By Blake Marshall, Senior Vice President & Managing Director - Government Relations, The PBN Company, Washington DC

Framework Legislation Takes Shape

The Russian government recently introduced two pieces of long-awaited legislation designed to strengthen Russia’s financial markets by curbing abuses of insider information.

On April 17, the State Duma, the lower chamber of the Russian Parliament, adopted on first reading the draft bill “On Counteracting the Abuse of Insider Information and Market Manipulation” with 316 votes in favor (more than two-thirds of the 450 member Duma).  This first reading adoption follows the bill’s submission by the Russian Government at the end of the Duma’s fall session in December 2008.

If this bill ultimately passes through both chambers and is signed, it would become the first law that addresses the issue of insider information in Russia.  In preparation for nearly a decade, an earlier version of the bill was introduced by a group of Duma deputies in 2000, but was then recalled under the pretext of another pending government initiative on the subject.

On March 4, the Government also introduced into the Duma amendments to the Criminal Code that establish a maximum sentence of seven years in prison for the abuse of insider information.  The first reading of these amendments is scheduled for May 2009.

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