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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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                                  SCHEDULE 13G



                    UNDER THE SECURITIES EXCHANGE ACT OF 1934
                                (Amendment No. )*




                       Central Europe & Russia Fund, Inc.
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                                (Name of Issuer)

                                  Common Stock
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                         (Title of Class of Securities)

                                    153436100
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                                 (CUSIP Number)

                                December 29, 2006
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             (Date of Event Which Requires Filing of this Statement)

Check the appropriate box to designate the rule pursuant to which this Schedule
is filed:

                  |X|  Rule 13d-1(b)
                  |_|  Rule 13d-1(c)
                  |_|  Rule 13d-1(d)

     * The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.

     The information required in the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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CUSIP No. 153436100                    13G                     Page 2 of 8 Pages
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1.  NAME OF REPORTING PERSONS
    I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS

    CITY OF LONDON INVESTMENT GROUP PLC, a company incorporated under the laws
    of England & Wales
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2.  CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP  (a) [_].
                                                      (b) [_].

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3.  SEC USE ONLY


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4.  CITIZENSHIP OR PLACE OF ORGANIZATION

    ENGLAND AND WALES
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                                 5.       SOLE VOTING POWER
                                          875,280

           NUMBER OF             -------- --------------------------------------
            SHARES               6.       SHARED VOTING POWER
         BENEFICIALLY                     0
           OWNED BY
             EACH                -------- --------------------------------------
           REPORTING             7.       SOLE DISPOSITIVE POWER
            PERSON                        875,280
             WITH
                                 -------- --------------------------------------
                                 8.       SHARED DISPOSITIVE POWER
                                          0

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9.  AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

    875,280
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10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES  / /.

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11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

    6.25%
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12. TYPE OF REPORTING PERSON

    HC
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                                   Page 2 of 8


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CUSIP No. 153436100                    13G                     Page 3 of 8 Pages
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1.  NAME OF REPORTING PERSONS
    I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS

    CITY OF LONDON INVESTMENT MANAGEMENT COMPANY LIMITED, a company incorporated
    under the laws of England & Wales
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2.  CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP  (a) [_].
                                                      (b) [_].

--------------------------------------------------------------------------------
3.  SEC USE ONLY


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4.  CITIZENSHIP OR PLACE OF ORGANIZATION

    ENGLAND AND WALES
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                                 5.       SOLE VOTING POWER
                                          875,280

           NUMBER OF             -------- --------------------------------------
            SHARES               6.       SHARED VOTING POWER
         BENEFICIALLY                     0
           OWNED BY
             EACH                -------- --------------------------------------
           REPORTING             7.       SOLE DISPOSITIVE POWER
            PERSON                        875,280
             WITH
                                 -------- --------------------------------------
                                 8.       SHARED DISPOSITIVE POWER
                                          0

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9.  AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

    875,280
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10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES  / /.

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11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

    6.25%
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12. TYPE OF REPORTING PERSON

    IA
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                                   Page 3 of 8

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CUSIP No. 153436100                    13G                     Page 4 of 8 Pages
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ITEM 1(A).    NAME OF ISSUER:

              Central Europe & Russia Fund, Inc.

ITEM 1(B).    ADDRESS OF ISSUER'S PRINCIPAL EXECUTIVE OFFICES:

              The principal executive offices of the Fund are located at Central
              Europe & Russia Fund, Inc. c/o Deutsche Asset Management, Deutsche
              Funds, 345 Park Avenue, New York, NY 10154

ITEM 2(A).    NAME OF PERSON FILING:

              This statement is being filed by City of London Investment Group
              PLC ("CLIG") and City of London Investment Management Company
              Limited ("CLIM," and together with CLIG, the "Reporting Persons").

              The principal business of CLIG is serving as the parent holding
              company for the City of London group of companies, including CLIM.

              CLIM is an emerging markets fund manager which specializes in
              investing in closed-end investment companies and is a registered
              investment adviser under Section 203 of the Investment Advisers
              Act of 1940. CLIM is controlled by CLIG. CLIM is principally
              engaged in the business of providing investment advisory services
              to various public and private investment funds, including The
              Emerging World Fund ("EWF"), a Dublin, Ireland-listed open-ended
              investment company, Emerging Markets Country Fund ("GEM"), a
              private investment fund organized as a Delaware business trust,
              Investable Emerging Markets Country Fund ("IEM"), a private
              investment fund organized as a Delaware business trust, Emerging
              Free Markets Country Fund ("Free"), a private investment fund
              organized as a Delaware business trust, Natural Resource Fund
              ("NAT"), a private investment fund organized as a Delaware
              business trust, Global Equity CEF Fund ("GEF"), a private
              investment fund organized as a Delaware business trust, Frontier
              Emerging Markets Fund ("FRONT"), a private investment fund
              organized as a Delaware business trust, the Global Emerging
              Markets Equity Yield Fund ("YIELD"), a private investment fund
              organized as a Delaware business trust, Global Emerging Markets
              Country Fund Cayman ("CEM"), a Cayman listed mutual fund, GFM
              (Institutional) Emerging Markets Country Fund ("GFM"), an
              open-ended fund organized under the laws of the Province of
              Ontario, Tradex Global Equity Fund ("Tradex"), an Ontario mutual
              fund, and ten third-party segregated accounts over which CLIM
              exercises discretionary trading authority.

