OREANDA-NEWS. August 25, 2011. Bashneft's Board of Directors, at its session held on 22 July 2011, approved a dividend policy for JSOC Bashneft.

The Regulation On the Dividend Policy of JSOC  Bashneft was developed in accordance with Russian law, the Company’s Charter and other internal Company documents. The Regulation establishes basic guidelines for the Board of Directors in developing its recommendations on the size of dividends to be paid on the Company’s shares as well as the method and form of their payment.

"JSOC  Bashneft is committed to balancing its interests and defending the rights of all shareholder groups, said Alexander Goncharuk, Chairman of the Board of Directors. The Regulation on Dividend Policy establishes the basic mechanisms for decision-making in this regard and ensures transparency, which raises the level of corporate governance."

In accordance with the Regulation, the decision of whether or not to pay dividends and the size of dividend payments, which is based on the results of the fiscal year, is made by the General Meeting of Shareholders, taking into account the Board of Directors’ recommendations. The proposed size of the dividend payments is determined by the Board of Directors based on the Company’s financial results (providing the Company has earned a net profit) for the first quarter, half-year, nine months or fiscal year. Generally, the amount is at least 10% of the Company’s net profit belonging to the parent company’s shareholders for the most recent reporting period under IFRS. The Company's net profit belonging to the parent company’s shareholders is determined on the basis of the Company’s consolidated financial statements for the relevant period, prepared in accordance with IFRS.

The size of dividends per preferred Type-A share shall amount to not less that 10% of the nominal value of one such share and that the size of the dividends paid per preferred share shall be not less than the size of the dividend paid per common share.

Dividend payments, as a rule, are made in cash. In accordance with current legislation and the Company Charter, the Company pays dividends during 60 calendar days from the date on which the General Meeting of Shareholders adopted the decision to pay dividends, while no shareholder shall have an advantage regarding the term of payment.