KUTAFIN UNIVERSITY 2 KUTAFIN UNIVERSITYLAW LAW REVIEW REVIEWVolume I (September 2014) Issue 1 Volume 1 April 2016 Issue 1(5)

Senior Editorial Council Maria Antokolskaja Dimitry Kochenov (VU University Amsterdam) (University of Groningen) Andrea Bonomi Sergey Pashin (University of Lausanne) (Higher School of Economics, Moscow) Bill Bowring Roman Petrov (University of Essex) (Kyiv-Mohyla Academy) William Butler Csaba Varga (Pennsylvania State University) (Catholic University, Budapest) Peter Van Elsuwege Sergey Zavriev (University of Ghent) (Kutafi n University, Moscow) Christophe Hillion Junjie Zhang (University of Leiden) (Minzu University of China) Editorial Board Team Editors-in-Chief Public Relations Editor Irina Alebastrova Alexander Ermolenko (Kutafi n University, Moscow) (Kutafi n University, Moscow) Paul Kalinichenko (Kutafi n University, Moscow) Diversity and Development Executive Editor Editors Olga Shevchenko Alexey Salomatin (Kutafi n University, Moscow) (University of Penza) Oleksiy Kresin International Editor (Volodymyr Koretskyi Institute Maria Zakharova of State and Law, Kyiv) (Kutafi n University, Moscow) Boris Strashun Online Editor (Kutafi n University, Moscow) Sergey Zaikin (Kutafi n University, Moscow) Editors Jensen Bigelow Promotion Editors (Davidson College, North Carolina) Yulia Kalinina Arsen Gourjian (Kutafi n University, Moscow) (Worcester Polytechnic Institute, Bartosz Mendyk Massachusetts) (Jan Kochanowski University, Kielce) Thomas Roberts (ELF Translations LTD, Submission Editors Edinburgh) Marina Lazareva (Kutafi n University, Vologda) Junior (Student) Editor Elena Cherepakhina Olga Gavrilova (Kutafi n University, Moscow) (Kutafi n University, Moscow)

Frequency Publisher The opinions expressed in two issues per year Kutafi n Moscow submissions do not necessarily Contacts State Law University (MSAL) refl ect the position of the www.kulawr.ru 9 Sadovaya-Kudrinskaya str., Editorial Body and Council. [email protected] Moscow, Russia, 123995 [email protected] http://msal.ru/en/ All rights reserved. Any +7 (499) 244-85-56 [email protected] part of this journal may not be KULawR always welcomes new published elsewhere without the authorswww and sponsors +7 (499) 244-85-56 written consent of the publisher II BRIEF TABLE OF CONTENTS

Welcome Note ...... 2

LEGAL TRANSFORMATIONS AND THEORETICAL INSIGHTS

The Dispute between Boris Chicherin and Vladimir Solovyov on the Nature of Law and Modern Constitutionalism Article by Vladimir Kochetkov (Russia) ...... 3

CRIME PREVENTION: CONCEPTUAL DESIGN AND SOCIAL PRACTICES

Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation Article by Gennady V. Dashkov (Russia) ...... 23

Developments of Social (Crime) Prevention in Europe – A Brief Overview Article by Gorazd Meško and Benjamin Flander (Slovenia) ...... 46

POLITICAL PROBLEMS AND LEGAL SOLUTIONS

Some Thoughts on the Origins of Russian Constitutionalism and the Position of Russia in the Global Constitutional Process Article by Galina Andreeva (Russia) ...... 54

Overlapping Competencies Within the System of Separation of Powers in the Russian Federation Article by Nina M. Kolosova (Russia) ...... 76

E-Democracy in Modern Russia: The Establishment, Development and Prospects Article by Marina M. Kuryachaya (Russia) ...... 93

LAW AND ECONOMY

Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam Article by Tran Viet Dung (Vietnam) ...... 106 www.kulawr.ru Volume 1 April 2016 Issue 1(5) BRIEF TABLE OF CONTENTS III

The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry Article by Vasily N. Anurov (Russia) ...... 127

The Constitutional Regulation of Property Rights Article by Ilya Iksanov and Polina Krasnova (Russia) ...... 142

HUMANISTIC VALUES IN LAW

Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan and their Impact on Developing an Effective System to Protect the Rights of Man and of the Citizen Article by Saule Amandikova (Kazakhstan) ...... 158

Moral, Informational and Legal Aspects of Professional Journalism Article by Dmitry Shibaev and Nina Uibo (Russia) ...... 173

Combating an Unjustifi ed Tax Benefi t in the Russian Federation Note by Sergey Sergeev (Russia) ...... 185

Legal Aspects of Surrogacy Contracts Note by Svetlana Morozova (Russia) ...... 198

MANY THANKS TO OUR REVIEWERS FOR THE YEARS OF 2014―2015 ...... 204

Volume 1 April 2016 Issue 1(5) www.kulawr.ru IV DETAILED TABLE OF CONTENTS

Welcome Note ...... 2 LEGAL TRANSFORMATIONS AND THEORETICAL INSIGHTS The Dispute between Boris Chicherin and Vladimir Solovyov on the Nature of Law and Modern Constitutionalism Article by Vladimir Kochetkov (Russia) ...... 3 I. Introduction ...... 4 II. Chicherin: law as freedom ...... 8 III. Solovyov: law as social justice ...... 11 IV. Modern constitutionalism on freedom and justice ...... 14 V. Conclusion ...... 20 Bibliography ...... 20 CRIME PREVENTION: CONCEPTUAL DESIGN AND SOCIAL PRACTICES Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation Article by Gennady V. Dashkov (Russia) ...... 23 I. Introduction. Objective setting ...... 25 II. Functions of criminological comparative legal studies ...... 26 III. Creative punishments as the subject of adopting foreign crime fi ghting experience ...... 32 IV. Priorities in adopting foreign practices in crime fi ghting ...... 36 V. Formation of the collective experience resulting from the citizens’ enhanced involvement in crime fi ghting ...... 40 VI. Perspectives ...... 44 Bibliography ...... 44 Developments of Social (Crime) Prevention in Europe – A Brief Overview Article by Gorazd Meško and Benjamin Flander (Slovenia) ...... 46 I. On social crime prevention ...... 47 II. The historical context: A brief sketch of the key post-war developments in the sphere of social crime prevention ...... 49 III. Conclusion ...... 52 Bibliography ...... 53 POLITICAL PROBLEMS AND LEGAL SOLUTIONS Some Thoughts on the Origins of Russian Constitutionalism and the Position of Russia in the Global Constitutional Process Article by Galina Andreeva (Russia) ...... 54 I. Russian researchers in constitutional law about the origins of Russian constitutional history ...... 55 II. Russian constitutionalism outside Russia and in its remote parts ...... 60 III. Origins of Russian constitutionalism outside Russia: An experience of joint (together with the Ottoman Empire) granting the Constitution to the Ionian Islands in 1799 ...... 62 IV. The importance of Russia’s constitutional experience for the evaluation of Russia’s place in the international constitutional process ...... 69 V. Concluding Remarks ...... 72 Bibliography ...... 72 www.kulawr.ru Volume 1 April 2016 Issue 1(5) DETAILED TABLE OF CONTENTS V

Overlapping Competencies Within the System of Separation of Powers in the Russian Federation Article by Nina M. Kolosova (Russia) ...... 76 I. Introduction ...... 77 II. Sovereignty of the people and representation of the people as constitutional foundations for the overlapping competencies ...... 79 IП. Limitations to overlapping: The danger of disproportion ...... 83 IV. The principle of separation of powers and overlapping competencies: The role of the RF Constitutional Court in ensuring their proportional application ...... 88 V. Conclusions ...... 91 Bibliography ...... 91 E-Democracy in Modern Russia: The Establishment, Development and Prospects Article by Marina M. Kuryachaya (Russia) ...... 93 I. The institutionalization of E-Democracy in Russia ...... 94 II. The electronic technology in the legal space of Russia ...... 97 III. The electronic technologies of the control of activities of public authorities ...... 99 IV. The development of crowdsourcing in the legal fi eld ...... 102 V. The problems of the development of electronic democracy in Russia ..... 103 Bibliography ...... 104 LAW AND ECONOMY Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam Article by Tran Viet Dung (Vietnam) ...... 107 I. Introduction ...... 107 II. An overview of the regulatory framework ...... 109 1. Types of arbitral awards ...... 109 2. The procedure for obtaining court judgment for the enforcement of foreign arbitral awards ...... 110 3. Grounds for the refusal to recognize and enforce arbitral awards ...... 111 III. Application of the New York Convention in Vietnam ...... 113 1. General principle of application of the New York Convention ...... 113 2. Defi nition of the arbitral award ...... 114 3. Causes for refusal to recognize the foreign arbitral awards ...... 115 (a) legal representation ...... 116 (b) validity of an arbitration agreement ...... 117 (c) notifi cation procedure ...... 118 (d) public policy consideration ...... 119 (e) court’s jurisdiction ...... 120 (f) an authorized representative for the applicant in the proceeding ...... 121 (g) burden of proof in case of refusal to enforce the award ...... 121 (h) piercing the corporate veil ...... 122 IV. Conclusion ...... 123 Bibliography ...... 126

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The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry Article by Vasily N. Anurov (Russia) ...... 127 I. Introduction ...... 130 II. The interaction between international investment law and human rights...... 131 III. The prerequisites for the application of the proportionality principle ...... 132 IV. The common denominator in the proportionality principle ...... 134 V. The interaction between concession contracts and human rights...... 136 VI. The application of the principle of proportionality in the oil and gas industry ...... 138 VII. Conclusions ...... 140 Bibliography ...... 141 The Constitutional Regulation of Property Rights Article by Ilya Iksanov and Polina Krasnova (Russia) ...... 142 I. Introduction ...... 144 II. The importance of constitutional law in regulating public relations in the economy sphere ...... 144 III. The involvement of the institution of property rights in some court cases ...... 145 IV. The constitutional law concept of private property rights ...... 147 V. The defi nitive opinion on the status and rights of bona fi de owner ...... 152 Bibliography ...... 156 HUMANISTIC VALUES IN LAW Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan and their Impact on Developing an Effective System to Protect the Rights of Man and of the Citizen Article by Saule K. Amandikova (Kazakhstan) ...... 158 I. Introduction ...... 159 II. The Constitution of the Republic of Kazakhstan and international human rights standards ...... 160 III. The Constitutional Council of the Republic of Kazakhstan: Its powers and the role in rights’ protection ...... 161 IV. Signifi cance of preventive constitutional control ...... 163 V. Interpretation of the Constitution as the most important part of the Constitutional Council's impact on the protection of human rights ...... 164 VI. The Constitutional Council as a body providing indirect protection of human rights ...... 169 VII. Conclusion ...... 170 Bibliography ...... 171 www.kulawr.ru Volume 1 April 2016 Issue 1(5) DETAILED TABLE OF CONTENTS VII

Moral, Informational and Legal Aspects of Professional Journalism Article by Dmitry Shibaev and Nina Uibo (Russia) ...... 173 I. Introduction ...... 174 II. International and Russian legal regulation of journalism ...... 176 III. The practice of resolving disputes by the Public Commission for Press Complaints ...... 180 IV. Findings ...... 182 Bibliography ...... 184 Combating an Unjustifi ed Tax Benefi t in the Russian Federation Article by Sergey Sergeev (Russia) ...... 185 I. Introduction ...... 186 II. Adopting the concept of unjustifi ed tax benefi t ...... 187 III. Common judicial doctrines applied by Arbitration courts ...... 188 A. The business purpose doctrine ...... 188 B. The doctrine of fi ctitious transactions ...... 189 C. The doctrine of primacy of substance over form ...... 189 D. The doctrine of due circumspection at the Choice of a Business Partner ...... 189 IV. Signs of unjustifi ed tax benefi t ...... 190 V. Combating abusive practices in foreign jurisdictions ...... 191 VI. Judicial practice review ...... 192 A. Artifi cial involvement of intermediaries ...... 192 B. Infl ating the price through the use of fl y-by-night companies ...... 193 C. Fragmentation of business ...... 194 D. Abuse of tax reliefs ...... 195 VII. Concluding remarks ...... 196 Bibliography ...... 197

Legal Aspects of Surrogacy Contracts Note by Svetlana Morozova (Russia) ...... 198

MANY THANKS TO OUR REVIEWERS FOR THE YEARS OF 2014―2015 ...... 204

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 2 KUTAFIN UNIVERSITY LAW REVIEW

Dear readers,

We are happy to present you the first issue of our journal of 2016. As usual we have published legal studies by scholars from different countries which focus on the actual problems and fundamental issues of the legal theory and practice as well as researches of social, political, economic and cultural environment of legal reality. We hope you will find a lot of interesting information and ideas while reading this issue. Among our authors and readers there are some well-known scholars as well as young researchers. They discuss on legal topics covered by various branches of law and allied sciences, expressing very different opinions. Submitting to KULawR as well as reading it, gives one a good chance to participate in very interesting and useful discussions with colleagues from every corner of the world, and to communicate with both like-minded people and opponents. A special attention in this issue is given to international law problems and moral pillars of law. It is our small contribution to the humanization and harmonization of relationships between people by virtue of law. We hope you would enjoy reading the Kutafin University Law Review. We always welcome you to join our team and become our reader or author. We are open to any kind of ideas and opinions. We welcome you to visit our web page at and join our group at Facebook.

Kindest regards, Editors-in-Chief Irina Alebastrova, PhD (Law), Associate Professor Paul Kalinichenko, Doctor of science (Law), Professor

www.kulawr.ru Volume 1 April 2016 Issue 1(5) 3

LEGAL TRANSFORMATIONS AND THEORETICAL INSIGHTS

ARTICLE

THE DISPUTE BETWEEN BORIS CHICHERIN AND VLADIMIR SOLOVYOV ON THE NATURE OF LAW AND MODERN CONSTITUTIONALISM

Vladimir Kochetkov (Russia)

Author Associate Professor, International Slavic Institute (Moscow) Email: [email protected] Abstract The content of the legislation and enforcement in the modern state depends on how we understand the nature of law. Therefore, the article discusses the controversy of Boris Chicherin and Vladimir Solovyov, which took place in the second half of the XIX century. The former was a classic liberal who had connected the essence of law solely with the value of freedom, yet the latter was of an opinion that law was the bare minimum of justice. In this regard, it is important to understand differences between moral norms and the law according to Chicherin. He believed that legal norms defined the outer bounds of freedom, while the moral norms defined the internal requirements of moral duty. In principle, Solovyov was agree, that the idea of freedom and rights generated by commodity-money relations was related to the sphere of private law. But extreme poverty and other adverse social circumstances can easily create insurmountable obstacles to realization of human capabilities. Therefore, these obstacles should be eliminated by ensuring that each person needs not only formal freedom, but also the necessary assistance with its implementation. Examining their views, the author shows that the arguments of these scholars are widespread among modern Russian jurists and philosophers. In order to exclude that

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opposition of freedom and justice the author offers an axiological understanding constitutionalism as a theoretical form of legal consciousness that connects these values into a creative synthesis. Keywords Constitutionalism, Boris Chicherin, Vladimir Solovyov, legal consciousness, constitutional law, legal classics

DOI: 10.17803/2313-5395.2016.1.5.003-022

TABLE OF CONTENTS

I. Introduction ...... 4 II. Chicherin: law as freedom ...... 8 III. Solovyov: law as social justice ...... 11 IV. Modern constitutionalism on freedom and justice ...... 14 V. Conclusion ...... 20 Bibliography ...... 20

I. INTRODUCTION

By the time the constitutional question1 was first arisen in Russia in the 70s of the 19th century, in the West there had already been formed three strong traditions of constitutionalism as a certain form of legal consciousness. According to the first tradition, which can be conventionally called as the Anglo-Saxon one, the priority of government was to protect the rights and freedoms, that the only basis of power is founding social contract based on recognition of the equal dignity of all human beings. Axial principle of nation-building is to limit its intervention in the space of private and public autonomy. Hence the great attention was given to the limitation of state power: either through the mechanism of representative self-government of the people provided

1 Constitutional question can be defined as cognitive dissonance between the rational expression of the values of freedom, justice and human dignity, on the one hand, and the lack of real conditions for their implementation, on the other. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 5 that there is a system of independent and fair courts (the parliamentary monarchy in England); or through a power-sharing arrangement, both vertically and horizontally, of the powers and processes of legitimation (known as a system of checks and balances), but again, in the presence of an independent and fair trial as a guarantor of the functioning of the entire system (the USA). Unlike the first model the second one, French did not recognize the occurrence of a state as a result of social contract. On the contrary a state by itself created the nation by recognizing the equal dignity of all citizens, which is primarily expressed in the recognition of the natural and imprescriptible rights of the individual. The only way to ensure this is the principle of the separation of powers, which led to the fact that the Court was not the guarantor of the functioning of the entire system, and as such it was considered the will of the nation, which appeared either as a result of parliamentary debates, or a plebiscite democracy, or within revolutionary actions. In other words, between a state and a citizen in this case there is a third person – the political nation and its will as a source of legitimation of state power. Thus, we can say that in France at the moment of the occurrence of constitutional archetypes there were united an absolutist state (administrative justice as justice) and the principle of popular sovereignty with its collective protection of human rights (solidarity as brotherhood). In Germany (with which Russian government bureaucracy and intelligentsia traditionally had broad cultural and dynastic ties) the process of the occurrence of constitutional archetypes took place in a different way. Since the process of formation of the German state was largely artificial, so far among German intellectuals there were spread two theories that had the strongest influence on the history of Europe as a whole and Russia in particular. We have in mind the theory of the national spirit as the substance of law and the state as a special legal entity. The first concept was the rationale for the special German path as consistent incarnation of the national spirit (der Sonderweg), which ultimately led to the tragedy of the whole world under National Socialism. The other one bred the idea of the possibility of the existence of the rule-of-law state (das Rechtstaat) as a state limited by its own law that means in fact by the bills it created. It was a special German rationalization of the Anglo-Saxon idea of the rule of law, which

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 6 KUTAFIN UNIVERSITY LAW REVIEW ultimately led to legal positivism that replaced the principle of justice as a source of law by the will of a (legal or natural) person in authority. The main reason for close relationship between Russian and Germany was the fact that for a long time those countries were on the periphery of social and economic development of Europe. Hence there is some irrationalism of theories of the national spirit (instead of rationalism of idea of human rights and popular sovereignty) and self- limiting state as a legal entity (instead of rationalism of the rule of law in the forms of private and public autonomy). Therefore the occurrence of the archetypes of constitutional legal consciousness2 in Russia at that time faced with several obstacles. Firstly, it is the rejection of the right as the primary means of social self-regulation. Arguments of this kind were actively being developed by thinkers of the Slavophile orientation. Slavophiles blamed the West for its legal rationalism. They believed that the autocracy and Orthodoxy made the Russian people very different from the others of (Catholic and Protestant) Christian Europe, so no any borrowing of political and legal institutions would be possible. And if possible, it would inevitably lead to the degeneration of Russian people and the ruin of the country. Secondly, at the time of the first occurrence of the constitutional question in Russian history, Russian thinkers were much influenced by Western socialist critique of bourgeois society that only naturally intensified their anti-constitutional prejudices. ‘Russian revolutionaries, realizing that change the form of government could not solve the painful social problems, hastened to assure that they are not the “bourgeois revolutionaries”, and their revolution, unlike Western political revolutions, is not going to serve the interests of the bourgeoisie. ... This explains the curious fact that the revolutionaries in Russia - a country that suffered a lot from its autocratic political system- were so adamant and stubborn in their contempt for the constitutional guarantees of

2 The conception of the archetypes of legal consciousness in this paper refers to intersubjectively recognized legal values of society that have an impact on the rationalization of the goals of individuals or social groups, as well as on the means of achieving them. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 7 human rights and “deceptive” political freedom of the West’.3 For this reason, all studies of constitutionalism in Russia were to carry out a kind of synthesis of liberalism and socialism.4 Thirdly, the autocracy itself creates favorable conditions for the spread of legal positivism. Any law in Russia at that time had the character of the gift from the absolute monarchy. Voluntariness grant had the effect of self-restraint of the Russian autocrat. In addition, the Russian emperor was limited to a tradition that was legal materials created by its predecessors. The maximum that he could afford was systematization of laws, which was firstly performed by Mikhail M. Speranski on behalf of Nicholas I. Finally, since the Russian autocracy (and that was the reverse side of legal positivism) associated with arbitrariness, legal nihilism was distributed among all groups of Russian population. The reason for this was also the fact that for a long time Russia had not had independent professional lawyers (though autocracy had the intention to build a well-functioning police state). In fact, this layer began to form only in the era of the Great Reforms. Another source of Russian legal nihilism was an ideological denying of a reasonable belief in law, which was typical not only for the enlightened monarchs of the eighteenth century, but to a greater extent, for revolutionaries of that time. Widespread disappointment in the results of a number of French revolutions caused almost universal denial of rationalist approach to social transformation, as well as the rationalist theory of human rights.5 In these historical conditions in regard to constitutional archetypes, first of all, the internal interrelation between law and freedom was necessary, as well as the independence of law from the power (power sanctions) and its dependence on inter-subjective ideas of justice.

3 Valitskiy A. Filosofiya prava russkogo liberalizma / M.: Mysl’, 2012 (A Valickiy, Philosophy of Law Russian Liberalism (Thought, 2012)). 4 From this fact, some researchers conclude that in Russia constitutionalism and socialism intercom. For example, see: Hamburg GM, Politics of the Russian Nobility, 1885–1905 (New Brunswick, NJ, 1984). In fact, this relationship was characterized by acquiescence to the prevailing public opinion, which led, ultimately, to the tragedy in October 1917. 5 The situation described corresponds to the present spiritual condition of the Russian society, linking the crisis of constitutionalism with its collapse.

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II. CHICHERIN: LAW AS FREEDOM

The first Russian liberal jurist Boris N. Chicherin (1828–1904) defined law as a freedom limited by laws. Any right for him in the subjective sense is a legitimate freedom to do anything or demand anything, but right6 in the objective sense is a system of laws defining freedom, which establishes the rights and responsibilities of individuals. According to Chicherin, freedom can be understood either as an external one that is a sphere of individual freedom in a framework of a certain society, or as an internal moral freedom.7 In the first sense, it is negative, it is freedom from coercion, independence from the arbitrary will of others; in the second sense it is a rational and moral autonomy. However, further considerations led Chicherin to rather unexpected conclusions: external freedom must never be rejected in the name of moral or any further considerations. Even a higher, moral freedom is positive one, morality is impossible to implement under a pressure. Therefore, the freedom to do evil – the freedom to be moral or immoral - is a necessary condition of freedom as self-determination and self- improvement.8 Socially acceptable boundaries of external freedom are set by the state. It is obvious that like all classical liberals of the time, Chicherin might follow the conclusion: ‘The absolute expression of law origins is a private or civil law. In its terms a person is represented as a free and independent individual, being in a certain legal relationship with another equal individual. By the nature of that relationship it is an individualism that is dominated, there is a top of human freedom here.’9 Objecting to the German school of the national spirit, Chicherin wrote: ‘The value of the human being is not limited to the fact that he

6 In the Russian language there is only one word “pravo” that mean both “right” and” law” in English. 7 Chicherin B.N. Sobstvennost’ i gosudarstvo. T.1. M.: Tip. Martynova i Kº, 1883 (BN Chicherin, Property and the State (Tip. Martynova i Kº, 1883)). 8 Chicherin B.N. Filosofiya prava / M.: Tipo-lit. t-va I. N. Kushnerev i Kº, 1900 (BN Chicherin, Philosophy of Law (Tipo-lit. t-va I. N. Kushnerev i Kº, 1900). 9 ibid (n 7) 88. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 9 or she becomes a body of world-historical process. An individual itself has an absolute value.’10 Understandings the priority of human rights led Chicherin to clash with supporters of unlimited national sovereignty, albeit in the form of direct or representative democracy. ‘Understanding freedom as participation in political decision-making was to strengthen the tendency to expand the area of political decision-making and thus - to restrict private, uncontrolled spheres of life. Thus, political freedom - freedom in the public sphere - gradually absorbs individual freedom. Political democracy, previously understood as an institution of protection of an individual freedom, fully exposes its absolutely collectivist character.’11 Therefore, this jurist has always stood for representative government as the ruling good and worthy. Chicherin`s parliamentary government was a natural consequence of the development of each nation and the final stage of political development of a mankind. 12 What is the essence of a person as an absolute beginning? ‘Freedom in a sense of one’s independence from tyranny of another, since it is goes together with a freedom of anyone else in accordance with the universal law, is the only primary right that every individual keeps just belonging to a mankind.’13 Some scholars, as Walicki, believe that such understanding of law as a law of liberty deprives the state power of positive goals and may even lead to the destruction in such a dominance of private interests of the entire system of public administration. ‘If the law is inseparable from freedom of the individual, it follows that it should not deal with the goals of human activity. Its true function is to formulate general principles of behavior and not to establish any particular purpose.’14 However, in our opinion, such a conclusion is too simplistic view of Chicherin. He wrote on this subject: ‘The task of law is to create necessary limits for personal freedom, but within these

10 Chicherin B.N. Nauka i religiya / 2-e izd. M.: Tip. Martynova i Kº, 1901(BN Chicherin, Science and Religion (Tip. Martynova i Kº, 1901)). 11 ibid (n 3) 170. 12 Chicherin B.N. O narodnom predstavitel’stve. M.: Izd-vo Sytina, 1866 (BN Chicherin, On Representation of the People (Tip. Martynova i Kº, 1883)). 13 ibid (n 8) 107. 14 ibid (n 3) 174.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 10 KUTAFIN UNIVERSITY LAW REVIEW limits a person should have a complete freedom to establish his/her own purposes. ... Public law deals not with individual liberty, but with public duties, and therefore it cannot ignore goals: every citizen must have a freedom to realize his/her own freely chosen goals, and officials shall not use their position for personal gain.’15 In this regard, it is important to understand Chicherin`s differences of moral norms and the law. He believed that the legal norms define the outer bounds of freedom, while the moral norms define the internal requirements for moral duty. The legal definition of the boundaries of freedom does not destroy the autonomy of the individual, but rather outlines a particular area in which the life of the individual is not subject to state intervention, and in which it can be moral or immoral. On the contrary, the legal definition of moral duties is incompatible with freedom of conscience and, consequently, with morality. It seems to us that such an opposition of morality and law in Chicherin`s are controversy to moralizing Slavophiles. He wanted to demonstrate that the private autonomy is essential for human freedom, including even the situations when a person does not share moral standards, prevailing in a society at a certain period of time. This exemption of legal freedom from morality also led Chicherin to anti-socialist views on issues of social justice. He believed that the solution of social problems should be carried out along with the improvement of individual moral norms: a person who is rich should have a moral obligation to help a poor, but a poor should not have a legal right to require such assistance. Chicherin admitted that a government can help poor people but only in exceptional cases and in a form of pure charity. In any case it should not institutionalize this aid as a subject of legal obligations and cannot ask additional amounts from its taxpayers for these purposes.16 In other words, since the law and morality are different ways of social regulation, to the extent the state should not be forced to morality, since it would mean an invasion to the private autonomy. But it shouldn’t be immoral itself in a sense of tyranny and

15 Chicherin B.N. Kurs gosudarstvennoy nauki. T.1. M.: Tipografiya tovarishchestva I. N. Kushnerev i Ko, 1894 (BN Chicherin, The Course of State Science (Tipografiya tovarishchestva I. N. Kushnerev i Ko, 1894)). 16 ibid 186. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 11 violation of private and public autonomy of the citizens. According to Chicherin, the highest is the law of truth, requiring to treat the others as you like the others treat your, and the law of love, which requires a person to sacrifice him/herself for the benefit of the others.

III. SOLOVYOV: LAW AS A SOCIAL JUSTICE

The main opponent of the classical liberal Chicherin (incidentally, the only one of its kind Russian constitutionalist) was a thinker Vladimir Solovyov (1853–1900) who with his philosophy of law had an enormous impact on the reception of the constitutional archetypes. In principle, he was agree, that the idea of freedom and rights are generated by commodity-money relations that is in the sphere of private law. ‘In the field of competing economic interests the people are considered merely as means; therefore the economic order must be a subject to legal regulations in which people act as individuals, subjects of rights and duties, thereby ensuring the establishment of justice.’17 In other words, the law according to Solovyov regulates relations between free individuals, bearers of rights. Therefore, it must recognize, accept as a self-evident freedom of individuals to satisfy their own interests and equality in freedom and respect the interests of others. The main objective of law is the protection of equal freedom, or, in other words, the restriction of freedom for the sake of equality. Thus, Solovyov concludes that law as a sum of rights can be defi ned as ‘a synthesis of freedom and equality’ or ‘freedom due to equality’.18 And from this point of view, classical liberalism is right: if different individuals have various interests, the law should protect their equal freedom and therefore cannot support the interests of some against the others. The task is a due ‘distinction’ of contending interests,19 i.e. the definition of the boundaries of institutionalized freedom of every person and equal protection of all of them.

