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Draft law on financial system of Crimea for transitional period goes to Duma

March 22, 2014, 21:38 UTC+3 MOSCOW

Taxes collected in Crimea will remain in its budget until 2015, and Russia will provide financial support to Crimea and Sevastopol in 2014-2016

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MOSCOW, March 22, /ITAR-TASS/. A draft law outlining key aspects of the financial system in Crimea and Sevastopol and its operation during the transitional period was submitted to the State Duma, lower house of parliament, on Saturday, March 22.

The draft law, written by Natalia Burykin, Head of the Duma Committee on the Financial Market, and Nikolai Zhuravlev, Deputy Head of the Committee on the Budget and Financial Markets of the Federation Council (upper house of parliament), sets out the terms of operation for banks, non-lending financial institutions, non-bank financial organisations, and cash exchange offices in Crimea and Sevastopol during the transitional period.

The transitional period will continue until January 1, 2015 to solve all issues pertaining to the integration of the new constituent members into the economic, financial, credit and legal systems of Russia, into its government system, as well as issues concerning military duty and military service in the Republic of Crimea and Sevastopol.

Taxes collected in Crimea will remain in its budget until 2015, and Russia will provide financial support to Crimea and Sevastopol in 2014-2016.

Security, customs, law enforcement and other government personnel, and prosecutors who worked in Ukraine and Sevastopol will have a pre-emptive right in seeking employment in the relevant Russian bodies, provided they have Russian citizenship and take a test to prove their knowledge of Russian legislation. This requirement will also apply to judges who worked in Crimea and Sevastopol.

The Russian rouble will be the official currency in Crimea, but the Ukrainian hryvnia will circulate along with the rouble until 2016. However taxes, social allowances and salaries will be paid in roubles.

Crimean banks will be required to exchange hryvnia for roubles at the official exchange rate of the Russian Central Bank until January 1, 2015. They will be allowed to operate under the licenses of the Ukrainian National Bank until the end of this year.

Elections in Crimea and Sevastopol will be held on the second Sunday of September 2015. The State Council of Crimea (parliament), the government of Crimea and the Sevastopol City Council will continue to perform their functions until then.

Under the re-unification treaty signed this and ratified week, Crimea and Sevastopol will have the status of republic and city of federal significance, respectively.

Crimea “is deemed admitted into the Russian Federation from the date when the treaty was signed,” the document said.

It states that “the official languages of the Republic of Crimea are Russian, Ukrainian and Crimean Tatar.

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