Extraterritorial Application of Russian Currency Control RulesExtraterritorial Application of Russian Currency Control Rules

Despite several major changes introduced into the federal law “[o]n currency regulation and currency control” (the Currency Control Law (CCL)) since its adoption in 2003,¹ this law still significantly restricts the ability of Russian nationals who are considered “residents” to use foreign currency as an instrument of payment in their domestic and international commercial transactions, particularly with the use of their bank accounts abroad. Because non-observance of these restrictions could result in the imposition of severe monetary penalties of up to 75 percent to 100 percent of the total amount of the unauthorized transaction,² or even in criminal proceedings,³ U.S. wealth management professionals need to take them into account to avo...