17 Solovyov V.S. Kritika otvlechennykh nachal // Solovyov V. S. Sobr. soch. v 9-ti tomakh. T.2. SPb.: Izd-vo T-va «Obshhestvennaja Pol’za», 1901 (VS Solovyov, ‘Criticism of the Abstract Principles’ in Collected works in 9 volumes,vol 2 (Izd-vo T-va ‘Obshhestvennaja Pol’za’). 18 ibid (n 17) 153. 19 ibid (n 17) 148.

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However, if the law does not prescribe our goals, that is, the positive content of our life, as Solovyov states, this content can be either (1) specified by our economic interests, or (2) prescribed by morality. Law is characterized by absolute universality of its shape, which is not compatible with the specific content and random economic interests. It requires the absolute content, which may be given only by absolute morality. A higher standard of morality is absolute compassion or love. In this case, Solovyov opposed the principle of free will as the basis of morality. He wrote that If a human freedom to act was an absolute one and independent from all kinds of determinations, it would be also independent from any morality. In those conditions moral behavior would be absolutely impossible.20 In fact, adding Solovyov, the element of freedom in the human will cannot allow that as an explanation of morality, as Kant thought, but as an explanation of immorality, because only a person’s choice of evil can be completely unfounded. From this understanding of the relation of law and morality should be logically concluded also the following: ‘To be moral a society should be based on the free mutual consent, and that means that any public union should be voluntary, and that each member of the society maintains its inalienable right to secede. On the other hand, a society should not be indifferent to the fate of its members: its duty is to provide everyone with a certain minimum welfare needed for a “decent living”.’21 At the same time, as Solovyov wrote: ‘every man should have not only livelihood ... and sufficient physical rest, but also time for leisure and spiritual development.’22 Although this conclusion was a certain novelty to the constitutional sense of justice at the time, it, nevertheless, was logical: extreme poverty and other adverse social circumstances can easily create insurmountable obstacles to the realization of human

20 Solovyov V.S. Opravdanie dobra // Solovyov V. S. Sobr. soch. v 9-ti tomah. T.8. SPb.: Izd-vo T-va «Obshhestvennaja Pol’za», 1901 (VS Solovyov, ‘The Justification of the Good’ in in Collected works in 9 volumes,vol 8 (Izd-vo T-va ‘Obshhestvennaja Pol’za’). 21 ibid (n 3) 239. 22 ibid (n 20) 380.This formula adds the same Solovyov, is designed to determine not only the required minimum public, but also the maximum legal requirements (if they are not related to the special merit). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 13 capabilities. Therefore, these obstacles should be eliminated by ensuring that each person has not only formal freedom, but also the necessary assistance in the implementation of decent human destiny. According to Solovyov, significant differences between morality and law can be summarized in three points.23 Firstly, the ethical requirements are unlimited, while legal requirements are always strictly limited. The reason for this lies in the fact that morality is always striving for perfection, while the law requires only ‘the lower, the minimum degree of moral status’. Secondly, the legal requirements are always clearly defined: it is always possible to establish whether they were executed or not. On the contrary moral requirements have unlimited nature, i.e. the lack of accuracy and certainty of their content and scope. Solovyov believed that it was the distinctive quality of the positive law. And thirdly, morality is incompatible with coercion, while the law should be backed up by force. The conclusion from this analysis resulted in a new definition of law (in the sense of legal justice, unifying objective law and subjective right): ‘The right to have a compulsory requirement to implement a certain minimum of good, or the order that prevents known manifestations of evil’.24 In this case, Solovyov introduces the criterion of law actually contrast to morality: ‘It is important here, first of all, to certain things actually were, and that famous things actually happened.’25 According to Solovyov, statutory (positive) law, moreover, must be characterized by the following three features: (1) it must be available to public; (2) it must define the ways of application in specific cases; and finally (3) its applicability to existing conditions and the availability of sanctions in case of default. Obviously, for the enforcement of laws and improvement it is needed a force (power).26 Such power can be defined as ‘real representation rights’ or ‘a workable law’.27 ‘In the simplest terms, the essence of the state lies in its ability to subdue violence and

23 ibid (n 20) 407. 24 ibid (n 20) 409. 25 ibid (n 20) 414. 26 ibid (n 20) 419. 27 ibid (n 20) 420.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 14 KUTAFIN UNIVERSITY LAW REVIEW outrage within the boundaries of law and legislation respectively, thus replacing the chaotic human nature with the order of how the things should be governed, yet coercion is allowed only as means of emergency, predetermined, regular and justified, because it comes from the general and impartial authority.’28 In other words, Solovyov believed that every state is a kind of a rule-of-law state (Rechtstaat), because even the most despotic state guarantees a certain order, overcoming a Hobbesian state of war of everybody against everybody. And it was a step in the direction of legal positivism: good excuse he turned to justify the state.

IV. MODERN CONSTITUTIONALISM ON FREEDOM AND JUSTICE

It seems that the controversy between Chicherin and Solovyov is still relevant nowadays because even if the official legal doctrine has been restated in the Constitution, legal positivism is still dominant in Russian law (both in theory and in practice) which was inherited from the Soviet period.29 In order to overcome the domination of legal positivism,30 it is necessary to overcome the reduction of constitutionalism to the norms and institutions of constitutional law and explicate the axiological content of this paradigm in the light of freedom and justice. In this context constitutionalism is understood as a special public-legal ethics (a form of legal consciousness), as well as deduced from its initial value (archetypes) political practice that considers possible and necessary to build on a rational basis a system of government, that is the legal order of the relationship between a citizen and a power (between citizens,

28 ibid (n 20) 421. 29 Lapaeva V.V. Tipy pravoponimaniya: pravovaya teoriya i praktika / M.: Rossiyskaya akademiya pravosudiya, 2012 (VV Lapaeva, Types of Legal Consciousness: Legal Theory and Practice (Russian Academy of Justice 2012)). 30 According to the adopted at the First Meeting on Science of the Soviet state and law in 1938 under the direction of Vishinski definition, law is «a set of rules of behavior, expressing the will of the ruling class, established by law, as well as customs and rules of social intercourse, authorized by state power, the use of which is provided by coercive power of the state to protect, consolidate and develop public relations and orders, profitable and pleasing to the ruling class»/ Osnovnye zadachi nauki sovetskogo prava: Materialy pervogo Soveshhanija nauchnyh rabotnikov prava. 16–19 ijulja 1938 g. M., 1938. P. 37. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 15 and between sovereign states as well). This form of legal consciousness is based on the recognition of the equal dignity of every freely self- determine (sovereign) subject of a society (individual, group of citizens or a nation as a whole) or even the international community of states. That should be realized through the recognition of inalienable natural predicated (which is the guarantee of freedom of mind and will that is not contradictory to the rules of conduct within a society) rights (freedom to do / not to do anything) of a citizen (associations of citizens, nations, states) by rules of public, state and interstate life. In other words, constitutionalism is a certain theoretical paradigm of legal consciousness, solving the problem of the development of principles of fair constitution of social life that allow the implementation of private and public autonomy for all social actors. You can also say that it is a certain way of rationalizing the legal sense (core values) of people. For constitutionalism, the categories of freedom, justice and human dignity are the basic interrelated fundamental values. The ancients used to say ‘omnis determinatio est negatio’ that means ‘every definition is a negation. In this context, the issue of freedom in terms of the philosophical and legal discourse, in our opinion, should be the following. What negates the concept of freedom? As Z. Bauman was right to say: ‘Freedom divides. Its attractiveness is in a difference. Some people can be free only in the borders of a dependence that they are trying to avoid.’31 Constitutionalism as a world-view comes from the fact that the area of freedom only occurs outside the scope of discretion power. For this form of legal consciousness the opposition of freedom and power permeates the entire system and all levels of the social division of labor in any type of social life (family, primary workplace, churches, tribal, modern state, etc.). Therefore it is necessary to limit and divide any power because that social institute by its logic tends to be a universal one. Since a power is just a monopolization of particular social functions – namely a function of a rational goal- setting, and control which are obligatory in any society – by a certain social subject. This immanent characteristic of power was reflected in the concept of sovereignty of the legal and political sciences.

31 Bauman Z. Svoboda / M.: Novoe izdatel’stvo, 2006 (Z Bauman, Liberty (The New Publishing, 2006)).

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The universality of power as an attribute of governance of a society can be limited only institutionally: or by tradition or by law. The latter in the constitutional sense, is nothing else than the rationalization of power relations on the basis of morality and the archetypes of legal consciousness by using the dogmatic method. A legal and moral evaluation is possible only in respect of acts of free and responsible personality with an objective significance (i.e. human dignity) in a particular society. Otherwise we have no right to demand responsible behavior from legal entity. In other words, without the recognition of dignity of the person realization of his/her freedom is not possible. That is why constitutionalism matches the category of freedom and the category of dignity of the human person in inseparable axiological synthesis. At the stage of emerging of the bourgeois society, the first of its program based on the principles of constitutionalism, was the theory of the rule-of-law state. Under the ‘rule of law’ in this paradigm is understood a state with the goal of creating the institutional prerequisites for the recognition of the equal dignity of every citizen by ensuring the exercise of his/her right to private and public autonomy. In this context certain principles have been developed. Firstly, it is the principle of separation of powers, that is, the legislative, executive and judicial ones. Secondly, it is the principle of independence of judiciary, according to which the process of justice and accepted by the court decision should be completely independent from both the impact of higher authorities, and any outside influence. Thirdly, it is the principle of subordinate administration, which excludes the possibility of the implementation of such administrative activities that are not based on the norms of existing legislation, or even more so, contradict the basic values of constitutionalism. Fourthly, it is the principle of judicial protection, which ensures the possibility of winning a lawsuit against any unlawful administrative actions. Finally, it is the principle of legal liability of public authorities, which provides the right to property compensation to victims as a result of both legal and illegal administrative activities. It is obvious that all those principles are linked and cannot function separately from each other. However, it would be incorrect – what many modern Russian lawyers do though – to reduce all of the content of the concept of the www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 17 rule-of-law state to the above mentioned principles.32 They are just signs of formal justice, which as shown by the theory and practice of pseudo- constitutionalism in many countries, can operate perfectly and be distorted by autocrats and bureaucrats of all stripes. ‘The true meaning, the real essence of the rule of law – it is a real, material justice. The state is indeed legal only if it is – in its structures and in its activities – aimed at ensuring fairness.’ 33 It’s safe to say that the idea of social justice is constitutive in the solidarity of society throughout human history. That idea of public relations just provides legitimacy of political institutions and leaders. In other words, the idea of social justice provides the integration of all members of society. So the above mentioned five principles of formal legality is only means in the realization of the idea of real justice;practical implementation of the idea of the rule of law state. Of course, in every type of society there is its own understanding of the idea of social justice.34 In this regard, social justice comes as legal and moral forms of recognition of human dignity. As science discovers, various forms of truth, rather than truth as absolute and constitutionalism in specific historical circumstances on rational (discursive) basis produces a form of social justice. In philosophical

32 See, for example, Mamut L.S. Sotsial’noe gosudarstvo s tochki zreniya prava / Gosudarstvo i pravo. 2001. № 7. S. 5–14. (LS Mamut, ‘Social State from the Point of View of the Law’ (2001) 7 State and Law 5): «The world of law» is not accessible «under the reign of it» social justice «(de facto equality). It is constructed as a set of horizontal symmetrical relationship between the parties to the universal process of social interaction. «Fairness – a formal equality and social vulnerability of certain categories of citizens does not impose on the state- organized society a legal obligation to ensure that everyone has «a decent life.» 33 Huber E.R. Pravovoe i sotsial’noe gosudarstvo v sovremennom industrial’nom obshchestve / Politicheskaya filosofiya v Germanii: Sb. st. M.: Sovremennye tetradi, 2005 (ER Huber, Legal and Social State in a Modern Industrial Society (Sovremennye tetradi, 2005)). 34 For example, «justice, as was during the formation and strengthening of bourgeois society, was to ensure that each of his natural rights such as the right to life, liberty, property – that is, the right to put each individual on the nature of rights an integral which dictates the mind»// Huber E.R. Pravovoe i sotsial’noe gosudarstvo v sovremennom industrial’nom obshchestve / Politicheskaya filosofiya v Germanii: Sb. st. M.: Sovremennye tetradi, 2005 (ER Huber, Legal and Social State in a Modern Industrial Society (Sovremennye tetradi, 2005)).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 18 KUTAFIN UNIVERSITY LAW REVIEW terms, social justice is an attribute, but not the substance, it is the value dimension of legitimation of authority and social order. From the point of view of constitutionalism, social justice is a social condition (provision of law, the functioning of political institutions), which does not restrict, but rather extends the space of freedom of the individual and scope of private and public autonomy. Formation of industrial society in the XIX century led to a situation where the idea of justice, in the theoretical understanding of the theory of the rule-of-law state, which at one time united the third estate, and brought him to the assault of traditional monarchical institutions of the old order could no longer be implemented. The creation of large factories demanded concentration in the cities of individuals who sell the only their property – their ability to work, i.e. labor and receives all that is necessary for life – housing, food, etc. Deprived of traditional social protection from the local community (the neighbor’s solidarity) and having no private property, those individuals in the eyes of the bourgeoisie were also deprived of human dignity. And that is why they could be subjected to exploitation. Pauperization, so vividly described by Carl Marx, brought the class struggle to uphold the human dignity of the people of wage labor in the name of justice. There is no coincidence that the struggle was primarily carried on for political rights, and then for the social, economic and other rights, as the constitutionalism of private and public autonomy are closely linked. A bourgeois society in order to avoid a total self-destruction, had to abandon the idea of the state as a ‘night watchman’ and create a new state type in the name of guaranteeing justice and freedom for all the citizens, which is defined as a ‘social state’ (welfare state) in a scientific literature. This kind of state was aimed to ensure a rebirth of a citizen as a person with dignity.35 In order to enable an opportunity for dispossessed citizens to take part in the democratic process the paradigm of constitutionalism was required to be reformulated in terms

35 A detailed program of the welfare state, we reviewed in: Kochetkov V.V., Kochetkova L.N. Sotsial’noe gosudarstvo kak ideal’nyy tip / Trud i sotsial’nye otnosheniya. 2010. № 4(70). S. 106-115 (VV Kochetkov, LN Kochetkova, ‘Social State as the Perfect Model’ (2010) 4 (70) The Labour and Social Relations 106). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 19 of some fundamental ‘natural rights’ – the right to life and the right to property, as well as the concept of law itself. First of all, it became clear that for those citizens for whom the only way to survive was to sell their labor power, the right to life could only be realized through the right to decent work. That is why all the activities of humanization of work started in all countries with the activities of the labor inspectorate. It was further found that the matrix of the individual and free labor contract does not create equality of the parties (workers and capitalists) of the contract. Such equality can only be achieved through the recognition of the significance of the workforce, which enables an individual worker to be a legitimate participant in the relationship with the employer. Therefore, in all developed countries the importance of trade unions should rapidly go up. Those unions could equally negotiate with employers and create a base for collective agreements that define the conditions of the employment. The pinnacle of the revision of basic tenets of the ‘classical’ legal discourse has become a system of mandatory collective insurance36 against the risks of wage labor (sudden disability, old age, unemployment, etc.). Now the systems of compulsory social insurance of individual risks are covered by the fact that it was included in the system of collective defense. But the most important thing was that this system allowed overcoming the dichotomy of autonomous property / heteronomous labor. ‘The social question was not whether to cancel the opposition owner / non-owner, and to redefine it, that is, to oppose private ownership of another type of property, namely the public, allowing to obtain protection without private property.’ 37

36 The first laws on compulsory social insurance and other wage earners (workers) almost simultaneously accepted in the developed countries of Europe in the second half of the XIX century. With the spread of the matrix of wage labor in the industrial society, these forms of social protection were extended to other categories of citizens, including the representatives of the so-called «free» professions, such as doctors, engineers, teachers, etc. 37 Kastel’ R. Metamorfozy social’nogo voprosa. Hronika naemnogo truda / SPb.: Aleteya, 2009 (R Kastel’, Metamorphoses of the Social Question. The Chronicle of Hired Labor (Aleteya, 2009)).

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The appearance of the property of public funds administered by the state created a new historical situation where contributions to mutual funds were required. Salary stopped to be the only way to get an income. From now on, it contained a piece is a kind of labor rents for non-productive situations. Thereby insurance brought an order into relationships between wageworkers. From the axiological point of view, the welfare state can be defined as a state that by publicly-imperious way guarantees citizens certain standards of living conditions, enabling to exercise their right to private and public autonomy.38

V. CONCLUSION

Thus, the dilemma of freedom and justice about which there was a controversy between Chicherin with Solovyov, in terms of axiological constitutionalism is false. The combination of theoretical expression of values of freedom and human dignity with the requirement of fairness and justice prevents the conversion of constitutionalism in a set of dead dogmas and institutions of constitutional law, because this combination requires only those reactions to a constantly changing society that would safe an autonomy of an individual in a private and public life.

Bibliography

Bauman Z. Svoboda / M.: Novoe izdatel’stvo, 2006 (Z Bauman, Liberty (The New Publishing, 2006)) Chicherin B.N. Filosofi ya prava / M.: Tipo-lit. t-va I. N. Kushnerev i Kº, 1900 (BN Chicherin, Philosophy of Law (Tipo-lit. t-va I. N. Kushnerev i Kº, 1900) Chicherin B.N. Kurs gosudarstvennoy nauki. T.1. M.: Tipografiya tovarishchestva I. N. Kushnerev i Ko, 1894 (BN Chicherin, The Course of State Science (Tipografiya tovarishchestva I. N. Kushnerev i Ko, 1894))

38 Kochetkov V.V. Konstitutsionalizm i sotsial’nyy vopros / POLIS. 2012. № 2. S. 152–163 (VV Kochetkov, ‘Constitutionalism and the Social Question’ (2012) 2 POLIS 152). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vladimir Kochetkov Boris Chicherin`s and Vladimir Solovyov`s Discussion on the Nature of Law and Modern Constitutionalism 21

Chicherin B.N. Nauka i religiya / 2-e izd. M.: Tip. Martynova i Kº, 1901(BN Chicherin, Science and Religion (Tip. Martynova i Kº, 1901)) Chicherin B.N. O narodnom predstavitel’stve. M.: Izd-vo Sytina, 1866 (BN Chicherin, On Representation of the People (Tip. Martynova i Kº, 1883)) Chicherin B.N. Sobstvennost’ i gosudarstvo. T.1. M.: Tip. Martynova i Kº, 1883 (BN Chicherin, Property and the State (Tip. Martynova i Kº, 1883)) Hamburg GM, Boris Chicherin and human dignity in history. A History of Russian Philosophy 1830-1930. Faith, Reason, and the Defense of Human Dignity (GM Hamburg and RA Poole eds, N.Y.: Cambridge University Press, 2010) Hamburg GM, Politics of the Russian Nobility, 1885–1905 (New Brunswick, NJ, 1984) Huber E.R. Pravovoe i sotsial’noe gosudarstvo v sovremennom industrial’nom obshchestve / Politicheskaya filosofiya v Germanii: Sb. st. M.: Sovremennye tetradi, 2005 (ER Huber, Legal and Social State in a Modern Industrial Society (Sovremennye tetradi, 2005)) Kastel’ R. Metamorfozy social’nogo voprosa. Hronika naemnogo truda / SPb.: Aleteya, 2009 (R Kastel’, Metamorphoses of the Social Question. The Chronicle of Hired Labor (Aleteya, 2009)) Korkunov N.M. Lektsii po obshchey teorii prava. SPb.: Yuridicheskiy tsentr «Press», 2004 (NM Korkunov, Lectures on the General Theory of Law (Yuridicheskiy tsentr «Press», 2004)) Kochetkov V.V. Konstitutsionalizm i sotsial’nyy vopros / POLIS. 2012. № 2. S. 152–163 (VV Kochetkov, ‘Constitutionalism and the Social Question’ (2012) 2 POLIS 152) Kochetkov V.V., Kochetkova L.N. Sotsial’noe gosudarstvo kak ideal’nyy tip / Trud i sotsial’nye otnosheniya. 2010. № 4(70). S. 106- 115 (VV Kochetkov, LN Kochetkova, ‘Social State as the Perfect Model’ (2010) 4 (70) The Labour and Social Relations 106) Lapaeva V.V. Tipy pravoponimaniya: pravovaya teoriya i praktika / M.: Rossiyskaya akademiya pravosudiya, 2012 (VV Lapaeva, Types of Legal Consciousness: Legal Theory and Practice (Russian Academy of Justice 2012)) Likoudis J. ‘Vladimir Solovyov (“The Russian Newman”) on Christian Politics and Ecumenism’ (2011) 16 The Catholic Social Science Review 195

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Mamut L.S. Sotsial’noe gosudarstvo s tochki zreniya prava / Gosudarstvo i pravo. 2001. № 7. S. 5–14. (LS Mamut, ‘Social State from the Point of View of the Law’ (2001) 7 State and Law 5) Obolevitch T, ‘All-Unity According to V Solovyov and S Frank. A Comparative Analysis’ (2010) 15 FORUM PHILOSOPHICUM 413 Rabow-Edling S, ‘Liberalism and Nationalism in Russia. Boris Chicherin as a Modernist Nationalist’ (2014) 4 (27) Perm University Herald, series ‘History’ 207 Schrooyen PW, ‘The Call for “Christian Politics” in the Publitsistika of Vladimir Solovyov: The Examples of the Question of Church Union and the National Question’ (2005) vol 33 3 Religion, State & Society 223 Sládek K, ‘The View of Creation through the Eyes of Vladimir Solovyov and Nikolai Lossky’ (2010) vol 6 2 European Journal of Science and Theology 13 Smith O, Vladimir Solovyov and the Spiritualization of Matter (Boston, Academic Studies Press, 2011) Solovyov V.S. Kritika otvlechennykh nachal / Solovyov V. S. Sobr. soch. v 9-ti tomakh. T.2. SPb.: Izd-vo T-va «Obshhestvennaja Pol’za», 1901 (VS Solovyov, ‘Criticism of the Abstract Principles’ in Collected works in 9 volumes,vol 2 (Izd-vo T-va ‘Obshhestvennaja Pol’za’) Solovyov V.S. Opravdanie dobra / Solovyov V. S. Sobr. soch. v 9-ti tomah. T.8. SPb.: Izd-vo T-va «Obshhestvennaja Pol’za», 1901 (VS Solovyov, ‘The Justification of the Good’ in in Collected works in 9 volumes,vol 8 (Izd-vo T-va ‘Obshhestvennaja Pol’za’) Valitskiy A. Filosofiya prava russkogo liberalizma / M.: Mysl’, 2012 (A Valickiy, Philosophy of Law Russian Liberalism (Thought, 2012)) Wozniuk V, ‘Vladimir S Solovyov: Moral Philosopher of Unity’ (2013) vol 16 1 Journal of Markets & Morality 323

www.kulawr.ru Volume 1 April 2016 Issue 1(5) 23

CRIME PREVENTION: CONCEPTUAL DESIGN AND SOCIAL PRACTICES

ARTICLE

PECULIARITIES OF RECEPTION OF FOREIGN CRIME PREVENTION PRACTICES IN THE RUSSIAN FEDERATION

Gennady V. Dashkov (Russia)

Author Doctor of science (Law), Academy of the Prosecutor General’s Office of the Russian Federation, 1981 Professor, Kutafin Moscow State Law University Merited Scientist of the Russian Federation Email: [email protected] Abstract The article is aimed at the evaluation of the topical issues concerning the use of foreign crime prevention practice in the Russian Federation. This is an international issue, being important for Russia and for foreign states as well. The modern world is such, that those holding positive crime prevention experience and those using it are both interested in making their best achievements generally accessible. This selfless interest (unlike the interest in technical issues) is, first of all, explained by the fact that in the age of developed technology and super-mobility the criminals from different states and continents are capable of developing their criminal activities, while facing virtually no obstacles. At the same time there are a lot of unresolved theoretical and practical issues regarding international cooperation guarantees. Taking into consideration the above-mentioned conceptual provisions, this article is addressed to both Russian and foreign readers. In particular, the article concerns the theoretical prerequisites for the reception of foreign crime prevention practice. The author discusses the priority directions for Russia concerning reception

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of the foreign crime fighting experience. These priority directions include white-collar crime and drug crime. The mechanisms for crime prevention in Russia include participation of citizens and non-governmental organizations in revealing and prevention of crimes (social capital). The mentioned goals have been achieved both in their historical and modern dimensions via the criminological connection to the classical and unfairly forsaken sources, such as the Great Yasa of Genghis-Khan, the Decrees of Tsar Peter the Great, and the financial legislation of the USA, which was drafted in order to overcome the Great Depression. The issues of international cooperation of Russia with foreign states have a positive perspectives even now, which is not the best time for such matters. This is explained by the fact that we have more uniting factors and interests, than dividing ones. In order to support this beneficial position the author provides a range of proposals and recommendations for the further development of the international cooperation in the sphere of fighting criminality. The author also used the results of his collective scientific research experience with the foreign colleagues, as well as his experience in the administrative bodies of the International Criminal Law Association and the International Criminology Society. Keywords Comparative criminology studies, fi ghting criminality in legal terms, creative punishments, transnational criminality, international experience in fighting corruption, social capital and criminality

DOI: 10.17803/2313-5395.2016.1.5.023-045

TABLE OF CONTENTS

I. Introduction. Objective setting ...... 25 II. Functions of criminological comparative legal studies ...... 26 III. Creative punishments as the subject of adopting foreign crime fighting experience ...... 32 www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 25

IV. Priorities in adopting foreign practices in crime fighting ...... 36 V. Formation of the collective experience resulting from the citizens’ enhanced involvement in crime fighting ...... 40 VI. Perspectives ...... 44 Bibliography ...... 44

I. INTRODUCTION. OBJECTIVE SETTING

Rene David,1 who was one of the founding fathers of the modern comparative legal studies, often pointed out that the modern world is characterized by interactions between the peoples and solidarity of a mankind. The world has become united. We cannot afford to separate ourselves from the people living in other states or other parts of the globe. The necessity of international interactions requires us to ‘open a window’ and to take a look at a foreign law.2 This theoretical position of the classical corporate law scholar is truly based upon the entire history of humankind. It has been known since immemorial times that any significant achievement in any sphere, including the sphere of fighting crime is hardly possible without due support from the past and present achievements of the global civilization. At the same time we often face with our own imperfections, being aware that our ancestors were right, saying that any knowledge is relative and the improvement has no limits. The position of Socrates, the great mentor of Plato, who after having heard much praise for himself, once decided to talk to people on goodness, justice, beauty, friendship, etc. The ideas of the common Hellenes on

1 Organizational formation of comparative law took place in 1900, when the first International Congress of Comparative Law was held in Paris. It turned the attention of the participating states to the need for the mutual studies of legislation and legal practice. 2 These were fundamental ideas, which were meant to find common and differing features in over 200 national legal system. For more detail, see: David R, Les grands systèmes de droit contemporains (Dalloz, Paris, 1964); R David, C Jioffre-Spinosi, Osnovniye pravoviye sistemy sovremennosti / M.: 1996 (R David, C Jioffre-Spinosi, Major Legal Systems in the World Today (1996)).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 26 KUTAFIN UNIVERSITY LAW REVIEW these matters impressed Socrates with their depth and variety, and he was completely convinced that he was previously right, thinking that unlike many other people he at least knew that knows nothing. (sciоmenihilscize). This is what a real wisdom is. And it is no accident that it was later reflected in the Holy Scripture, where Apostle Paul wrote that ‘If anyone imagines that he knows something, he does not yet know what he ought to know.’ (To Corinthians, 1.8,2). The need for continuity and mutual enrichment of knowledge is a necessary condition for the social development, and it fully applies to law, including crime sociology, as well as to the so-called natural sciences, such as physics, chemistry, mathematics, etc. And it is predictable that the significant positive results in limiting crime were achieved by the states and regions, which have managed to use their past experience with maximum efficiency, as well as to use the positive experience of their nearby and fairway neighborhoods.

