A Memorandum of Understanding has been signed between the Russian Federal Service on Financial Markets and the Commission for Regulation of the Securities Market of the People’s Republic of China. The Memorandum will allow the admittance of Chinese issuers’ securities to placement and circulation in the Russian Federation.

Under Russian law, the securities of a foreign issuer (including global depositary receipts) may be placed and/or publicly traded in Russia only if permitted by: (i) an international treaty between the Russian Federation and the issuer’s country of incorporation; or (ii) an agreement between the Russian securities market regulator, the Federal Service on Financial Markets (the FSFM), and the regulatory authority of the issuer’s country of incorporation.

On 8 August 2008, during a visit by the head of the FSFM Mr Milovidov to China, a Memorandum of Understanding was signed between the FSFM and the Commission for Regulation of the Securities Market of the People’s Republic of China.

According to Mr Milovidov, the Memorandum will allow the FSFM to admit the securities of Chinese issuers to placement and circulation in the Russian Federation.

At the end of 2007 the FSFM entered into similar agreements with the Ministry of Finance of the Republic of Belarus and the securities regulator in Brazil. Under Russian law, entry into inter-governmental treaties with other countries’ governmental authorities is subject to prior approval by the Russian Ministry of Foreign Affairs.

We understand that the treaty with the Belorussian regulator has received such an approval, unlike the Brazilian one. As for the Chinese treaty, no information in this regard is available to us from the FSFM yet. Such treaties are not usually published, and information on whether all prescribed procedures were followed when entering into such treaties is not usually publicly available. Therefore we cannot confirm with certainty if these treaties have come into force.

Under Russian securities laws, securities of foreign issuers must be registered with the FSFM in order to be placed or publicly traded in Russia. Current law does not provide for any exemptions for foreign issuers from the registration requirement, as well as for any special requirements or dispensations as to the documents to be filed by foreign issuers for the purposes of such registration.

The State Duma is currently considering a draft law concerning amendments to the Securities Market Law, which provides for a detailed description of the procedure of admitting foreign securities to placement and/or public trading in Russia.