The Russian Federation is consistently increasing efforts to counter corruption.
Beginning in 2010, certain categories of the Russian Federation civil servants, state officials and state corporations officers have been required to provide information regarding their income, property and proprietary liabilities, as well as information regarding income, property and proprietary liabilities of their spouses and minor children.
In 2011, a Federal Law was passed making individuals holding offices in foundations and other organisations established by the Russian Federation on the basis of federal laws, and certain categories of employees hired under labour contracts by organisations set to fulfil tasks assigned to federal agencies, responsible for presenting this kind of information.
However, the full anti-corruption potential of this measure may only be achieved by monitoring the sources of the money used to obtain property – in other words, monitoring spending.
The President of Russia’s Address to the Federal Assembly of December 22, 2011 therefore proposed the idea to implement the examination of spending by specific categories of individuals in cases when their spending on the acquisition of land, other real estate, means of transportation, securities, stocks (equity shares, shares in companies’ authorised capital) clearly do not correspond with their incomes.
In order to implement this provision of the Presidential Address, drafts have been prepared for the Federal Law On Monitoring Correspondence between Spending and Incomes of State Officials and Other Individual, the Federal Constitutional Law On Amendments to Article 10 of the Federal Constitutional Law On the Government of the Russian Federation and the Federal Law On Amendments to Certain Legislative Acts of the Russian Federation following the Adoption of the Federal Law On Monitoring Correspondence between Spending and Incomes of State Officials and Other Individuals.
In accordance with the indicated draft laws, individuals holding state offices of the Russian Federation, state offices of federal constituent entities, municipal offices, federal public service offices, public service offices of federal constituent entities, municipal service offices, and certain offices in organisations set to perform state management functions (state corporations, pension funds, etc.), are obligated to file information regarding their spending, as well as spending by their spouses and minor children, pertaining to the acquisition of land, other real estate, means of transportation, securities, stocks (equity shares, shares in companies’ authorised capital), and information on the sources of the money thus spent.
Information concerning the incomes of the individual and his or her spouse at their primary jobs is published on official government and municipal websites, as well as the websites of organisations set to perform state management functions.
The draft laws also specify procedures for monitoring the said spending and establish that when circumstances are revealed attesting to a discrepancy between spending by the individual in question, or his or her spouse and minor children, and their incomes, the information obtained through such monitoring is to be forwarded to law enforcement agencies of respective jurisdiction and are mandatorily presented to the prosecution authorities of the Russian Federation. Upon receiving such materials, the Prosecutor General of the Russian Federation or subordinate prosecutors shall submit a request to a court for alienating such land, other real estate, means of transportation, securities, stocks (equity shares, shares in companies’ authorised capital) and converting it into public revenue, in cases when such property is not accompanied by evidence confirming its procurement through lawful forms of income.
To implement this stipulation, the Civil Code of the Russian Federation shall be supplemented with the corresponding provisions.
Corresponding amendments shall also be made to the Civil Code of the Russian Federation, the Law On the Tax Authorities of the Russian Federation, the Federal Laws On Banks and Banking Activities, On the Prosecutor General’s Office of the Russian Federation, On the Status of a Member of the Council of Federation and a Deputy of the State Duma of the Federal Assembly of the Russian Federation, On the Accounts Chamber of the Russian Federation, On General Principles for Organising Legislative (Representative) and Executive Government Authorities in Constituent Entities of the Russian Federation, On Combating Legalisation (Laundering) of the Proceeds of Crime and Financing of Terrorism, On State Civil Service in the Russian Federation, On Countering Corruption, and several other laws.
The measures stipulated by these draft laws conform to the National Strategy for Countering Corruption, approved by the April 13, 2010 Executive Order of the President of the Russian Federation, and comply with the requirements of international conventions on establishing liability for unlawful enrichment.
The amendments made to the Federal Law On Combating Legalisation (Laundering) of the Proceeds of Crime and Financing of Terrorism are aimed at meeting the Russian Federation’s international obligations.