Legal Guarantees Ensuring Entrepreneurial Freedom

Key conclusions

Ways to create a barrier-free environment for business 

“No matter what we do, our common task is to make sure business is protected by the government from potential consequences. If these consequences occur, they need to be adequate and they should not make them go out of business,” Andrei Nazarov, Prime Minister of the Government of the Republic of Bashkortostan.

“Our primary short-term task was set by the Government in March–April. We started acting on it and  giving maximum liberty to businesses within the country by reducing excessive procedures and audits, extending permits and licenses, providing tax incentives and speeding up budgetary procedures,”  Alexey Khersontsev, State Secretary – Deputy Minister of Economic Development of the Russian Federation.

“We firmly believe that we need to set a national goal for at least five years either by adopting a law or by President’s decree. After that, we can align the whole legislative and regulative package to this goal. The goal should be creating a barrier-free environment for business,” Sergey Morozov, First Deputy Chairman of the Committee of the State Duma of the Federal Assembly of the Russian Federation on Regional Policy and Local Self-Government. 

PROBLEMS 

Delays in court appeals and lengthy legal proceedings  

“The Criminal Code of the Russian Federation is probably the most conservative one, which may be good, because swift changes in criminal process mean you cannot foresee the consequences. They also deprive entrepreneurs and everybody else of confidence about the future. Nevertheless, some things cannot but strike me as surprising, especially now. For example, criminal justice in Russia is probably the only one that lacks efficient appeal mechanisms. If you look at the average time an appeal takes, you’ll see that it takes court four to six weeks just to register your complaint. If you appeal to prosecutor’s office or the law enforcement system, you will get a response no sooner than in 70–80 days. <…> The time it takes to review a criminal case [for economic crimes, – Ed.] is a disaster. It is a frequent situation when investigation to sentence takes eight or even nine years,” Viktoria Burkovskaya, Partner, Co-Head of Litigation Practice, Egorov Puginsky Afanasiev & Partners.

SOLUTIONS

Increasing accountability of authorities 

“We need a direct law that would approve a national programme for social and economic rehabilitation of the country. It will increase accountability of both federal, regional and municipal authorities for what we need to get done as soon as possible to achieve technological sovereignty and independence from import,” Sergey Morozov, First Deputy Chairman of the Committee of the State Duma of the Federal Assembly of the Russian Federation on Regional Policy and Local Self-Government.

“The best legal guarantee of entrepreneurial and personal liberty is independent courts, especially when it comes to threats of criminal liability for entrepreneurs,” Vadim Zaripov, Head of Analytical Service, Pepeliaev Group.

Studying regional best practices in business protection and regulating civil lawsuits 

“We suggest studying regional best practices in protecting entrepreneurial rights and removing administrative barriers. Then we can spread those practices to Moscow and other regions where they do not exist yet. It will give us an additional instrument for business development and protection, which becomes even more important under current conditions,” Anatoly Maltsan, Head of Business Protection Headquarters Office.

“We need to go back to legislative regulation of civil lawsuit in a criminal process, as well as to limiting filing possibilities in terms of its amounts and term. Presently, there is no statute of limitation. We need to change the courts’ approach and allow such a measure as arrest of property. This is something very important in terms of freeing up the resources that otherwise stay frozen for a long time,” Viktoria Burkovskaya, Partner, Co-Head of Litigation Practice, Egorov Puginsky Afanasiev & Partners.

Flexibility of antimonopoly regulation 

“Antimonopoly laws must be flexible. The immunities already prescribed by antimonopoly laws have allowed to provide additional guarantees for small businesses over the past year. Basically, all businesses with a revenue of up to RUB 800 mln do not fall under antimonopoly laws, which is a certain guarantee and gives small businesses an impetus for development. There is also a new optimization package that forces the antimonopoly agency respond to signs of economic concentration in the markets faster. Now that many companies are leaving, their property and assets need to be dealt with. Naturally, the antimonopoly function provides for control over monopolization of commodity markets through preliminary approval of the deals. <…> We are switching to notification-based control to help companies do it independently and fast. Later we can go into detail and see what happened and whether additional antimonopoly regulation is needed.  <…> We should never lose antimonopoly regulation. Otherwise, we will face monopolization of commodity markets and arbitrary will of authorities among other things. It will do no good to entrepreneurial liberty. Yet, our antimonopoly laws should not cross the red line and hinder economic development,” Sergey Puzyrevsky, Secretary of State – Deputy Head, Federal Antimonopoly Service of the Russian Federation (FAS Russia).

For more information, visit the Roscongress Foundation’s Information and Analytical System roscongress.org.

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