"The regulation will be in force once the Central Depositary law and nominee account regulations for foreign custodians have been legally introduced", he said.

The CD bill may be adopted by the State Duma in second and third readings as early as 21 October. The bill is set to become enacted on 1 January 2012.

FFMS Head added that the regulator has filed the finalized proposal regarding this at the Ministry of Justice.

Today, the limit for Russian company stock to be placed abroad is 25%.

Pankin admits that there is a certain risk that the Russian securities market could migrate abroad. He also stated that leaving current restrictions in place will only increase this risk.

Pankin quoted research data that shows that of the total USD 4bn Russian IPOs in 2011, USD 3bn worth of shares were placed abroad through foreign SPVs. "The market is really migrating, and our job is to offer the best terms to make foreign buyers of our ADRs trade through our depositary system, owning shares directly", he stressed.

Project Group №1, Dmitry Pankin