The Russian State Duma published a draft law which proposes to introduce a new type of issued debt security called structured receipts.
Among others, the draft law proposes the following main features for the new instrument:
A structured receipt will be an issued debt security. This instrument will be similar to bonds in terms of placement, circulation and redemption of the receipts, as well as disclosure and provision of information on them. The main difference of the instrument is that the nominal value is not supposed to be fixed, but rather it is dependent on the market value of an underlying asset;
An owner of such a receipt will receive its par value and/or other income upon the occurrence of certain events determined in the prospectus of issue.
Within the current draft the structured receipts are allowed to be distributed between qualified investors only. The draft law doesn`t contain specific strict requirements to distinguish which financial instruments can be used as underlying assets. The specialised structured products companies, introduced by the draft law, will be allowed to issue structured receipts together with brokers, dealers and credit organisations.
The draft is subject to change and needs to be adopted by the State Duma, the Federal Council and signed by the President before entering into force.