The Central Bank proposed to triple the initial capitalization ceiling for innovation sector issuers

The Central Bank of the Russian Federation proposed to liberalize one of the conditions that allow classifying the shares of a Russian organization as securities of a high-tech (innovative) sector of the economy, raising the upper threshold of the issuer’s market capitalization by a factor of three during the first week of trading after its shares are included in the list admitted to trading.

„Without diminishing in any way the importance of supporting small and medium-sized businesses, of course, it is important to support fast-growing high-tech companies,” Bank of Russia Governor Elvira Nabiullina said at a meeting of the Council for Strategic Development and National Projects on Monday.

At the same time, such companies, having received support measures from the state, do not always meet the criteria for small business, as well as the criteria that are established for classifying the stock exchange as a sector of the innovation and investment market.

„And here special criteria are needed for such companies in order to extend the already existing support measures to them and, possibly, develop special measures,” Nabiullina believes.

In particular, the head of the Central Bank proposed to increase the upper threshold of the market capitalization of issuers to attribute their shares to the innovation sector from 25 to 75 billion rubles.

The requirement for the upper threshold of capitalization of the company’s shares in the first week of trading on the exchange market is contained in the rules approved by the Government of the Russian Federation No. 156 dated February 22, 2012 for classifying shares and bonds of Russian organizations, as well as investment units circulating on the organized securities market, to securities high-tech (innovative) sector of the economy, to apply a 0% tax rate to the tax base for corporate income tax, determined by income from operations with these securities.

Currently, 20 securities are traded in the innovation and investment market sector of the Moscow Exchange, including shares and depository receipts of Qiwi, Softline Holding, UAC, the Institute of Human Stem Cells, the International Medical Center for Processing and Cryostorage of Biomaterials, ” Pharmsintez” and „Group Pozitiv”.

Steve Walker

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