II. FUNCTIONS OF CRIMINOLOGICAL COMPARATIVE LEGAL STUDIES

Comparative law studies not only furnish the information about various legal systems, or the laws in question, but also can provide – through the process of borrowing – solutions for many problems that can arise or even can help to avoid those problems.3 Comparative legal studies as a mechanism for the analysis of foreign experience in Russia have many functions.4 Concerning the issue of using foreign crime fighting experience in Russia, it is viable to outline the following functions: scientific function, educational function, practical function and international unification function.5 All of those functions contain

3 Zaid Muhmoud Al-Aqaileh, ‘Legal Cultures Dialogue: Benefits and Obstacles of Comparative Law Studies’ (2013) 54 Journal of Sharia & Law 23. 4 Oksamytnyi V.V., Vozniknoveniye i evolutsiya sravnitel’nogo pravovedeniya. Rossiya: na puti globalizatsiyi i integratsiyi / Institut mezhdunarodnogo prava i ekonimiki imeni A.S. Griboedova. 2012. S. 44–47. (VV Oksamytnyi, ‘Appearance and Evolution of Comparative Legal Studies. Russia on the Path of Globalization and Integration’ (2012) Scientific Works of the Comparative Law and Economics Institute named after A.S. Griboedov 44). 5 Saidov A.H. Sravnitel’noye pravovedeniye / M.: 2003 (AH Saidov, Comparative Legal Studies (2003)). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 27 historical elements. Their studies are necessary in all of their aspects. It does not merely concern the fashion for history and the desire of an author to show off his education. There are more significant reasons for studying history, and a world legal science and practice vividly demonstrates it. One of the most impressive examples may be found in the famous Code of Law of the Great Mongolian State, which became known as the Great Yasa of Genghis-Khan. It was Temujin (the name of Genghis-Khan), who announced at the Great Kurultaj in 1206 the new laws and provisions, which were meant to establish the true statehood in a state, which had previously been ungovernable. He did so for the good of his land, wishing to overcome the opposition of those preferring personal freedom and lack of liability over statehood and order. Analysis of this ageless legal treasure, which had a significant influence on the development of global legal science and practice,6 from the standpoint of criminological needs of today’s Russia it requires to pay attention to the following. The Great Yasa of Genghis-Khan included descriptions of 36 prohibited acts. Half of those acts were punished with the death penalty. For example, capital punishment was provided even for the greed for food, which seems to be quite an excusable behavior for the modern people. It is unclear for our contemporaries why the punishment for the greed for food was so cruel. What is the practical need to discuss it now in legal and criminological scholarly writings of the XXI century? The answers to these questions can be found in the ageless wisdom of Great Yasa of Genghis-Khan, the ability of its authors to reveal the pressure points in the society, to evaluate them and to take urgent measures in order to neutralize negative manifestations. That is what Genghis-Khan did,7 since he had understood much earlier than his contemporaries did that in the situation of total poverty and hunger any deviation from non- written standards (customary law) concerning food could be dangerous,

6 G.V. Vernadskiy G.V. Istoriya Rossiyi. Mongoly i Rus’ / Tver’: 1997 (GV Vernadskiy, History of Russia. Mongolians and Russia (1997)). 7 See, Khoara-Davan E. Chingiskhan kak polkovodets i ego naslediye // Arabeski istoriyi. Pustynya Tartari. 1995. №2. S. 89–90. (E Khoara-Davan, ‘Genghis- Khan as a Chieftain and His Heritage’ (1995) 2 Historical Arabesques.Tartary Desert 89); Juvayni Ala Ad Din Ata-Malik, Istoriya pokoritelya Vselennoy / Rodina. 1997. № 3–4. (Ala Ad Din Ata-Malik Juvayni, ‘History of the World Conqueror’ (1997) 3–4 Rodina).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 28 KUTAFIN UNIVERSITY LAW REVIEW so it required immediate reaction of the state in order to avoid riots among poor and starving groups of the society. There are reasons to comprehend this position today when a small group of people, possess the heritage of all nation without any real reason. Should the modern state react to such social injustice severely in a medieval manner? Once again, it is worth thinking about, especially since the causes for the hypertrophied social stratification in the late years involve virtually no legal or economic matters. Rather they are consequences of various fraudulent novelties, and their consequences are so serious that entire states are put at the verge of national catastrophes. It does not suffice to refer to the unfortunate events in the territory of modern Ukraine, where the mass riots of 2013 and later period against intensive spread of the total corruption and the downfall of agriculture, science, culture and education finally led the nation to the civil war. The spread of corruption involving the supreme government bodies has allowed for the rapid formation of the system for the misappropriation of the national heritage, involving nepotism and other legal and economic mechanisms. Questions relating to the situation on how and when ordinary citizens can stand against oppression, injustice, and abuse without resorting to violence challenge all of us to rethink our understanding of international peace and conflicts.8 The amounts of these misappropriations are measured by billions US dollars, and they are far beyond the treasuries of the Shahs, Khans, Tsars and Emperors of the past. It should be also mentioned that those treasuries did not belong personally to the rulers. These circumstances should be taken into consideration, when providing theoretical analysis of whether it is possible and viable to have positive perception, rather than blind unmotivated denial of some elements of medieval crime fighting system. While evaluating harsh measures against criminals the one should consider that those measures were not resulted from the voluntarist qualities or “bad temper” of the Great Khan. That document, which had a significant impact on many states including Russia, was not drafted by only Mongolians. The key role belonged to the Chinese scientists. When inviting the Chinese authors, Genghis-Khan realized that the laws and provisions of the Chinese were durable, strict and

8 Governance, Corruption, and Conflict (United States Institute of Peace, 2010). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 29 nuanced. That was how he wanted to see Yasa. And his hopes were truly fulfilled. The main achievement of Yasa fairly recognized by historians, writers and jurists in Europe, Asia and America was that it provided both the clear legal prescriptions for the legal part of life of the Great Empire and it also provided for the clear and detailed system of punishments for those who violated Yasa. For example, it contains a description of nine types of torture. Even reading those descriptions it feels horrified, thereby making people obey the law. Using the modern terminology, these were general measures taken against a crime. According to the position of the Persian scholar Juvayni who lived in the XIII century and studied the Great Yasa of Genghis-Khan, the state almost totally suppressed the greed for riches. If a woman had put a tray of gold upon her head and walked alone with it, she wouldn’t have had to be afraid of anything, Juvayni had stated. The prescriptions of Yasa were obligatory for everyone including Genghis-Khan who was an icon of following them. Otherwise, the Mongolians would not have trusted him and probably would not have followed the Yasa. The laws of the Great Yasa of Genghis-Khan9 were formulated in such a manner that in spite of all their cruel nature they met the needs of the majority of the population and were accepted by them. The Yasa for the Mongolians was just like what the Quran and the Hadith of the Seal of Prophets were for the Muslims and the Gospels for the Christians. It was not just about the fact that almost any violation of the Yasa was followed by death. The main attraction of the Yasa was in the fairness of its conceptual provisions, making one will to follow it. For example, there were the following provisions, and development of no state could be possible without them. It provided for fame and respect for the pure, blameless, fair, educated and wise people, no matter what their origin was, and for the condemnation of the evil and unfair people. It provided

9 Vernadskiy G.V. O sostave Velikoy Yasy Chingiskhana / Brussel’: 1939 (GV Vernadskiy, On the Elements of the Great Yasa of Genghis-Khan (1939)); Ryazanovskiy V.A. K voprosu o vliyaniyi mongol’skoy kul’tury i mongol’skogo prava na russkuyu kul’turu i pravo // Voprosy istoriyi. 1993. №7. (V.A. Ryazanovskiy, ‘On the Issue of the Influence of the Mongolian Culture and Mongolian Law upon the Russian Culture and Law’ (1993) 7 Issues of History).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 30 KUTAFIN UNIVERSITY LAW REVIEW that people should love each other, but they should not commit adultery, they should not steal, perjure, betray. It called for respect for the elderly age and the poorness. It prohibited eating in the presence of others without sharing food with them, or eating more than other people. It required respect for the sages and hermits of any tribe. It required that people should not be aggrandized over other people. Those not wishing to follow those rules found their inevitable deaths very soon. Within this framework the “savage laws of the Middle Ages” seem to be not so savage and cruel anymore. For a number of objective and subjective reasons the perception of foreign experience in the sphere of fighting crime by Russia is selective and seemingly accidental. In order to mitigate these factors, the following should be taken into account. Usually, the most successful measures against various forms of abuse including crimes were developed in complicated political, social and economic situations, at the time of revolutionary changes within a state. Many legal sources of the faraway and near past which already became classical prove that. First of all, they include the Great Yasa of Genghis- Khan, the German Code of Laws of the Emperor of the Holy Roman Empire of the German Nation Charlemagne, which was later named after him, the Russian legal sources (the Dvina Charter of 1398, the Pskovian Charter of 1397, the Novgorod Charter of 1471, the Judicial Charters and Codes of 1497, 1550, etc.). All of those laws included significant “foreign components” and it was due to the high quality and successful practice of application of foreign laws, as well as particularities of the individuals who decided to take that foreign experience. For example, the phenomenal multi-faceted abilities of the first Russian Emperor Peter the Great (Petr Aleksandrovich Romanov) allowed him to use a wide range of foreign laws in order to introduce anti-crime measures, which could be deemed efficient according both to the modern standards and to the standards of his time. It is worth mentioning that for the first time in the Russian history Tsar Peter the Great established the same severe punishment for taking and giving bribes with his Decree of August 23, 1713. It is also notable (as far as fighting white-collar crime is concerned) that with his Decree of March 17, 1714 Tsar Peter the Great established the responsibility for officials, bringing a harm and financial damage to the state. What’s more, since he could not rely upon the will of officials to work honestly, Tsar Peter www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 31 the Great did not allow them to remain in the same position for a long time. He used what now would be called vertical and horizontal rotation, and so it was a legislative provision, which was successfully implemented 300 years ago in the state government apparatus of the Russian Empire. Difficult political, social and economic situation within the state stimulates the development of highly efficient anti-crime measures, which are quite worthy of reception by other states. This is a sustainable category, which is typical for more than just the distant past. For example, the legislation of the USA, which was developed within the framework of emergency measures to get the state out of the Great Depression of 1930-1940s, couod be regarded as a classic crime prevention scheme. At the pre-crisis time the legal protection of economic activities in the USA was underdeveloped and it was hardly attractive for other states. However, after the resonating investigations of the Senate Commission of the US Congress concerning the financial catastrophe of 1929, a number of Federal Laws were adopted, and their international value could hardly be overestimated. Those laws include the US Securities Act of 1933, the US Banking Act of 1933 and the US Securities Exchange Act. Analyzing those laws from the standpoint of the possible receptions of their mechanisms for protecting economy from criminal encroachments, it should be noted that the US Securities Act of 1933 introduced the system of legal regulation of the relations at the stages of emission, placement and sale of securities for the first time in the world’s practice.It is of no less importance that the activities of the issuer became transparent both for the state and for the people. The issuer was allowed to sell securities only after his declaration of intent was registered by the Securities and Exchange Commission. The registration procedure for the declaration of intent to sell securities presupposes thorough examination of seller’s credit history. What’s more, the US Securities Act of 1933 provided for criminal liability for any attempt of the issuer to fraud or mislead the Federal Securities and Exchange Commission. It is important to note that the American tradition provides for establishment of criminal liability for “branch” abuse in special laws, rather than in the Criminal Code. And that tradition has spread among many states in the global community. For example, the number of the convicts according to special laws in Japan is much higher than the number of those convicted according to the Criminal Code. There are certain grounds for this practice to be

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 32 KUTAFIN UNIVERSITY LAW REVIEW adopted in Russia as well. In any case, this issue is being actively discussed among the expert groups in the Russian Federation. For example in the VI meeting of the Russian-German Roundtable devoted to the issues of fighting crimes in Russian and European Economics, which was held at the Kutafin Moscow State Law University in November of 2014, the Russian legal scholars addressed to their German colleagues mostly with the questions on the legal practice of application of specialized laws on criminal responsibility for economic crimes. From the standpoint of criminological practice the most attractive is containing in the above-mentioned US Banking Act of 1933prohibition for the private banks to combine commercial and investment functions. The law prohibited the banks to act as brokers (dealers) or otherwise in the stock market. The enforcement of anti-crisis laws in the USA was mostly guaranteed by the provision of various types of punishments for both individuals and legal entities. Among them there are public reprimand, fine, expulsion from the range of professional market participants, and long term imprisonment. For example, use of telecommunication or mail for spreading fraudulent information in the stock market is an aggravating circumstance, and it is punished with the prison term up to 5 years. If the fraud is directed against a financial institution, the guilty party is a subject to pay a fine up to 1 000 000 USD or to imprisonment up to 30 years, or even both of them. From that time till now American legislation was developing mostly to include more severe sanctions for the abuses in the sphere of business and finances. For example, the Foreign Corrupt Practices Act of 1977 provides that the persons guilty of such acts are punished with fines up to 2 000 000 USD. In addition, the generally broad discretion competence of the US judges tends to become even broader.

III. CREATIVE PUNISHMENTS AS THE SUBJECT OF ADOPTING FOREIGN CRIME FIGHTING EXPERIENCE

There is a gap in criminological and criminal science in this respect, and filling this gap would facilitate correction of many shortcomings of the penal system. What is the nature of this problem? The issues of defi nition, goals and types of punishments are quite suffi ciently studied. There are intensives www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 33 positive changes in this sphere, facilitating the practical implementation of the general principles of the modern criminal law (lawfulness, justice, humanity, differentiation of responsibility, individualized punishment). For example, the system of criminal punishments in the Russian Federation contains a limited list of punishments, which is obligatory for the court. These punishments include fi ne, the loss of right to hold certain offi cial positions or to be involved in certain activities; loss of specialized right, military or honorary position, class rank or state awards, limitations in military service, limitation of freedom, obligatory works, arrest, service in a disciplinary military unit, deprivation of freedom for a certain period of time, life sentence in prison and capital punishment.10 It is easy to see that there is a broad range of punishments, however, at time they are not suffi cient to restore the social justice, to achieve an improvement of a convicted person, to prevent new crimes committed by this or other persons. What should one do in such a situation? Some authors suppose that all the generally recognized goals of the criminal punishments can only be achieved in a manner of medieval times, when the capital punishment was the dominating type of punishment. Other authors consider that there is a need for more dynamic development of types of punishments. The third viewpoint is that there is a need to widen the scope of discretion of the law enforcement offi cials, allowing them to use currently existing punishments or to create new types of criminal punishment. This is not an easy question. It becomes more or less from time to time both in theory11 and in practice. For example, on December 4, 2014 the group of terrorists entered the city of Grozny, and captured the News Center and a school. They killed 14 policemen and wounded 30 people. The terrorists were killed. However, this measure does not guarantee 100% preventive

10 Imposing capital punishment in Russia is suspended with the Decision of the Constitutional Court of the Russian Federation of February 2, 1999 №.3. 11 The discussion of these matters from the criminological and criminal legal positions non-with standing common approval or disdain took place about 8 years ago. Dashkov G.V. Kreativniye vidy nakazaniya kak ugolovno-pravovaya i kriminologicheskaya kategoriya / Sbornik nauchnykh statey ‘Nauka ugolovnogo prava i sovershenstvovaniye ugolovnogo zakonodatel’stva, Moskovskiy universitet MVD Rossii. 2007. S. 18–21. (GV Dashkov, ‘Creative Punishments as a Category of Criminal Law and Criminology’ (2007) Collected Articles. Science of Criminal Law and Improvement of Criminal Legislation. Moscow University of the Ministry of Interior of Russia 18).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 34 KUTAFIN UNIVERSITY LAW REVIEW effect, as the the experience shows. That is why the Head of the Chechen Republic Ramzan Kadyrov proposed that the homes of terrorists should be burned down and their families should be deported. He also proposed to dismiss the heads of regions, where the facts of unlawful use of weapons by their residents took place. These are creative means of reaction to terrorism-related facts. However, there are no exceptionally cruel and socially unacceptable elements in them. There was an analogous practice at the time of the Caucasus war (1817–1864), and there is a similar modern model of fi ghting terrorism in Israel, which is not condemned by anyone. It is no accident, that 75% of people who were taking part in the radio poll approved the creative position of R. Kadyrov, while only 24% were against it. The neutral position on this issue was adopted by 1% of persons polled. Nevertheless there are a lot of questions arising. It is necessary to look for the creative and untypical punishments. First of all, there is a need for the defi nition of creative punishment, which may be based upon the foreign experience. As a starting point, it is offered to regard creative punishments as punishments characterized by creativity and different from a common idea on its essence, at the same time being effi cient means for achievement of purposes of criminal punishment defi ned by law. When resolving legal, moral, ethical, organizational and economic problems, concerning application of creative punishments, the existing positive and negative experience in this sphere should be taken into consideration. For example, since the USA has rich legal traditions, some of its states apply creative punishments for crimes of insignificant and medium gravity. For example, a 22-year old Atlanta resident Brendon Huff was brought to criminal responsibility for “forgetting” to pay for the gasoline, when refueling his car. The judge decided that considering personal qualities of the offender and type of his crime, the best punishment would be creative rather than “classic”. The creativity was expressed by obliging the offender to walk regularly along the road near the gas station wearing the poster “I stole gasoline, and this is my punishment”. In the opinion of most American citizens of various incomes and social origins creative punishments such as this one are more effective than fines for the persons who have committed de minimis crimes. There is a relatively wide range of offences to which creative punishments are applied by the judiciary, and they are supported by the public. To provide a general idea regarding this matter, there are some www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 35 examples of the US judicial practice on creative punishment in the mass media: — Housewife Michelle Murray was obliged to spend a winter night in the forest for leaving 35 kittens there before; — The offender, who broke into a house and defecated on the floor, was sentenced to cleaning 100 prison toilets; — Juvenile drug addict was sentenced to 40 hours of working at the drug rehabilitation clinic. The things she has seen there made her lose any interest to narcotic drugs; — Juvenile offenders who punctured the tires of the school bus had to organize a picnic for the elementary school students. Specific contents of creative punishments depend much on the state, specific region, national specificities of the population and some other factors. The most authoritative and circulating Russian newspaper “Komsomolskaya Pravda” having made a public survey, established that when it comes to the criminal punishments, Russians do not sure the same opinion with Americans. For example, when asked how to deal with stealing, 35% of the interviewed said that the thieves should be imprisoned; 27% of persons said that the names and photographs of the thieves should be put on TV and in the newspapers for all to see; 26% of the interviewed want to cut hands off for thieving; 12% of the them consider that nothing should be done, since everyone steals here. As for the above-mentioned case with a gasoline thief in Atlanta, Russian newspaper ‘Komsomolskaya Pravda’ asked Russian citizens what kind of posters should be placed on offenders in Russia. Here are some of those answers: Yulia Latynina (journalist and writer): ‘Most drivers would have “I bribed the road police” posters. Most pedestrians would have “I crossed the road, where it was prohibited”. The public officials would have “I misappropriated … millions” posters.’

Mihail Barschevskiy (advocate): ‘I was punished for petty theft.’ Oleg Mitvol (public activist): ‘He pollutes environment.’ Boris Nemtsov (politician): ‘Everyone steals and I do.’ Grigory Antipenko (actor): ‘Beware, you see a.’ Dmitriy Puchkov (interpreter): ‘I sell drugs’, ‘I am a prostitute’, ‘I use prostitutes services’.

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IV. PRIORITIES IN ADOPTING FOREIGN PRACTICES IN CRIME FIGHTING

Taking into account the situation, structure and dynamics of crime in the modern world, Russia has great opportunities, when it comes to choice of subjects for adopting foreign crime fighting experience. There is no need to take everything at the same time, and it is technically impossible. The problem of collective experience in the sphere of fighting drug business and related matters seems to be among such priorities. In this respect there is no need to start anew with every relevant issue. There is a huge experience of foreign states, and it is worth to reveal and study it, then to develop methodology and directions for other states and regions. It is quite indicative that the unique experience of fighting drug addiction is not limited to superpower states with highly developed medicine, law, and information capabilities for transition of the experience to the interested states and international organizations. There is much use for fighting drug crime in the other sources, even if they are difficult to access for internal or external reasons. To support this position, one may refer to the experience of the Socialist Republic of Vietnam. Acting in a difficult post- war period Vietnam government managed to make this problem much less pressing. Its criminological nature is as follows. For a number of political and economic reasons by the early 1970s Vietnam (and especially southern Vietnam) became an important link within the system of states within the so-called “Golden Triangle” (Thailand, Laos, Philippines and some other Southeast Asian states). The sea port of Saigon became an important trans-shipment point for narcotic drugs in that region. It is natural that most of the drugs became accessible both for the rich American army, having its quarters in the Southern Vietnam, and for the poor native population. The scale of drug addiction among the population was exceptionally high compared to the global rates. However, just in six months after Northern and Southern Vietnam were united the situation suddenly changed for the better. The new government offered all persons suffering from drug addictions to undergo a voluntary medical treatment in the special centre of social and medical rehabilitation. Its efficiency was highly beyond any expectations. Only 15% of drug addicts returned to using drugs after the treatment. Such results had never been achieved before. The school annually hosted up to 700 delegations from the USA, www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 37 the Great Britain, France and other highly developed foreign states. Having been the advisor to the Supreme People’s Prosecution of Vietnam, the author had an opportunity to see the work of that centre and evaluate it from the criminological standpoint. In brief, the results are as follows. The staff included 1 doctor and several supporting staff workers, including administration. Treatment for 1 000 drug addicts included several stages. First stage was a medical one. The drug addicts followed the prescriptions of the doctor, helped each other with physiotherapeutic procedures (medication shots, medications). The second stage was educational. The patients were told that the new government needed healthy citizens who could bring a maximum use to the society, their families and themselves. And they could become those citizens, only if they truly wanted it. The third stage involved restoring the willpower, which was previously lost at the time of drug addiction. It was achieved by daily exercises in the open area in the 40 C heat, martial arts training in order to restore spiritual and physical balance of the patients. The fourth stage was a labor therapy. The drug addicts worked, and their work was not limited just to socially useful jobs, such as watering the rice fields. Their work was economically profitable for them as well. For example, they made popular seafood delicacies, such as shrimp patties for a foreign market. It allowed them to earn several times more than other Vietnamese citizens. The drug addicts could send the money that they earned to their families, who had not even dreamed of such incomes before. There was created an atmosphere of importance of their work. Naturally, there were developed and supported feelings of their value and respect for their work. When they got free from drug addictions, the former addicts could leave the centre and return home. There were no administrative or other obstacles for them to do so. Several years later, while holding the same position, the author managed to visit the school of social and medical rehabilitation for the drug addicts near Saigon (currently Ho Chi Minh City). The situation became worse, especially from the standpoint of criminological markers. First of all, a school became a closed and a strictly guarded institution; the term of stay there became fixed. The process of treatment was seemingly the same. The same medical measures, the same labor therapy, the same support for the physical health. However, the ideological and psychological means of influence upon the drug addicts, which provided that they were capable of becoming worthy members of society and getting good jobs, were removed.

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In this respect the government was not able to fulfill its obligations to the patients, who were healed of drug addiction. Thus, the entire system of treatment, reeducation and correction of drug addicts was undermined. The above-described experience of overcoming drug addiction in Vietnam with its positive and negative features withstood the test of time, and, quite naturally, it was adopted by many states, including the Russian Federation. On November 20, 2014, the Federal Drug Control Service (FDCS) introduced for the Government of the Russian Federation the Program for Rehabilitation of Drug Addicts and Consumers of Drug-Containing Substances. This Program involves the use of foreign experience, including the experience of the Socialist Republic of Vietnam, and it introduces a number of measures meant to limit the punitive element within the system of working with drug addicts to its minimum. It is very important, since over 200 000 drug addicts are annually brought to administrative and criminal liability in Russia. As the Head of the FDCS Viktor Ivanov stated, the drug addicts should be sent for rehabilitation, and not to prisons. However, it requires significant improvements in quality and quantity of material and technical guarantees of the activities of the relevant Ministries and Departments. It is planned to spend about 180 billiard rubles for this purpose in the period till the year of 2020. Additionally, there will be private drug rehabilitation centers, working along with the state centers according to the unified standards for assisting drug addicts. Those standards will be worked out soon in accordance with the assignment of the Government of the Russian Federation.12 The traditionally topical direction of adopting the foreign crime fighting experience by Russia is corruption. This is not a new problem for Russia, and many useful measures were already taken.13 In any case,

12 For more details, see: Egorova E. Pravitel’stvo vzyalos’ za narkomanov / Moskovskiy komsomolets. 2014. S.2. (E Egorova, Government Takes Care of Drug Addicts (2014) 2). 13 Dashkov G.V. Kriminologicheskaya sushchnost’ korruptsiyi i korruptsionnoy prestupnosti / Sovremenniye problemy ugolovnoy politiki. Materialy V Mezhdunarodnoy nauchno-prakticheskoy konferentsiyi. Krasnodarskiy universitet MVD Rossii. 2014. T 1. S.103–110. (GV Dashkov, ‘Criminological Nature of Corruption and Corruption Crime’ (2014) 1 Modern Problems of Criminal Policy. Materials of the V International Scientific and Practical Conference. Moscow University of the Ministry of Interior of Russia 103). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 39 a rather balanced system of revealing, investigation and prevention of embezzlement of state property, bribery and other similar state service- related crimes had been formed in Russia long before Christopher Columbus discovered America. However, this problem does not seem to become less acute, and it gains more and more international damage potential. That is why, the UN and other international organizations take more and more intensive efforts to curb the white-collar crime, such as corruption. The international community adopted a number of acts against it, such as the Criminal Law Convention on Corruption (ETS № 173) (Strasbourg, January 27, 1999); the UN Corruption Convention (adopted by the General Assembly of the UN on October 31, 2003). These acts relieved the tension in the sphere of fighting corruption in the world to a great extent. And these Conventions are implemented into the Russian legislation. However, the practical experience shows that these measures are not sufficient for the positive results at the level, which was achieved by most states in the global community. In any case, the problems for Russia are obvious, and they do require additional measures in order to improve the efficiency of reception of the experience and socially valuable achievements of foreign states in the sphere of fighting corruption. It is hardly possible to make a list of such states, and it is probably not viable. However, based upon the general principles of comparative legal studies, it seems reasonable to give priorities in the sphere of foreign experience in fighting corruption to the USA and China. Within a short span of time, while using different means and methods these states managed to achieve similar positive results in overcoming corruption manifestations in various spheres of economic and administrative activities, including legal sphere. The latter deserves special attention. In the high days of mafia at the time of the Great Depression in the USA the scale of corruption in the police was higher than anywhere else in the world. The famous Chicago gangster Alfredo Capone publicly stated that he had bought a police, and was not afraid of punishment. In any case, it took a lot of efforts to take the N.1 Gangster to the prison in the USA, and he was taken not for the hundreds of murders and other grave crimes that he had committed, but for the tax evasion in his legal business of small-scale furniture retail. Historically speaking, quite little time has passed since then. Once we turn to the criminological analysis of the persons guilty of corruption crimes in the USA, there are almost no judges, policemen, attorneys, or

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 40 KUTAFIN UNIVERSITY LAW REVIEW law-enforcement officers among them. How was it achieved? Scientifically substantiated information on these matters is quite of interest for Russia, where the law-enforcement system is not at the bottom of the list, when it concerns the corruption offences.

