Economically significant organizations will be allowed not to disclose information on their activities

Russian President has signed a decree allowing economically significant organizations not to disclose certain information, the disclosure of which is mandatory under a number of regulations, such as laws on joint stock companies, limited liability companies, banks, consolidated financial statements, etc. Also, persons who have taken direct ownership of shares or stakes in such companies, as well as judicially created companies to which the management of economically significant organizations has been transferred instead of foreign holding companies, are exempted from the obligation to disclose information.

Despite the fact that publication of a number of data in respect of economically significant organizations is now not mandatory, this information must nevertheless be provided at the request of federal executive authorities.

Economically significant organizations appeared in the Russian legislation in summer 2023, and the Russian Government is entitled to form a list of such companies (although such a list has not yet been published). A company may be recognized as economically significant if it reaches threshold values of revenue, assets, taxes paid or number of employees. A number of other legal entities, such as companies that implement technologies and software for publicly important services and services, systemically important credit organizations and their parent structures, city-forming enterprises and critical information infrastructure entities, may also obtain such status. At the end of 2023, this list was expanded to include securities market participants – management companies that manage assets of at least 300,000 clients worth more than RUB 400 billion, and organizations whose services are used by more than 2 million people.

Russian beneficiaries of economically significant organizations, owning them through foreign holding structures, by the court order may acquire their shares and stakes in them in direct possession, as well as to receive dividends directly.

Source: Decree of the President of the Russian Federation from January 27, 2024 Nu. 73 "On Temporary Procedure for Disclosure and Provision of Information by Business Companies that are Economically Significant Organizations and Certain Related Persons"