed the Government of the Russian Federation and the Central Bank of Russia to set a limit of $1 billion per month on the purchase of currency by companies that have sold their business in Russia. The deadline for the execution of the instruction by the Government of the Russian Federation is June 1, 2023.
This decision was made to strengthen economic stability in the country and protect the national currency. According to the Chairman of the Central Bank of Russia, Elvira Nabiullina, the establishment of the limit may help reduce the volatility of the ruble.
In accordance with the instruction, the restriction applies to cases where funds are used "to carry out transactions based on permits issued by the Government Commission on Control over Foreign Investment Implementation."
Now foreign companies will not be able to quickly withdraw large sums abroad, which can help prevent economic upheavals in Russia. If the limit is maximum, foreign investors will be able to withdraw $12 billion per year. One of the requirements of the government commission is a discount of no less than 50% of the market value when selling a business. That is, in a year, funds from the sale of a business worth at least $24 billion can be withdrawn.
Nadmitov, Ivanov & Partners Law Firm advises on obtaining permission from the Government Commission on Monitoring Foreign Investment.
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