V. FORMATION OF THE COLLECTIVE EXPERIENCE RESULTING FROM THE CITIZENS’ ENHANCED INVOLVEMENT IN CRIME FIGHTING

The issues of raising the level of social activities of the people in the foreign states (social capital) are quite topical for the Russian criminology today. It is still so, while Russia does have significant and long-standing experience of participation of people and non- governmental organization in social matters. In any case, in Russia in 1881 after the murder of the Emperor Alexander the II by the member of the ‘Will of the People’ group (narodovoltsy), there was formed a closed non-governmental union ‘Holy People’s Guard’. It was meant to act against terrorism, to reveal Russian revolutionaries in Russia and abroad, to physically protect the Tsar during the mass events and tours, fighting rebellion and nihilism. The Holy People’s Guard as a NGO acted in close cooperation (without hierarchy) with the police and other law-enforcement bodies of the Russian Empire. The Guard was financed rather generously by the Emperor Alexander the III. The members of the Holy People’s Guard had no salary or other benefit. The only stimulus for their work was to protect the Tsar and the Motherland. The Holy People’s Guard worked rather efficiently and operatively. Just after one year it was formed it reached its main purpose. Later its functions on support of legal order were transferred to the new public organization – the Voluntary Guards. It was more democratic and mass (compared with the Holy People’s Guard) organization for participation of citizens in fighting crime. The Voluntary Guards involved representatives of all classes of Russia, and the procedure for joining the Voluntary Guards was much simpler, than that of the Holy People’s Guard. There was only a need for recommendations from two acting members of the Voluntary Guards. The administration of the Voluntary Guards was carried out by the Minister of the Interior of Russia and the Governors. The main goals of www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 41 the Voluntary Guards involved the following: prevention of attacks upon the Tsar and the royal family, prevention of mass riots. The Voluntary Guard as a form of participation of citizens in fighting crime withstood the test of time and by the start of the 1st World War (in more than 30 years after it was formed) there were over 40 000 members in it. It ceased to exist after the February revolution of 1917, and so did other public order protection bodies. In the Soviet period the role of non-governmental organizations within the structure of state and non-governmental bodies fighting crime was changed dramatically, and it gained much greater scale compared to the pre-Revolution period. The purpose of most Soviet government and administration bodies was to guarantee the social activities of the population at the maximum level. Thousands of various non-governmental organizations, commissions and committees for assisting the government in fighting crime were formed among the workers, peasants and Soviet intelligentsia. For example criminal judicial proceedings obligatorily involved public defenders and public accusers. Many judicial hearings were held in the organizations or at the factories. There were institutions of public assistants for investigators and prosecutors, bailiffs, etc. The voluntary communities (brigades) for assistance to the militia and criminal investigation were very efficient. So were the non-payroll militia officers, Komsomol brigades, public auditors, controllers, inspectors, etc. In the Soviet period the most mass forms of participation of people in preservation of the public order were the voluntary people’s guards, involving over 10 000 000 people. While there were obvious abuses, elements of formalism and showing off in the activities of non- governmental organizations in the Soviet period, there were positive elements, preventing crime and other types of unlawful behavior. At the same time, in the opinion of the author the scale of participation of citizens in fighting crime was overgrown in the Soviet period, and it was not efficient. Overall, the super-scale of participation of citizens in fighting crime contradicted the very nature of the society. For example, it is a well-known fact that the number of socially passive citizens (especially, when it comes to the specific spheres of social activities, such as revealing and prevention of crimes) is 15-20 times higher than the number of socially active citizens. This is a sustainable

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 42 KUTAFIN UNIVERSITY LAW REVIEW ratio and it does not tend to change dramatically. For example, in the middle of XIX century the famous Russian writer N.G. Chernyshevskiy, the author of the famous novel ‘What Is To Be Done?’ noted that the nation had about 10% of active and talented people. They are ready to search, to risk and to achieve success in the name of the people. The rest of the people are socially passive and their initiatives are limited solely to their personal interests. One can hardly count upon the success of mass involvement of citizens in fighting crime in such conditions. It is an impossible task. However, it is possible to improve the ratio between the socially active and passive groups of citizens for the better of the community. There is a certain positive experience of this kind in Russia, in the EU states, in the USA and China, in Japan and some other states in the global community. And it becomes accessible for other states thanks to the efforts of the UN, other regional and national structures. However, that is not sufficient for achieving a progress, especially since it concerns the documents themselves, rather than generalization of the practical experience. At the initial stage of formation of the market relations in Russia in 1990s, when some things were not done at the right time, the institution of the participation of citizens in fighting crimes almost ceased to exist. However, it soon became obvious that such a voluntarist method of limiting the number of subjects fighting crime in the Russian Federation was altogether unproductive. Legal and organizational reform of the activities of the citizens and public organizations in the sphere of resolving the problems of fighting crime was to a great extent based upon the positive national traditions. Nevertheless, such an approach does not always give satisfactory results, and it has no theoretical guarantees. For example, in spite of the new foundations for the formation and functioning of the civil society institutions, the theoretical and practical issues of their interaction with the state government and administration bodies are being resolved in accordance with the old standards, when the non-governmental organizations were regarded as some appendix to the state bodies, and the state bodies had total control over the non- governmental organizations. It is currently impossible to agree with such position, especially since a complex theory of combination of social and state control is www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 43 absent in Russia. For example, there are no scientifically substantiated principles of the implementation of the state control for state- governmental organizations activity. There is only a will to control them. As a result, the party acting as a non-governmental organization, often falls outside the scope of legal influence upon the offenders wishing to achieve public order by any means. The other party (state government and administration bodies) attempts to direct the public initiatives in a right way. For a number of reasons of political, economic, administrative and legal nature it is currently impossible to establish a mathematical formula for calculation of the acceptable level of state bodies influence on non-governmental organizations activity. Perhaps, there is no need for it in a developing democratic state. In order not to risk making serious mistakes, it is sufficient to use constitutional provisions establishing that ‘the creation and activities of public associations whose aims and actions are aimed at a forced change of the fundamental principles of the constitutional system and at violating the integrity of the Russian Federation, at undermining its security, at setting up armed units, and at instigating social, racial, national and religious strife shall be prohibited’ (para 5 of Art 13 of the Constitution of the Russian Federation). As for the rest, the degree of influence of state government and administration bodies upon the activities of non-governmental organizations and citizens should be minimal, and at best it should be zero. Within such a model of interaction between the government bodies and public many of the limiting factors for the social activities of the people should be removed. However, it does not seem viable to achieve the desired result simply by the refusal of the state to control the activities of non-governmental organizations and associations. The practice shows that uncalculated steps in this direction lead to grave violations of basic rights and freedoms. Russia is not the only state facing problems of that kind. It is natural, that there is also positive experience in resolving those problems. Nevertheless, the reception of the foreign experience is occasional and isolated. The activities in the sphere of development of international crime fighting programs also became less pronounced. Most of them have long history, and the ‘model range’ is not renewed with due intensity, while there is great need for such renewal.

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VI. PERSPECTIVES

The issues discussed in this article do not cover all of the aspects of the relevant problem. They more reflect subjective priorities of the author. It seems necessary to turn to other aspects of this problem later on, since it was not sufficiently studied. One of such aspects concerns various subjects of adopting the foreign crime fighting experience. So, the famous Russian proverb saying: ‘the deeper in the wood you go, the more timber seems to grow’ is quite applicable to the problem in question.

Bibliography

Al-Aqaileh ZM, ‘Legal Cultures Dialogue: Benefits and Obstacles of Comparative Law Studies’ (2013) 54 Journal of Sharia & Law Dashkov G.V. Kreativniye vidy nakazaniya kak ugolovno-pravovaiya i kriminologicheskaiya kategoriya / Sbornik nauchnykh statey ‘Nauka ugolovnogo prava i sovershenstvovanie ugolovnogo zakonodatel’stva, Moskovskiy universitet MVD Rossiyi. 2007. S. 18–21. (GV Dashkov, ‘Creative Punishments as a Category of Criminal Law and Criminology’ (2007) Collected Articles. Science of Criminal Law and Improvement of Criminal Legislation. Moscow University of the Ministry of Interior of Russia) Dashkov G.V. Kriminologicheskaiya sushchnost’ korruptsiyi i korruptsionnoy prestupnosti / Sovremenniye problemy ugolovnoy politiki. Materialy V Mezhdunarodnoy nauchno-prakticheskoy konferentsiyi. Krasnodarskiy universitet MVD Rossii. 2014. T 1. S.103- 110. (GV Dashkov, ‘Criminological Nature of Corruption and Corruption Crime’ (2014) 1 Modern Problems of Criminal Policy. Materials of the V International Scientific and Practical Conference. Moscow University of the Ministry of Interior of Russia) David R, Les grands systèmes de droit contemporains (Dalloz, Paris, 1964) David R, Jioffre-Spinosi C, Osnovnye pravoviye sistemy sovremennosti / M.: 1996 (R David, C Jioffre-Spinosi, Major Legal Systems in the World Today (1996)) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gennady V. Dashkov Peculiarities of Reception of Foreign Crime Prevention Practices in the Russian Federation 45

Egorova E. Pravitel’stvo vzyalos’ za narkomanov / Moskovskiy komsomolets. 2014. S.2. (E Egorova, Government Takes Care of Drug Addicts (2014)) Governance, Corruption, and Conflict (United States Institute of Peace, 2010) Gumilev L.N., Drevnyaiya Rus’ i velikaiya step’ / M.: 1992 (LN Gumilev, Ancient Russia and the Great Steppe (1992)) Juvayni Ala Ad Din Ata-Malik, Istoriya pokoritelya Vselennoy / Rodina. 1997. № 3-4. (Ala Ad Din Ata-MalikJuvayni, ‘History of the World Conqueror’ (1997) 3-4 Rodina) Khoara-Davan E. Chingiskhan kak polkovodets i ego naslediye / Arabeski istoriyi. Pustynya Tartari. 1995. №2. S. 89–90. (E Khoara- Davan, ‘Genghis-Khan as a Chieftain and His Heritage’ (1995) 2 Historical Arabesques.Tartary Desert) Oksamytnyi V.V., Vozniknoveniye i evolutsiya sravnitel’nogo pravovedeniya. Rossiya: na puti globalizatsiyi i integratsiyi /Institut mezhdunarodnogo prava i ekonimiki imeni A.S. Griboedova. 2012. S. 44–47. (VV Oksamytnyi, ‘Appearance and Evolution of Comparative Legal Studies. Russia on the Path of Globalization and Integration’ (2012) ScientificWorksoftheComparative Law and Economics Institute named after A.S. Griboedov) Ryazanovskiy V.A. K voprosu o vliyaniyi mongol’skoy kul’tury i mongol’skogo prava na russkuyu kul’turu i pravo / Voprosy istoriyi. 1993. № 7 (V.A. Ryazanovskiy, ‘On the Issue of the Influence of the Mongolian Culture and Mongolian Law upon the Russian Culture and Law’ (1993) 7 Issues of History) Saidov A.H. Sravnitel’noye pravovedeniye / M.: 2003 (AH Saidov, Comparative Legal Studies (2003)) Vernadskiy G.V. Istoriya Rossii. Mongoly i Rus’ / Tver’: 1997 (GV Vernadskiy, History of Russia. Mongolians and Russia (1997)) Vernadskiy G.V. O sostave Velikoy Yasy Chingiskhana / Brussel’: 1939 (GV Vernadskiy, On the Elements of the Great Yasa of Genghis- Khan (1939))

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 46 KUTAFIN UNIVERSITY LAW REVIEW

ARTICLE

DEVELOPMENTS OF SOCIAL (CRIME) PREVENTION IN EUROPE – A BRIEF OVERVIEW

Gorazd Meško, Benjamin Flander (Slovenia)

Authors Gorazd Meško – PhD, Professor of Criminology, Faculty of Criminal Justice and Security, University of Maribor Email: [email protected] Benjamin Flander – LLD, Assistant Professor of Law, Faculty of Criminal Justice and Security, University of Maribor Email: [email protected] Abstract It is widely acknowledged that the last four decades have seen an expansion in crime reduction initiatives focused upon prevention rather than the traditional means of prosecution, punishment and repression. This shift to a preventive mentality took place in most western countries as well as in the post-communist European countries. Among different approaches to crime prevention, social crime prevention gained a lot of attention in western and particularly European countries until the end of the 1970s and even at the beginning of the 1980s. Afterwards, in academic debate as well as in crime and social policies, the concept of social crime prevention has taken a less important role, as – with the processes of globalisation, individualisation and neo-liberalism – actively promoting welfare (state) for all has ceased to be a central ambition of rulers and policy makers. With the rapid economic, political, social and cultural changes that have taken place during the last decade, and supported mainly situational crime prevention it is difficult to make a prognosis about the future development of social crime prevention in neoliberal western societies. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gorazd Meško, Benjamin Flander Developments of Social (Crime) Prevention in Europe – A Brief Overview 47

Keywords Crime prevention, social crime prevention, criminology, social security, crime prevention strategies, welfare state

DOI: 10.17803/2313-5395.2016.1.5.046-053

TABLE OF CONTENTS

I. On social crime prevention ...... 47 II. The historical context: a brief sketch of the key post-war developments in the sphere of social crime prevention ...... 49 III. Conclusion ...... 52 Bibliography ...... 53

I. ON SOCIAL CRIME PREVENTION

Social crime prevention focuses on the “root causes” of crime, especially the factors that contribute to delinquency, drug abuse, and adolescent problems. Based on the premise that crime is caused by the social illnesses of society, the social crime prevention model focuses on developing programs and policies to improve the health, family life, education, job opportunities and neighborhood activities of potential offenders.1 In general terms, social factors which contribute to delinquency and crime are neighborhood instability and change, rapid turnover of households, decline of the labour market, loss of services and transport, and visible deterioration of buildings as well as radical physical alteration, such as demolition and construction of housing stock.2 Therefore, social crime prevention includes prevention strategies aimed to modify social environments and, consequently, influence

1 DP Rosenbaum, AJ Lurigio and RC Davis, The Prevention of Crime: Social and Situational Strategies (Wadsworth Publishing Company 1998) 2 P Knepper, Criminology and Social Policy (Sage, 2007) 60.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 48 KUTAFIN UNIVERSITY LAW REVIEW on offenders’ motivations, preferably with planned and co-ordinated multi-agency approaches.3 It focuses on interventions that seek to strengthen socialisation agents such as informal control (e.g. family, school, etc.), education, employment, and support policies for ex- convicts in order to minimize opportunities for (re)commitments.4 Similarly, Crawford and Traynor5 assert that social crime prevention incorporates interventions aimed at reducing individual motivations to offend via their social environments and institutions of socialisation, and altering social relationships and the social environment through a collective focus on communities, neighbourhoods and social networks. In contrast to situational crime prevention, which involves the management, design or manipulation of the immediate physical environment aimed at reducing the opportunities for specific crimes,6 the concept of social crime prevention comprises “inclusive” measures, which target the social causes of crime rather than those concerned with the mechanical reduction of opportunities or with deterrence. In the broader social context that concept primarily focuses on interventions that seek to affect and target social processes and collective relationships, i. e. it aims at providing an alternative to the dissuasive or repressive effects of the criminal justice system.7

3 A Crawford and P Traynor, ‘La prevention de la délinquance chez les Anglais: From Community-based Strategies to Early Intervention with Young People’ in Social Crime prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) 63–101. 4 G Meško, Osnove preprečevanja kriminalitete. Visoka policijsko-varnostna šola, 2002 (G Meško, Basics of Crime Prevention (Visoka policijsko-varnostna šola 2002); A Groenemeyer and H Schmidt, ‘Social Crime Prevention in Germany. Balancing Social Policy and Crime Policy?’ in Social Crime prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) 121–50. 5 ibid (n 1) 62. 6 RVG Clarke, ’”Situational” crime prevention: theory and practice’ in Criminological perspectives (J Muncie, E McLaughlin and M Langan eds, Sage Publications 1996) 332–42. 7 ibid (n 1) 65. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gorazd Meško, Benjamin Flander Developments of Social (Crime) Prevention in Europe – A Brief Overview 49

Social crime prevention has also been increasingly challenged by the populist demand for harsher punishment. Indeed, the “law and order” message is far easier to sell to the mass media and the public than social crime prevention.8

II. THE HISTORICAL CONTEXT: A BRIEF SKETCH OF THE KEY POST-WAR DEVELOPMENTS IN THE SPHERE OF SOCIAL CRIME PREVENTION

After World War II, until the end of the 1970s, the concept of social crime prevention aimed at preventing economic and social marginalization and exclusion gained attention of several European countries. Initially, the concept was incorporated in the educational, public housing and social policies carried out in the context of the developing social welfare state.9 Within the functioning of criminal justice systems, emphasis was given to the reintegration and rehabilitation of convicted offenders and juveniles delinquents. While the 1960s and 1970s are considered the ‘golden age’ of social crime prevention, even during the 1980s there were several attempts to introduce that concept as a policy aimed at preventing the marginalization and exclusion of vulnerable social groups and their members. According to Baillergeau and Hebberecht10, French sociologists and socialist-oriented policy makers influenced the development of a so-called French social crime prevention model. Founded on the elaboration of an urban and structural view of social crime prevention and in state-driven policies aimed at changing structural conditions for young people at risk of crime commitment in various fields such as education, leisure and labour, that model was exported to a significant number of other European countries and even to other continents.

8 A Sutton, A Cherney and R White, Crime Prevention: Principles, Perspectives and Practices (OUP 2008). 9 P Hebberecht and E Baillergeau (eds), Social Crime Prevention in Late Modern Europe. A Comparative Perspective (Vubpress Brussels University Press 2012). 10 ibid.

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Another model developed throughout this period was the Nordic model, based on the ideas of the Scandinavian concept and practice of welfarism. That model involved social and educational programs aimed at eliminating or reducing the social causes of crime. The third model of the 1980s, identifi ed as the prevalent alternative to situational crime prevention in the UK and other Anglophone countries, was the community crime prevention model primarily based on affi rmative action addressed to young people in socially deprived areas. Until the end of the 1980s, social crime prevention was at the peak of its development also in the communist countries. In Slovenia (ex Yugoslavian territory), for example, the idea of social crime prevention was by one way or another integrated into the socialist state’s welfare programs and activities. That period was characterised by a crime policy, which was devoted to re-socialisation and rehabilitation practices and a critical examination of the role of the police in society. During the democratization process of the second half of the 1980s, social crime prevention was still remaining a part of crime policy and crime response practices.11 In Hungary as well, a political and professional environment began to form during the 1980s which clearly encouraged the idea of the prevention-oriented transformation of crime control and a complex system of crime prevention, which included social initiatives and programs.12 The neo-liberal-inspired “fi rst turn in social crime prevention” of the 1980s redirected the focus to crime prevention and control through the deterrent effects of the criminal justice system and situational crime prevention, which aimed to reduce opportunities to commit crime.13 Those new developments played a central role in the crime policies of the British Conservative administration of the Prime Minister, Margaret Thatcher.

11 G Meško, Z Kanduč and M Jere, ‘Social Crime Prevention in Slovenia – Recent Developments’ in Social Crime Prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) 303–19. 12 K Kerezsi, ‘”Grandpa’s Fashion in the New Year” – Innovative Theoretical Thoughts vs. Simplistic Crime prevention Practices in Hungary’ in Social Crime Prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) 181–208. 13 G Hughes, The Politics of Crime and Community (Palgrave MacMillan 2007). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gorazd Meško, Benjamin Flander Developments of Social (Crime) Prevention in Europe – A Brief Overview 51

According to Baillergeau and Hebberecht,14 under British influence, the “preventive turn” took place in the Netherlands, Belgium, France and Italy among others. The dismantling of the social welfare state in those and the vast majority of other European countries was, however, less significant than in the UK and the United States. So, in most of those countries social crime prevention policy remained an integral part of broader social policies. Their respective crime control policies became more flexible and reactive to real and immediate social needs. For example, while the Nordic countries, which were equally influenced by neo-liberal ideas, also introduced situational crime prevention strategies, post-war social crime prevention efforts remained the leading force within the their social and criminal policies. Throughout the Nordic countries the concept of the welfare state was maintained, albeit not to the same extent in all of them. While recognising that since the beginning of the 1990s punitiveness has become a dominant feature of penal policy in the vast majority of democratic countries, the “second turn in social crime prevention” happened. Baillergeau and Hebberecht15 stated that the second turn was a result of the adaptation of the reconfigured social crime prevention of the 1980s to a new wave of neoliberal situational crime prevention policies developed, initially, in Great Britain, the Netherlands and Belgium. While in the Netherlands and Belgium that second turn took the form of “an integrated administrative crime prevention policy”, in England and Wales it was realised by implementing the concept of “community safety”.16 The social crime prevention reconfiguration reached its fullest development in the security and safety policy of UK Prime Minister Tony Blair’s New Labour government. The second turn in social crime prevention also influenced development of crime prevention in France, Germany, Italy, Spain, Belgium, Portugal, Greece and some other “old” European democracies, as well as in some post-communist Central and Eastern European

14 ibid (n 9). 15 ibid (n 9) 28. 16 A Crawford, ‘Crime Prevention and Community Safety’ in The Oxford Handbook of Criminology (M Maguire, R Morgan and R Reiner eds, 4th edn, OUP 2007) 866–909.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 52 KUTAFIN UNIVERSITY LAW REVIEW countries. In Hungary,17 the prevention-oriented transformations were interrupted by the change of political regime in 1989, so that the idea of a complex crime prevention system was taken off the agenda up until the mid-1990s. On the contrary, until the late 1990s in Slovenia there wasn’t a “turn” towards a more punitive stance and a withdrawal from the previous “inclusive” orientation in crime prevention practices. Baillergeau and Hebberecht18 stated that the transfer of the new western “safety and security” policy to the post-socialist countries had been partially realised by initiatives of the European Crime Prevention Network (EUCPN), which was set up by the European Union, and by incorporation of EU laws into their domestic legal systems, and other “agents” who helped to transfer western social control and especially deterrence practices which seem to receive more public and policy making support than social programmes, which remind the welfare state, and even more, on the socialist/communist welfare programmes in Eastern European countries.

III. CONCLUSION

The latest reconfigurations in the sphere of social crime prevention policies towards a more individualized, control-oriented and authoritarian “community safety” crime prevention model in the majority of European countries prioritise, among other things, the fight against anti-social behaviour and public disorder. Those policies incorporate measures aimed at reducing individuals intention to offend via the institutions of socialization focusing on communities, neighbourhoods and social networks. That neo-classicist and neo- positivist approach to social crime prevention is linked with the individual positivist perspective prevalent in the second half of the 19th century. The neoliberal pressures that cause a greater social differentiation need to be reduced somehow. We believe that governments have to implement the proclaimed social policies which might have the preventative effect on the most disadvantaged people in the society instead of increasing punitivity even for minor offences.

17 ibid (n 12) 181–208. 18 ibid (n 9) 29. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Gorazd Meško, Benjamin Flander Developments of Social (Crime) Prevention in Europe – A Brief Overview 53

Bibliography

Clarke RVG, ’”Situational” crime prevention: theory and practice’ in Criminological perspectives (J Muncie, E McLaughlin and M Langan eds, Sage Publications 1996) Crawford A, ‘Crime Prevention and Community Safety’ in The Oxford Handbook of Criminology ( M Maguire, R Morgan and R Reiner eds, 4th edn, OUP 2007) Crawford A and Traynor P, ‘La prevention de la délinquance chez les Anglais: From Community-based Strategies to Early Intervention with Young People’ in Social Crime prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) Groenemeyer A and Schmidt H ‘Social Crime Prevention in Germany. Balancing Social Policy and Crime Policy?’ in Social Crime prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) Hughes G, The Politics of Crime and Community (Palgrave MacMillan 2007) Kerezsi K, ‘”Grandpa’s Fashion in the New Year” – Innovative Theoretical Thoughts vs. Simplistic Crime prevention Practices in Hungary’ in Social Crime Prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) Knepper P, Criminology and Social Policy (Sage, 2007) Meško G, Osnove preprečevanja kriminalitete. Visoka policijsko- varnostna šola, 2002 (G Meško, Basics of Crime Prevention (Visoka policijsko-varnostna šola 2002)) Meško G, Kanduč Z and M Jere, ‘Social Crime Prevention in Slovenia – Recent Developments’ in Social Crime Prevention in Late Modern Europe. A Comparative Perspective (P Hebberecht and E Baillergeau eds, Vubpress Brussels University Press 2012) Rosenbaum DP, Lurigio AJ and Davis RC, The Prevention of Crime: Social and Situational Strategies (Wadsworth Publishing Company 1998) Sutton A, Cherney A and White R, Crime Prevention: Principles, Perspectives and Practices (OUP 2008)

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 54 KUTAFIN UNIVERSITY LAW REVIEW

POLITICAL PROBLEMS AND LEGAL SOLUTIONS

ARTICLE

SOME THOUGHTS ON THE ORIGINS OF RUSSIAN CONSTITUTIONALISM AND THE POSITION OF RUSSIA IN THE GLOBAL CONSTITUTIONAL PROCESS

Galina Andreeva (Russia)

Author PhD (Law), Lomonosov Moscow State University, 1980 Leading Researcher, Institute of Scientifi c Information for Social Sciences of the Russian Academy of Sciences (INION RAN) Email: [email protected] Abstract The article analyzes the position of Russia in constitutional processes abroad at the end of the 18th – the beginning of the 19th century. The role of Russia is shown as important both in the preparation and adoption of the Constitutions of the Ionian Islands of 1799 and 1803, and in drafting of the constitutions, which were not adopted. The author has conducted a detailed study of both scientifi c literature and archival materials in Russia and Corfu (Greece) and discovered a signifi cant gap in the Russian constitutional history, which, when fi lled in, would allow to raise a question of a new interpretation, as well as re-evaluation of particular problems of the Russian statehood and its moving towards constitutional order. If Russia’s experience in creating constitutions for the states under its patronage were included in the constitutional history of Russia, then it becomes clear that Russia received its fi rst practical experience in the fi eld of constitutional development in the Ionian Islands, participating in the preparation and adoption of comprehensive constitutional acts – the Ionian Constitutions of 1799, 1806. The constitutional and legal interpretation of Russia’s foreign constitutional experience and that of granting constitutions ‘on the outskirts’ of the Russian Empire reveals www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 55

new facets of the emergence of modern constitutionalism, while research of events and facts associated with its creation makes the picture of the mankind’s constitutional history more comprehensive. Keywords Global constitutional processes, Russia, Constitution of the Ionian Islands, gradual transition to the constitutional system, role of Russia in foreign constitutionalism, evolution of the Russian Constitutional Law

DOI: 10.17803/2313-5395.2016.1.5.054-075

TABLE OF CONTENTS I. Russian researchers in constitutional law about the origins of Russian constitutional history ...... 55 II. Russian constitutionalism outside Russia and in its remote parts ...... 60 III. Origins of Russian constitutionalism outside Russia: An experience of joint (together with the Ottoman Empire) granting the Constitution to the Ionian Islands in 1799 ...... 62 IV. The importance of Russia’s constitutional experience for the evaluation of Russia’s place in the international constitutional process ...... 69 V. Concluding Remarks ...... 72 Bibliography ...... 72

I. RUSSIAN RESEARCHERS IN CONSTITUTIONAL LAW ABOUT THE ORIGINS OF RUSSIAN CONSTITUTIONAL HISTORY

During last decades in Russia there have been published a number of studies on constitutionalism showing Russia’s movement towards a constitutional order in the light of written constitutions history. Unlike their Soviet predecessors, modern Russian researchers of constitutionalism apply diverse approaches to interpret Russian historical experience of constitution- making. This applies to monographs and articles, as well as study aids – and we believe that opinions contained in the latter are even more important in some sense, because, on the one hand, Russians traditionally believe

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 56 KUTAFIN UNIVERSITY LAW REVIEW that study aids, passing down fi rmly entrenched opinions as they do, serve as the stronghold of established paradigms, and on the other hand, study aids, forming the world outlook of future lawyers, are ones of the factors responsible, to some extent, for the future of scholarship. The researchers who focus their attention on material constitutions search for the roots of constitutionalism, including the Russian one, in ancient times.1 However, they single out different periods as the starting point of Russian constitutional history. Some researchers believe that ‘as a movement to curtail the monarch’s power, constitutionalism in Russia had been around for a long time, and the history of Novgorod and Pskov proves that.’2 At the same time, some researchers aim to specify more precisely a position of the ancient institutions vis-à-vis their modern counterparts. Thus, Yury Shulzhenko applies to them a term ‘prototype’: ‘Prototypes of constitutional institutions, elements of practical constitutionalism could be found yet in the old Russian state – an early feudal monarchy.’3 Being fairly interesting, this interpretive approach to the history requires additional elaboration and argumentation with regard to the pauses of the evolution. Because in the case of the parliament of the Isle

1 How deep one should go down in history, and either limit oneself to the Russian sources only or use sources common to humanity at large, as influencing all and every country, depends on researchers’ preferences – for example, some believe that it is necessary to start with “protoconstitutional documents”: The Code of Laws published by the Sumerian monarch in the 24 century BC, The Code of Hammurabi, etc. Konstitutsionnoe pravo Rossii: uchebnik / Pod. red. V.A.Vinogradova. M.: Uniti-Dana, 2010. S. 65. (The Constitutional Law of Russia: Textbook (V Vinogradov ed., Unity-Dana 2010) 65). Others base on the fact that the first written constitution appeared about a thousand years BC and was issued by the judge and prophet Samuel in Ancient Israel. Barenboym P. Drevneegipetskie korni bibleyskoy konstitutsii // Rossiyskaya yustitsiya. 1999. № 1. S. 19. (P Barenboym, ‘Ancient Egyptian Roots of the Biblical Constitution’ (1999) 1 Russian Justice 19). 2 Vaksman V.B., Parkhomenko A.G. Konstututsionalizm i parlamentarizm: stanovlenie i razvitie v Rossii / Vladivostok: Morskoy Gosudarstvennyy Universitet imeni admirala G.I. Nevel’skogo, 2010. S. 18. (VB Vaksman, AG Parkhomenko, Constitutionalism and Parliamentarianism: Formation and Development in Russia (Admiral GI Nevelskoy Maritime State University 2010) 18); See also Parkhomenko A.G. Konstitutsionalizm: stanovlenie i razvitie v Rossii / M., Voronezh: MODEK, MPSU, 2012. S. 22. (AG Parkhomenko, Constitutionalism: Formation and Development in Russia (MODEK, MPSU 2012) 22). 3 Konstitutsiya v XXI veke. Sravnitel’no-pravovoe issledovanie. M.: Norma, 2011. S. 94. (V Chirkin, The Constitution in the 21st Century. Comparative Law Research (Norm 2011) 94). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 57 of Man applying in its activities and organizational practices thousand years traditions, we deal with one type of situation, but it is absolutely different one, when speaking about constitutional history, one recalls, for instance, the Novgorod veche, which traditions are lost. Undoubtedly, in both cases there can be elements of constitutional history, but appraisals of their roles in history are bound to be different. What indeed was happening in Russian constitutional history, if we are to look for its roots in ancient times: was it irregular sparks, dying out without any consequences, or a constitutionalism evolving under the surface? This question still requires a deep analyzation and serious arguments. Generally speaking, with regard to approaches and arguments used, this line of inquiry is close to those international researchers of material constitutions who apply the terms ‘constitutionalism of classical antiquity’ and ‘Medieval constitutionalism’. As it appears, further inquiry along these lines into Russian constitutional history would throw more light on inner connections between different modern institutions of constitutional law and its antecedent institutions giving us a deeper understanding of the evolution and problems of Russian constitutional phenomena. Other researchers of constitutional history take the modern legal approach to the subject, viewing the constitution fi rst of all as a written document that takes a special place within the system of legal instruments and governs a certain ‘set’ of relations within a society in a liberal spirit. Here, too, one witnesses a diversity of opinions as to when the movement toward a constitutional order began. It would seem that this difference of viewpoints results from different interpretations of legal instruments adopted in Russia at different times. Some researchers believe that it was the 18th century4 that gave birth to the ideas of constitutional democracy and the fi rst blueprints of a constitution. Some of them argue that 18815 was

4 Karnishina N.G. Konstitutsionalizm v Rossii: Teoriya i istoriya: uchebnoe posobie / Penza: Penxenskiy Gosudarstvennyy Universitet, 2009. S. 3. (NG Karnishina, Constitutionalism in Russia: Theory and History: Tutorial (Penza University Press 2009) 3). 5 Sheynis V. Vlast’ I zakon. Politika i konstitutsii v Rossii v ХХ—ХХI vekakh / M.: Mysl’, 2014. S. 27. (V Sheynis, Power and Law. Politics and Constitutions in Russia in the 20th – 21st centuries (Thought 2014) 27). The author writes about the assassination of the Russian emperor, which disrupted the already prepared reform and stopped ‘Russia’s progress to the Constitution by a quarter century’.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 58 KUTAFIN UNIVERSITY LAW REVIEW the year when Russian constitutionalism began. There is a fairly common viewpoint that a year of 19056 gave a start of partial implementation of constitutional ideas. In essence, those studies are focused on legal instruments refl ecting individual elements of a constitutional order rather than on a comprehensive framework of constitutional regulation. Some scholars limit their researches to the Soviet period as a period that gave birth to constitutions. They claim that ‘Russia during its history had fi ve constitutions’: the ones of 1918, 1925, 1937, 1978, and 1993.7 That approach was formed in the Soviet period, and nowadays the list was simply complemented with the current constitution. What mostly matters for the followers of the approach is a formality of a presence of a legal instrument called constitution, being in force on the territory of a whole state. It should be noted that the authors of all of the above mentioned works on the constitutional history address to the history of the Russian state as a whole, without considering its imperial nature and the specifi cs of its internal setup – in other words, the past in essence is evaluated from a present perspective, and to a large extent – using the concepts from the Soviet period.

