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Ministry of Finance sets out to oblige operators of vital infrastructure, to which the SWIFT system can be attributed, to register a legal entity in Russia, said Alexey Moiseev, Deputy Finance Minister, on Monday. “I find the idea of creation of a Russian legal entity rightful, because such a legal entity will be bound by Russian legislation, violation of which will lead to legal consequences”, - quotes Interfax.

In late August Ministry of Finance drafted a bill that introduces a notion of “service operator of vital infrastructure”, i.e. infrastructure vital for transfer of financial messages. One can attribute to such operators SWIFT, Bloombert and Reuters. Such operators will have to comply with requirements and will be liable for failure to perform information services.

David Cameron, Prime Minister of the United Kingdom, called for exclusion of Russia for the international system SWIFT, and European Parliament’s resolution contains such a proposition. However, as a private company SWIFT believes that European Parliament’s resolution violates its rights. “Our mission is to be a global and neutral service provider in finance industry”, — claims SWIFT. SWIFT’s headquarters are situated in Belgium and it does not cooperate with separate companies in other countries.

Market players do not rule out the possibility of SWIFT following the same scenario as Visa and Mastercard. After the law “National payment system” was enforced, authorities obliged them to create in Russia separate legal entities, and now they demand to deposit margins to the Central Bank of Russia. “From the viewpoint of creation of the SWIFT subsidiary in Russia with localization of the data processing system, this will not be able to protect Russian banks from disconnection from the system that is located outside of Russia, should SWIFT’s management make that decision”, — says Alexander Zakharov, partner of Paragon Advice Group. He doubts SWIFT is interested in Russian market more than Russian banks are interested in its system, so it would be silly to expect margins. Alma Obaeva, Chairman of the Board of Directors of the Non-commercial Partnership “National Payment Council”, does not think that margin will be required, since SWIFT is already financially responsible to the countries where it operates.

According to RBC, largest banks, first of all state ones, have already initiated testing of their own systems of financial message exchange, reports to RBC one of the state bank sources, as confirmed by a source close to the management of Sberbank and VTB. “Banks can exchange information using the “bank – customer” system, and now they are seeking to use it for that purposes to have a fallback plan in case of disconnection from SWIFT , so as not to fuss as with building inter-host connections after disconnection of certain banks from Visa and Mastercard“, - says the source.

Sberbank, VTB, Gazprombank and Alfa-Bank gave RBC no commentary on the matter.

According to Vladimir Kuznetsov, CEO of Cyberplat electronic payment system, interaction via the “bank – customer” system cannot fully substitute for SWIFT. “Bank - customer” can be installed only between two banks, turns out each bank has to establish hundreds of channels with other banks, which will create a huge operating load and make bank costs skyrocket”, - says Kuznetsov.

Banks and companies of materials sector (that are also SWIFT users) submitted their propositions to the Central Bank of Russia via the Non-commercial National Payment Council. Most of them proposed integration of upcoming infrastructure with existing systems of financial message exchange (e.g. SWIFT, payment system of the Bank of Russia, interagency electronic interaction system, “customer – bank”, etc.). Rosneft in particular spoke in favor of implementation of payment system message format ultimately close to the ones used in banking practice (SWIFT and ISO). Lukoil supported standardization of message formats and usage of ISO 20022 (international standard of financial messages, published in 2004).

Sberbank proposed to use elaborations of Universal Electronic Card, as VTB pointed out that SWIFT standards should not be a corner stone for the upcoming infrastructure in the long run, but there should be room for compatibility and integration.

Source: RBC Daily