On 2 May 2017 the Central Bank of Russia published a Directive1 in which it defined limits for application of the Corporate Laws on interested-party transactions2. The limits are taken into account when the price or book value of the transaction does not exceed 0.1% of the book value of the company's assets. Book value of assets is determined according to the company's accounting (financial) statements as of the last reporting date.
Depending on the book value of the assets, the following limits are set:
RUB 20 million for an asset value not exceeding RUB 25
billion;
RUB 50 million for an asset value from RUB 25 billion to RUB 100
billion;
RUB 500 million for an asset value from RUB 100 billion to RUB 1
trillion;
RUB 1 billion for an asset value from RUB 1 trillion to RUB 2
trillion;
RUB 2 billion for an asset value exceeding 2 trillion.
If a transaction price does not exceed 0.1% of book value of the company's assets and the mentioned limits, the transaction is not subject to the provisions of the Corporate Laws on interested-party transactions.
The Directive comes into force on 13 May 2017, 10 days from the date of its official publication.
Footnotes
1. Directive No.4335-U of the Central Bank of the Russian Federation "On Setting Limits for Transactions of Joint-Stock Companies and Limited Liability Companies for the Purposes of Considering Them Interested-Party Transactions" dated 31 March 2017.
2. Article 81(2)(12) of Federal Law No.208-FZ "On Joint-Stock Companies" dated 26 December 1995 (as amended), Article 45(7)(11) of Federal Law No.14-FZ "On Limited Liability Companies" dated 8 February 1998 (as amended).
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