"The exact date was not discussed. They said the bill should be passed in this session, it’s slated for debate on 21 October”, he said.

MICEX Head says if the law passes this Autumn, NRD (MICEX settlement depositary) will legally become Central Depositary starting next year.

The CD will benefit the Russian market, as centralization will lead to expedited settlement, which will improve market liquidity, says Aganbegyan.

The MICEX-RTS merger has made NRD the sole candidate for Central Depositary in Russia. This position was earlier contested by DCC (RTS settlement depositary).

The MICEX-RTS integration is planned for mid-2012, says Aganbegyan.

Head of NAUFOR Alexey Timofeev told Interfax that the bill supported by President lays the foundation for a CD in Russia, thus de-blocking foreign investment, primarily for suck long-term investors as private pension funds.

Timofeev says the bill supports NAUFOR’s suggestion that the CD should initially have an exclusive right to operate nominee accounts at the registrar for all traded stocks.

As reported earlier, compromise has been reached on the CD bill on Friday.

“We reached a compromise – initially the CD will have an exclusive nominee right for exchange traded securities", said source.

The CD bill was passed in first reading as far back as 2007. However, its further progress was stalled by the RTS-MICEX standoff, with two depositaries competing for the right to become the CD. This issue was resolved after the two exchanges decided to integrate.

MIFC Taskforce has drafted a CD bill, noting several moot points that have to be dealt with. One moot point both for regulators and market participants was the exclusive CD nominee right at the registrar. The Ministry of Finance was against it, while the Central Bank was in favour.

Trading infrastructure, Project Group №1, Ruben Aganbegyan, Alexei Kudrin, Alexey Timofeev