A draft law has been put before the State Duma to toughen liability for small-scale corrupt business practices and small-scale bribery
Pepeliaev Group advises that a draft federal law (the “Draft”) has been put before the State Duma toughening liability under certain aggravating bodies of a crime under articles 204.2 (“Small-scale corrupt business practices”) and article 291.2 (“Small-scale bribery”) of the Russian Criminal Code (the “Criminal Code”). The confiscation of property is also introduced under such bodies of crimeDraft Federal Law No. 411567-8 “On amending the Russian Criminal Code” (the “Draft”); https://sozd.duma.gov.ru/bill/411567-8.
The author of the draft law, deputy Vasily Piskarev, emphasizes the importance of the proposed changes: “The amounts that are affected do not exceed RUB 10 000. This is important because specifically such exactions that are small at first sight comprise low-level corruption, which is just as dangerous as large-scale bribery “https://lenta.ru/news/2023/07/28/duma/
According to the Explanatory Note to the Draft, such crimes often have a nature of criminal business: “While sporadic cases of small-scale bribery and corrupt business practices are not very dangerous for the public, the same actions turned into criminal business are not a lesser threat to the exercise of individuals’ rights and the interests of society or the state that are protected by law than gross manifestations of bribery. The aggregate amount of small-scale bribes may be comparable with an extremely large scale”.
Statistics of corruption-related crimesAccording to the Russian Ministry of Internal Affairs
Of these, 13,668 crimes were bribery-related crimes (increased by 3%), of which 32% (4,349 crimes) was accounted for by low-scale bribery.
What is proposed to be changed
1. To expand the bodies of crime under articles 204.2 and 291.2 of the Russian Criminal Code.
The draft law proposes that independent bodies of crime be singled out in articles 204.2 “Small-scale corrupt business practices” and 291.2 “Small-scale bribery” of the Criminal Code:
an individual carrying out management functions in a commercial or another company unlawfully transferring and receiving the subject matter of small-scale corrupt business practice;
an official, a foreign public official or an officer of a public international organisation providing and receiving a small-scale bribe.
2. To supplement the bodies of crime of articles 204.2 and 291.2 of the Russian Criminal Code with additional classifying factors
Articles 291.2 and 204.2of the Russian Criminal Code are supplemented with classifying factors that strengthen liability when the following circumstances are in place:
extorting the subject matter of a corrupt business practice or a small-scale bribe;
a group of persons acting in collusion or an organised group of persons committing a crime;
acts (omissions) that are known to be unlawful for which a small-scale bribe is provided;
an individual committing an offence who has a prior conviction for committing similar crimes.
3. To expand the application of provisions regarding the confiscation of the property of individuals involved in corrupt practices
The Draft supplements the list of crimes contained in article 104.1(a) of the Criminal Code with articles 204.2 and 291.2. This means that it will be possible to apply the confiscation of property if a punishment is imposed for low-scale bribery and small-scale corrupt business practices.
The new aggravating bodies of crime increase the general “strictness” of sanctions under articles 204.2 and 291.2 of the Criminal Code for small-scale and what is known as everyday corruption. Sanctions are also actually toughened for small-scale corruption owing to the list being expanded of classifying factors that aggravate liability. However, we believe that the main change for which the Draft provides is the permission to apply the confiscation of property under these bodies of crime.
The Russian Supreme Court in its response to the Draft considered excessive the inclusion in it of such a classifying factor as “an organised group committing crimes”. From the perspective of the Russian Supreme Court, the authors of the draft law “have not provided data as to how common cases are of low-scale bribery (corrupt business practices) committed by an organised group of persons”. The classifying factor of “a group of persons acting in collusion” is sufficient for these bodies of crimes.
This classifying factor will probably disappear from the Draft in subsequent readings. The Russian Supreme Court supports all of the other additional classifying factors. This means that if the draft law is adopted more offences will be subject to harsher liability.
What to think about and what to do
At present the date of the first reading of the Draft in the State Duma has not yet been determined. This date and subsequent progress of the Draft in the State Duma should be monitored.
The responses received from the Russian Supreme Court and the Russian Government give general approval to the proposals of those who have initiated the Draft, but also make several important comments. Thus, the Russian Supreme Court emphasises that the Explanatory Note does not always substantiate the need to expand tougher sanctions and the Government notes certain flaws in the wordings of these sanctions. Therefore, it is reasonable to assume that certain amendments will be made to the Draft.
Compliance specialists and specialists from legal departments of companies should pay closer attention to the new classifying factors of the bodies of corruption-related crimes that are proposed in the Draft.
Help from your adviser
Pepeliaev Group’s lawyers are ready to assess the actions of a company’s management and employees for criminal-law risks of liability for offences with respect to which the Draft expands the classifying factors. They will also develop measures to protect the rights and legitimate interests of the company and its managers while preventing corruption, which includes implementing appropriate measures of anti-corruption complianceThe requirements to implement measures of anti-corruption nature according to article 13.3 of the Federal Law “On preventing corruption” (Federal Law No. 273-FZ dated 25 December 2008) extend to all companies active in Russia.
Translated by the Translation Department of Pepeliaev Group