In a Word

Day of Reckoning

Mar 12, 2012:

Two girls believed to be members of the dissident group Pussy Riot (they deny this) have been officially charged with the violation of public order. If found guilty, they can spend up to seven years in prison. Statistically - 98.5% of charged with crime are found guilty - they are doomed.

Earlier, Nadezhda Tolokonnikova and Maria Alyokhina were arrested. They will stay behind bars until late April. Both have young children: Tolokonnikova has a four-year-old son and Alyokhina's daughter is five.

On 21st of February, Pussy Riot staged a guerrilla performance at Moscow's Christ the Saviour cathedral. Several girls ran to the altar and sang a kind of ‘punk prayer’ titled the Holy Shit accusing the Moscow Patriarchate in the over-involvement in politics and campaigning for Vladimir Putin in the upcoming presidential election.

Archpriest Vsevolod Chaplin, the head of the MP Department of Church and Society, has said that the Church will not give in to those who defend the girls or ask to release them from detention. Punishment, he said, should be severe enough so nothing like this would happen ever again.

Anti-Gay Capital of Russia

Mar 11, 2012:

St. Petersburg governor, and a former KGB officer, Georgy Poltavchenko has signed into law the bill banning ‘promotion of non-traditional sexual relations and paedophilia among minors’.

Thus St. Petersburg, a Russian ‘cultural capital’ and home to the famous Mariinsky Theatre, becomes the fourth Russian region which claims to protect the youth by banning ‘public actions aimed at propaganda of sodomy, lesbianism, bisexuality, transgenderness amongst minors’.

The bill provoked widespread discussion not only in Russia but abroad. The fighters for the rights of sexual minorities believe that the law, under the guise of protecting public morale, will prohibit all public gatherings of homosexuals and restrict access to information about health and support networks for young lesbians or gays.

Supreme Commercial Court Triggers a Flood of Lawsuits Against Banks

Mar 7, 2012:

The Supreme Commercial Court of Russia has ruled that banks cannot unilaterally raise interest rates even if such right is included in the loan agreement. The upshot of this decision may be a flood of lawsuits against credit institutions.

The Presidium of the Supreme Commercial Court has overruled the decisions of lower courts in a dispute of a sole trader with a bank. In the period 2008 - 2009, the bank has been steadily increasing the interest rate from 14.5% to 24.5%. The right to do so had been agreed by the entrepreneur and included in the loan agreement. The courts of three instances have ruled for the bank but the Supreme Commercial Court has decided that a significant increase in rates is not consistent with the principle of fairness and drives the borrower into bondage.

The decision means that even if the right to raise interest rates is included in a loan agreement, such increase – if not approved by a borrower - can be challenged. Banks will have to prove that the increase is ‘insignificant and economically justified’.

Tax Revenues Keep Growing

Mar 7, 2012:

In January, Russia’s tax revenues grew by almost 13% as compared to January of last year and amounted to about $22 billion. The federal budget has received $14 billion and regions, around $8 billion.

Tax collection in Russia has been rising steadily and, despite global economic crisis, in five years has grown by 50%, from $200 billion in 2006 to $300 billion in 2011.

Indirect taxes - import and export duty, excise, taxes on natural resources and VAT - remain the major source of revenue. In 2006 direct taxes, on corporate profits and on personal incomes, were responsible for 48% of total tax collection, and by 2012 their share has fallen to 44%.

Antimonopoly Watchdog Fines TNK-BP

Mar 5, 2012:

The Federal Antimonopoly Service has fined TNK-BP for $45 million. According to the antitrust watchdog, the company set monopolistically high prices on petrol during the second and third quarters of 2011.

Twice As Precious

Mar 2, 2012:

If you paid a worker more than you should, ruled the Supreme Court of Russia, the employee may take the surplus.

In the summer of 2010 gas station operator P. left her job. The company, mistakenly, transferred to P’s account bonus and compensation for unused vacation twice. When, a month later, the company’s accountants saw the error and asked the money back, the ex-employee refused to do so.

