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. Last Updated: 07/27/2016

Moscow Exchange Granted License

The Moscow Central Stock Exchange has been granted an operating license, giving it a crucial victory in a drawn-out fight against what it calls corruption at the state markets regulator, the Federal Securities Commission.

The Moscow Central Stock Exchange, a would-be rival to the main Moscow Stock Exchange, won the license Monday, two months after a city arbitration court ordered the commission to stop dragging its feet.

The exchange had initially applied for the license over a year ago, but the commission repeatedly turned down the requests citing technical issues.

The feud boiled into a personal battle between Sergei Karpov, president of the Moscow Central Stock Exchange, and the commission's head, Dmitry Vasiliyev.

Finally, Karpov took Vasiliyev to court and a judge ruled in March that the commission had no legal grounds for denying the exchange a license.

The Federal Securities Commission plans to appeal the ruling, commission spokesman Vadim Bely said Tuesday.

Even though the court found in favor of the exchange in March, the commission did not get around to granting the license until this week, partly because it was trying to get the court to reverse its decision, Bely said.

Karpov, in the meantime, did not take the delay lying down. Late last month, he mounted a letter-writing campaign in which he brought up earlier accusations against Vasiliyev, saying the commission chief was encouraging market players to pay bribes to gain favors. Letters were sent to the Prosecutor General's Office and the Kremlin, as well as to ministries, lawmakers and anti-corruption organizations.

Karpov wrote about different ways he said the market regulator could extort money from market participants and accused it of patronizing and limiting competition on the securities market.

Karpov has many times in the past bombarded government officials with letters accusing Vasiliyev of unethical behavior, but to no effect.

His fight against the market regulator has gained the support of Konstantin Volkov, president of the National Stock Market Association, who has also accused Vasiliyev of arbitrariness and formality in making decisions.

Vasiliyev, considered by many Western economists to be a leader in Russian market reforms, has never publicly replied to Karpov's allegations, saying the disputes should be settled in court.

"We prefer the issues to be settled properly in a legal way," Bely said.