The Federal Law “On the Securities Market” was amended with a new institute of collective management and control - general meeting of bondholders.
The law updated and signed by the Russian President Vladimir Putin, will come into force 01 July 2014 (except for several items). It establishes general requirements for the preparation, convocation and conduct of bondholders meeting and contains requirements for the representatives of bondholders, determines their rights and obligations, procedure of representatives’ replacement, responsibility before bondholders etc.
Furthermore, the law sets a procedure of early redemption of bonds at the discretion of issuers as well as at the request of bondholders. If the terms of issue provide that early redemption at the request of bondholders, the latter is executed with respect to the entire amount of the bonds submitted for the redemption; such amount cannot exceed 25 per cent of the entire bonds issue.
Impact on investors:
The amended law will contribute to protect the rights and the interests of the bondholders.