13:14, 11 July 2023 Page views 1641 views

Adoption of the Law on Digital Currencies of Foreign States

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The State Duma has passed a law which introduces the concept of central bank digital currencies (CBDC) into Russian legislation. The law was ratified in the third reading, equating the status of CBDC with traditional foreign currencies.

The present modification represents an amendment to the law on currency regulation in Russia in the part where the main definitions are prescribed. At present, the notion of foreign currency includes banknotes and coins, as well as funds in bank accounts and bank deposits in monetary units of foreign countries, as well as international currency units, or payment units.

According to the text of the adopted amendment, it is proposed to include in this list the national monetary units of a foreign state (group of foreign states), issued in digital form by both the national central bank and another body of a foreign state, whose functions include the issuance of such monetary units.

At the same time, CBDC are to be in circulation and represent legal means of payment in the territory of the respective foreign state.  

The amendment was included in the package of amendments on the digital ruble (No. 270838-8).

So far, China, Brazil, Nigeria and a number of African countries have announced the issuance of digital currency. The central banks of Saudi Arabia and the United Arab Emirates are working on the Project Aber initiative. The latter stands for testing instruments for domestic and cross-border settlements between the two countries. Anatoly Aksakov, Head of the State Duma's Financial Market Committee, have earlier said that the adoption of the law on the digital ruble would simplify settlements within the framework of foreign economic activity with a number of countries.