6 For example, the textbook by Strekozov (2012) states that “the foundations of the constitutional order and the first legislative acts of the constitutional character emerged in the Russian state in the early 20th century. It was the revolution of 1905 that only promoted the need to turn the unlimited autocracy into a constitutional monarchy.” Strekozov V.G. Konstitutsionnoe pravo Rossii: uchebnik dlya bakalavrov / M.: Yurait, 2012. S. 37. (VG Strekozov, The Constitutional Law of Russia: Textbook for Bachelors (Yurait 2012) 37). “In the pre-revolutionary period, constitutional ideas were put forward by Russian scientists and politicians, they were partly reflected in the Tsar’s Manifestos of 1905 on the improvement of public order, the establishment of the State Duma, the Elections Act, the Basic Laws of the Russian Empire of 23 April 1906 – people’s representation, multiparty system, media freedom, fundamental rights and freedoms of the individual, and others.” See also Narutto S.V., Taeva N.E., Shugrina E.S. Konstitutsionnoe pravo Rossii: uchebnik / M.: Infra-M, 2013. S. 35. (SV Narutto, NE Taeva, ES Shugrina, The Constitutional Law of Russia: Textbook (Infra-M 2013) 35). 7 Kozlova E.I., Kutafin, O.E. Konstitutsionnoye pravo Rossii / 5 - e izdanie, M.: Prospekt, 2013. S. 84. (EI Kozlova, OE Kutafin, The Constitutional Law of Russia (5th ed, Prospekt 2013) 84); Kirichek E.V. Konstitutsionnoye pravo Rossii: uchebnik / Tyumen’: Tyumenskiy institut povyshenia kvalifikatsiyi sotrudnikov MVD Rossii, 2012. S. 55. (EV Kirichek, The Constitutional Law of Russia: Textbook (Tyumen’ Institute of Professional Development for Employees of the Ministry of Internal Affairs of the Russian Federation 2012) 55). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 59

The authors of the studies published by the Russian Academy of Science’s Institute of State and Law tend to take a broader view of Russia’s constitutional history. Talking about the history of Russian constitutional law, they mention and analyze, along with the Russian national pieces of legislation, the draft of the Ionian Islands’ Constitution of 1804, the Tarnovo Constitution of 1879, the Constitution of the Kingdom of Poland signed in 1815, as well as the Constitution of Finland. 8 Even if all of those acts are of the 19th-century, but considering the imperial nature of the Russian state. However, the features identifi ed in these sometimes very detailed observations are presented precisely as peculiarities (‘one should be mindful of the specifi city of imperial Russia’s state structure’9) which do not change the writer’s overall appraisal: ‘Russia under monarchy did not have a constitution. However, constitutional ideas were being presented and drafts of constitutions were proposed. They infl uenced to some degree the further development of the state legal institutions.’10 It would seem that the mere fact of inclusion of descriptions of those acts into the works shows that the scholarly community is aware of the gap in the history of Russian constitutional law and Russian constitutionalism – the gap that needs to be filled. Having made a detailed research of archives of scientific literature on the subject in Russia and Corfu island (Greece)11, the author came to conclusion that Russian constitutional history indeed has a significant gap, closing thereof allows to give a new interpretation of the Russian constitutional history; it makes also possible to re-evaluate problems of Russia’s statehood and those of moving towards constitutional order.

8 Shul’zhenko Yu.L. Ocherk rossiiskogo konstitutsionalizma monarkhicheskogo perioda / M.: Institut gosudarstva i prava RAN, 2008. S. 73―77. (YuL Shul’zhenko, Essay on the Russian Constitutionalism of the Monarchical Period (Institute of State and Law RAN 2008) 73―77); Konstitutsionnoye pravo Rossii: kurs lektsiy / M.: Yurlitinform, 2013. S. 87― 89. (The Constitutional Law of Russia. Lectures (Yurlitinform 2013) 87-89). 9 Konstitutsionnoye pravo Rossii: kurs lektsiy / M.: Yurlitinform, 2013. S. 87― 89. (The Constitutional Law of Russia. Lectures (Yurlitinform 2013) 87). 10 ibid 86. 11 Included in the framework of the international research project RHRF-KERIE 2011 № 11-23-14001 a/Gre.

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II. RUSSIAN CONSTITUTIONALISM OUTSIDE RUSSIA AND IN ITS REMOTE PARTS

Russia in different periods participated in making foreign constitutions (the Ionian Islands’ constitutions of the late 18th – early 19th centuries, the Tarnovo Constitution of 1879) and granted constitutional acts to its remote parts (Poland and Finland).12 The question of Russian constitutionalism outside Russia and in its remote parts was carefully investigated yet by Soviet and foreign historians13. However, Soviet historians approached the topic as a part of common history, a curious element in the history of the Russian state before the Bolshevik revolution, and not as a component of its constitutional history and constitutional law. This knowledge, therefore, was not applied for evaluating and interpreting the evolution of Russian constitutional law. In recent years the historians have begun to acknowledge that the Ionian Islands’ Constitution of 1799 is also a good subject to explore when studying the evolution of Russian ideas about constitutionalism.14 The question of this act’s place in the constitutional history has been addressed in modern research on constitutional law as well,15 and this allows us to

12 Peleshko A. Natsionalno – vizvol’na borot’ba grets’kogo narodu protii osmanskogo panuvannya i vitchiznyanih ta zarubizhnikh pratsyakh : Ukrainskiy istoricheskiy zbirnik / Kiev: Vip, tom 11, 2008. S. 395. (A Peleshko, Ukrainian history compilation, vol 11 (Vip 2008) 395); JL McNhight, Admiral Ushakow and the Ionian Republik: The Genesis of Russia’s first Balcan Satellite (PhD thesis, Wisconsin 1965) 550; Μαυρογιαννη Γ, Ιστορια των’Ιονιων νησων αρχομενη τω 1797 και ληγουσα τω 1815, vols 1 and 2 (Αθηναις 1889); Κορδατος Γ, Ιστορια της νεωτερης (Ελλαδας, Αθηνα 1957); NCh Pappas, Greeks in Russian military service in the late eighteenth and early nineteenth centuries (Thessalonikē 1991) 425; E Lunzi, Della Repubblica settinsulare (Bologna 1863). 13 The work of the Soviet period summarizing the research: Grosul V.Ya. Rossiiskiy konstitutsionalizm za predelami Rossii / M.: Otechestvennaya istoriya, tom 2, 1996. S. 166―180. (VY Grosul, Russian Constitutionalism beyond Russia, vol 2 (Native history 1996) 166―180). 14 Minaeva N.V. Potaennye konstitutsii Rossii / M.: Posev, 2010. S. 18-21. (NV Minaeva, Secret Russian Constitutions (Crop 2010) 18-21). 15 Andreeva G.N. Mesto Ionicheskoy konstitutsii 1799 g. v mirovykh konstitutsionnykh protsessakh: postanovka problem // Zhurnal zarubezhnogo zakonodatel’stva I sravnitel’nogo pravovedeniya. 2010. № 3. S. 79―84. (GN Andreeva, ‘The Place of the Ionian Constitution of 1799 in the World Constitutional Processes: Problem Statement’ (2010) 3 Journal of Foreign Legislation and Comparative Law 79―84). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 61 trace the origin of Russian constitutionalism to an earlier date – 18th century – that is the period of the fi rst written constitutions, and adjust our ideas about the important aspects of the formation and content of Russian constitutionalism. The investigation of the constitutions Russia granted to foreign entities was mostly focused on the seemingly paradoxical fact that Russia itself did not have a constitution. It should be noted that the author, initially subscribing to this opinion, after researching the subject has concluded that in fact there was nothing paradoxical in it. What’s more, this seeming paradox was a product of the interpretation of Russian history by historians at that stage of development of the Russian historical scholarship when Socialist constitutionalism was regarded as the only possible one. So, researchers were expected to use only a critical approach, never making any general conclusions about the development of Russian constitutionalism both in the Soviet and preceding historical periods. The approach to the constitutional acts produced for Russia’s remote parts was approximately the same. Their inclusion into Russia’s constitutional history would have undermined the overall orderly, simple and internally consistent (but inconsistent with the facts) historical picture of an unconstitutional character of Russia’s political system before the Bolshevik revolution. Accordingly, an examination of those acts, too, could have been focused only on a certain paradoxical fact unrelated to the nature of Russian autocracy, with all the relevant implications. We believe that such interpretation of Russia’s international experience and the experience of granting constitutions to its remote parts no longer goes together with the modern level of the Russian scholarship. First of all, the exclusion of this experience from Russia’s constitutional history does not go well together with the modern understanding of the country’s imperial nature. In the paradigm of historical scholarship and in the theory of state, the classical Soviet view of the Russian Empire as ‘a prison of nations’ was replaced with a more sophisticated and complex understanding of its nature as a polity where the monarch rules over not only a unitary state but the empire’s individual entities as well, as a state structure ‘with an asymmetric distribution of public authority within a unitary state, preservation of some public law in its individual regions, and

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 62 KUTAFIN UNIVERSITY LAW REVIEW varying degrees of autonomy’.16 In a view of the above, the constitutional acts for so-called ‘remote parts of Russia’ should not be regarded as an exception, a paradox or something alien to Russian constitutional law – no, they are a manifestation of precisely the innately imperial nature of the state (here one can draw a parallel with the British Empire). The Russian Empire (as any other empire) practiced different forms of patronage, and, while doing so, was actively involved, using different forms, in matters of territories not directly affi liated with Russia, taking care of them as of its own provinces (the most popular example in this respect is Paul I’s attitude to Malta). All of that was fairly typical for other empires at that time. What’s more, numerous studies carried out in the last decade have signifi cantly broadened our ideas about Russia’s governmental, evolutionary constitutionalism, its variability, capacity for absorbing different ideas, fl exibility and adaptability (of course, within certain limits), allowing us to relate this knowledge to the experience described below. Since role of Russia in creating the constitutions for Bulgaria and Poland has been quite thoroughly described in studies devoted to constitutional law, in this article the author pays special attention to the case of Ionian Islands – being less known to specialists in constitutional law, this experience was the fi rst of its kind and in many respects formed the basis for the future development of evolutionary, governmental constitutionalism both in Russia and Eastern European countries.

III. ORIGINS OF RUSSIAN CONSTITUTIONALISM OUTSIDE RUSSIA: AN EXPERIENCE OF JOINT (TOGETHER WITH THE OTTOMAN EMPIRE) GRANTING THE CONSTITUTION TO THE IONIAN ISLANDS IN 1799

If we include into Russia’s constitutional history its experience of creating constitutions for states under its patronage, it could be noted that

16 Krasnyakov N.I. Konvergentsiya imperskikh institutov publichnoy vlasti v Rossii / Innovatsionnoe razvitie yuridicheskoy nauki kak faktor ukrepleniya rossiyskoy gosudarstvennosti: materialy konferentsii. Novosibirsk, 2013. S. 256. (NI Krasnyakov, ‘The Convergence of the Imperial Institutions of Public Authority in Russia’ in Innovative Development of Legal Science as a Factor of Strengthening of the Russian Statehood: Conference Proceedings (Novosibirsk 2013) 256). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 63

Russia gained its fi rst practical experience taking part in the preparation and adoption of the complex Act - Ionian Constitution of 1799. Since a historical background and a role of certain individuals in the history of Ionian Islands in the late 18th century have been thoroughly investigated by historians, the author, considering a volume of the existing research and natural limitations of the available printing space, suggests that the reader should look through a relevant historical research and original texts.17 Let’s start directly with the fact that the Russian Emperor sent to the Mediterranean Sea a Russian naval squadron under a command of Admiral Fyodor Ushakov, who defeated French troops, liberated Ionian Islands and went on to take care of order and security on the islands, creating conditions for the formation of the new state’s government and preparation of the constitution, which was adopted by the Ionian Senate in 1799. The constitution was expected to create a legal basis for maintaining an order on the islands, which by that time stopped to be a center of military action in the Mediterranean Sea.18

17 ibid (n 15) 79―80. 18 The fact that the text of the Constitution exists in two versions is directly related to the peculiarities of the constitutional process. The first version used by Russian historians is a translation from Italian (the political elite of the Ionian Islands was, so to say, ‘formed’ by Venice during its reign, and Italian served as the language of the political elite). A copy of the translation is stored in the Russian State Archive of Ancient Acts (RSAAA. State Archives. F 20 Op 1 Unit. rep 379 L 274–279) and was published in 1952 in the publication Admiral Ushakov. V 3 tomakh / Ed. by R.I. Mordvinov. Tom 2. Moscow, 1952 (Admiral Ushakov, in 3 vols, vol 2. S. 520―526. (RI Mordvinov ed, 1952) 520–526); (Hereinafter the Constitution is quoted from this publication). This publication of the text of the Constitution is not an entirely accurate reproduction of the archive copy: although it generally keeps the style of the original, some ‘details’ irrelevant for the purposes of the article were omitted, and the writing of many words and partially the grammar are aligned with the standards of the 20th century spelling. See about this: Stanislavskaya A.M. Admiral Ushakov i Ionicheskaya konstitutsiya 1799 g. / Voprosy istorii vneshney politiki SSSR I mezhdunarodnykh otnosheniy: Sb. statey pamyati akad. V.M. Khvostova. M.: Nauka, 1972. S. 381. (AM Stanislavskaya, ‘Admiral Fyodor Ushakov and the Ionian Constitution of 1799’ in Issues of the History of the USSR’s Foreign Policy and International Relations. Collected articles dedicated to Academician VM Khvostov (Science 1972) 381).

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The Ionian Islands Constitution contains just 30 articles.19 The republic of the islands was to be a centralized state with the separation of powers, however, incomplete. The Senate consisted of elected representatives of the islands (from three to one). On the islands there were created there own legislative bodies – main councils, which were also involved in a common legislative process: for a law or a directive to become effective, it had to be approved by a majority of the main councils of all islands one year after the Senate’s approval. The Constitution contained detailed provisions for a system of justice, which apparently reflected an intention to address the problem of frequent instances of robbery and vigilante justice, giving the participants an opportunity to seek redress through lawful and civilized means. There was no any separate article about citizens’ rights, and their legal status was regulated only fragmentarily. The existing provisions concerned the relations that were most vital for the question of reducing social tensions – for instance, private and church property rights protection. States participating in the process of the Constitution making planned generally to turn back to a system of the government in the islands that had existed before French invasion. That was the reason why the Constitution of the Republic of Ragusa20 was chosen as a blueprint that was the most appropriate in the local conditions,

19 Articles 1–6 regulate suffrage law issues, Articles 7–9, 16–17, 25 and 29 regulate the formation and powers of the Senate; Art. 10–13, 15, 20, 23―24 – the status of judges, the judiciary and the police; Art. 14 – the status of secretaries of official public place, Art. 18 – the status of the Treasury; Art. 21 – the status of prosecutors; Art. 22 – The text of the oath for elected officials, Art. 19 – the security of tenure; Art. 26–28 – issues concerning the troops and military ships belonging to the Islands; Art. 30 – the procedure of the Constitution approval. 20 It read about the control system established in Dubrovnik heavily influenced by Venice’s experience. For details, see: Andreeva G.N. Dubrovnitskaya (Raguzskaya) Respublika kak obrazets dlya sozdaniya polunezavisimogo grecheskogo gosudarstva v kontse XVIII – nachale XIX vekov: k voprosu ob istochnikakh ionicheskoy Konstitutsii 1799 goda / Reformy i pravo. 2011. №2. S. 64―70. (GN Andreeva, ‘Dubrovnik (Ragusa) Republic as a Model for the Creation of a Semi-independent Greek State in the Late 18th – early 19th centuries: On the Issue of the Sources of the Ionian Constitution of 1799’ (2011) 2 Reforms and the Law 64). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 65 and that was repeatedly pointed out by Paul I in the instructions he sent to Ushakov.21 At the same time it is worth mentioning that it was just a blueprint that didn’t intend to be copied entirely.22 The historians point out two most significant distinctions: expansion of elective body by means of granting voting rights to wealthy people of non-aristocratic origin, and creating conditions for the growth of the Greeks’ national consciousness (as a result of introduction of Greek language for legal proceedings). The constitutional process in Ionian Island was mainly regulated by rulers of two states – the Ottoman and Russian Empires – who were giving their instructions in the course of diplomatic negotiations about the islands’ status; accordingly, diplomats were important players in the process.23 Russia’s agent staying in the islands was Admiral Fyodor Ushakov who, using modern terminology, was a chief of the Russian military administration. That is why the Ionian Constitution of 1799 is a fairly peculiar document of its kind, being a product of mutually adjusted positions of two states, which were external powers vis-à-vis the country for which the constitution was being made, in the conditions of foreign military administration.24 At the same time, all of that did not mean that the Constitution makers were inattentive to the population’s needs – Ushakov was instructed to create a constitution that would establish ‘a form of government mindful of the locals’ traditions and wishes’. One feels a need to point to the signifi cant difference between making the Ionian Constitution and constitutional practices on the territories conquered by Napoleon. When French troops were present on those territories, the acts made for them – the Constitution

21 Stanislavskaya A.M. Politicheskaya deyatel’nost’ Ushakova v Gretsii / M.: Nauka, 1983. S. 214-215. (AM Stanislavskaya, Ushakov’s Political Activity in Greece (Science 1983) 214―215). 22 Nevertheless, the impact of this sample was evident both in the aristocratic character of the republic, and in the order of formation of the state bodies, and their competence, and in principle of the exclusion of physical labour workers from politics. 23 Ginzburg Yu.V. Vasiliy Stepanovich Tomara i Konstitutsiya Ionicheskikh ostrovov 1799 goda / Publichno – pravovye issledovaniya. 2012. № 3. S. 96―117. (Yu.V. Ginzburg, ‘Vasiliy Tomara and the Constitution of the Ionian Islands of 1799’ (2012) 3 Public Law Research 96). 24 The situation, which was later reproduced repeatedly, one example – the adoption of the Fundamental Law of Germany.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 66 KUTAFIN UNIVERSITY LAW REVIEW of the Cisalpine Republic (1797), the Constitution of the Batavian Republic (1798), the Constitution of the Helvetic Republic (1798) – rather than being tailored to local specifi cs, were ‘doubles’ of the French Constitution of 1795. Although the Constitution was approved by the Senate, the document caused a bitter political struggle in the islands, first of all because nobles wanted to have all their traditional aristocratic rights and absolute power. That political conflict also affected the further life of the Constitution adopted by the Ionian Senate and approved by Fyodor Ushakov (as the head of the military administration). In accordance with Article 30 of the Constitution, delegations from the islands submitted the document for approval to Russia and the Sublime Porte. Although the delegation sent to the Sublime Porte was not authorized to do so, it immediately began backstage negotiations in order to introduce aristocracy-friendly amendments to the document, and was successful in that undertaking. Accordingly, official St. Petersburg deemed the document to be insufficiently ready and was delaying the meeting with the delegation sent to Russia. Then the Sublime Porte began to ‘promote’ another document, known in the historical literature as the ‘Byzantine’ Constitution, which reinstated the aristocracy’s rule as it existed in the Republic of Venice. That version was approved by the Ionian Senate and the Sublime Porte, but Russia kept silent on it and never gave its approval. The further run of the constitutional process in the Republic was not smooth either. Because of a strong differentiation of the interests, a passionate character of the islands’ residents and a confl ict between nobles and the rest of the public, the situation in the Republic became unstable. A ‘parade of constitutions’ began: before the republic became defunct (in 1808), it had lived through several constitutions and drafts of constitutions.25

25 The parade of constitutions of this period is described in the works: Anshakov Yu. P., Arsh G.L., Vyazemskiy E.K. Formirovanie natsional’nykh nezavisimykh gosudarstv na Balkanakh. Konets XVIII ― 70-е gg. XIX st.: sbornik statey / Otv. red. Dostyan I.S. M.: Nauka, 1986. S. 34―37. (YuP Anshakov, GL Arsh, E.K. Vyazemskiy, ‘The Formation of Independent National States in the Balkans. The late 18th Century – the 1890s’ in IS Dostyan (ed), sbornik statey (Science 1986) 34―37); Stanislavskaya A.M. Rossiya i Gretsiya v kontse XVIII – nachale XIX veka. (Politika Rossii v Ionicheskoy respublike 1798―1807 gg.) / M.: Nauka, 1976. S. 185-197. (AM Stanislavskaya, Russia and Greece in the Late 18th – Early 19th Centuries. Russia’s Policy in the Ionian Islands in 1798–1807 (Science, 1976) 185―197). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 67

Some of them were prepared without Russia’s input (already mentioned ‘Byzantine’ Constitution and the Constitution of Onoranda26). Russian party was closely watching the changes in the islands and trying to find a constitutional formula that would stabilize the political situation. Appropriate instructions on the drafting of a new constitution were given to Russian diplomats – Russia’s envoy to the Septinsular Republic Count Georgio Mocenigo, who was in Italy at that time, and Russia’s envoy to Naples Andrei Italinsky. Thus, working on constitutional aspects of a state structure became for Russia a lasting undertaking. Unlike the drafts prepared in the islands, which were products of temporary domination of a certain class or its part and therefore reflected their interests, Russian drafts sought a balance between different interests that would guarantee peace and stability in the islands. Each of the drafts prepared by Russians reflected the creators’ ideas about the current situation (which itself was variable) and possible instruments for guaranteeing peace in the islands, and was distinctive in that respect. The draft prepared by Andrei Italinsky27 in 1802 envisioned for the islands’ wealthy residents more options to join the nobility which could alleviate social tensions and increase a number of voters, culling the novices from a wealthy and, accordingly, more reliable group of society. In comparison with the Constitution of 1799, the division of powers was appreciably enhanced. Approving the draft in general, Alexander I added to it significant elements, improving interaction between different governmental organs, their mutual cohesion. That draft did not become a constitution, but its main ideas (since they were approved by Emperor) were later used by Georgio Mocenigo in his draft. In winter of 1802―1803 Mocenigo completed his draft of the Constitution and submitted it to the emperor. Legislature Assembly of the islands elected in summer of 1803, reviewed the new Constitution’s draft. Within two months disagreements were discussed and smoothed out, Constitution was approved and came into effect on December 23(5), 1803.28

26 Onoranda Interim Government was created in 1801 by the townspeople and peasants and supported by some noblemen as opposed to aristocratic bodies. 27 The draft by Italinsky // vol 1 EPR 711. 28 ibid Stanislavskaya АМ (n 25) 185.

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Calling his version ‘a paragon of high-quality and solid piece of work’,29 modern researchers rightly point to the carefully structured character and elaborateness of its elements comparing to its antecedents. Neatly divided into chapters, the Constitution demonstrates its creator’s excellent command of the conceptual framework of the constitutional law of that period, new level of understanding constitutional texture and the opportunities for its generalization (for instance, Chapter 1 was devoted to ‘the form, nature and fundamentals of the Republic’), as well as desire to set forth constitutional principles and key elements (for instance, Article 1 proclaimed the unitary character of the Republic and rule by aristocracy). The central idea of that Constitution was to form the so-called ‘constitutional nobility,’ which was thereby endowed with political power. As some scholars have rightly observed,30 that draft generally belies the infl uence of the 1799 Constitution (in effect, it fl eshes out the ‘boldest’ ideas of that Constitution, especially second-class), as well as Italinsky’s version. At the same time, we believe that this Constitution is a suffi ciently independent piece of work, in which the achievements of the European constitutional thought with regard to the organization and presentation of the constitutional material – fi rst of all, the achievements of the revolutionary constitutions – are used to fulfi ll the objective of creating an aristocratic constitution and forming a constitutional nobility. The sophisticated system of organs of government infl uenced by ideas borrowed from different sources, specifi cs of interaction between the organs allowed to secure a deeper separation of powers while preserving the leading role for constitutional nobility. At the same time, the islanders’ traditional cultural values were quite smoothly woven into the Constitution text of 1803: for aristocracy – the unacceptability of physical labor, and family values – for all (the suffrage was tied in with family status, with sole exemption granted to seasoned bachelors over 70; a person who had broken up with his family would be deprived of voting

29 Petrunina O.E., Klisunov, S.G. Evolutsiya gosudarstvennogo ustroystva respubliki semi soedinennykh ostrovov v 1799–1803 / Vestnik Moskovskogo Universiteta. Seriya 11. Upravleniye (obshestvo i gosudarstvo), 2009. № 2. S. 140. (OE Petrunina, SG Klisunov, ‘The Evolution of the State System of the Republic of the Seven Interconnected Islands in 1799–1803’ (2009) 2 Bulletin of Moscow University. Series 11 – Management (State and Society) 140). 30 ibid 145. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 69 rights, etc.). As it seems, the Constitution in question plays important role for constitutional law because, fi rst of all, its creator attempted to elaborate a complex approach to the problem of preserving rule by aristocracy, at the same time releasing social tensions. From a viewpoint of a history of Russian constitutionalism studying, the important features seem to be a qualitatively new level of the use of constitution-writing techniques by the Russian administrative apparatus for the purpose of regulating an evolutionary development, a much more liberal approach to search for perfect solutions, their organizational completeness, and special attention given to interaction between different governmental organs. Since under the rule of Alexander I Russia itself began to actively move along the road of evolutionary constitutionalism, and in 1803 Russia’s Commission on Laws brought up the question of creating an official draft of the Russian Constitution, and even drew up a detailed plan for that purpose, a question of making of a constitution moved from theoretical to practical. As the reforms of the supreme organs of public administration in Russia were underway, the participation in the constitutional process in Ionian Islands acquired practical value for Russia. That experience allowed to evaluate in practice functioning of various institutions, taking in consideration the ideas of constitutionalism and separation of powers. That appears to be a reason for Alexander I’s already mentioned interest to interaction of governmental organs in the islands.

IV. THE IMPORTANCE OF RUSSIA’S CONSTITUTIONAL EXPERIENCE FOR THE EVALUATION OF RUSSIA’S PLACE IN THE INTERNATIONAL CONSTITUTIONAL PROCESS

As it seems, Russia’s experience of participation in the constitutional process in Ionian Islands described above allows to revisit a question of when Russia acquired its practical experience of constitution-making. Due to its involvement in the constitutional process in Ionian Islands Russia became an active practitioner in the field of constitution-making (albeit not on its own territory) in the late 18th century – at the same time when the first written constitutions appeared in America and Europe. This circumstance significantly changes our idea about the timelines and specifics of the development of Russian constitutionalism.

