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This article examines continuity and change in the development of financial-industrial groups (FIGs) in Russia. FIGs usually embrace one or several banks and one or several industrial enterprises. Looking at how Russian enterprises are transformed into FIGs, I focus on the process of reforming systems of control and incentives over savings and investment decisions. In the Soviet era, after 1973, enterprises and production associations were under the control of ministries or so-called industrial associations. At that time, production associations were recognized as legitimate industrial groups, but there were no FIGs. But under the power of Gorbachev, he decided to open brand-new businesses, which meant the first step to the market economy. On June 30, 1987, the Soviet law concerning governmental enterprises was enacted to introduce a self-financing system for enterprises and production associations. This new self-financing system enlarged power of enterprise managers in the decision-making, but it did not basically change the old system of control over the industry. Branch ministries and other hierarchical structures still existed exerting a strong pressure on enterprises. The law alleviating them was enacted in July 17 1987. On August 3, 1989, the Soviet law concerning the introduction of amendments and additions of governmental enterprises law was enacted. It added a 7th clause to the 5th article, which stated that enterprises, associations and organizations could establish concerns, consortiums, inter-sector governmental associations and governmental production associations on the basis of contracts. This both confirmed the existence of, and gave official sanction to the newly established industrial groups. Some Russian economists have claimed that establishing of these groups was merely a change in signboards. Ministries kept enjoying enough power and control over enterprise policies. Staff of ministries tried to keep their rights and interests by pretending to follow new economic policies. Their powers were so strong that they could maintain their positions and promulgate a new law about Soviet-enterprises which was enacted in June 4, 1990. After the election of the Russian republic of the USSR in March 1990, radical reformers gained a majority in parliament. Following this, the law concerning privatization of governmental and autonomous enterprises was enacted. The 4th clause of the 8th article in this law decreed that holding companies could be established by enterprises of associations. This showed that the Russian government did attempt to change concerns, consortiums, inter-sector governmental associations and governmental production associations into joint stock companies under control of holding companies. By keeping corporate grouping, the staff of those groups could maintain their powers throughout the process of privatization. The defeat of the August 1991 putsch of communist hard-liners accelerated the shift to capitalism. The decree of the Russian president on November 16, 1992 approved of measures governing holding companies activities at the time of the privatization of governmental enterprises into joint stock companies. According to these measures, 10 holding companies such as Gazprom, Russian United energy system, YuKOS and so on were authorized to do business. Moreover, Gazprom developed into a FIG by establishing private banks such as Gazprombank and acquiring a share of the Imperial Bank. On the other hand, leaders of military industries, which were confronted with economic difficulties after the collapse of the USSR, planned to introduce officially registered FIGs in order to receive assistance from the government. Their lobbying efforts resulted in a Presidential Decree, of December 5 1993, allowing so called "official FIGs". Examining the history of how control in the industry has been transformed, one can conclude that the observed changes have resulted from lobbying activities of old managers and politicians. But why they tried to establish FIGs? One of the reasons is that they wanted to keep their power. But another important factor was to keep investment funds within the groups. On the process of the reform of the industrial system, the government tried to decrease subsidies to enterprises, forcing them to earn more themselves. The Soviet law concerning governmental enterprises on June 30 1987 decided to abolish united fund for development of science and technology on the level of industrial ministries in order to keep a lot of investment resources on the level of enterprises. But the system of paying some profits to upper class organization was not changed. Therefore, at this time the self-financing system was imperfect. In the case of concerns, they kept concentrated financial funds by collecting profits from their participants. This means that one of the purposes of establishing concerns was to mobilize funds as before. On the other hand, FIGs were instrumental for accumulating investment resources in their own banks. Often they established their own banks (sometimes called "pocket banks") to be used for intra-group transactions, for keeping the liquidity and for mobilizing investment resources. For example, the Radio Ministry of the USSR had established Promradtekhbank in 1990. State concern, Norilisk Nikel Metallurgy Complez, which became one of the members of an official FIG (Interros). Of course, several FIGs were led by newly established banks such as ONEKSIMbank, which was established after the collapse of the USSR. But SBS-Agro, Alfa Bank, Most Bank, which established FIGs, were developed by the founders of cooperatives, which were established after the Gorbachev's economic policy. Therefore, I come to conclusion that ignoring continuity in Russian corporate development one cannot correctly understand the evolution of Financial-Industrial Groups.