Contents Introduction Chapter I. Theoretical foundations of currency regulation

Chapter II. Characteristics of the main approaches to currency regulation in world practice.
2.1. Features of foreign exchange transactions in Russia.
The currency regulation in the Russian Federation should be understood as legislative (law-making) and state control activities in the face of currency regulation and currency control bodies on the establishment of rules for managing currency values, on regulating the procedure for conducting currency transactions, and on the organization and conduct of currency control.
Through legislative consolidation (authorization) of the main methods (mechanisms) of currency regulation, the state more effectively implements powers in the monetary sphere and achieves its goals in monetary policy.
The main document regulating the conduct of foreign exchange by banks in Russia is the enacted Federal Law of the Russian Federation “On Currency Regulation and Currency Control” of December 10, 2003 No. 173-ФЗ. The law defines the legal basis and principles of currency regulation and currency control, currency regulation authorities, the rights and obligations of residents and non-residents regarding the ownership, use and disposal of currency values, the rights and obligations of non-residents regarding ownership, use and disposal of the currency of the Russian Federation and domestic valuables securities, rights and obligations of currency control bodies and agents.
“Residents shall mean:
a) natural persons who are citizens of the Russian Federation, except for citizens of the Russian Federation recognized as permanently residing in a foreign state in compliance with laws of this state;
b) foreign citizens and stateless persons permanently residing in the Russian Federation on the basis of the residence permit provided for by laws of the Russian Federation;
c) legal entities established in compliance with laws of the Russian Federation;
d) branches, representative offices and other subdivisions of the residents indicated in Subitem "c" of this Item which are situated outside the territory of the Russian Federation;
e) diplomatic representations, consular offices of the Russian Federation and other official representations of the Russian Federation which are situated outside the territory of the Russian Federation, as well as permanent representative offices of the Russian Federation at interstate or intergovernmental organizations;
f) the Russian Federation, the subjects of the Russian Federation and municipal formations which participate in the relations regulated by this Federal Law, other federal laws and other normative legal acts adopted in compliance with it;
7) non-residents shall mean:
a) natural persons who are not residents in compliance with Subitems "a" and "b" of Item 6 of this Part;
b) legal entities established in compliance with laws of foreign states and located outside the territory of the Russian Federation;
c) organizations not being legal entities which are established in compliance with laws of foreign states and which are located outside the territory of the Russian Federation;
d) diplomatic representations, consular offices of foreign states and permanent representative offices of said the states at interstate and inter-governmental organizations which are accredited with the Russian Federation;
e) inter-state and inter-governmental organizations, branches and permanent representative offices thereof at the Russian Federation;
f) branches, permanent representative offices and other separate or independent structural subdivisions of the non-residents indicated in Subitems "b" and "c" of this Item which are situated on the territory of the Russian Federation;
g) other persons who are not indicated in Item 6 of this Part;”¹⁰
“Currency control is the state’s control over the observance of currency legislation in foreign exchange operations”¹¹.
“In accordance with the currency legislation, the purpose of currency control is to comply with currency legislation when performing currency transactions. The main principles of currency regulation and currency control in the Russian Federation are:
1) the priority of economic measures in the implementation of state policy in the field of currency regulation;
2) exclusion of unjustified interference of the state and its bodies in the currency operations of residents and non-residents;
3) the unity of the foreign and domestic monetary policy of the Russian Federation;
4) the unity of the system of currency regulation and currency control;
5) ensuring by the state the protection of the rights and economic interests of residents and non-residents in the implementation of foreign exchange transactions.”¹²

The Bank of Russia implements its foreign exchange policy in the general context of the monetary policy pursued by the Government and Central Bank of the Russian Federation. The major objectives of the Bank of Russia foreign exchange policy are to ensure stability of the national currency and create conditions for the dynamic development of Russia’s foreign exchange market.

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  “In order to create conditions in the foreign exchange market corresponding to the objectives of the exchange rate policy and to manage (to even out) the rouble exchange rate, the Bank of Russia makes use of the following main instruments:
  
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  foreign exchange interventions;
  
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  deposit operations to regulate the level of rouble liquidity in the interbank market;
  
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  shifting interest rates on the Bank of Russia operations in the money market.
  

The effect of using the market instruments of the exchange rate policy depends on the state of the monetary sphere as a whole and on the general economic situation.
When tendencies emerge in the domestic foreign exchange market, posing a threat of long-term destabiliaztion of the exchange rate, the Bank of Russia may also take additional measures, such as:

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  changing the procedure for and the required rate of exporters’ foreign exchange earnings surrendering;
  
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  changing the reserve requirements and other economic and prudential standards of credit organizations;
  
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  modifying the procedure for conducting foreign exchange trading on the authorized currency exchanges and foreign exchange transaction rules.”¹³
  

The Bank of Russia continuously improves the system of control over the main sectors of the foreign exchange market, especially over transactions at the authorized currency exchanges, securing quick and effective use of the foreign exchange policy instruments.

The Central Bank of the Russian Federation has set from 27/04/2019 the following exchange rates of foreign currencies against the ruble without assuming any liability to buy or sell foreign currency.

Table 2.1.1

Number code	Char code	Unit	Currency	Rate
036	AUD	1	Australian Dollar	45.5072
933	BYN	1	Belarussian Ruble	30.6762
986	BRL	1	Brazil Real	16.3637
410	KRW	1000	South Korean Won	55.7526
344	HKD	10	Hong Kong Dollar	82.4807
840	USD	1	US Dollar	64.7053
978	EUR	1	Euro	72.0882
356	INR	100	Indian Ruppe	92.3161
124	CAD	1	Canadian Dollar	48.0010
417	KGS	100	Kyrgzstan Som	92.6346
156	CNY	10	China Yuan	96.0261
934	Tmt	1	New Turkmenistan Manat	18.5137
578	NOK	10	Norwegian Krone	74.6295
702	SGD	1	Singapore Dollar	47.4832
972	TJS	10	Tajikistan Ruble	68.5307
826	GBP	1	British Pound Sterling	83.5023
392	JPY	100	Japanese Yen	57.9511
860	UZS	10000	Uzbekistan Som	76.6528
949	TRY	1	Turkish Lira	10.9176
756	CHF	1	Swiss Franc	63.3931