              EWF, GEM, IEM, Free, NAT, GEF, FRONT, YIELD, GFM, CEM, and Tradex
              are referred to herein as the "City of London Funds."

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CUSIP No. 153436100                    13G                     Page 5 of 8 Pages
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              The Shares to which this Schedule 13G relates are owned directly
              by the City of London Funds and the segregated accounts.

ITEM 2(B).    ADDRESS OF PRINCIPAL BUSINESS OFFICE OR, IF NONE, RESIDENCE:

              Address for CLIG and CLIM:

              10 Eastcheap
              London EC3M 1LX
              England

ITEM 2(C).    CITIZENSHIP:

              CLIG - Great Britain

              CLIM - Great Britain

ITEM 2(D).    TITLE OF CLASS OF SECURITIES:

              Common Stock, par value $.001 per share

ITEM 2(E).    CUSIP NUMBER:

              153436100

ITEM 3.       IF THIS STATEMENT IS FILED PURSUANT TO RULE 13D-1(B), OR 13D-2(B)
              OR (C), CHECK WHETHER THE PERSON FILING IS A:

              (a) |_| Broker or dealer registered under Section 15 of the Act
                      (15 U.S.C. 78o).

              (b) |_| Bank as defined in Section 3(a)(6) of the Act (15
                      U.S.C. 78c).

              (c) |_| Insurance company as defined in Section 3(a)(19) of the
                      Act (15 U.S.C. 78c).

              (d) |_| Investment company registered under Section 8 of the
                      Investment Company Act of 1940 (15 U.S.C. 80a-8).

              (e) |X| An investment adviser in accordance with Rule
                      13d-1(b)(1)(ii)(E) (for CLIM);

              (f) |_| An employee benefit plan or endowment fund in accordance
                      with Rule 13d-1(b)(1)(ii)(F);

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CUSIP No. 153436100                    13G                     Page 6 of 8 Pages
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              (g) |X| A parent holding company or control person in accordance
                      with Rule 13d-1(b)(1)(ii)(G) (for CLIG);

              (h) |_| A savings association as defined in Section 3(b) of the
                      Federal Deposit Insurance Act (12 U.S.C. 1813);

              (i) |_| A church plan that is excluded from the definition of an
                      investment company under Section 3(c)(14) of the
                      Investment Company Act (15 U.S.C. 80a-3);

              (j) |_| Group, in accordance with Rule 13d-1(b)(1)(ii)(J).

ITEM 4.       OWNERSHIP.

              For CLIG and CLIM:

              (a)   Amount beneficially owned:

                    875,280

              (b)   Percent of class:

                    6.25%

              (c)   Number of shares as to which such person has:

                    (i)    Sole power to vote or to direct the vote: 875,280

                    (ii)   Shared power to vote or to direct the vote: 0

                    (iii)  Sole power to dispose or to direct the disposition
                           of: 875,280

                    (iv)   Shared power to dispose or to direct the disposition
                           of: 0

ITEM 5.       OWNERSHIP OF FIVE PERCENT OR LESS OF A CLASS.

              Not applicable.

ITEM 6.       OWNERSHIP OF MORE THAN FIVE PERCENT ON BEHALF OF ANOTHER PERSON.

              CLIG, as the parent holding company of CLIM, and CLIM, as
              investment advisers to the City of London Funds and segregated
              accounts accounts, has the power to direct voting and disposal, of
              the shares owned by the City of London Funds and the segragated
              accounts. Each of the City of London Funds and each of the
              sedregated accounts owns less than 5% of the sharesof the class of
              issuer's equity securities to which this scheduale relates.

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CUSIP No. 153436100                    13G                     Page 7 of 8 Pages
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ITEM 7.       IDENTIFICATION AND CLASSIFICATION OF THE SUBSIDIARY WHICH ACQUIRED
              THE SECURITY BEING REPORTED ON BY THE PARENT HOLDING COMPANY.

              CLIG is the parent holding company of CLIM. See also Item 3.

ITEM 8.       IDENTIFICATION AND CLASSIFICATION OF MEMBERS OF THE GROUP.

              Not applicable.

ITEM 9.       NOTICE OF DISSOLUTION OF GROUP.

              Not applicable.

ITEM 10.      CERTIFICATION.

              By signing below I certify that, to the best of my knowledge and
              belief, the securities referred to above were acquired and are
              held in the ordinary course of business and were not acquired and
              are not held for the purpose of or with the effect of changing or
              influencing the control of the issuer of the securities and were
              not acquired and are not held in connection with or as a
              participant in any transaction having that purpose or effect.

              The filing of this Schedule 13G shall not be construed as a
              admission that CLIG and/or CLIM is, for the purpose of Section
              13(d) or 13(g) of the Securities Exchange Act of 1934, the
              beneficial owner of any securities covered by this Schedule.

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CUSIP No. 153436100                    13G                     Page 8 of 8 Pages
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                                    SIGNATURE

         After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.

         The reporting persons agree that this statement is filed on behalf of
each of them.



Dated:        February 6, 2007



                                              CITY OF LONDON INVESTMENT GROUP
                                              PLC


                                              By: /s/ Barry M. Olliff
                                                  ------------------------------
                                                  Name: Barry M. Olliff
                                                  Title: Director



                                              CITY OF LONDON INVESTMENT
                                              MANAGEMENT COMPANY LIMITED


                                              By: /s/ Barry M. Olliff
                                                  ------------------------------
                                                  Name: Barry M. Olliff
                                                  Title: Director