Russian govt submits strategic sector bill to MPs

MOSCOW, July 18 (Reuters) Russia's government has submitted to parliament a bill on foreign ownership of strategic sectors, a key law designed to keep important businesses under Russian control, the Energy Ministry said today.

The bill limits foreign participation in 39 business activities, grouped into five industrial sectors including production of special equipment, arms and military equipment, aerospace, space and atomic energy, the ministry said in a statement.

''Apart from that, business activities carried out in natural monopolies are also included,'' the statement added, without elaborating.

The bill suggests that foreign participation in these sectors would be regulated by special rules and approved by a state commission headed by the prime minister. Approval may take up to six months.

The bill also says that foreign state-owned investors would be excluded from holding a controlling stake in the sectors. It would have to get special state permission to acquire a blocking stake of 25 per cent plus one share.

The bill is supplemented by amendments to the existing subsoil law, which limits foreign participation in developing ''strategic'' mineral deposits.

The ministry did not comment on the amendments, but late last year it suggested including oil deposits of over 70 million tonnes, gas deposits of more than 50 billion cubic metres, copper deposits containing 500,000 tonnes and gold fields containing 50 tonnes or more.

The bill and the amendments are to be considered by the Duma, the lower house of parliament, when it resumes work in September after the summer break.

To come into force, the documents must be approved by the higher house of parliament and signed by the president.

REUTERS SM HT1812