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Currency and Exchange Controls in the Russian Federation

Elena A. Kuryatnikova, International Resources Law II: A Blueprint for Mineral Development (1995)

The process of perestroika as envisaged by former President Gorbachev has dramatically affected the way international trade and transactions are now conducted in the Russian Federation. Previously, only state organizations were authorized to engage in such transactions. Each such organization was required to maintain accounts with, and conduct all international transactions through, the Bank of Foreign Trade of the U.S.S.R. (later renamed the Bank for Foreign Economic Activity). Access to foreign exchange was regulated by the state planning agencies, mainly GOSPLAN, the Ministry of Finance and the State Bank. As a result, the country's foreign exchange resources were allocated to state organizations on an as-needed basis (as determined by the central government).

In the early 1990s, however, a number of fundamental reforms were adopted that radically transformed the ability of individuals and private entities to engage in international transactions in the former U.S.S.R. The most significant of these reforms was the decentralization of control over foreign economic activity. In March 1991, the U.S.S.R. law “On the Regulation of Foreign Exchange” was enacted and changed the centralized system of foreign exchange allocation that previously existed. Foreign currency exchange controls in Russia would never be the same.

Presidential Decree No. 213 “On Liberization