New investments in Russia may soon be possible via type 'In'-accounts
On July 1, 2025, Decree 436 of the President of the Russian Federation was published (http://actual.pravo.gov.ru/content/content.html#pnum=0001202507010017), which establishes guarantees for new investments by foreign residents in the Russian Federation. The Decree provides for the possibility of foreign investors, including unfriendly investors, to acquire the following securities during the initial placement, as well as on the stock exchange (based on non-addressed applications [not over-the-counter]):
- Shares of Russian legal entities
- OFZ
- Bonds of Russian issuers
- Investment units of Russian mutual investment funds
The provisions of the Decree also establish the possibility for foreign investors to receive income on such securities (and subsequently withdraw them outside the Russian Federation in foreign currency), as well as to conclude agreements that are derivative financial instruments and place deposits in Russian credit institutions. The specified operations with funds newly invested in the Russian circuit are carried out without the restrictions stipulated by the Russian counter-sanction Decrees of the President of the Russian Federation (such as Decree 81 which prohibits the buying or selling shares in Russian companies for entities from 'unfriendly states').
New investments and return of income from such investments are carried out using a new type of account, which is called an "In" account (both bank and brokerage accounts, as well as depository accounts, can be "In" accounts). In the coming month, the Bank of Russia should establish a regime for such accounts.
An important aspect is that the implementation of the Decree is significantly hampered by Western sanctions. Thus, US persons will not be able to use this procedure at all due to a complete ban on new investments in the Russian economy (Section 1(a)(i) of E.O. 14071) and sanctions against the Russian registrars that maintain the shareholder register. Sanctions against Russian financial organizations by the US and EU, including NSD, also pose significant obstacles. On the other hand, the Decree provides for the possibility of unfriendly residents making direct investments in the Russian economy, for example, through the acquisition of investment units of mutual investment funds, joint-stock companies, or bonds of Russian issuers during the initial placement and the company's share register (bypassing NSD).
It will be interesting to see if the NSD and the MOEX will establish commission free trading to make investments more accessible for EU entities. EU entities are still faced with sectoral sanctions which generally prohibit new investments in the energy, mining and quarrying sector (Article 3a of Reg. (EU) 833/2014).