Moratorium on inspections of small and medium-sized enterprises

Pepeliaev Group advises that the amendments made to article 26.2 of Federal Law No. 294-FZ dated 1 April 2020 introduce a moratorium on inspections of small and medium-sized enterprises[1].

In line with the amendments, no inspections will be held with respect to legal entities and individual entrepreneurs classified as small and medium-sized enterprises (SMEs) in the period from 1 April to 31 December 2020.

Exceptions are made with respect to inspections caused by damage or exposure to damage to the life and health of individuals, as well as natural or man-made emergencies.

Prior to this change a moratorium had been established until 31 December 2020 only for small enterprises and only with respect to scheduled inspections with a large number of exceptions.

In the meantime, state authorities continue to function (clause 6 of the Russian President’s Decree No. 239 dated 2 April 2020); therefore, inspections that do not fall under this moratorium or other restrictions being introduced at present[2] may be held at any time, especially if these inspections do not require direct contact with the person being inspected or its employees.

What to think about and what to do

We believe that inspections appointed before the moratorium was introduced but not completed by 1 April 2020 should be terminated (should not be conducted). However, they may be performed, where possible, without a direct contact with the persons being inspected and their employees. If any violations have been identified within the scope of these appointed inspections, such inspections will also continue (in particular, this approach was suggested by the Federal Tax Service in its Order No. ED-7-2/181@ dated 20 March 2020).

At the same time, the moratorium has other exceptions:

  • for this regulation to be applied to an enterprise or individual entrepreneur, information about them has to be registered with the Unified Register of Small and Medium-sized Businesses; otherwise the moratorium will not be applicable;
  • the introduced limitation will be relevant only to those inspections that are appointed and held under Federal Law No. 294-FZ dated 26 December 2008;
  • a violation of the rules established in connection with the high-alert regime causes a threat to the life and health of individuals and creates exposure to an emergency. It is compliance with these rules that primarily will be checked (and is being checked) from now on.

Help from your adviser

Pepeliaev Group’s specialists have accumulated vast experience of how to prepare their clients for state and municipal control measures; we offer legal support during such control measures and can challenge the results. The final outcome of such control measures conducted with respect to our clients generally corresponds to their interests to the maximum extent possible.

[1] Federal Law No. 98-FZ dated 1 April 2020 “On amending certain items of legislation of the Russian Federation regarding the prevention and elimination of emergencies” dated 1 April 2020.

[2] For instance, the scheduled tax and customs inspections, inspections of compliance with foreign currency legislation and legislation on cash register equipment (CRE) and others have been suspended

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