Russian police officers detain a man during a protest rally against the military invasion of ... [+]
Western companies hoping to return someday to the Russian market received more bad news with a set of new laws that further erode the rights of businesses and individuals in Russia. The latest actions by the State Duma follow Western sanctions and increasing domestic repression that darken the country’s political and economic prospects.
Limiting Freedom For Businesses: “[A] draft law on supplying the armed forces of Russia during operations outside the country was adopted,” reports The Insider, an independent online Russian newspaper headquartered in Latvia. “The government will be able to ‘reactivate mobilization capacities and facilities’ and establish ‘conditions of overtime work for individual organizations and enterprises’ during night, on weekends and holidays. If such measures are taken, legal entities ‘regardless of their organizational and legal forms of ownership’ will not be able to back out of agreements and contracts on delivery of goods and rendering of services for the army. In such cases, the Defense Ministry will be able to change the terms of a contract even after it has been signed.”
The Insider notes, “At the close of the spring session the State Duma deputies adopted a package of laws, under which one can be imprisoned for almost anything.”
The precedent of the Russian government commandeering businesses will likely give further pause to Western companies interested in returning to the Russian market in the future.
“Russia used to be considered a major emerging economy,” said Brian D. Taylor, a professor of political science at Syracuse University, in an interview. “With its war against Ukraine and in the face of economic sanctions, Russia is diminishing, not emerging, economically. New laws make even sharing information about Russian foreign economic activity more dangerous, as Russia seeks to hide economic activity that might fall under sanctions. Further, citizens face renewed scrutiny from security and law enforcement for sharing information with foreign organizations, which could be labeled illegal ‘confidential cooperation.’ Putin’s war has instigated a grand economic decoupling for Russia.”
As a way to lure human capital away from Russia to the benefit of the United States, the Biden administration proposed legislative language to the Ukraine assistance bill in May 2022 that would offer Russian scientists and engineers a better chance at permanent residence and a new life in America. However, the bill passed without the language. Congress could add an amendment on Russian scientists to a defense authorization bill.
Prison Time For Transmitting “State Secrets” Or Displaying A Facebook Logo: Given the Russian government is the sole authority to determine what is “extremist,” new criminal penalties put individuals and businesses at significant risk. “Now the ‘repeated propaganda or public demonstration of symbols of Nazism and extremist organizations’ will be punished under a criminal article; a violator could face up to four years in prison,” according to The Insider report. “Notably, the company Meta, which owns Facebook and Instagram, as well as the ‘Smart Voting’ symbols are also considered extremist in Russia.”
Similarly, since the Russian government can define what is a state secret, a new law on criminal penalties against transmitting “state secrets” abroad could put anyone at risk who posts information electronically.
Protection For Owners Of Palaces: Protecting government officials from embarrassment is now part of Russian criminal law. “The State Duma passed a law to classify data from Rosreestr [a Russian agency],” according to The Insider. “At present you can get information about real estate from the Unified State Register of Real Estate database for a small fee, and this information, in particular, serves as a basis for investigations carried out by journalists and the opposition into the property owned Russian politicians and security officials. Now it will be impossible to get an extract confirming the ownership of a palace without the permission of the real estate owner.” (Emphasis added.)
Potential Return Of Stalin-Like Treatment Of POWs: In the United States and countries around the world, soldiers taken as prisoners of war (POWs) are welcomed home with sympathetic treatment after being released from their hardship. After World War II, Soviet leader Joseph Stalin instituted a policy of labeling Soviet soldiers as traitors if they surrendered and spent time in German POW camps. As a result, many returning POWs, including Soviet dissident writer Alexander Solzhenitsyn, were sentenced to years in the Gulag. It appears the Russian government is interested in reviving or threatening soldiers with that practice.
Under a new law, individuals can be imprisoned for up to 20 years if they “defect to the side of the enemy during an armed conflict or hostilities.” Human rights advocate Ivan Pavlov told The Insider, “Political officers will be explaining individually and collectively and will say: 'Now you cannot surrender and will fight to the last man, and those who are taken prisoner will, as before, be welcomed at home with a criminal case.”
Treatment Of Professional Athletes: The treatment of foreign and domestic athletes in Russia bodes ill for the country reestablishing its reputation in professional sports circle. The most high-profile case involves WNBA star Brittney Griner, whose arrest after playing in a Russian women’s professional basketball league many analysts consider akin to a hostage situation. The Russian government is expected to exchange Griner for a Russian prisoner in U.S. custody. Her treatment will likely discourage other foreign athletes from working again in Russia.
Russia’s treatment of its own athletes harkens back to the days of the USSR when Soviet athletes were forbidden from signing NHL or NBA contracts. The Athletic reported the NHL Rookie of the Year in 2020-21, Kirill Kaprizov of the Minnesota Wild, has not been allowed to leave the country, accused of five years ago buying a fake military ID card. “This situation comes days after Philadelphia Flyers goaltending prospect Ivan Fedotov was arrested and taken to a military naval camp for allegedly evading mandatory military service,” the publication reports.
Businesses that hoped the Russian invasion of Ukraine would result in only short-term disruption must face reality. The Russian government has enacted policies designed to tighten its control over every aspect of the country’s political and economic life.
