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Russian parliament backs limitations on foreign investment

Russian parliament backs limitations on foreign investment

Russia's lower house of parliament on Wednesday backed restrictions limiting foreign investment in key sectors such as oil and gas, aerospace and mass media.
The legislation, which also would increase the powers of Russian security services in business transactions, has raised concern among foreign investors.
The State Duma passed the bill in its final reading 384-55. It now goes to the upper house, the Federation Council, where passage is likely, and to the president for his signature.
The legislation stipulates that private foreign companies would need authorization to buy more than 50 percent of a Russian company in one of 42 "strategic" sectors. A commission made up of Russian economic and security officials would review such deals.
Foreign state-controlled companies would need permission to acquire more than 25-percent stake in a Russian company within the list of major industrial sectors. Those include either controlled by the Russian state or tied to state interests _ aviation, mining, fishing, media, arms production and other defense-related industries.
Also included are fixed-line telephone operators, which affects Svyazinvest_ the massive telecoms holding company that unites seven regional fixed-line operators as well as the national long-distance operator. The company's privatization has been held up for years over security concerns connected to its work with Russia's military and security services.
The Kremlin has sought to set up state corporations in key industrial sectors, saying a tight government grip is necessary to bolster the economy. It also has pressured foreign oil companies as it consolidates control over the largest and most important hydrocarbon deposits.
Investors have criticized the state-controlled giants as behemoths plagued by inefficiencies and corruption.


Updated : 2021-10-16 22:03 GMT+08:00