As most of the precious metals industry continues to ban Russia for its invasion of Ukraine, Russia is attempting to bypass the sanctions by establishing its own standard for gold and other precious metals. Russia’s proposed “Moscow World Standard” (MWS) would directly compete with the London Bullion Market Association’s globally-recognized LBMA Gold Price, which is set twice a day by 15 LBMA member banks. Until 2015, the pricing was known as the London A.M. and London P.M. Gold Fix. 

Russia’s Finance Ministry claims the LBMA is manipulating precious metals markets to hold prices down. It argues the creation of a new standard is “critically important” and is necessary for “normalizing the functioning of the precious metals sector.”

After Russia went to war against Ukraine, the LBMA suspended its accreditation of Russian precious metals refiners and barred them from selling any new production. Though Russia has been able to sell some of its gold to rouge players, the Russian Finance Ministry says the ban has damaged the country’s precious metals sector, an important source of revenue for Russia. 

“The basis of this new structure will be a new specialized international precious metals brokerage headquartered in Moscow,” the Finance Ministry said. Moscow would coordinate a committee of central banks and large commercial banks from the Eurasian Economic Union, which includes Kazakhstan, Belarus, Kyrgyzstan, and Armenia, to fix prices for gold and other precious metals. According to the Russian proposal, prices would be set in the currencies of key member nations, or in a new monetary unit. 

Russia is the world’s second leading producer of gold, after China, having produced more than 330 metric tons of the precious metal last year, according to the World Gold Council.