OREANDA-NEWS. August 05, 2013. The President of the Russian Federation Vladimir Putin signed the Federal Law “On Introducing Amendments to the Law of the Russian Federation “On Commodities Exchanges and Exchange Trading” and Some Legislative Acts of the Russian Federation”.

The Federal Law “On Introducing Amendments to the Law of the Russian Federation “On Commodities Exchanges and Exchange Trading” and Some Legislative Acts of the Russian Federation” was devised by the Federal Antimonopoly Service (FAS Russia) in the first six months of 2012 to introduce administrative liability for avoiding obligations to register off-exchange transactions at commodity exchanges under Article 6 of the Law of the Russian Federation “On Commodities Exchanges and Exchange Trading”.

The new Law adds Clause 4 to Article 6 of the Law “On Commodities Exchanges and Exchange Trading”, which introduced obligation for the parties to off-exchange transactions with exchange commodities, including long-term supply contracts, to submit information to a commodity exchange about such transactions in the cases, and according to the procedures, scope and periods established by the Government of the Russian Federation.

Article 11 of the Federal Law “On Organized Trading” came into force on 1st January 2013. Part 1 of this Law specifies that in the cases, and according to the procedures, scope and periods established by normative legal acts of the Government of the Russian Federation, the parties must submit information about contracts concluded not through organized competitive bidding, when contractual obligations require transferring the rights of ownership for the commodities allowed for organized trading (off-exchange contracts).

Also on 1st January 2013 came into force a new version of Article 14.24 of the Code of the Russian Federation on Administrative Violations. Part 6 introduced administrative liability for breaching by parties to off-exchange contracts the deadlines of submitting information about such contracts, specified in the normative legal acts of Government of the Russian Federation and (or) the deadlines for submitting information about such contracts, including submitting incomplete and (or) incorrect information.

At the same time, administrative liability for failure to submit information about off-exchange contracts was not established.

Thus, the Federal Law “On Introducing Amendments to the Law of the Russian Federation “On Commodities Exchanges and Exchange Trading” and Some Legislative Acts of the Russian Federation” added to Part 6 Article 14.24 of the Code on Administrative Violation liability for the new violation – failure to submit information about off-exchange contracts.

“Adopting the Federal Law that establishes administrative liability for non-registering off-exchange transactions will facilitate developing price indicators for the commodities, for which off-exchange contacts must be registered”, pointed out Deputy Head of FAS Andrey Kashevarov.

Reference:

1. The registration procedures – including entering by commodities exchanges information in a Register of off-exchange transactions with exchange commodities about an off-exchange transaction with exchange commodity, including long-term supply contracts, and the procedures for keeping the Register (an electronic database that contains information about all off-exchange transactions with exchange commodities subject to registration) and providing information from the Register are established by the Regulations on registering off-exchange transactions with exchange commodities by commodities exchange, including long-term supply contracts, аs well as information about keeping the Register of such transactions and providing data from the Register, approved by No.65 Decree of the Government of the Russian Federation of 10th February 2011.

2. The list of exchange commodities, off-exchange transactions with which, including long-term supply contracts, must be registered with commodities exchanges, is approved by No. 167-r Order of the Government of the Russian Federation of 10th February 2011.