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Russian President Vladimir Putin has signed a decree authorising the country’s airline companies to pay for aircraft and engines rented from foreign-registered firms in rubles.

With this new order, Russian airline companies will fulfil their financial obligations by making payments in their own national currency rather than US dollars or Euros, which were specified in the original contracts.

The decree stated: “To establish that obligations on making rental, leasing and other payments within the implementation framework of agreements stipulating purchase, rental, leasing of aircraft, auxiliary power plants, aircraft engines […] are recognised as properly performed if these obligations are performed for their primary business companies – residents by way of debtor’s transfer of funds in rubles to the account of the primary business company – resident opened with a Russian credit institution, in the amount equivalent to the value of obligations in foreign currency (irrespective of the currency reflecting such cost) and calculated at the official rate of the Central Bank of Russia set as of the day of obligations performance,” reported Russian News agency TASS.

The payments in rubles will be calculated according to the currency exchange rate of the Russian Central Bank on the day of the transaction.

With this new rule, foreign lessors will be required to have an account with Russian banks in order to receive payments.

Additionally, airline companies planning to make such payments will have to initially obtain approval from the Government Commission for the Control of Foreign Investments. 

The Russian Government will also implement similar norms for gas exports. Last month, Russian President Vladimir Putin introduced a new law to allow the nation’s airline companies to register aircraft leased from foreign companies.