The process of exchanging blocked assets involves the participation of only brokers and other participants in the securities market, and not the state, the Ministry of Finance explained. A decree allowing the launch of a mechanism for the exchange of frozen assets was signed the day before, on November 8, by Russian President Vladimir Putin.
“The decree of the President of the Russian Federation creates legislative opportunities for the exchange of frozen assets; the state will not participate in organizing the exchange itself. Brokers and other securities market participants will participate in it. The mechanism will be completely voluntary for all market participants,” the press service of the Ministry of Finance reported (quoted by TASS). The department noted that the decree refers to the use of funds from foreign investors in type “C” accounts.
Type “C” accounts accumulate the assets of foreign investors in Russia. Foreigners from unfriendly countries could not withdraw funds from these accounts after February 2022. It is assumed that the exchange with foreigners will take place in the format of bidding, the terms of which will be determined by a government commission. For investors, the transaction will be free, but the volume of assets for such an exchange should not exceed 100 thousand rubles.
According to the Bank of Russia, the total volume of funds in type “C” accounts at the beginning of November 2022 exceeded 280 billion rubles. In June 2023, Interfax wrote that by the end of 2022 the figure was close to 600 billion rubles.
For more information about how the mechanism for returning the frozen funds of Russians will work, see the Kommersant FM article “Investors will take what is theirs.”