The Transfer of Intermediated Securities and of the Correspondent Russian law Term

AuthorM. Botvinov
PositionUniversity of Geneva (Geneva, Switzerland)
Pages93-116
BRICS LAW JOURNAL Volume V (2018) Issue 1
COMMENTS
THE TRanSFER oF InTERMEDIaTED SECuRITIES
anD oF THE CoRRESPonDEnT RuSSIan Law TERM
MIKHAIL BOTVINOV,
University of Geneva (Geneva, Switzerland)
DOI: 10.21684/2412-2343-2017-5-1-93-116
The recent reform of the Russian Civil Code (hereinafter RCC) has also considerably
touched the regulation of uncerticated securities. Such issues as the legal nature, the
protection of a bona de purchaser and the transfer, including the creation of security
interests were precised by the legislator in the Code. As for the transfer, we may arm
that this was one of the main points of the reform in respect of those securities.
What about the Swiss legislation, we can also affirm that the disposition of the
intermediated securities was one of the key elements of the Federal Intermediated
Securities Act, also known as FISA.
In this article we intend to analyze precisely the methods of transfer applicable to
intermediated securities under Swiss law and compare them with those which are
governed by the modied dispositions of the RCC. In order to nalize our analysis on that
subject we will also touch some points raised in the previous article. Thus, the present work
will be the consequent continuation of the discussion started in my previous article.
Keywords: Russian law; securities; UNIDROIT; legal reform; Geneva Securities Convention;
intermediated security; uncertificated security; Russian Civil Code (RCC); Federal
Intermediated Securities Act (FISA).
Recommended citation: Mikhail Botvinov, The Transfer of Intermediated Securities
and of the Correspondent Russian Law Term, 5(1) BRICS Law Journal 93–116 (2018).
BRICS LAW JOURNAL Volume V (2018) Issue 1 94
Introduction
The denition of security has neither been claried by the life,
nor by the legal science, nor by the legislation.1
Professor Gabriel Shershenevich
As you may have already noticed, I have recently written a comparative research
devoted to the issue of the legal nature of intermediated securities and the
correspondent term under Russian law.2 In order to understand the context of the
reform, I kindly refer you to my previous article published in the BRICS Law Journal.3
I would like to continue the discussion started at that article. However, this time
I would like to concentrate specically on the question of the transfer of intermediated
securities and of the correspondent term under Russian law. The present article is not
intended to give a general description of the methods but has the purpose to give
the precise analysis of each method in the chosen jurisdictions. Firstly, we are going
to summarize our notes regarding the recent reform of the relevant provisions of
the Russian Civil Code (hereinafter RCC). In this chapter we will somehow continue
the discussion raised in my previous article. I will discuss in the beginning such
questions as the legal nature of those securities, the problem of vindication in
relation to uncerticated securities under Russian law and compare the results of the
reforms in Switzerland and in the Russian Federation. Secondly, we will examine the
methods of transfer applicable to intermediated securities. We are going to analyze
the one under Art. XI of the Geneva Securities Convention which is called debits and
credits.” In particular we will analyze and compare the legal nature of the instruction
[передаточное распоряжение] under the chosen legal orders. Finally, we are going
to analyze “other methods of transfer governed by Art. XII of the Geneva Securities
Convention. They are usually used to create a security interest upon intermediated
securities. Those methods are: the designating entry, the control agreement and the
creation of an interest in favour of the relevant intermediary. In this Chapter we will
also present our conclusions on the usage of abstraction and causality principles in
relation to the transfer of securities held in a dematerialized form.
Before we start to analyze the methods of transfer under the respective legal
orders, I would like to return to the issues raised in my previous article and discuss
the results of the reforms in Switzerland and in Russia in relation to those securities.
As our reader might notice, the terms employed by the two legal orders are not
1 Шершеневич Г.Ф. Курс торгового права. Т. II: Товар. Торговые сделки [Gabriel F. Shershenevich, The
Course of Commercial Law. Vol. II: Merchandise. Commercial Transactions] (4th ed., St. Petersburg: Izdanie
Bratiev Bashmakovykh, 1908) (Aug. 17, 2017), also available at http://base.garant.ru/6185553/.
2 Mikhail Botvinov, Geneva Securities Convention and Russian Civil Legislation Reform: Comparative
Perspectives, 4(1) BRICS Law Journal 26 (2017).
3 Id.

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