The Russian Duma approved its much anticipated amnesty for entrepreneurs on July 2, seeking to halt the legal onslaught against the Russian business community. More than 100,000 Russian businesspeople are now either in prison or have been subject to criminal proceedings, according to Boris Titov, Russia’s official ombudsman for the defense of the rights of entrepreneurs. He maintains that the majority are innocent. Releasing them — and improving Russia’s overall business climate — remains critical as the Russian economy continues stumbling along with low growth and falling revenues.
Russia has reached this disastrous state because of Moscow’s abuse of criminal law statutes — specifically provisions covering economic crime. Law enforcement authorities use these statutes, many still based on Soviet law, essentially to criminalize regular business activity, otherwise permitted under Russian civil law.
So Russian criminal investigators, tax inspectors, prosecutors and other oversight bodies — often at the behest of criminal groups — have used these broad laws to intimidate, and blatantly steal from Russia’s fledgling small business community. Titov regularly highlights these miscarriages of justice. He recently traveled to Rostov-on-Don, for example, and singled out an entrepreneur who had been detained without trial for five years based on charges of fraud (Article 159) — the most abused provision within the Russian criminal code.
Titov broached the possibility of an amnesty about a year ago, to bring attention to the plight of Russia’s small business sector. He hoped that releasing thousands of Russian entrepreneurs might also spark economic growth.