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The difficult historical context of the constitutional process in Ionian Islands and its residents’ high level of political engagement required considerable flexibility and forced the emperor, his court, his diplomats and Fyodor Ushakov to “try out” different versions of the constitution- building that would lead to a constitutional order by evolution rather than by revolution, as it was in France. Since it happened at the end of the 18th century, which saw the appearance of the first written constitutions in America and Europe, one can argue that Russia joined the constitutional process as an active participant (albeit not on its own territory) practically at the same time with the USA and European countries. The participation in the constitution-making in the islands was not a single action for Russia. Developing the other constitutional drafts, Russia became a permanent participant in the constitutional process in the islands. This circumstance did not ultimately just augmented a number of carefully elaborated drafts but also significantly improved a law-making technique, a grade of acts content, and a command of the advanced for that time constitutional terminology, all of which was clearly demonstrated in the 1803 Constitution of Ionian Islands. Russia’s experience of creating the Ionian Islands’ Constitution of 1799 has a very important and unique value for the state, since Russia had an opportunity to test new ways of transition to constitutional order without risk to its own government. However, since, on the one hand, in Russia at that time a question of introducing its own constitution was not on the official agenda, and on the other, different forms of Russia’s patronage were approached individually, the Russian participants of constitutional process, including the emperor, did not perceive or think of this undertaking as a training of sorts – rather, it was for them a complicated but manageable problem – a result of Russia’s concerns about the international situation and Russia’s fulfillment of its obligations to its allies (with a significant material burden). Nevertheless, the emperor, his inner circle and the officials being objectively involved in a constitution-making process of a foreign state had to reflect on constitutional values and principles prevailing at that time, as well as to look for those forms of government that would ensure a peaceful, evolutionary, smooth transition to a constitutional order, as an alternative to the French revolutionary model, and to articulate the ideas through prescriptive provisions. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 71

Another noteworthy fact is that Russia, as it fulfilled its international obligations, was keen to take into account the interests of different groups of local population, as they were perceived of at that time, as well as to find a formula ensuring social consensus, security and stability for the islanders. In Russia itself, however, with its complex social structure monarchy relied on the elite of the relevant social group. The fact that Ushakov from the very beginning was pointing to the dangers of using similar tactics on the islands (and the truth of his words was proven in practice by the experience of the next – ‘Byzantine’ – Constitution) forced the emperor, his inner circle and the officials to be mindful of this consideration – in other words, expanded and changed their ideas about possible forms of government. And under the next tsar, Alexander I, a question of taking into account political interests of different groups became axiomatic, although later in Russia this approach, unfortunately did not get an appropriate legal foundation. However, the vital question for Ionian Islands was not to balance of the interests of different groups but to increase number of voters, and to address that question the experience of 1799 Constitution was used. Since in the course of the constitution-making process the Russian emperor and officials acting under his orders had to find solutions for different political and constitutional problems (identifying a regulatory model by way of the Constitution of the Republic of Ragusa, head of the state issues, election law, etc., going, at the same time, into Greeks’ mindset31), at least the society’s elite groups began to understand that constitution and constitutionalism were not as scary as had been previously believed under the influence of French bloodbath experience, and that one could find an algorithm for a peaceful evolutionary way.

31 The letters by Paul I often contain comments showing that he related his orders to the national character and culture of the people to whom they were to be applied. Thus, in a letter to Tomara dated 27 February 1799, Paul I wrote that Phanariot’s reign on the islands ‘can not be acceptable there, with the hot manners and the rampant population, who never bow down to look quietly on oppressions similar to those perpetrated in Moldavia and Wallachia’. AEPRI F The Constantinople Mission Op 90 D 1409 L 54.

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V. CONCLUDING REMARKS

As an integral part of international constitutional process and international history of constitution-making, the experience of creating the Ionian Islands’ constitutions with Russia’s participation was arguably valuable for the following reasons. First of all, thanks to those constitutions, one could see that already in the period of early constitutionalism, evolutionary constitutions were variable and proper for realization of different models and interests while preserving a basically traditional form of government, and this was later confi rmed by many countries’ practical experience. Secondly, constitutionalism was enriched with the unique experience of crafting a constitution under the pressure of a need to achieve a consensus among many players of different ranks and from different countries. Thirdly, it was demonstrated that even in the areas with a military presence one could create a constitution with a signifi cant input from the population but without forcing alien models on them. In addition, as a result of the adoption of the constitutions the islanders received a constitutional experience of creating a semi-independent state – the fi rst experience of constitutional transition from a colony to statehood. Finally, an exploration of Russia’s practical experience of constitution-making for a foreign state and the cases of granting constitutions to the empire’s ‘remote parts’ opens up new dimensions in the history of constitutionalism. The relevant academic studies would enrich a picture of the constitutional history of the world.

Bibliography

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Κορδατος Γ, Ιστορια της νεωτερης (Ελλαδας, Αθηνα 1957) Kozlova E.I., Kutafi n, O.E. Konstitutsionnoye pravo Rossii / 5-e izdanie, M.: Prospekt, 2013 (EI Kozlova, OE Kutafi n, The Constitutional Law of Russia (5th ed, Prospekt 2013)) Krasnyakov N.I. Konvergentsiya imperskikh institutov publichnoy vlasti v Rossii // Innovatsionnoe razvitie yuridicheskoy nauki kak faktor ukrepleniya rossiyskoy gosudarstvennosti: materialy konferentsii. Novosibirsk, 2013 (NI Krasnyakov, ‘The Convergence of the Imperial Institutions of Public Authority in Russia’ in Innovative Development of Legal Science as a Factor of Strengthening of the Russian Statehood: Conference Proceedings (Novosibirsk 2013)) Lunzi E, Della Repubblica settinsulare (Bologna 1863) Μαυρογιαννη Γ, Ιστορια των’Ιονιων νησων αρχομενη τω 1797 και ληγουσα τω 1815, vols 1 and 2 (Αθηναις 1889) McNhight JL, Admiral Ushakow and the Ionian Republik: The Genesis of Russia’s fi rst Balcan Satellite (PhD thesis, Wisconsin 1965) Minaeva N.V. Potaennye konstitutsii Rossii / M.: Posev, 2010 (NV Minaeva, Secret Russian Constitutions, Crop 2010) Narutto S.V., Taeva N.E., Shugrina E.S. Konstitutsionnoe pravo Rossii: uchebnik / M.: Infra-M, 2013 (SV Narutto, NE Taeva, ES Shugrina, The Constitutional Law of Russia: Textbook (Infra-M 2013)) Pappas NCh, Greeks in Russian Military Service in the Late Eighteenth and Early Nineteenth Centuries (Thessalonikē 1991) Parkhomenko A.G. Konstitutsionalizm: stanovlenie i razvitie v Rossii / M., Voronezh: MODEK, MPSU, 2012 (AG Parkhomenko, Constitutionalism: Formation and Development in Russia (MODEK, MPSU 2012)) Peleshko A. Natsionalno – vizvol’na borot’ba grets’kogo narodu protii osmanskogo panuvannya i vitchiznyanih ta zarubizhnikh pratsyakh : Ukrainskiy istoricheskiy zbirnik / Kiev: Vip, tom 11, 2008 (A Peleshko, Ukrainian History Compilation, vol 11 (Vip 2008)) Petrunina O.E., Klisunov, S.G. Evolutsiya gosudarstvennogo ustroystva respubliki semi soedinennykh ostrovov v 1799–1803 / Vestnik Moskovskogo Universiteta. Seriya 11. Upravleniye (obshestvo i gosudarstvo), 2009. № 2. (OE Petrunina, SG Klisunov, ‘The Evolution of the State System of the Republic of the Seven Interconnected Islands in 1799–1803’ (2009) 2 Bulletin of Moscow University. Series 11 – Management (State and Society)) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Galina Andreeva Some Thoughts on the Origins of Russian Constitutionalism and Position of Russia in Global Constitutional Process 75

Sheynis V. Vlast’ i zakon. Politika i konstitutsii v Rossii v ХХ— ХХI vekakh / M.: Mysl’, 2014 (V Sheynis, Power and Law. Politics and Constitutions in Russia in the 20th – 21st Centuries (Thought 2014)) Shul’zhenko Yu.L. Ocherk rossiiskogo konstitutsionalizma monarkhi- cheskogo perioda / M.: Institut gosudarstva i prava RAN, 2008 (YuL Shul’zhenko, Essay on the Russian Constitutionalism of the Monarchical Period (Institute of State and Law RAS 2008)) Stanislavskaya A.M. Admiral Ushakov i Ionicheskaya konstitutsiya 1799 g. / Voprosy istorii vneshney politiki SSSR I mezhdunarodnykh otnosheniy : Sb. statey pamyati akad. V.M. Khvostova. M.: Nauka, 1972 (AM Stanislavskaya, ‘Admiral Fyodor Ushakov and the Ionian Constitution of 1799’ in Issues of the History of the USSR’s Foreign Policy and International Relations. Collected articles dedicated to Academician VM Khvostov (Science 1972)) Stanislavskaya A.M. Rossiya i Gretsiya v kontse XVIII – nachale XIX veka. (Politika Rossii v Ionicheskoy respublike 1798-1807 gg.) / M.: Nauka, 1976 (AM Stanislavskaya, Russia and Greece in the Late 18th – Early 19th Centuries. Russia’s Policy in the Ionian Islands in 1798–1807 (Science 1976)) Stanislavskaya A.M. Politicheskaya deyatel’nost’ Ushakova v Gretsii / M.: Nauka, 1983 (AM Stanislavskaya, Ushakov’s Political Activity in Greece (Science 1983)) Strekozov V.G. Konstitutsionnoe pravo Rossii: uchebnik dlya bakalavrov / M.: Yurait, 2012 (VG Strekozov, The Constitutional Law of Russia: Textbook for Bachelors (Yurait 2012)) Vaksman V.B., Parkhomenko A.G. Konstututsionalizm i parlamenta- rizm: stanovlenie i razvitie v Rossii / Vladivostok: Morskoy Gosudarstvennyy Universitet imeni admirala G.I. Nevel’skogo, 2010 (VB Vaksman, AG Parkhomenko, Constitutionalism and Parliamentarianism: Formation and Development in Russia (Admiral GI Nevelskiy Maritime State University 2010))

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ARTICLE

OVERLAPPING COMPETENCIES WITHIN THE SYSTEM OF SEPARATION OF POWERS IN THE RUSSIAN FEDERATION

Nina M. Kolosova (Russia)

Author Doctor of Science (Law), Institute of Legislation and Comparative Law under the Government of the Russian Federation, 2006 Professor, State and Administrative Law Department, Samara State University Chief Scientific Researcher, Constitutional Law Department, Institute of Legislation and Comparative Law under the Government of the Russian Federation, and Chief Scientific Researcher, Constitutional Legal Studies Department, Russian State University of Justice Email: [email protected] Abstract The article includes analysis of the phenomenon of overlapping competencies of the branches of government. As the institute of society nowadays is becoming more and more complicated, the sphere of overlapping competencies tends to grow. The author points out that the ideological constitutional basis for the entwining of the branches of government and the overlapping of competencies is found in the principle of rule of the people. This principle unites the state government, stimulating cooperation among its branches. At the same time, overlapping competencies should not infringe upon the principle of separation of powers. To achieve this balance, the overlapping competencies should be proportionate to the constitutionally important purposes of such an overlapping, and the purposes should not contradict the fundamental mission of the separation of powers. It should prevent concentration of power. The article analyses specific examples of disproportionate www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 77

overlapping of competencies, as provided by both legislation and legal practice. The author then proposes the means for correction of such a disproportion.

Keywords Separation of powers, unity of power, principle of rule of the people, genuine democracy, the Constitutional Court of the Russian Federation, immunity of deputies, right of the deputy to have judicial protection; holding a vacant deputy position, preliminary termination of deputy’s mandate

DOI: 10.17803/2313-5395.2016.1.5.076-092

TABLE OF CONTENTS

I. Introduction ...... 77 II. Sovereignty of the people and representation of the people as constitutional foundations for the overlapping competencies ...... 79 IП. Limitations to overlapping: The danger of disproportion ...... 83 IV. The principle of separation of powers and overlapping competencies: The role of the RF Constitutional Court in ensuring their proportional application ...... 88 V. Conclusions ...... 91 Bibliography ...... 91

I. INTRODUCTION

Actuality of the subject of the article is determined by a constant search for the optimum means of implementation of the constitutional principles of organization and implementation of government in the modern state. There is no universal model for the separation of powers without considering their social and psychological situations, specificities of political mentalities and historical traditions. Lately the value of separation of powers in Russia is sometimes brought into doubt. Russian Professor Yury Tikhomirov notes the

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 78 KUTAFIN UNIVERSITY LAW REVIEW incomplete and weak character of separation of powers that doesn’t consider ‘strong presidential power’.1 It is true that the President of the Russian Federation and some other bodies can hardly belong to any branch of government under art 10 of the Russian Constitution. Due to this fact it is sometimes noted the contradictory character of separation of powers and its insufficiency for characterizing the organization of the state apparatus in the Russian Federation. According to the author’s opinion such criticism is unfounded. Provisions of art 10 of the Constitution of the Russian Federation should be understood in a way that stands for separating executive, judicial and legislative powers. It does not exclude other types of power within the state, including the President one. But separation of powers is meant to reduce the danger of extreme policy preferences, also for those subjects of decision making that do not belong to any of the branches of power.2 The presence of overlapping competencies of the state government bodies gives rise to the claims on the violations of the separation of powers principle in the Russian Federation. According to the constitutional provisions, the same state bodies resolve issues, concerning for example the possibility of use of the Armed Forces of the Russian Federation outside the territory of the Russian Federation.3 The main purpose of this article is to provide scientific refutation for the abolishment of the separation of powers principle due to the overlapping competencies of branches of government. For this purpose, the article includes analysis of definition and variety of overlapping competencies and their boundaries that exist or should exist. The scientific analysis is performed with a due attention paid to the main purposes of the Russian separation of powers model,

1 Mazaev V.D., Tikhomirov Yu.A., Andrichenko L. Konstitutsiya Rossiiskoy Federatsii: otobrazabudushchegokreal’nosti (k 20-letiyu Osnovnogo Zakona Rossii) / Podobshch. red. T.Ya. Khabrieva. M.: Yurisprudentsiya, 2013 (VD Mazaev, Yu.A Tikhomirov, L Andrichenko, The Constitution of The Russian Federation. From a Vision of the Future to Reality (for the 20th Anniversary of the Fundamental Law of Russia)(TYa. Khabrieva ed, Jurisprudence 2013)). 2 Kira Fuchs, Florian Herold, ‘The Costs and Benefits of a Separation of Powers— An Incomplete Contracts Approach’ (2011) 13 1 American Law and Economics Review 131. 3 Diana Draganova, ‘Chechnya’s Right of Secession under Russian Constitutional Law’ (2004) 3 2 Chinese Journal of International Law 576. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 79 its correlation with the unity of power resulting from its representative character, as provided for by the Constitution of the Russian Federation. The author analyzes a specific case concerning preliminary termination of the term mandate of the State Duma deputy Gennady Gudkov within the context of overlapping competencies of legislative and judicial branches of government, principles of rule of the people and separation of powers. The author also analyzes the development of the separation of powers principle in the legal statements of the Constitutional Court of the Russian Federation. Special attention is paid to strengthening its independence guarantees.

II. SOVEREIGNTY OF THE PEOPLE AND REPRESENTATION OF THE PEOPLE AS CONSTITUTIONAL FOUNDATIONS FOR THE OVERLAPPING COMPETENCIES

According to art 10 of the Constitution of the Russian Federation, the state power in the Russian Federation shall be exercised on the basis of its division into legislative, executive and judicial power. Through this separation, each branch works according to its own authority, forming a check or balance against any abuse of power by the remaining two branches.4 Accordingly, their independence is guaranteed. It seems that the so-called overlapping competencies allowing a branch of power to act within the untypical competence sphere, do not violate the constitutional principal of separation of powers. Intrusion into the other’s sphere of competence is not acceptable. However, for the sake of rationalization of power, it is possible for the President of the Russian Federation to exercise some legislative functions (normative decrees), for the Parliament of the Russian Federation to exercise some executive functions (directing domestic and foreign policy, ratification and denunciation of international treaties), for the executive branch of government – to have some norm- making powers (issuing normative acts, conclusion of international treaties). The role of the President of the Russian Federation within the separation of powers system is controversial, and it does not fall within

4 C Rossiter, 1787: The Grand Convention (WW Norton 1987) 64.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 80 KUTAFIN UNIVERSITY LAW REVIEW the scope of this study. However, it should be noted that according to art 80 (2) of the Russian Constitution the President of the Russian Federation guarantees coordinated functioning and interaction of the state government bodies. The existence of a particular coordinating role of the President of the Russian Federation is obvious. Therefore, constitutional and other legal provisions, regulating the activities of the federal government bodies, allow for the overlapping competencies of different branches of government. However, only the constitutional provisions on the status of the President of the Russian Federation allow him to implement the competence of other government bodies in the absence of relevant provisions. It is due to the fact that some constitutional competencies and obligations of the President of the Russian Federation can be formulated via systemic evaluation of the combination of the constitutional provisions, while they are not provided by such provisions directly. For example, the Decision of the Constitutional Court of the Russian Federation of December 1, 1999 N. 17-P on the competence dispute between the Federation Council and the President mentions that the President of the Russian Federation not only has a right but is obliged to issue an act on suspension of the General Prosecutor for the period of the criminal investigation against him. However, this provision is not directly provided for by the Constitution of the Russian Federation. The overlapping competencies can not be absolute. Otherwise, the very nature of the separation of powers principles as reflected in its purposes can become erased. Those purposes define the limitations to the overlapping competence to a considerable extent. The modern understanding of the principle of separation of powers allows to single out two related purposes, and achieving them presupposes overlapping competencies of the three branches of government, defining the limits to their legitimacy at the same time. The first purpose is to guarantee the real rule of the people via the representative character of all branches of government. The second purpose is to rationalize organization of the government. The scholarly writings sometimes tend to make one of these purposes absolute. However, it seems questionable, since there should be an optimum correlation of these purposes. Boris Ebzeev has noted that ‘constitution enshrines democracy, and it is not purely the matter of the rule of the people based www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 81 upon their uniform will, rather, the matter concerns rational organization of the political process and guarantees the political unity of the people in the conditions of multiparty politics and political pluralism.’5 It seems that taking into consideration the specificities of the historical situation and purposes of social development, one may single out more resources to achieve the maximum limitation to the mentioned purpose. At the same time, implementation of any of these purposes should not infringe upon another. For example, in order to achieve rational organization of state government bodies, it does not seem viable to abolish its executive aspect. Moreover, it is viable to consider the consequences and to prevent the imbalance between public and private interests, when establishing the optimum use for the overlapping competencies as we strive to achieve those purposes. It is necessary to clarify the understanding of the representative character of state government bodies. It defines the unity of the state government, while its functions are divided among its branches. The principle of separation of powers cannot be efficiently implemented outside the unity of power, since its source is the multinational people of the Russian Federation. It is no accident that every branch of government can function efficiently within the system of state government only. Today the principle of separation of powers in Russia is based upon the idea of cooperation and unity of the branches of government, while it is possible for the branches of government to be relatively independent within the common framework. The Decision of the Constitutional Court of the Russian Federation of December 11, 1998 № 28-P concerning interpretation of the provisions of the art 111 (4) of the Russian Constitution6 excludes strife among them, since such a strife would not comply to the general position, considering the multinational people of the Russian Federation to be the sole source of the government. However, according to art 94 of the Constitution the Federal Assembly is the only representative body of the Russian Federation. Therefore, representative nature of executive and judicial branches of government

5 Ebzeev B.S. Vvedenie v Konstitutsiyu Rossii. M.: Norma, 2013 (BS Ebzeev, Introduction to the Constitution of Russia (Norm, 2013)). 6 Legislation Bulletin of the Russian Federation (1998) 52. Art. 6447.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 82 KUTAFIN UNIVERSITY LAW REVIEW is an object for discussion. It seems reasonable to draw a final conclusion on the representative nature of various state government bodies based upon the analysis of the entire framework of the constitutional provisions, rather than based upon the reference just to one Article. For instance, study of art 3 of the Russian Constitution, providing that the bearer of sovereignty and the only source of power in the Russian Federation shall be its multinational people, when analyzed within the framework of other constitutional provisions, allows one to draw a conclusion that all of the government bodies are representative bodies to a certain extent, since they reflect the will of the people. For example, the Constitutional Court of the Russian Federation is meant to protect the interests of all people and guarantee the principle of people’s rule, sometimes opposing the political will of the state government, and its judges are not elected directly by the people of the Russian Federation. According to the Constitution of the Russian Federation the implementation of the principle of people’s rule should guarantee the unity of state government bodies and efficient interaction of all of the branches of government, while each of these branches is constitutionally bound to represent the people and to protect their interests. It finds its expression in a fact that every government body shall perform its activities guiding by the interests of the people and a will of the people. People’s rule, its criteria and qualities are however disputable issues. It seems that activities of the state government bodies in the interests of their people are those activities that are performed within the state development strategy, which is first of all enshrined in the Constitution of the Russian Federation. That is why any deviation from the constitutional model should be regarded as a violation of the people’s rule principle. For this reason compliance with the Constitution of the Russian Federation, its strategic principles and provisions should become a criterion in the process of following the interests of popular representation in the activities of all of the state government bodies. Accordingly each of the branches of government should possess representative quality. In other words, some form and degree of the representative aspect provides source and contents for each of the elements of the separation of powers system. Therefore, one may draw a first intermediary conclusion that the existence of overlapping competence by itself does not violate the principle of separation of powers. At the same time one should remember www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 83 about the purposes within applying the principle of separation of powers. That is why any attempt to deny the existence of the separation of powers principle in the Russian Federation based upon the presence of overlapping competencies seems unsound. The representative character is inherent in any government body, which is due to the unity of the branches of government. At the same time the degree of representative character of the state government body depends both on the procedure for its formation and types of its activities.

IП. LIMITATIONS TO OVERLAPPING: THE DANGER OF DISPROPORTION

So, the constitutional principle of separation of powers allows for overlapping competencies, when it is being interpreted in interrelation with the constitutional principle of people’s rule. At the same time, it is important to establish its limitations, since every state government body is independent, and sometimes it does have an exclusive right to make a certain decision. Otherwise, the state administration would become inefficient. That is why, disproportionate intervention into the competence of one government body by another is unacceptable, and it is especially so when it comes to the judicial branch of government that brings a significant threat to the rule of law and the protection of the constitutional rights of citizens, since only the public judicial proceedings provide for the true means of protection for an infringed right. Let us view a specific example of this situation, when the State Duma of the Federal Assembly of the Russian Federation went outside the boundaries of its competence. There was a situation, when the State Duma applied to its deputy Gennady Gudkov the provisions of art 97 (3) of the Russian Constitution, providing that deputies of the State Duma can not be employed in the state service, engage in other paid activities, except of teaching, scientific and other creative work. This provision is given in a more detailed way in the Federal Law ‘On the Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’. However, there are no unilaterally accepted definitions for ‘paid activities’, ‘entrepreneurial activities’ in the scholarly writing. In spite of this fact, the State Duma went on to preliminarily terminate the term for the deputy Gennady

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Gudkov. It seems that such decisions fall within the exclusive competence of the judiciary. Then, it is an obvious example of the situation, when the use of overlapping competence went beyond the acceptable limitations. Let us view the timeline of events. In September 2012, the Investigation Committee of the Russian Federation filed into the Prosecution General of the Russian Federation and the State Duma of the Russian Federation the materials on entrepreneurial activities of the deputy Gennady Gudkov who had been previously elected in the party list of the ‘Just Russia’ political party. On September 10 the State Duma Commission for Control over the Credibility of State Deputies’ Incomes and Expense studied the materials and made a conclusions that those materials proved that the deputy had violated the provisions of the Federal Law ‘On the Status of the Member of the Council of the Federation and the Status of the deputy of the State Duma of the Federal Assembly of the Russian Federation’. On September 13 the Council of the State Duma brought the issue on preliminary removal of the deputy G. Gudkov into the agenda of the plenary session. The head of the fraction ‘Just Russia’ Sergey Mironov spoke at the session of the Council of the Duma, and stated that the Deputies of the ‘Just Russia’ and ‘Communist Party of the Russian Federation’ had made a special request to the Constitutional Court of the Russian Federation and asked, therefore, to suspend hearing a case. However, the Council of the State Duma brought this matter to the plenary session, which took place on September 14, 2012. The Vice Prosecutor-General of the Russian Federation proposed to vote for the preliminary termination of the deputy status of the deputy G. Gudkov, since he seemed to have violated the requirements of the Law on the Status of Deputy. 291 Deputies voted in favor of this proposal, while 150 Deputies voted against it, and 3 Deputies abstained. So, the deputy G. Gudkov lost a mandate of the deputy of the State Duma of the Federal Assembly of the Russian Federation, and the Duma decided not to wait for an act of the Constitutional Court of the Russian Federation, making and independent decision. However, the issue of preliminary termination of the deputy term should fall within the scope of judiciary competence. It seems that otherwise the principles of separation of powers and rule of the people are both violated. On December 27, 2013 the Constitutional Court of the Russian Federation decided that the provisions of the Federal Law ‘On the www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 85

Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’, prohibiting parliament members to perform entrepreneurial activities, are constitutional. At the same time, the Constitutional Court of the Russian Federation ruled that a parliament member had a right to challenge the decision of the State Duma of the Russian Federation on preliminary termination of his/her term as a member in the Supreme Court of the Russian Federation on both material and procedural grounds. On February 12, 2013 the Supreme Court of the Russian Federation rejected a claim against the Decision of the State Duma of the Federal Assembly of the Russian Federation of September 14, 2012 № 768-6 GD ‘On Preliminary Termination of the Term of the Deputy of the State Duma of the Federal Assembly of the Russian Federation Gudkov G.V.’. The State Duma made a decision on termination of the term of Gennadiy Gudkov with the reference to the Federal Law. ‘On the Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’. The Deputies of the ‘Just Russia’ and Communist Parties of the Russian Federation expressed another opinion, according to which the relevant provisions of the Federal Law ‘On the Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’ are unconstitutional. In their opinion the mentioned Federal Law does not provide for the clear criteria for preliminary termination of the deputy’s term, and some of its provisions are in contradiction to the Constitution of the Russian Federation. The legal scholarly writings also show no unity, when it comes to the dispute in question. Let us try to figure this situation out from the scientific standpoint. For this purpose, there is a need to analyze constitutional legal status of the deputy of the State Duma, the institute of immunity and grounds for the preliminary termination of the term as a deputy in the State Duma. The institution of immunity is meant to form additional legal obstacles against ungrounded persecution of the Deputies of the State Duma. Their immunity as provided for by art 98 of the Russian Constitution, is an important legal guarantee for their activities. This guarantee is of a higher level, than general constitutional guarantees of personal immunity. It is not a personal privilege, since it belongs to a public law. It is meant to

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 86 KUTAFIN UNIVERSITY LAW REVIEW serve public interests by providing higher degree of personal protection for a parliamentary from ungrounded persecution, thus guaranteeing his/her public function and facilitating the unobstructed activities of parliamentary and parliament as a whole, allowing for its independence. At the same time independence of deputies does not stand for relief from legal liability. Otherwise, the constitutional principle of equality of all persons under the law and in court would be severely distorted. However, juridical liability is legal, when it is based upon the principles of lawfulness, fairness and expediency. The issue of termination of the term of the deputy is a measure of constitutional liability and it may be, competently resolved only by the court. It is especially important, since the legislation does not provide for clear procedural provisions. One should be aware of the fact that a mechanism for the preliminary termination of the deputy’s term for reasons other than committing an offence is not fully reflected in the Federal Law ‘On the Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’. Such gaps may cause the situation, when a deputy of the State Duma can be striped of his powers only because of his opposition activities. That is why there is a need for clearer regulations when it comes to the procedure for the constitutional liability of the deputies. Art 4 of the Federal Law ‘On the Status of the Member of the Federation Council and the Deputy Status of the State Duma of the Federal Assembly of the Russian Federation’ provides grounds for preliminary termination of the deputy’s term. This measure is taken based upon the decision of the State Duma. First of all, there is a need to clarify the terms. There is a difference between the termination of the term as a general category (on the initiative of the deputy, due to objective circumstances, such as death of the deputy) and relieving the deputy from his position (against the will of the deputy) as a constitutional responsibility measure. Unfortunately the grounds for the preliminary termination of the deputy’s term are not differentiated. It is important to distinguish the grounds for voluntary termination of the deputy’s term or termination regardless his/her will. Accordingly, there should be two different procedures for termination: one type of procedure shall be applied, when a deputy voluntarily refuses from his status, and a totally different mechanism should be applied, when the deputy’s term is ended in a www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 87 compulsory manner, for example, if the deputy denies that he is engaged in the commercial activities or other activities incompatible to the status of the deputy. The proceedings in such a dispute should be adversarial and public. Only the judicial proceedings meet these requirements. It is not acceptable to have any ambiguity in the legislative definitions concerning the grounds for the early termination of the deputy’s term. Otherwise, the democratic institution of preliminary termination of parliamentary term may become an instrument for the destruction of political competitors. Therefore, the absence of the judicial instance in the process of such decision-making somehow limits the independence of a deputy of the State Duma. Moreover, the rule of the people is also abridged, since the will of the electors is infringed upon. The deputies of the State Duma in the Russian Federation are chosen by popular elections, thus gaining their status directly from the people, whom they represent and whom they are responsible for. In order to guarantee the constitutional rule of the people principle, there are two options for the legislative provisions, concerning preliminary termination of the deputy’s term. The first model could have presupposed the strengthening of the role of the court, which may review the decision of the State Duma. The decision of the State Duma on preliminary termination of the deputy’s term due to the offence that the deputy committed should not come into force immediately. It should come into force after the period during which the claim may be filed to the court. The claim should also suspend the entry of the relevant Decision of the State Duma into force. Otherwise, one can not exclude the situation, when it would be difficult to enforce a judicial decision, upholding a claim. For example, the vacant deputy position can be already taken by another candidate. In order to guarantee deputy independence, it could be useful to have legislative provisions on the second model as well, when the State Duma first of all has to first issue a warning to a deputy stating that his/ her activities are not compatible with the constitutional legal status of the member of the parliament, and if the deputy fails to abolish the negative factors, then the Duma makes the decision to preliminarily terminate his/ her powers as a deputy. In this case judicial challenging of the mentioned decision of the State Duma is also necessary.

