Federal Law “On Amending the Russian Code of Administrative Offences” has been adopted

1. Article 3.4. of the Code of Administrative Offences determines a warning as a type of administrative punishment. This article is now supplemented with a list of criteria for the levying of a warning. A warning is now included as a sanction in approximately 50 rules of the special part of the Code of Administrative Offences.

A warning (an official written censure of a person) may be levied as administrative punishment if the following criteria are met simultaneously.

• The administrative offence was committed for the first time.
• No harm has been inflicted and there is no threat of inflicting harm on the life or well-being of people, animals or plants, the environment, cultural heritage (historical and cultural monuments) of peoples of the Russian Federation or safety of the state, as well as there being no threat of natural or man-made emergencies.
• No property was damaged.

Now it is possible to levy a warning as administrative punishment on, for example, an employer or its representative

• for avoiding participation in negotiations regarding the conclusion, amendment or supplementing of a collective agreement or contract, or for violation of a statutory timeframe for conducting negotiations; for a failure to organise work of a committee to conclude a collective agreement or contract within the timeframes determined by the parties (article 5.28. of the Code of Administrative Offences);
• for a failure to submit, within the statutory timeframe, information required to conduct collective negotiations and exercise control over the compliance with a collective agreement or contract (article 5.29. of the Code of Administrative Offences);
• for unmotivated refusal to conclude a collective agreement or contract (article 5.30. of the Code of Administrative Offences);
• for violation or non-performance of obligations stipulated in a collective agreement or contract (article 5.31. of the Code of Administrative Offences);

a citizen, official, person engaged in entrepreneurial activities or a legal entity

• for violation of the requirements stipulated in design documentation, technical rules, mandatory requirements of standards, construction rules and standards and other regulations governing construction during the construction, reconstruction or overhaul repairs of capital construction facilities, including the use of construction materials (products) (part 1, article 9.4. of the Code of Administrative Offences);
• for sale of goods, performance of work or provisions of services to people in violation of the requirements stipulated in technical rules and sanitary standards or without a compliance certificate (compliance declaration) certifying the safety of such goods, work or services in respect of the life and well-being of people (part 2, article 14.4. of the Code of Administrative Offences);

a citizen, official or a legal entity

• for violation of statutory rules governing sale of certain types of goods (article 14.15. of the Code of Administrative Offences);
• for non-compliance with environmental requirements in connection with territorial planning, town-planning zoning, planning of a territory, architectural and constructional design, construction, overhaul repairs, reconstruction, commissioning, operation or decommissioning of buildings, structures and other capital construction facilities (article 8.1. of the Code of Administrative Offences);
• for manufacture, sale or operation of technical means that do not comply with standards or rules stipulating admissible levels of man-made interference (article 13.8. of the Code of Administrative Offences);
• for performance of entrepreneurial activities in violation of conditions stipulated in a special permission (licence) (part 3 article 14.1. of the Code of Administrative Offences);
• for sale of goods, performance of work or provision of services to people that do not comply with the requirements of technical rules, standards, technical specifications or samples in terms of quality, completeness or packaging (part 1, article 14.4. of the Code of Administrative Offences);
• for sale of goods, performance of work or provision of services by a company or citizen registered as a sole trader if there is none of the required information about the manufacturer (contractor, seller) or other information required by Russian legislation (part 1, article 14.5. of the Code of Administrative Offences);
• for failure to use cash registers when required by federal laws; for use of cash registers that do not comply with statutory requirements or are used in violation of the procedure and conditions for their registration and use, as prescribed by Russian legislation; and for refusal to issue, at the request of a buyer (client), a document (sales receipt, notice of receipt or another document confirming the receipt of money for the relevant goods (work, services)) when stipulated by a federal law (part 2, article 14.5. of the Code of Administrative Offences);
• for non-submission or untimely submission to a state authority (official) of data (information) required by law or necessary for the performance by this authority (official) of his/her/its lawful activity, as well as for the submission to a state authority (official) of incomplete or corrupted data (information) (apart from exclusions stipulated in article 19.7. of the Code of Administrative Offences);

an official or a legal entity:

• for violation of a consumer’s right to receive requisite and reliable information about the good (work, service) sold, the manufacturer, seller, contractor or their work schedule (part 1 article 14.8. of the Code of Administrative Offences);

an official:

• for violation of a statutory timeframe for filing an application for tax registration (part 1, article 15.3. of the Code of Administrative Offences);
• for violation of a statutory timeframe for the submission to the tax authority of information about the opening or closing of an account with a bank or another credit institution (article 15.4. of the Code of Administrative Offences);
• for violation of statutory timeframes stipulated by tax legislation for the submission of a tax return to the tax authority at the place of registration (article 15.5. of the Code of Administrative Offences).

