Information disclosure by issuers: new Bank of Russia rules
Information indispensable for investment decisions, which is disclosed at the time securities are issued and as part of regular reports, will now be presented through IFRS-based reporting. Any non-essential, redundant or duplicate data will remain unpublished. The new Вank of Russia regulation governing information disclosure by issuers sets out conditions enabling a transition to information disclosure by an issuer group on a consolidated basis.
Under the new rules, the composition and structure of information in a prospectus and an issuer’s report are patterned on international standards. Issuers will use IFRS to calculate financial results and provide an analysis of impactful changes affecting financial and business performance — just like MD&A (management discussion and analysis). The critical information, including business and financial performance and data on key counterparties, is subject to consolidated disclosure on a group basis; an issuer retaining the solo mode of disclosure shall provide the relevant reasons.
The new rules rescind requirements for disclosure in an issuer’s report of information which is non-essential for investors; the list of corporate events to be reported in a news bulletin has been reduced by almost a third; duplicate cases of information disclosure in several forms have been eliminated. These changes will reduce issuers’ regulatory burden without detriment to transparency of the investment process.
Once issuers have switched to IFRS-based information disclosure rules, an issuer’s report and a list of affiliated persons shall be subject to disclosure every six months.
The new disclosure procedures are effective from 1 October 2021: issuers have sufficient time until this date to make relevant adjustments in their corporate information systems.