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Therefore, the proportionality of the scale and limitations to the overlapping competencies in the legislation and legal practice is not achieved in some cases, violating the principle of separation of powers and threatening the democracy and rule of law in the Russian Federation. The overlapping competencies violate the separation of powers principle if its purposes become distorted or abridged, and these purposes include guarantees of people’s rule and prevention of abuse of all and any branches of government.

IV. THE PRINCIPLE OF SEPARATION OF POWERS AND OVERLAPPING COMPETENCIES: THE ROLE OF THE RF CONSTITUTIONAL COURT IN ENSURING THEIR PROPORTIONAL APPLICATION

The theory and practice of implementation of the separation of powers principle within the framework of the Constitution of the Russian Federation is constantly being improved in Russia today via the relevant legal positions of the Constitutional Court of the Russian Federation, as it was mentioned above (avoiding strife, etc.). One should also mention the Decision of the Constitutional Court of the Russian Federation of January 18, 1996 N.2-P concerning reviewing of Ustav (the Fundamental Law) provisions of the Altai region,7 where the separation of powers principle excludes concentration of power by one of the branches of government. At the same time it was mentioned their independence and interaction. The Constitutional Court of the Russian Federation both develops the principle of the separation of powers and uses it as an instrument in order to complete other tasks. For example, there was a claim by a person who was not offered a vacant position of the deputy in the State Duma, while he was first in the party list. The proposal was made to the candidate, who had already exercised a right to become a deputy, then he entered public service, while remaining in the list of candidates for the position of a deputy. In his claim Nikolai Goncharov rose an issue on violation of his constitutional rights by the provisions of art 89 (3) (4) of the of the Federal Law ‘On the Elections of the Deputies of the State Duma of the

7 Legislation Bulletin of the Russian Federation (1996) 4. Art. 409. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 89

Federal Assembly of the Russian Federation’ as well as of art 71 (17) (18) of the Federal Law ‘On the Fundamental Guarantees of the Elective Rights and Rights to Participate in a Referendum for the Citizens of the Russian Federation’ which create an ambiguous situation on whether a deputy of the State Duma whose term is over as a deputy early due to entering public service position, gain a mandate again, while the regional list of registered candidates contains other candidates, to whom the mandate was not yet offered. According to art 89 (3) of the Federal Law ‘On the Elections of the Deputies of the State Duma of the Federal Assembly of the Russian Federation’ the registered candidate who is included into the federal list of candidates, and who is entitled to participate in allocation of deputy mandates, has a right to participate in taking deputy mandates no more than twice. It means that a deputy, who voluntarily finished his term does not lose his passive right, and he can have a deputy mandate again (though no more than twice). Art. 89 (4) of the Federal Law does not provide for the procedure of excluding the candidates who were once allowed to take a mandate, then voluntarily finished their term, from the party list. However, there is a question arising, whether a candidate, who has already ended his term voluntarily, can gain a mandate again. Can one speak of a violation of the separation of powers principle by the legal provision allowing for a person to both hold a position in the executive branch of government and be enlisted as a candidate for the position of deputy? According to the Constitutional Court of the Russian Federation the provisions of current parliamentary legislation allowing one to alternate the positions in the State Duma and the executive branch of government, when a person who has voluntarily resigned from his/her deputy position and took a position in the executive branch of government, gains the deputy’s mandate within the same convocation of the State Duma, contradicts the provision that does not allow to simultaneously take part in the activities of different branch of government, since it presupposes the division between the persons serving in the parliament and in the executive branch of government, which is required by the separation of powers principle, as enshrined in arts 10 and 11 of the Constitution of the Russian Federation. As the Constitutional Court of the Russian Federation has pointed

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 90 KUTAFIN UNIVERSITY LAW REVIEW out in the Decision of May 29, 1998 N. 16-P the provision of art 2 (2) of the Constitution, according to which a deputy of the State Duma of the first convocation can simultaneously be a member of the Government of the Russian Federation, is purely temporary and fits a specific purpose. It only applies to the deputies of the State Duma of the 1st convocation, and there are no exceptions possible from this rule. The possibility of the Constitutional Court of the Russian Federation to correct the contents of the separation of powers principle requires a special level of independence of the Constitutional Court. The foreign scholarly writings also refer to the need of establishing additional guarantees for the institutional security of the constitutional justice bodies in the situations, when one political party holds a dominant position.8 These concerns apply to Russian reality as well. That is why, there is a need to strengthen institutional and organizational security guarantees of the Constitutional Court of the Russian Federation as well as material ones. That is why the changes in the procedure for the election of the Chairman of the Constitutional Court of the Russian Federation seem to be unreasonable. Previously, according to art 23 of the Federal Constitutional Law ‘On the Constitutional Court of the Russian Federation’ the Chairman, the Vice-Chairman and Secretary-Judge were elected individually by a secret vote of judges in the plenary hearing of the Court for a term of three years. The proposal on the appointment of the Chairman by the President of the Russian Federation, which was introduced instead of his election by the judges, contradicts the independence and other basic principles of the Constitutional Court of the Russian Federation, independence of its judges and equality of their rights, as provided for by arts 5, 13, 16 of the Federal Constitutional Law ‘On the Constitutional Court of the Russian Federation’. The judge of the Constitutional Court of the Russian Federation who wills to take a position of the Chairman of the Constitutional Court voting for the Decisions of the Constitutional Court, will be consciously or subconsciously following the position of the powers within the state government, on whom his future appointment would depend. In the mid-1990s the legislative draft was introduced to the State Duma, which would give the Federation Council the right to

8 Theunis Roux, ‘Principle and pragmatism on the Constitutional Court of South Africa’ (2009) 7 1 (International Journal of Constitutional Low) 108. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Nina M. Kolosova Overlapping Competencies within the System of Separation of Powers in the Russian Federation 91 appoint a Chairman of the Constitutional Court of the Russian Federation. However, this proposal was not supported. Therefore, the Constitutional Court of the Russian Federation plays a special role in the development of the separation of powers principle and guaranteeing limitations to the overlapping competencies. It also uses the separation of powers principle in order to resolve specific legal disputes, strengthening the value of the said principle. That is why there is a need for additional guarantees for the independence of the Constitutional Court of the Russian Federation.

V. CONCLUSIONS

Thus, within the framework of the separation of powers principle the unified power of the state is implemented via state government bodies, which are constitutionally separated on both horizontal and vertical levels, while they interact with each other. At the same time, each state government body, functioning independently within the limits of its competence, should strive for mutually beneficial cooperation. That is why the unity of power is achieved by unified goals, which are the same for every branch of government. That is why, it is both natural and positive to have overlapping competencies, if they are aimed at rationalizing the organization of state government bodies, and they do not infringe upon the people’s rule principle. The said competences are guarantees against the ruptures among the branches of government. They facilitate the balance of powers, serving as parts of the mechanism for their interaction, ultimately, facilitating stability of state and its rational organization. At the same time, the overlapping competencies have their limitations, and going beyond those limitations creates a significant threat to democracy, rule of law and guarantees of basic human rights and freedoms.

Bibliography

Draganova Diana, ‘Chechnya’s Right of Secession under Russian Constitutional Law’ (2004) 3 2 Chinese Journal of International Law 576 Ebzeev B.S. Vvedenie v Konstitutsiyu Rossii. M.: Norma, 2013 (BS Ebzeev, Introduction to the Constitution of Russia (Norm, 2013)) Fuchs K, Herold F, ‘The Costs and Benefits of a Separation of

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Powers—An Incomplete Contracts Approach’ (2011) 13 1 American Law and Economics Review 131 Mazaev V.D., Tikhomirov Yu.A., Andrichenko L. Konstitutsiya Rossiiskoy Federatsii: ot obraza budushchego k real’nosti (k 20-letiyu Osnovnogo Zakona Rossii) / Podobshch. red. T.Ya. Khabrieva. M.: Yurisprudentsiya, 2013 (VD Mazaev, YuA Tikhomirov, L Andrichenko, The Constitution of The Russian Federation. From a Vision of the Future to Reality (for the 20th Anniversary of the Fundamental Law of Russia) (TYa Khabrieva ed, Jurisprudence 2013)) Rossiter C, 1787: The Grand Convention (WW Norton 1987) 64 Roux Theunis, ‘Principle and pragmatism on the Constitutional Court of South Africa’ (2009) 7 1 (International Journal of Constitutional Law) 106

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ARTICLE

E-DEMOCRACY IN MODERN RUSSIA: THE ESTABLISHMENT, DEVELOPMENT AND PROSPECTS

Marina M. Kuryachaya (Russia)

Author PhD (Law), Lomonosov Moscow State University, 2004 Associate Professor, Public Policy and Public Administration Department, Kuban State University (Krasnodar) Email: [email protected] Abstract The article considers the problems of implementation of constitutional rights of citizens with the help of modern forms and means of participation of citizens in state administration and local self-government (electronic democracy). It is noted that in recent years one of the most notable trends in the political process has been the institutionalization of e-democracy. The e-democracy as a set of forms and tools to use information technology in order to empower the realization of the rights of any citizen is characterized by conducting on-line various campaigns, by a high level of self-organizing online community amid lack of significant social differences between members of a community, by online advocacy, by using online as the means disseminating political information. The author states that the Internet as a communication tool is suitable not only for electoral, but to the functional system of popular representation of inhabitants’ interests, and examines the possibilities of e-democracy in the areas of the participation in the management of the affairs of the state and local government, expressing public opinion and bringing it to the attention of public authorities, public control of the activities of public authorities, the implementation of the legislative initiative of citizens, monitoring of law enforcement. It is concluded that the e-democracy is impossible without providing

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every citizen a free access to information about the activities of public authorities. The possibilities of the e-democracy should be available to all categories of inhabitants of the country, which entails the need to provide an access to Internet resources in every settlement of Russia. The conservative mentality of Russian citizens is also a serious obstacle to the development of the e-democracy, therefore, its implementation must be gradual and the formation of legal awareness and computer literacy should be always in advance of it. Keywords Human rights, civil society, direct democracy, freedom of public opinion, e-democracy

DOI: 10.17803/2313-5395.2016.1.5.093-105

TABLE OF CONTENTS

I. The Institutionalization of E-Democracy in Russia ...... 94 II. The Electronic Technology in the Legal Space of Russia ...... 97 III. The Electronic Technologies of the Control of Activities of Public Authorities ...... 99 IV. The Development of Crowdsourcing in the Legal Field ...... 102 V. The Problems of the Development of Electronic Democracy in Russia ...... 103 Bibliography ...... 104

I. THE INSTITUTIONALIZATION OF E-DEMOCRACY IN RUSSIA

Legal policy is inconceivable in isolation from political and socio- economic reforms going on in Russia. The potential of democracy can be realized only in organizational forms of sovereignty produced by the historical development of people; otherwise, the freedom of thought, speech, press, meetings and gatherings, universal suffrage, don’t generate democracy, by themselves, but anarchy, which is replaced by oligarchy in the next stage of development, accompanied by a loss of state social www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 95 service and social and political apathy of most people.1 The task of modern legal policy is not to find the legal form of the socio-political realities, but to give the public new means of implementation of constitutional rights and freedoms of citizens within existing legal forms and, with the utmost caution and prudence, to involve the emerging social relations in the sphere of the new legal regulation. In this regard, the problem of mutual understanding the government and society, respect of the state and the civil society is becoming one of the most topical. Thus, it is impossible to deny the fact that among objective reasons for the lack of interaction between the government and the civil society imperfect legislation plays a significant role, which does not allow to change the current practice of relations. The state power is exercised through special forms, legislative, executive and judicial. Democracy presupposes not only the existence of these forms and mechanisms of their interaction, including checks and balances, but also requires transparency of daily operations of all branches of government and the availability of effective mechanisms for citizens’ participation in its implementation (including the mechanisms of civil control).2 In recent years one of the most important development trends of the political process in the countries of developed democracy, and in countries where democratic transformation began only in the second half of the twentieth century, is the institutionalization of e-democracy. A few years ago it was noted at the Federal level that the modern information society is characterized by a high level of development of information and telecommunication technologies and their intensive use by citizens, businesses and public authorities. High technologies, including information and telecommunications, have already become the

1 Churov V.E., Ebzeev B.S. Reshenie ESPCH po delu “Respublikanskaya partiya Rossii protiv Rossii”, ili utrachennye illuzii / Konstitutsionnoe i munitsipal’noe pravo. 2011. № 11. S. 3—5 (VE Churov, BS Ebzeev, ‘The Decision of the ECHR in the Case «Republican Party of Russia v Russia” or Lost Illusions’ (2011) 12 The Constitutional and Municipal Law 3). 2 Kuryachaya M.M. Elektronnaya demokratiya kak vyzov sovremennoy pravovoy politiki // Konstitutsionnoe i munitsipal’noe pravo. 2013. № 1. S. 41—44 (MM Kuryachaya, ‘E-democracy as a Challenge to Modern Legal Policy’ (2013) 1 The Constitutional and Municipal law 41).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 96 KUTAFIN UNIVERSITY LAW REVIEW engine of socio-economic development of many countries in the world, and guaranteeing free access to information is one of the most important tasks of the state.3 The reality today is that under the influence of profound changes in patterns of social organization and cooperation in our society centralized hierarchical structures have been replaced by flexible and networked types of organization; the role of self-organization aimed to solve some specific problem and of the individual is increasing. Information and knowledge in modern society have become not only important factors of production, the driving force of the economy, but also those of different socio-political significance. In the information society social progress of the state is increasingly dependent on the availability and effectiveness of national, regional and local innovation systems. The following factors influence the changes: — the close relationship between science and technical developments finally taken shape by the mid-twentieth century that resulted in a dramatic increase in the dynamics of production and the emergence of knowledge-intensive technologies; — globalization of all changes happening in society when the events which are geographically very distant from each other, are links of the same chain, thereby losing their seemingly locality in nature; — a major complication of all economic, political and military activities of mankind and the creation of complex systems, that has highlighted the problems of management and its informational support, creating not only such areas of knowledge as Cybernetics, systems analysis, operations research, but a new worldview in which the world is perceived through the prism of information processes; — the development of new information and communication technologies, which wide implementation in all spheres of human life has resulted in a significant restructuring and the

3 Strategy of information society development in the Russian Federation: Approved of Russian President 07.02.2008 № PR-212 / The Russian newspaper. 2008. 16 Feb. No. 34. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 97

emergence of new forms of social and economic activities such as electronic Commerce, telework, distance education, telemedicine and e-democracy.

II. THE ELECTRONIC TECHNOLOGY IN THE LEGAL SPACE OF RUSSIA

Digital technologies penetrate into the traditional technology, changing their capacity and expanding the horizons of the use, they penetrate into new areas4. These allow to speak about computer, telecommunications or microelectronic revolution and consider a society to be the society of informational technologies. The development of communication channels, forms and sources of information allows to talk about the formation of Electronic State, a necessary attribute of e-democracy. The terms ‘electronic government’ (‘e-government’) and electronic democracy (‘e-democracy’, ‘digital democracy’, ‘electronic democratization’, ‘teledemocracy’, ‘cyberdemocracy’) came into use in the late twentieth century in countries where special attention was paid to the development of information and communication technologies, including the development of the Internet.5 E-democracy is a ‘governmental self organization of citizens’,6 as a set of forms and tools giving the opportunity to empower citizens through the use of information and communication technologies. E-democracy is characterized by on-line conducting various campaigns, a high level of self-organizing online community amid the lack of significant social differences between members of a community, online advocacy, online

4 Kuryachaya M.M. Elektronnoe pravosudie kak neobkhodimyi element elektronnoy demokratii v sovremennoy Rossii / Konstitutsionnoe i munitsipal’noe pravo. 2013. № 7. S. 52—54 (MM Kuryachaya, E-justice as a Necessary Element of e-democracy in Modern Russia (2013) 7 The Constitutional and Municipal law 52). 5 Vaskova M.G. Problems of Formation and Realization of E-Democracy Electronic State (2010) 4 The Russian Law Journal 46. 6 Rudenko V.N. Pryamaya demokratiya: modeli pravleniya, konstitutsionno- pravovye instituty. Ekaterinburg, 2003 (VN Rudenko, Direct democracy: Models of Governance, Constitutional and Legal Institutions (Ekaterinburg, 2003)).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 98 KUTAFIN UNIVERSITY LAW REVIEW as means to spread political information. The concept of e-democracy involves new legal forms of interaction between government agencies and a person in the informational society. The mechanism of e-democracy is a set based on information and telecommunication technologies of forms, methods and procedures of citizens’ participation in the initiation, development and implementation of public decisions.7 Today, when the Internet has become one of the main areas of political communication, it became obvious that its cross-border capabilities are not limitless. It is possible to assert with confidence that certain principles and procedures of e-democracy are in conflict with the universally recognized human rights. Moreover, information technologies have become to be perceived by citizens as an attack on personal rights and freedoms. So, during the unprecedented openness of the voting process and counting of votes on elections of the President of Russia on March 4, 2012, which were broadcasted on the Internet using web cameras installed at almost all polling stations, some voters required to ensure their right to participate in elections in the absence of any control that is required to place the cameras to record only the members of the precinct election Commission and the ballot boxes, but not voters. As practice shows, the Internet as a communication tool is suitable not only for electoral, but to the functional system of representation of the interests of citizens in which the technologies of electronic democracy serve as a channel of interaction between the society and political institutions. Having a high risk of disclosure or unauthorized use of voting results or voters data, online voting was not broadly applied to state power authorities.

7 Hacker KL, Dijk J Van, Digital Democracy. Issues of Theory & Practice (London: Sage Publications, 2000); Hague BN, Loader BD, Digital Democracy: Discourse and Decision Making in the Information Age (London: Routledge, 1999); Macintosh A, ‘Characterizing e-participation in policy-making’ in Proceedings of the Thirty-Seventh Annual Hawaii International Conference on System Sciences (Hawaii: Big Island, 2004). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 99

III. THE ELECTRONIC TECHNOLOGIES OF THE CONTROL OF ACTIVITIES OF PUBLIC AUTHORITIES

One of the incentives for implementation of e-democracy is a need of the society to regularly monitor and publicly evaluate the activities of state authorities and local self-government (especially in the context of the protests of late 2011 – mid 2012). At the Federal level in the Russian segment of the Internet, the functions of accumulation and support of public initiatives are carried out by two Institutes e-democracy. Those are the portal ‘Expert Council under the Open government of Russia’ and the website ‘Russian public initiative’ (ROI). The main users of the first resource are specialists in various branches of knowledge, the second is intended for a wide audience. The legal basis for the functioning of the portal of the Russian public initiative is the presidential Decree ‘On consideration of public initiatives by citizens of the Russian Federation with the use of the Internet resource “Russian public initiative”’.8 Community initiatives are considered the proposals of the citizens of the Russian Federation on socio-economic development of the country, improvement of state and municipal management. The citizens of the Russian Federation who attained the age of 18 and who are registered through electronic form as recipients of state services can direct public initiatives using the Internet resource SWARMS and vote for them. The citizen submitted a public initiative, indicates at what level (Federal, regional or municipal), in his opinion this initiative should be implemented. A mandatory preliminary examination, the duration of which shall not exceed two months is preceded the placement of public initiatives on the Internet resource SWARMS. The preliminary examination is established under the public initiative of the Constitution of the Russian Federation, generally

8 On consideration of public initiatives by citizens of the Russian Federation with the use of the Internet resource ‘Russian public initiative’: The decree of the President of the Russian Federation dated 04.03.2013 No. 183 / Collected legislation of the Russian Federation.2013. No. 10. Art. 1019.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 100 KUTAFIN UNIVERSITY LAW REVIEW recognized principles and norms of international law, including human rights, freedoms and legitimate interests of citizens, the urgency of the problem contained in the public initiative, the validity of the proposed variations. Initiative cannot be placed on the Internet resource SWARMS in cases, if the content: is contrary to the Constitution of the Russian Federation, generally recognized principles and norms of international law, including human rights, freedoms and legitimate interests of citizens; made on issues that can not be put on the Federal referendum; does not contain a description of the problem, or does not propose solutions of the problem, or the proposed options are not justified. The public voting on the initiative begins on the day of placement of the initiative on the Internet resource SWARMS and shall be held within one year. The initiative is considered supported when within one year after its publication is received: — no less than 100 thousand votes of the citizens in support of the initiative at the Federal level; — at least 5 % of votes of the citizens, permanently residing on the territory of the corresponding state of the Russian Federation (where a population is more than 2 million people – no less than 100 thousand votes) – in support of initiatives at the regional level; — at least 5 percent of votes of the citizens residing in the territory of the respective municipality, in support of the initiative at the municipal level. The supported initiative is directed towards the expert working group of the relevant level (Federal, regional or municipal) for examination and decision on the feasibility of development of draft regulatory legal acts and (or) other measures to implement that initiative. Based on the results of consideration of the public initiative expert working group within a period not exceeding two months prepare the expert report and the decision to develop an appropriate normative legal acts and (or) other measures to implement the initiative. Information on the consideration of the public initiative and measures for its implementation are posted on the Internet site ROI. At the time of preparation of this material via the online resource SWARMS 5834 initiatives are made, 1935 initiatives are on the ballot, www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 101 decisions are taken on 18 initiatives (and only 8 of them have received the required 100 thousand votes, the remaining 10 solutions have been implemented by the authorities in connection with the fact of taking the initiative).9 In May 2014 the Internet project ‘System of electronic referenda of the government of Moscow ‘Active citizen’ was launched, and within one year of its existence it was attended by over one million users, more than 580 voting were conducted, 250 solutions were implemented by the authorities. In the project 25 million views on various issues were made, each voting was attended by about 270 thousand people every week, 10 thousand new users were registered in the project. Among the participants of the project, 58 % are women and 42 % are men, 52% of participants have children, the most active participants are people aged from 25 to 34 years (39 %). By electronic referenda 9 new bus routes are introduced, 140 thousand trees and shrubberies within 1,000 yards of houses are planted, the design of the new subway stations is chosen, 10 km of cycle tracks are organized, measures to improve the quality of public services and the work of the clinics are worked out, the rules of loading and unloading at night time aimed at ensuring the rest of the townspeople are made. Muscovites have voted to restrict the sale of alcoholic energy drinks (80 %) and against the speed limit reduction to 40 km/h in the city center (53,3 %).10 However, the regional Russian political practice is that the electronic interaction channels perform rather a collective, and not an effective function. This reduces the effectiveness and appropriateness of the activities performed, as there is no practical implementation in the presence of the spent resources (time, labor, material). The authorities are considering the work in the ‘open government’ as an additional burden and treat it accordingly. A vivid example of the formal approach to this tool of e-democracy is the operation of the open government website of Krasnodar region http://open.krasnodar.ru where there are 3 drafts of legal acts and 15 national initiatives to discuss. And only three of those initiatives meet the requirements for public initiatives.

9 Russian public initiative accessed 18 October 2015. 10 Annual report of the project ‘Active citizen’ accessed 18 October 2015.

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IV. THE DEVELOPMENT OF CROWDSOURCING IN THE LEGAL FIELD

The civil society as one of the most changing and perceptive political substances most clearly expresses itself in the development of new forms of interaction with the state, among which the phenomenon of crowdsourcing should be mentioned.11 In the interdisciplinary dimension crowdsourcing is defined as the set of solutions based on the use of intellectual, informational, organizational efforts of the online community.12 The development of means of communication, the Internet and mobile communications technologies allowed commercial crowdsourcing project to be a way of addressing humanitarian problems. The legal basis of public discussion of draft laws and normative-legal acts on the Internet have been elevated to the presidential Decree ‘On public discussion of projects of Federal constitutional laws and Federal laws’.13 Expert discussion of the draft legislation in the framework of the activities of the Public chamber of the Russian Federation took place on the portal of public examination https://aeis.oprf.ru. Public discussion on the use of the Internet projects of Federal constitutional laws and Federal laws developed by the Federal bodies of the Executive power, affecting the main directions of state policy in the field of socio-economic development of the Russian Federation, took place on the Federal portal of draft regulations . Another sphere of application non-commercial (political) crowdsourcing in legal practice is a law enforcement. After signing in December 2010 agreements on cooperation in the fi eld of monitoring of law enforcement in the framework of the joint project ‘Monitoring of Law Enforcement’ by the

11 Kuryachaya M.M. Tekhnologii kraudsordinga v yuridicheskoy praktike / Konstitutsionnoe i munitsipal’noe pravo. 2012. № 6. S.31–37 (MM Kuryachaya, ‘Technology Crowdsourcing in the Practice of Law’ (2012) 6 Constitutional and Municipal Law 31). 12 Geerts S, Discovering Crowdsourcing. Theory, Classification and Directions for Use (Eindhoven, 2009). 13 About public discussion of projects of Federal constitutional laws and Federal laws: Decree of the President of the Russian Federation dated 09.02.2011 No. 167 / Collected legislation of the Russian Federation. 2011. No. 7. Art. 939. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 103

Ministry of Justice of the Russian Federation and the St. Petersburg State University a new online resource () was opened in June 2011. This resource is designed for a thorough discussion of existing national legislation. The purpose of monitoring is to assess how the provisions of the current legislation is applied in practice, how they interpret the law enforcement authorities and what issues and challenges arise. Today the discussion is taking place on land, tax and labor law. However, in the near future discussions in other areas of jurisprudence will be initiated. According to the intent of the leaders of the project the number of participants should continue to grow, including through their involvement in various expert groups. According to the head of the working group on the implementation of the project V. Lukyanov, the most active participants of the discussion can be included in the expert Council of ‘Law Enforcement’ for reporting to the Ministry of Justice of the Russian Federation.14

V. THE PROBLEMS OF THE DEVELOPMENT OF ELECTRONIC DEMOCRACY IN RUSSIA

Thus, from exotic hobby of the most politicized part of the Internet community e-democracy has become an independent form of direct participation of citizens in the governing at the federal, regional and local levels. However, in the process of development of e-democracy a number of organizational, technical and legal problems are revealed, which not only constrain this development, but also discredited the very idea of e-democracy. First of all, e-democracy is hardly possible without providing every citizen free access to information about the activities of federal and local authorities.15 The problem of formation of the system of e-democracy

14 St. Petersburg State University and the Ministry of Justice has launched a new online resource accessed 18 October 2015. 15 Avak’yan S.A. Konstitutsionnyi leksikon: gosudarstvenno-pravovoy termino- logicheskiy slovar. M.: Yuristinform, 2015 (SA Avak’yan, Constitutional Lexicon: State Legal Terminology Dictionary (Yuristinform, 2015)).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 104 KUTAFIN UNIVERSITY LAW REVIEW legal concepts is closely connected with that issue; among the concepts a special place is given to the user (citizen), the community (socio-legal Institute) and the dialogue (public debate). It is obvious that in the absence of legal regulation of these concepts electronic democracy cannot claim to be appropriate legal institution.16 The participation of citizens in governing process both in federal and local level should be granted for all categories of inhabitants of the country, which entails the need to provide access to Internet resources absolutely in each settlement of Russia. The conservative mentality of Russian citizens is also a serious obstacle to the development of e-democracy, therefore, its implementation must be gradual and always in advance of the formation of legal awareness and computer literacy. Thus, the current circumstances make objective changes of all existing forms and methods of implementation of state power and local self- government. The development of telecommunications and information technologies allows to create new mechanisms for the implementation of democracy. While e-democracy has no significant effect on the political and legal reality in Russia, but its possibilities are much wider than even known to us today, therefore, the legal policy should be aimed at ensuring the effectiveness of e-democracy as a form of direct democracy.

