Permission from the government commission

The permission of the Government Commission to conduct
transactions in the purchase and sale of shares in the authorized capital of an
LLC, the purchase or sale of shares in a joint stock company or other
transactions affecting the activities of such organizations is regulated by a
special procedure established by presidential decrees. Permission must be
obtained if one of the parties to the transaction is a person from an
unfriendly country.

These decrees approved all transactions for which the
permission of the control commission is required, permits are applied if the
management structure of shares and shares of companies changes (not applicable
to credit and non-credit financial organizations), as well as in real estate
transactions, transfer of payments for intellectual property and with objects
for which permission was previously issued, conducted between:

• Persons of foreign states who commit unfriendly acts.
• Persons of foreign States engaged in hostile acts and foreign persons who are not citizens or legal entities of foreign States engaged in hostile acts.

The list of countries was approved by the Government
of the Russian Federation. It includes large States and territories, including:

• United Kingdom
• Member States of the European Union
• Canada
• United States of America
• Japan, etc.

However, there are exceptions to this rule. In some
cases, you do not need to get permission from the Commission. Exceptions
include:

• Transactions with equity interests in financial companies and non-financial credit institutions
• Organizations in the field of fuel and energy sector (if their final beneficiaries are the Russian Federation, Russian legal entities or individuals, transactions entailing the emergence of ownership rights to securities alienated by individuals who are foreign persons)
• When conducting transactions with foreigners from unfriendly countries under the jurisdiction of Russia
• When making a transaction between resident individuals on a gratuitous basis (both parties are spouses or relatives)
• Transactions with securities with a price equal to 1 ruble (both parties must be spouses or relatives)

To obtain permission, the Commission is provided with
documents from the specified list, to which it is necessary to attach an
application with a full justification of the reasons for the purchase or sale
of shares or shares. The request is sent to the Ministry of Finance of the
Russian Federation through relevant organizations or directly. The package of
documents must contain:

• request for permission to carry out a transaction (operation);
• the identity document of the applicant (individual);
• constituent documents of the applicant (legal entity);
• a document with information about the beneficiaries;
• the resident’s balance sheet and information on the book value of assets as of the last reporting date.
• all information about the transaction
• objectives of the transaction
• terms of the transaction
• information about persons controlling a person from an unfriendly country
• an inventory of the submitted documents

Based on the results, the commission may issue a
permit or refuse to issue it. The reason for the refusal may be a lack of
documents or an error in filling out some forms. The deadline for reviewing
documents for obtaining permission by the Government Commission is not
precisely defined. The process takes a long time, given the variety of
transactions that require permission, but the minimum waiting time will be 2
months.