Market consultation

Executive Order by the President ofthe United States of America

ftserussell.com

November 2020

Executive Order by the President of the UnitedStates of America
Further to the ‘Executive Order by the President of the United States of America’ notification published on 13
November 2020, FTSE Russell is inviting comments from market participants on the appropriate treatment ofaffected constituents of FTSE Russell indexes.
Effective from Monday 11 January 2021, the Executive Order prohibits United States persons fromtransacting securities investments in any Communist Chinese military company as defined in section 4(a)(i)of the Executive Order. FTSE Russell understands the affected companies to be those listed by the US
Department of Defense (link), but has requested the Office of Foreign Assets Control (OFAC) to confirm thescope of the sanctions.
The FTSE Russell Index Policy Guide for its equity indexes, "In the Event Clients are Unable to Trade aMarket", section 2.3, “Sanctions are imposed which restrict investment into foreign jurisdictions” states:“Should sanctions, either primary or secondary, be imposed that prohibit US, UK and or European Union(EU) natural or legal persons from investing in particular countries, industries, named companies orcompanies linked to sanctioned individuals, FTSE Russell will delete the sanctioned securities from FTSE
Russell indexes”.
In the light of the imminence of the effective date of the Executive Order, FTSE Russell is seeking rapid
feedback from clients and other stakeholders on the scope of the sanctions and the timing of the deletion of
the affected securities from FTSE Russell indexes. Comments are requested to be submitted to FTSE
Russell via our online answer form by the US market close on Friday 27 November 2020. FTSE Russell
intends to confirm equity index treatment following the US market close on Friday 04 December 2020.
Please note that the indicative review files for those indexes that are reviewed in December (scheduled to be
published from Friday 20 November 2020 for FTSE GEIS indexes) will continue to reflect the sanctioned
securities as index constituents. The product files published on and after Monday 7 December 2020 willreflect the confirmed index treatment that will be effective from the open on Monday 21 December 2020.
FTSE Russell is currently reviewing the impact of the Executive Order to its fixed income indexes and will
provide an update in due course.

FTSE Russell

2Responding to the consultation

Online answer form
The proposals set out in this consultation document are included in order to gather feedback andmay or may not result in changes to our indexes or data solutions.
Please submit your response online at https://www.surveymonkey.co.uk/r/B8L7QPH
All responses will be treated as confidential. FTSE Russell may publish a summary of theconsultation results, but no individual responses will be published and no respondents will be named.
If you have any questions about this survey, or if you encounter any technical issues, please contact
rpawson@ftserusssell.com.

FTSE Russell

3For more information about our indexes, please visit ftserussell.com.
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4About FTSE Russell
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