Russian Natural Resource Law To Restrict Foreign Companies

A new law on Russia's natural resources will limit the access of foreign companies to Russian mineral deposits, the newspaper Kommersant reported Tuesday, citing a draft prepared by the Natural Resources Ministry.

The newspaper said that according to the draft law, foreign companies will be able to participate in auctions to win licenses to exploit deposits only through subsidiaries registered in Russia. Under current legislation, foreign companies can participate directly in such auctions.

The draft law also proclaims natural resources as federal property. Kommersant said this contradicts the Russian Constitution, which defines them as the joint property of federal and regional governments.

Kommersant also said that under the new legislation, the government will award licenses to exploit the largest deposits without holding auctions.