The stock markets integration plan will be discussed with market participants at both exchanges this week.

Section one of MICEX derivatives trading will consist solely of FX derivatives, short rates, stock derivatives and Federal Bonds, effectively a unification of the MICEX derivative markets. Section two of RTS derivatives trading will be split into three market – stock derivatives, FX and money market, as well as commodities.

According to the plan, on Friday, 16 December, the RTS stock market will be closed ‘as a duplicate’ for MICEX. RTS Classic will be transferred to MICEX Stock Exchange, except for Central Counterparty trading, which will be terminated as of 1 December. RTS Standard will be transferred to MICEX as is. RTS markets will retain the settlement scheme and rules in full as per RTS infrastructure.

Primary unification of indices is planned by end-2011. Today both MICEX and RTS have their own self-titled indices, as well as a number of other index lines such as industrials. MICEX calculation time will be prolonged until 23.50 Moscow time, the calculation will be based on the evening session prices of RTS Standard. From 10.00 till 19.00 the rouble/dollar conversion for RTS index will be based on MICEX TOM quotes for the rouble/dollar pair, after 19.00 Reuters quotes will be used.

By 2012 the integrated exchange will have eliminated duplicate processes, with one Central Settlement Depositary, Central Clearing House and Central Counterparty, besides infrastructure will be ready for partial pre-deposit T+N settlement.

RTS also lists 15 trading participants with no access to MICEX Stock Exchange. They are due to be offered a special 1000 rouble fee towards the payment of MICEX admission charge, set at RUB 3mn.

Issuers listed on RTS and not listed on MICEX will have a special 300 rouble fee towards the payment of MICEX listing, 2011 maintenance and expert charge, ranging from 111-165 thousand roubles depending on the list.

By 2013, the unified stock market will offer order-driven and negotiated trading with rouble quotes. Stock trading will involve partial pre-deposit, with adaptive margin and Т+3 settlement for liquid stock and 100% deposit and Т+0 settlement for other stock. Negotiated deals will involve partial pre-deposit only in Central Counterparty trades, otherwise 100% deposit and choice of settlement.

RTS and MICEX shareholders have signed a framework merger agreement on 29 June. Extraordinary shareholder meetings on 5 September approved the RTS-MICEX merger, greenlighting the legal procedure of exchange integration. FAS approved the merger on 9 September.

As planned, CJSC MICEX shareholders will approve the company reorganization into an open joint-stock company at an extraordinary shareholder meeting on 16 September, in order to float the integrated exchange in 2013. The same year will see the election of a new, post-integration MICEX Board of Directors.

Trading infrastructure