On September 1, 2024, a law came into force that allows foreign banks to open branches in Russia. Previously, foreign credit organizations had to open subsidiary banks or representative offices in the country.
Author:
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The State Duma adopted amendments to the law “On Banks and Banking Activities” in the second reading on July 30, 2024. According to the draft, foreign companies can open a branch on the territory of the Russian Federation, with the full name in Russian.
The bank must have a license to conduct banking activities in its country for at least three years and a credit rating not lower than the level established by the Central Bank of the Russian Federation.
In addition, the Central Bank may appoint its representative there. At least half of the employees must be Russian citizens. The branch may open and maintain bank accounts for legal entities, make money transfers on behalf of legal entities and other banking operations.
Moreover, since the purpose of the changes is to develop the international payment system and attract foreign investment, such branches are not allowed to carry out transactions with individuals and sole proprietors. The exceptions are transfers without opening a bank account and the purchase and sale of foreign currency.
As the Bank of Russia clarified, before the bill came into force, foreign banks were required to open subsidiary credit organizations or representative offices to operate in the territory of the Russian Federation.
Other laws that will come into force in early September can be found in the RB article.
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Author:
Akhmed Sadulayev
Source: RB
I am a professional journalist and content creator with extensive experience writing for news websites. I currently work as an author at Gadget Onus, where I specialize in covering hot news topics. My written pieces have been published on some of the biggest media outlets around the world, including The Guardian and BBC News.
