File No. 861.51/315
The Consul General at Moscow ( Summers ) to the Secretary of State
[Received May 11, 9.51 a.m.]
427. Following is decree of Soviet government issued April 20, 1918, respecting registration of shares, bonds and other interest-bearing papers:1
1. In execution of the decree of December 29, 1917 [/January 11, 1918], respecting the cessation of payment against coupons and of dividends (Collection of Laws No. 13 of January 4, 1918, Art. 185), the system of unregistered (to bearer) shares and other interest-bearing papers is abolished and in future only registered securities will be valid.
Note: Such government interest-bearing papers which by special orders of the government have been given the right to circulate as currency do not come under this article.
2. In accordance with the above a compulsory registration is introduced of all Russian as well as foreign shares, bonds and other interest-bearing papers belonging to citizens of the Russian Republic as well as to foreign citizens residing in Russia.
3. Every owner or holder of securities indicated in Article 1 is obliged to present such for registration to one of the officers or branches of the People’s (Government) Bank of the Russian Republic of Soviets.
4. On presentation of the securities as per the foregoing article the Government Bank enters each paper in a security registration book, inscribes on each paper the full name and address of the owner and applies to it the seal of the bank.
5. All branches of the Government Bank, of the Government Savings Bank, all government and public institutions and likewise all banking institutions which have not been nationalized, which have in their keeping shares and interest-bearing papers turned over to them as deposits, as securities or which have been pawned with them, are obliged to register such the name of those private or judicial persons to whose account they stood [sic]. All such registered information must be concentrated to local branches of the People’s (Government) Bank.
[Page 43]Note: Interest-bearing papers found in safes will be considered property of person who rents the safe if the safe does not contain evidence to the contrary.
6. The prohibition of transactions with interest-bearing papers (decree, December 29, 1917) remains in force until the law respecting a special permit system of such transactions is issued. The right to claim compensation in case of a nationalization of enterprises to the extent and on the terms to be stipulated by a law respecting nationalization will be granted only to those owners of shares and other interest-bearing papers who have correctly and in due time registered same. Likewise, when the right to receive dividend, suspended by the decree of December 29, 1917, will be reestablished, this right will be granted only to those owners of shares who have registered them correctly and in due time.
7. Before presenting the shares and other interest-bearing papers, a statement should be handed [sic]. The form of such a statement, the date of presentation and other rules bearing relation to the registration of interest-bearing papers are defined by the People’s Commissary of Finance and published for general information.
8. All shares in respect to which a statement as per foregoing article has not been made in due time, will be considered without compensation as property of the state.
Note: Owners and holders of shares who have failed to fulfil the stipulations of the present decree are liable to imprisonment for not less than one year. Persons guilty of fictitious transactions and of attempting to evade the present decree will be punished by imprisonment for not less than two years.
9. In order to provide for the interest of holders of shares of confiscated enterprises and of annulled securities, such shares and securities are also liable to registration.
10. Russian interest-bearing papers held abroad, whether private, public, or government, are likewise registered, irrespective of their belonging to Russian or foreign citizens. At registration it is necessary to produce the actual papers to persons or institutions which are appointed by the representatives of Russia abroad to keep the government registration books. The date of registration will be fixed by Russian diplomatic representatives abroad.
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The decree, translation of which is given by the Consul General, was dated Apr. 18 (5), 1918, and was published in the Izvestia, No. 78, of Apr. 20. The decree of Dec. 29, 1917/Jan. 11, 1918, referred to (also published in the Gazette of the Temporary Workers’ and Peasants’ Government, No. 43, of Dec. 29, 1917/Jan. 11, 1918), reads in translation as follows:
- 1.
- Until the publication of a general decree concerning the further nationalization of production, and also concerning the order and extent of payment of interest on funds and dividends on shares and stock of private enterprises, all payments of coupons are temporarily discontinued.
- 2.
- All transactions in valuable papers are prohibited.
- 3.
- For violation of Article 2 of this decree, the guilty persons are subject to court trial and confiscation of all their property.