Russia's Supreme Court has ruled that an over-paid salary or bonus cannot be recovered as unjustified enrichment unless an employer can prove that the extra money was paid as a result of an arithmetic error or because of an employee’s fault. A computer glitch that makes the same payment twice does not, says the court, qualify as an arithmetic error and, therefore, is not good enough to demand the money back.

St. Petersburg Approves Law Against 'Gay Propaganda'

Feb 29, 2012:

The Legislative Assembly of Saint Petersburg has approved in the final, third reading the bill ‘against the propaganda of homosexuality and paedophilia to minors’. We wrote about this here.

The author of the law made a passionate speech about declining moral values. Vitaly Milonov, an MP from the ruling United Russia, recalled the recent Rammstein concert when, he said, singers imitated a homosexual act. He promised to bring them to justice (how is he going to do this?). 'Let them do whatever they want and show any dirt at home but they cannot behave like that in St. Petersburg’, said the member of the local parliament.

The law forbids ‘public actions promoting sodomy, lesbianism, bisexuality and transgender among minors’ and ‘the dissemination of information that can harm health, moral or spiritual development of minors’ and ‘shape distorted understanding of the social equivalence of traditional and non-traditional marriages’.

The law sets forth the penalties for violation: 5,000 roubles ($170) for individuals and up to 500,000 roubles ($17,000) for organisations.

To come into force, the bill needs to be approved by the governor. We don't believe that Georgy Poltavchenko would sign this law. Still, the fact that it has come through the local parliament has damaged the city’s reputation for years to come.

Let Them Choose: Black, Black or Black

Feb 28, 2012:

Russia has announced nominees for the post of Judge of the European Court of Human Rights. All three candidates are experts in commercial law. Business disputes, however, comprise a tiny fraction, no more than 2%, of all cases considered by the court.

The Parliamentary Assembly of the Council of Europe (PACE) will have to pick from professor of commercial law Andrey Bushev and two judges of the Supreme Commercial Court, Dmitry Dedov and Lyudmila Novoselova.

According to the PACE recommendations, all candidates must have experience in the field of human rights. Also, the selection procedure is expected to be public. Non-governmental organisation should have their say about official candidates and suggest their own.

Moscow Helsinki Group, a human rights heavyweight, has already complained to the PACE that it did not have a chance to put forward a number of prominent activists and sent a formal letter of disagreement with how Russia’s Ministry of Justice handled the selection process.

The term at the court of Anatoly Kovler, who represented Russia in the ECHR from 2004, will expire on 31 October 2012.

The Army of Debtors

Feb 27, 2012:

Perhaps the most volatile, yet so far untapped, force in Russia is the army of those who cannot pay debt.

Sberbank, the largest bank in Russia, is selling a bad debt portfolio with a face value of $350 million to collectors, reports daily Kommersant. Last year, according to the general director of collection agency Sequoia Credit Consolidation Elena Dokuchaeva, Russian banks sold consumer debts for $2.7 billion. Mostly these are unsecured personal loans and credit cards delinquencies overdue by more than a year.

As we wrote, there is no law on individual bankruptcy in Russia. A significant number of Russians, maybe three or four million people, do not pay their debts and are doomed to constant, relentless pressure from collectors. They cannot declare bankruptcy and start living again.

The Kremlin is postponing adoption of the bankruptcy law. Why? It is afraid of misuse. That someone will not pay what he or she can.

Russian lawmakers, however, should keep in mind that bankruptcy was not invented for charity. The idea was to give people the chance to see light at the end of the tunnel, get an incentive to start earning again. For society, this is also a way to ease social tension and to stop the marginalization of entire social strata.

MP Calls to Raise Drinking Age

Feb 27, 2012:

A draft law raising the drinking age from 18 to 21 has been submitted to Parliament.

‘Today, alcohol consumption in Russia per capita is almost twice the maximum of the level allowed by the WHO’s recommendations ... An average adult consumes 17 litters of ethanol per year whereas this figure should not exceed eight’, said the author of the law MP Belyakov.

Three out of every four Russians drink. The average age at which people start drinking regularly is 14 years old. Every year 75,200 people die from alcohol, two times more than all casualties in the Afghan and the Chechen wars taken together.