Before, the above offences entailed punishment by way of an administrative fine or, more rarely, suspension of activities. This demonstrates an overall trend of liberalising administrative liability in respect of entrepreneurial activities. It should be taken into account that the law liberalising administrative liability has a retrospective effect. In other words, it applies to a person who committed an administrative offence before the enactment of the law and in respect of whom no resolution levying administrative punishment has been executed (part 2, article 1.7. of the Code of Administrative Offences).

2. The Code of Administrative Offences is supplemented with article 19.6.1. This article stipulates administrative liability for officials of the controlling authorities for incompliance with the requirements of legislation on audits.

The Law stipulates punishment of officials of state controlling (supervisory) authorities by way of a warning or administrative fine from RUB 3,000 to 5,000 and for a repeated offence from RUB 5,000 to 10,000 for the following violations of requirements specified in Federal Law No. 294-FZ dated 26 December 2008 “On the Protection of the Rights of Legal Entities and Sole Traders when Exercising State Control (Supervision) and Municipal Control”:

• Performance of an audit in the absence of grounds for the performance thereof;
• Violation of timeframes stipulated for the performance of an audit (under the general rule, the duration of an audit is 20 business days, but special conditions are stipulated in article 13 of the Law);
• Absence of an approval by the prosecutor’s authorities for an extraordinary field audit;
• Performance of an audit without an instruction (order) of the head or deputy head of the state controlling (supervisory) authority;
• Non-submission of a statement on the audit performed;
• Engagement of citizens or organisations for the performance of control measures not accredited in the prescribed manner;
• Performance of a planned audit not included in the annual plan of planned audits.

Cases on the administrative offences envisaged in article 19.6.1 of the Code of Administrative Offences are initiated by the Prosecutor and are considered by judges. The relevant additions are also introduced to part 1, article 28.4 and part 1, article 23.1 of the Code of Administrative Offences, respectively.

3. The Code of Administrative Offences is supplemented with article 19.7.5-1. This article stipulates administrative liability of a legal entity and sole trader for violation of the procedure for the submission of a notification of its commencement of entrepreneurial activities.

Article 8 of Federal Law No. 294-FZ dated 26 December 2008 “On the Protection of the Rights of Legal Entities and Sole Traders when Exercising State Control (Supervision) and Municipal Control” stipulates that legal entities and sole traders have an obligation to submit a notification about the commencement of entrepreneurial activities, which as a rule directly relate to the provision of services to consumers of goods, work or services.

Such notifications are submitted to the regional agency of the Federal Supervisory Service in the Sphere of the Protection of Consumer Rights and Human Well-Being (Rospotrebnadzor) or to a regional agency of the Federal Medical and Biological Agency (depending on the type of activity).

Resolution No. 584 of the Russian Government dated 16 July 2009 approves a form of notification about the commencement of entrepreneurial activities, the procedure for submitting such notifications and the procedure for accounting for these notifications by the authorised body.

The new article of the Code of Administrative Offences stipulates liability for non-submission of a notification about the commencement of entrepreneurial activities (part 1, article 19.7.5-1. of the Code of Administrative Offences) and for the submission of a notification about the commencement of entrepreneurial activities containing unreliable data (part 2, article 19.7.5-1. of the Code of Administrative Offences), in both cases if the submission of such notification is mandatory.

These offences entail punishment by way of an administrative fine:

• for officials and sole traders from RUB 3,000 to RUB 5,000; for legal entities from RUB 10,000 to RUB 20,000 under part 1, article 19.7.5-1. of the Code of Administrative Offences;
• for officials and sole traders from RUB 5,000 to RUB 10,000; for legal entities from RUB 20,000 to RUB 30,000 under part 2, article 19.7.5-1. of the Code of Administrative Offences.

Protocols on administrative offences are to be drawn up by officials of the bodies authorised to accept such notifications. Cases on administrative offences are to be considered by judges. The relevant additions are introduced to part 2, article 28.3 and part 1, article 23.1 of the Code of Administrative Offences, respectively.

For further details, please contact:

in Moscow – Elena Ovcharova, Head of the Administrative Defence of Business Group, at (495) 967-00-07 or by e.ovcharova@pgplaw.ru; Nataly Travkina, Senior Associate, at (495) 967-00-07 or by n.travkina@pgplaw.ru; Elena Lazareva, Senior Associate, at (495) 967-00-07 or by e.lazareva@pgplaw.ru; Julia Osipova, Associate, at (495) 967-00-07 or by y.osipova@pgplaw.ru

in St Petersburg - Sergey Spasennov, Partner, Head of St. Petersburg office, at (812) 333-07-17 or by s.spasennov@pgplaw.ru