Imagine trading shares in New York, having to fly to Los Angeles to buy stocks there and hiring a lawyer to draw up a deed to transfer ownership. That's what brokers must do in Russia's ad hoc markets.


But if all goes to plan, that will change soon.


A project modelled on the U.S. Nasdaq stock exchange will link brokers across seven Russian time zones from Vladivostok in the Far East to St. Petersburg in the west.


Jonathan Bulkley, a managing director with consultants KPMG Peat Marwick, said equity settlement centers in Moscow and St. Petersburg and others planned for Novosibirsk, Yekaterinburg and Vladivostok would be linked by the end of 1994.


KPMG is handling the equity trading side of the project for the Russian Securities Exchange Commission, or SEC, and consultants Deloitte and Touche are setting up the clearing and settlement centers. The contract is funded by USAID.


"We will link these centers electronically and allow interregional share trading," Bulkley said in a weekend interview. "By late August, we should be able to link dealers in Moscow and St. Petersburg in an electronic trading system. Novosibirsk, Yekaterinburg and Vladivostok should be running by this fall."


The centers will cater for regional clients -- such as oil companies in Novosibirsk and shipping firms in Vladivostok.


Russia has thousands of shares to sell. Since privatization started in 1992, more than 15,000 enterprises have sold stocks.


But without a payments system and price feed, traders rely on Russia's faltering telephone network to keep up to date with shares traded in cities thousands of kilometers apart.


The bulk of the trading is on an over-the-counter telephone market. But prices vary wildly. The market is not transparent. There are no rules on insider trading, shareholders' rights and corporate disclosure requirements, nor means to enforce them.


A Nasdaq-style network, which in the United States allows over-the-counter trade also for firms with small capital, would mark a historical transformation for Russian markets.


The project would bring much-needed self-regulation to Russia's rickety share trading by setting up dealers' associations and forcing members to publish company data.


The centers would be run by brokers associations which would handle share settlements and regulate trade. Minimum capital needs and other rules will ensure firms are financially sound.


"As self-regulatory organizations, the associations will impose counter-party rules and protect investors," Bulkley said.


The first brokers association, the Moscow-based Professional Association of Russian Dealers, is ready to start work as soon as the Russian SEC approves its foundation documents.


The association has 15 members. The aim is to create similar associations for other regional share trading centers.


"This is historical for Russia," Bulkley said. "The dealers' associations, when linked to clearing organizations, will access a big pool of shares and transfer ownership electronically."


Russia has no central registry. Companies cannot issue bearer securities which give holders ownership rights.


For a seller to transfer share ownership to a buyer in a company, say in the Far East, both have to get on a flight and go to the company's registrar at its headquarters.


Bulkley said the custodian centers would re-register owners' rights, creating a pool of nominee ownership and speeding up trade. Correspondent banks would handle cash settlements. The network will help create benchmark prices and provide liquidity.


The aim is to make the centers powerful enough to mediate in disputes and guarantee funds, like New York's Depositary Trust Company which has bank lines and a fund to guarantee ownership.


Bulkley said a multilateral body like the International Finance Corporation or the European Bank for Reconstruction and Development could help set up a Russian guarantee fund.