Bibliography

Abdujalilov А, ‘Legal Relations on the Internet’ (2015) 3 Kutafin University Law Review 68 Avak’yan S.A. Konstitutsionnyi leksikon: gosudarstvenno- pravovoy terminologicheskiy slovar’. M.: Yuristinform, 2015 (SA Avak’yan, Constitutional Lexicon: State Legal Terminology Dictionary (Yuristinform, 2015)) Churov V.E., Ebzeev B.S. Reshenie ESPCH po delu “Respublikanskaya partiya Rossii protiv Rossii”, ili utrachennye illuzii / Konstitutsionnoe i munitsipal’noe pravo. 2011. № 11. S. 3-5 (VE Churov, BS Ebzeev, ‘The

16 Abdujalilov А. Legal Relations on the Internet // Kutafin University Law Review. 2015. No. 3. Р. 70–74. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Marina M. Kuryachaya E-Democracy in Modern Russia: The Establishment, Development and Prospects 105

Decision of the ECHR in the Case “Republican Party of Russia v Russia” or Lost Illusions’ (2011) 12 The Constitutional and Municipal Law 3) Geerts S, Discovering Crowdsourcing. Theory, Classification and Directions for Use (Eindhoven, 2009) Hacker KL, Dijk J Van, Digital Democracy. Issues of Theory & Practice (London: Sage Publications, 2000) Hague BN, Loader BD, Digital Democracy: Discourse and Decision Making in the Information Age (London: Routledge, 1999) Kuryachaya M.M. Elektronnaya demokratiya kak vyzov sovremennoy pravovoy politiki / Konstitutsionnoye i munitsipal’noye pravo. 2013. № 1. S. 41–44 (MM Kuryachaya, ‘E-democracy as a Challenge to Modern Legal Policy’ (2013) 1 The Constitutional and Municipal law 41) Kuryachaya M.M. Elektronnoe pravosudie kak neobkhodimyi element elektronnoy demokratii v sovremennoy Rossii / Konstitutsionnoye i munitsipal’noye pravo. 2013. № 7. S. 52–54 (MM Kuryachaya, ‘E-justice as a Necessary Element of e-democracy in Modern Russia’ (2013) 7 The Constitutional and Municipal law 52) Kuryachaya M.M. Tekhnologii kraudsordinga v yuridicheskoy praktike / Konstitutsionnoye i munitsipal’noye pravo. 2012. № 6. S. 31–37 (MM Kuryachaya, ‘Technology Crowdsourcing in the Practice of Law’ (2012) 6 Constitutional and Municipal Law 31) Macintosh A, ‘Characterizing e-participation in policy-making’ in Proceedings of the Thirty-Seventh Annual Hawaii International Conference on System Sciences (Hawaii: Big Island, 2004) Rudenko V.N. Pryamaya demokratiya: modeli pravleniya, konstitutsionno-pravovye instituty. Ekaterinburg, 2003 (VN Rudenko, Direct democracy: Models of Governance, Constitutional and Legal Institutions (Ekaterinburg, 2003)) Vaskova M.G. ‘Problems of Formation and Realization of E-Democracy Electronic State’ (2010) 4 The Russian Law Journal 46

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LAW AND ECONOMY

ARTICLE

RECOGNITION AND ENFORCEMENT OF ARBITRAL AWARDS RELATING TO INTERNATIONAL COMMERCIAL DISPUTES IN VIETNAM

Tran Viet Dung1 (Vietnam)

Author PhD, Associate Professor Dean of International Law Faculty, Ho Chi Minh City University of Law Email: [email protected] Abstract This article discusses issues related to the recognition and enforcement of arbitral awards in Vietnam. The author analyzes the procedure for obtaining a judgment for enforcement of foreign arbitral awards. The author also examines the causes for refusal to recognize foreign arbitral awards. Keywords Arbitration Law, Enforcement of Arbitration Award, Vietnamese court, Commercial Dispute, Investment, Public Policy, Vietnam

DOI: 10.17803/2313-5395.2016.1.5.106-126

TABLE OF CONTENTS

I. Introduction ...... 107 II. An overview of the regulatory framework ...... 109 1. Types of arbitrl awards ...... 109

1 The views expressed in this paper are solely those of the author in his private capacity and do not in any way represent the views of his institution, or any other entity of Vietnam’s Government. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 107

2. The procedure for obtaining court judgment for enforcement of foreign arbitral awards ...... 110 3. Grounds for the refusal to recognize and enforce arbitral awards ...... 111 III. Application of New York Convention in Vietnam ...... 113 1. General principle of application of the New York Convention ...... 113 2. Defi nition of arbitral award ...... 114 3. Causes for refusal to recognize the foreign arbitral awards ...... 115 (a) Legal representation ...... 116 (b) Validity of an arbitration agreement ...... 117 (c) Notifi cation procedure ...... 118 (d) Public policy consideration ...... 119 (e) Court’s jurisdiction ...... 120 (f) Authorized an representative for the applicant in the proceeding ...... 121 (g) Burden of proof in case of refusal of enforcement of the award ...... 121 (h) Piercing the corporate veil ...... 122 IV. Conclusion ...... 123 Bibliography ...... 126

I. INTRODUCTION

One of the main problems economic actors in Vietnam facing today is an access to judicial system. This problem is particularly troubling in light of the constant growth of civil lawsuits on the court dockets. To that end, an alternative solution for business entities and other economic actors to overcome the problem is approaching the arbitration for dispute settlement. In international business practice, arbitration is often preferred to litigation for a number of reasons: it is entered into voluntarily; the parties choose the arbitrator or agree how the arbitrator will be chosen; the rules of procedure are more flexible; there is greater confidentiality and a speedier disposition. Vietnamese policy makers have been supporting the development of arbitration by adopting the laws on

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 108 KUTAFIN UNIVERSITY LAW REVIEW arbitration since 2003.2 Nonetheless, Vietnam’s record with respect to the enforcement arbitral awards leaves much to be desired as there was reluctance by courts to recognize and enforce the arbitration awards.3 Being aware of the fact that a failure to develop the arbitration regime and especially enforce arbitral awards has damaged its image as an attractive destination for foreign investment and hurt domestic enterprises as well, Vietnam has attempted to legislate its way out of trouble.4 The Law on Commercial Arbitration, adopted by the National Assembly in 2010 (the ‘Arbitration Law’), was designed in response to the situation and strengthened the status of arbitration in Vietnam.5 The Supreme People’s Court has also unleashed a number of notices and guidelines concerning the issues of recognition and enforcement of arbitral awards. Their efforts to overcome the doctrinal obstacles to enforcement of arbitral awards are remarkable; however, existing laws are still deficient to certain aspects, and required further reforms. This paper overviews the regulatory framework on recognition and enforcement of arbitral awards in Vietnam and analyse the shortcomings in its application to propose some solutions for regulatory and doctrinal reforms.

2 The National Assembly of Vietnam has adopted the Ordinance on Commercial Arbitration, the first arbitration legislation in Vietnam 2003. 3 While conceptually there are differences between recognition of an award and enforcement of an award, such differences are not significant for the purposes of this paper. In international practice, the issues of the enforcement of arbitral awards apply equally to the recognition of awards, given that recognition of an award is a prerequisite of the enforcement of awards (but not vice versa). Any potential problems faced in the enforcement of arbitral awards will similarly be problems faced in the recognition of awards. Accordingly, references to recognition and enforcement in this paper will, in the interest of economy, be to ‘enforcement’. For a discussion of the differences between ‘recognition’ and ‘enforcement’ of an arbitral award, see Alan Redfern et al, Law and Practice of International Commercial Arbitration (5th edn, OUP 2009) para 11.20–11.24. 4 Dang Hoang Oanh, Vietnamese regulations on recognition and enforcement of foreign arbitral awards – Griffin’s View on International and Comparative Law (2003) 48–65. 5 Do Van Dai, Tran Hoang Hai, Vietnamese Law On Commercial Arbitration (National Political Publishing House 2012) 12. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 109

II. AN OVERVIEW OF THE REGULATORY FRAMEWORK 1. Types of arbitrl awards

There are two main types of arbitral award recognized under the laws of Vietnam, namely (i) domestic arbitral award and (ii) foreign arbitral award. The first category is the arbitral award rendered by a local arbitration tribunal (including both institutional and ad-hoc arbitration).6 Pursuant to the Arbitration Law, this type of arbitral award is enforceable without a need to pass before the judges of the exequatur. Accordingly, when the execution of the award period has expired but the losing party fails to comply with the arbitral award voluntarily and not seeking setting aside the arbitral award, the beneficiary party of the performance may submit a written request directly to the civil judgment enforcement agency to enforce compliance with the arbitral award.7 Thus, unless the arbitral award is not a subject to setting aside, the award is considered as a civil judgement rendered by a Vietnamese court and is enforceable without being subject to recognition by the court. The second category is the arbitration awards rendered in a foreign arbitration in order to resolve a dispute.8 It should be noted that arbitration award rendered within territory of Vietnam by an arbitration panel organized by foreign and international arbitration institution, are also regarded as foreign arbitral award in Vietnam. For this type of arbitration award, the transition before the local competent court for purpose of enforcement is necessary. According to Article 343 (4) of the Civil Proceeding Code, the enforcement in Vietnam of any foreign arbitral

6 The Vietnam arbitration system consists of primarily of the Vietnam International Arbitration Centre (VIAC) at the Vietnam Chamber of Commerce and 6 other local arbitration commissions set up in large cities of Vietnam, including Pacific International Arbitration Centre based in Ho Chi Minh City; Hanoi Commercial Arbitration Centre based in Hanoi; Ho Chi Minh City Commercial Arbitration Centre; Can Tho Commercial Arbitration Centre; Vien Dong Arbitration Centre based in Hanoi; Asia Arbitration Centre based in Hanoi; and based in Hanoi. By far, VIAC, established in 1993 on the basic of merging the Foreign Trade Arbitration Committee and the Marine Arbitration Committee, is considered as a reputable arbitration institute in Vietnam and gains much of reliance of domestic and international business communities. 7 Arbitrational Law, Art. 64 (1). 8 Arbitration Law, Art. 3 (12).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 110 KUTAFIN UNIVERSITY LAW REVIEW award must be subject to the recognition and approval of the courts of Vietnam. It is observed a significant difference between a foreign arbitral award, which requires a court’s recognition for the purpose of enforcement, and a Vietnamese arbitral award, which does not require such court’s enforcement order. According to general principle of civil procedural law, the courts of Vietnam would consider the recognition and enforcement in Vietnam of foreign civil judgements and/or foreign arbitration awards to be on a reciprocal basis9 or based on the international convention that includes Vietnam as a member. In practice, the enforcement process should be easier for arbitration institution of the countries that are signatories to the New York Convention 1958 on recognition and enforcement of Foreign arbitral Awards (‘New York Convention’) as the Convention requires the courts of a signatory country to the Convention to recognise and enforce foreign arbitral awards as court judgments unless one or more of the limited exceptions apply. Rules and principles on recognition of foreign arbitration award under the New York Convention have been also incorporated into Vietnamese law with some reservation.10 With this legal framework, a number of foreign arbitral awards have received enforcement in Vietnam, while others have been rejected by the judges of the exequatur. 2. The procedure of obtaining court judgment for enforcement of foreign arbitral awards

As mentioned above, foreign arbitral awards are required for court’s formal recognition for enforcement in Vietnam. Pursuant to the civil procedural law, before involving a court for requesting the recognition and enforcement of foreign arbitral award, the requesting party must undergo pre-submission proceeding by lodging the application to the Ministry of Justice (‘MOJ’).11 The application must include any documentation required by the relevant international treaty, if applicable. If the treaty does not set forth any procedural requirements, the petition must include

9 Civil Proceeding Code, Art. 343(3). 10 Vietnam has joined the New York Convention in 1995 by Decision No. 453 / QD- CTN of the President of the Socialist Republic of Vietnam, dated 28 July1995. 11 Civil Proceeding Code, Art. 364(1). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 111 two principal documents namely (i) an original or notarized copy of the foreign arbitral award and (ii) an original or notarized copy of the arbitration agreement of the parties. In addition, the party, applying for recognition and enforcement of the award, must also have a power of attorney and documentation of the applicant’s legal representative; and a notarized and legalized certificate of incorporation or analogous documentation. All documentation must be translated into Vietnamese. Upon approval on the legality of the application dossier by MOJ, the application will then be forwarded to competent court. The court assigned to consider the application should notify relevant parties, agencies, or organizations. If the consideration process is not suspended, the court must formally consider the application. Court meetings must be attended by a presiding panel of three judges, a public procurator, and the person or legal representative of the person against whom the requesting party is trying to enforce the award. Formal recognition and enforcement of a foreign arbitral award does not involve a substantive review of the dispute, but consideration of whether the procedural and provisional requirements are met. A foreign arbitral award recognised for enforcement has the same effect as any civil judgment or decision of a Vietnamese court. Vietnam has established rules for ‘two-step process’ in regard to recognition of the foreign arbitral award. Firstly, the review on legality of the application dossier has to be made by the MOJ and only after this step is passed a court could start a review of the case. To promote the arbitration and facilitate enforcement of this alternative mode of dispute resolution, it is preferable a process of recognition of award to be speedy. To that end, it might be asked a review on legality of the application dossier for recognition of arbitral award to be carried out directly by a court itself without interference of the MOJ. 3. Grounds for the refusal to recognize and enforce arbitral awards

Pursuant to Article 68 (2) of the Arbitration Law, foreign arbitral awards will not be recognised if: — the parties to the arbitration agreement were not enabled to sign an agreement in accordance with the applicable law of each party;

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— the arbitration agreement is unenforceable or invalid in accordance with the governing law or the laws of the country in which the award was made – if the arbitration agreement does not stipulate the governing law; — the individual, body or organization against which enforcement is sought has not been properly notified on the arbitrator’s appointment or the procedures for resolving the dispute by foreign arbitration, or had reasonable cause for failing to exercise his/her/its right to participate in the proceedings; — the foreign arbitral award was made in respect of a dispute, which was not referred to arbitration by the parties, or which exceeds the scope of the request of the parties; — it is possible to apply the arbitration award, on which the parties reasonably referred as to the one recognized and enforced in Vietnam; — the composition of the foreign arbitration panel, or the foreign arbitration procedure, was inconsistent with the arbitration agreement or the laws of the country in which the foreign arbitral award was made in cases where such matters are not stipulated in the arbitration agreement; — the foreign arbitral award is not yet enforceable or binding on the parties; — the foreign arbitral award has been revoked or suspended by a competent body of the country in which the foreign arbitral award was made, or of the country which law governs the arbitration agreement. Foreign arbitral awards will also not be recognised, when the court, based on the evidence provided by the parties, can conclude that: — the relevant dispute cannot be resolved by arbitration in accordance with the laws of Vietnam; or — the recognition and enforcement of the foreign arbitral award is contrary to the fundamental principles of the laws of Vietnam (public policy).12

12 Arbitration Law, Art. 68.3; Civil Proceeding Code, Art. 370 (2) (b). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 113

III. APPLICATION OF NEW YORK CONVENTION IN VIETNAM

1. General principle of application of the New York Convention The courts of Vietnam consider the recognition and enforcement of foreign arbitration awards where such awards have been made in, or by arbitrators of a country which is a party to a relevant international treaty of which Vietnam is a participant or a signatory. As a member of the New York Convention, Vietnam shall take into consideration for recognition of the arbitral awards of arbitrators of other 149 members of the Convention. It is noted that the regulations on recognition and enforcement of foreign arbitration award in Vietnam, including Arbitration Law and the Civil Proceeding Code, have been made in the light of the Convention. Under Article VII (1) of the Convention, ‘the provisions of the present Convention shall not […] deprive any interested party of any right he may have to avail himself of an arbitral award in the manner and to the extent allowed by the law or the treaties of the country where such award is sought to be relied upon’. Such an arrangement may be useful to the extent that Vietnamese law is more favourable than the Convention for the award. However, there is no evidence that Vietnamese law has more advantages compared to the New York Convention. It should be noted that Vietnam has made three principal reservations to the New York Convention. The first reservation concerns the geographical scope of the arbitral awards. Specifically, Article 2.1 of the Decision 453/QD-CTN of the President of Vietnam on accession of the New York Convention (Decision 453) states that ‘the Convention applies only to the recognition and enforcement in Vietnam of foreign arbitral awards made in the territory of a Member State of the Convention’. There was an issue for application of this rule for arbitration award of Hong Kong. In 2001, the Hanoi People’s Court, based on the opinion of MOJ, has found Hong Kong an administrative territory of People’s Republic of China (a member of the New York Convention) and thus the award by Hong Kong arbitration can enjoy the status of foreign arbitral awards made in the territory of member country of the Convention. The second reservation is that ‘the rules of the New York Convention apply only to disputes arising out of commercial legal relationships’

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(Article 2 of Decision 453). Thus, for cases that are not commercial legal relationships by nature, the rules of New York Convention should not apply in Vietnam and, in this case, the recognition and enforcement of the foreign atria award (that are not under the definition of ‘commercial legal relationships’ of the laws of Vietnam) shall be subject the rules of the Civil Proceeding Code (Article 370.2 (a)). In practice, regarding the cases where the dispute is not commercial in its nature, the laws of Vietnam do not allow the application of the rules on commercial arbitration and only accept the court’s jurisdiction.13 The third reservation is about the requirement that the interpretations of the Convention by the courts or other competent agencies of Vietnam must not contradict the rules of the Constitution and laws of Vietnam (Article 2 of Decision 453). This reservation may cause some potential problems for implementation of the Convention in Vietnam in practice, which will be discussed in other parts of this paper. 2. Definition of arbitral award

New York Convention regulates the recognition and enforcement of foreign arbitral award, but it does not define what is means «arbitration award». For years, this has been a topic for discussion among scholars and practitioners in Vietnam because it is unclear which kind of decision by arbitration commission shall be considered as arbitral award. Take an example, whether the order of arbitration tribunal during the arbitration proceeding for ‘interim measure’ or ‘temporary emergency measure’ would fall under scope of recognition for enforcement by the court based on the New York Convention? This issue is not clearly regulated in the New York Convention. The Civil Proceeding Code and Ordinance on Commercial Arbitration are also silent on this issue, causing thus some legal uncertainty. Without guidelines of the law, the Vietnamese courts had taken conservative position by not accepting ‘interim measure’ of foreign arbitration as awards and object of the New York Convention. This court’s approach was criticized by many practitioners as unjustifiable and ungrounded.

13 Elena Blanco, Tran Anh Dung, & Umut Turksen, ‘Evolving to Perfection?: Enforcement of international arbitral awards in Vietnam’ (2011) 11 6 Journal of World Investment and Trade 965–1017. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 115

With efforts to settle the above mentioned discussion, Vietnamese legislators have introduced a clarification on the concept of arbitration award in the new Arbitration Law. Article 3 of the Arbitration Law stipulates that ‘arbitral decision’ means a decision of the arbitration tribunal during the dispute resolution process, while arbitral award’ means the decision of the arbitration tribunal resolving the entire dispute and terminating the arbitration proceedings. Here, there are two different terms, namely ‘arbitral decision’, which is normally a procedural decision and ‘arbitration award’, which is a decision on the merits of the case. As Vietnam has made a reservation on the interpretation of the New York Convention (Reservation No. 3), the distinction between arbitral award and arbitral decision means that only the award of foreign arbitration will be subject to recognition by the courts in Vietnam. While arbitration decision, which may also include a provisional measure, taken by the foreign arbitrators shall not be considered by the court as it does not fall under the scope of New York Convention. It is believed that the above mentioned position can make the tasks of the courts earlier, but at the same time it might create problems for an interested party. If the party has to wait until arbitration proceeding is completed, the other party would have an opportunity to hide or transfer assets or destroy the evidence. Parties may wish to apply for preservation of assets in order to avoid disclosure after a long and expensive arbitration, that the contractor party has hid or transferred its assets. This is particularly important in Vietnam where local governments/ officials may help companies to hide assets or dodge debts in case they have an economic interest. Thus, if the law recognizes and allows the courts to consider the interim measures by foreign arbitration (permitted by the laws of Vietnam), it would help to prevent the defendant from transferring or encumbering the assets, and local government and Party officials are less likely to try to prevent enforcement of the judgment. 3. Causes for refusal to recognize the foreign arbitral awards

The New York Convention provides a list of grounds for refusal of a foreign arbitral award. The judicial practice in Vietnam shows that some of the provided grounds have never been used by the courts. For example, the following issues have not been assessed by Vietnamese courts, ‘the

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 116 KUTAFIN UNIVERSITY LAW REVIEW award deals with a different not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration’14 and where ‘the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made’.15 In the following lines, we only tackle the causes already used by judges in considering the application for recognition and enforcement of arbitral awards in Vietnam. (a) Legal representation: In general, arbitration is based on a valid arbitration agreement by the parties. One of the main conditions for validity of an agreement is that it must be executed by a legal representative in case of representation, especially for a corporation. Thus, under Article 370.1 (a) of the Civil Proceeding Code, the foreign arbitral award is not recognized in Vietnam if ‘the parties to the arbitration agreement are unable to sign the agreement in accordance with the applicable law of each party [respective jurisdictions]’. This provision corresponds to Article V.1 (a) of the New York Convention. This provision, denying the award of foreign arbitration, is very often used in Vietnam by the losing party under the arbitral award because the arbitration agreement is often signed on behalf of a company by a person who is not a legal representative of a company (such as a deputy director, branch manager, head of division...) without being provided with a power of attorney signed by a legal representative.Some foreign arbitral awards were refused because a person who signed an arbitration agreement was not a legal representative or was not authorized to sign an agreement on behalf of a company. In order to evaluate whether a person signing the arbitration agreement is authorized to represent a Vietnamese company, judges should refer to relevant provisions of Vietnamese law, but in case it is a foreign company, they would seek the answer in the applicable law of the country of incorporation or real seat of the foreign company. This approach by the Vietnamese court is insofar applicable, if the place of incorporation is the place of a real seat of the company. Hence, when these two places are different, a judge should, in our opinion, refer to the law of a country of a company’s real seat.

14 New York Convention, Art. V.1 (c). 15 New York Convention, Art. V.1 (e). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 117

(b) Validity of an arbitration agreement: According to Article V.1 (a) of the New York Convention, ‘the recognition and enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the competent authority of the country where recognition and enforcement is sought, proof that the agreement (arbitration) is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made.’ This provision is reflected in Article 370.1 (b) of the Civil Proceeding Code, which stipulates that ‘the arbitration agreement is unenforceable or invalid in accordance with the governing law, or the laws of the country in which the award was made where the arbitration agreement does not stipulate the governing law’. This ground for refusal was exploited in a recent case of Amara Hotel Properties Pte Ltd. et al vs. VINA Real Estate Development Co. Ltd (VINA)16 relating to a dispute on a sale and purchase contract, which was settled by the Singapore International Arbitration Centre (SIAC). The losing party (VINA) realized that the award had to be set aside because the arbitration agreement was not valid under Vietnamese law (specifically under Article 10 of the Ordinance on Commercial Arbitration 2003), which provides for the invalidity of the arbitration agreement where the agreement does not specify the arbitration organization. However, the Supreme People’s Court in Ho Chi Minh City rejected the argument of Vietnamese company on the ground that the winning party was able to provide evidence proving that the intention of the arbitration agreement the dispute case must be settled by SIAC as ‘the agreement was drafted in accordance with the “SIAC Model Arbitration Clause”’. 17 What’s more, upon assessing the SIAC Arbitration Rules (issued on July 1, 2007), the Court further stated that ‘the procedural rules set under the relevant arbitration agreement shall only be applied under the SIAC, not any other arbitration organisation, [therefore], the arbitration proceeding conducted by SIAC conforms to the arbitration agreement as well as Vietnamese law’.18 Therefore, the claim for refusal to recognise and

16 Decision 90/2013/QD KDTM-PT of the Appellate Division of the Peoples’ Supreme Court at Ho Chi Minh City. 17 ibid. 18 ibid.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 118 KUTAFIN UNIVERSITY LAW REVIEW enforce arbitral award due to violation of Article 10 (4) of the Ordinance on Commercial Arbitration shall be dismissed and cannot be accepted.19 Some may find the above mentioned decision confusing, but the approach of the judge, according to the author’s opinion, complies entirely with the provisions of the New York Convention and the Civil Proceeding Code because it has considered the arbitration agreement under the procedural rules of arbitration centre.20 (c) Notification procedure: According to Article V.1 (b) of the New York Convention, the award is in the case of refusal when ‘the party against whom the award is invoked was not given a proper notice of the arbitrator or proceedings or was it impossible for any other reason, to argue its case’. This provision corresponds to Article 370.1 (c) of the Civil Proceeding Code, which stipulates that ‘the award is not subject to execution, if an individual against whom, or body or organization against which, enforcement is sought, has not been notified properly and in a timely manner of the appointment of the arbitrator or the procedures for resolving the dispute by foreign arbitration, or had reasonable cause for failing to exercise its, or his or her, right to legal proceedings’. The requirements of the New York Convention and the Civil Proceeding Code regarding this situation are vague and therefore make courts interprete and apply the provision with a discretion. Some judges would review the notification based on foreign law, but other judges would consider this notification under the Vietnamese law only. In some cases, foreign arbitral awards have been denied on the basis of this provision. For example, a foreign arbitral award was denied by the Vietnamese courts due to the fact that the notice of the appointment of the arbitrator or arbitration proceeding had been made without knowing if he/she was entitled to receive the notice or that the notice was sent to a branch of the company which was not empowered to receive the notification on behalf of the company. To avoid the problem on recognition of arbitral award due to above mentioned grounds, the judges of the exequatur should examine a validity of the notification according to the applicable law of the arbitration because the parties

19 ibid. 20 Do Van Dai, L’application de la Convention de New York de 1958 par les juridictions Vietnamiennes (2014). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 119 chosen the arbitration must accept the requirements on notification procedure under said arbitration. (d) Public policy consideration: According to Article V.2 (b) of the New York Convention, the recognition and enforcement of an arbitral award may also be refused if the competent authority of the country where recognition and enforcement is sought finds out that the recognition or enforcement of the award contradicts to the public policy of this country. The term ‘public policy’ is not used in Vietnamese legal system, although there is an equivalent concept in the Civil Code, Civil Proceeding Code as well as the Arbitration Law. According to Article 68.2(d) of the Arbitration Law, the award shall be cancelled in case of its contradiction to ‘fundamental principles of Vietnamese law’. The Civil Proceeding Code also mandates the court not to recognize foreign judgment and foreign arbitration award in Vietnam when the recognition and enforcement of such judgment or award in Vietnam contradicts to the fundamental principles of Vietnamese law.21 In fact, Vietnamese courts have never confronted the foreign arbitral award or foreign judgment on the ground of public policy of Vietnam; but often consider if the foreign judgment or arbitral award are against the fundamental principles of Vietnamese law. In other words, the concepts of ‘public policy’ and ‘public order’ exist neither in the Vietnamese law nor in judicial practice. It seems that Vietnamese courts limit their analyses of foreign arbitral awards just to the aspects of their confrontation to the fundamental principles of Vietnamese law. That does not contradict to the New York Convention. It can be argued that Vietnam has transplanted the concept of ‘public order’ of the New York Convention in the sense of ‘fundamental principles of Vietnamese law’. While it is believed that the terms ‘public order’, ‘public policy’ and ‘contrary to fundamental principles of Vietnamese law’ are similar in nature and shall be interchangeable, the problem is that there is no clear definition of ‘fundamental principles of Vietnamese law’. In 2014, the Supreme Court has attempted to define the arbitration award in contrary to the fundamental principles of the Vietnamese law as ‘the ruling that violates the basic principles of treatment having overall

21 Civil Proceeding Code, 370 (2) (b).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 120 KUTAFIN UNIVERSITY LAW REVIEW effects on development and implementation of the law” and where “seriously jeopardises the interest of the state, legitimate interests of any part(ies), third party’. 22 However, this definition is proved to be still too abstract, so local courts have different approaches to its implementation. Some courts consider ‘fundamental principles’ as ‘general principles of a substantive law’ and thus easily decide to deny recognition of foreign arbitration awards. For instance, in Tisco vs. Agc, enforcement was denied by the People’s Court of Hanoi because the compensation awarded by the arbitration tribunal was ‘inadequate’ in comparison to the general requirement under the law on products quality (however neither further explanation nor reference was provided).23 This court decision was strongly criticized by commentators, as it would virtually make breach of any principle in all areas of law as violation of fundamental principle of the Vietnamese law, which is a big deviation from the generally accepted international practice on interpretation of the concept of ‘public policy’.24 (e) Court’s jurisdiction: As enforcement is a court decision, it should seek a competent jurisdiction. According to Article 35 of the Civil Proceeding Code, in case of application for recognition and enforcement in Vietnam of a decision in civil, family, economic, commercial and social spheres made by a foreign court, the competent court should be a court of the place of residence or work of the applicant individual or place of the organization’s seat, or place of the location of property involved in the implementation of that decision. This analogy is also applied in case of recognition of foreign arbitration award. Such a transfer seat poses challenges to the applicant for enforcement. For example, in the case Tyco Services Singapore Pte Ltd v Leighton Contractors, after receiving the award from Australian arbitration, Tyco requested the recognition and enforcement of the award in Vietnam. The application was submitted to the MOJ and was then forwarded to the People’s Court in Da Nang where the

22 Resolution 01/2014/NQ-HĐTP of the Judicial Commission of the Supreme People’s Court on interpretation of some provisions of the Arbitration Law, dated 20/03/2014, Art.14 (dd). 23 Court Decision 06/2014/QĐ-PQTT of the Peoples Court of Hanoi, dated 29/8/2014. 24 Do Van Dai, ‘Setting aside arbitral award: Shortcomings and Resolutions’ in Conference on “Refusal to Recognise the Arbitral Award” (Ho Chi Minh City University of Law 2015). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 121 losing company was headquartered. However, the Da Nang People’s Court refused to hear the case because the company moved its headquarters in Ho Chi Minh City. The record was finally sent to the People’s Court of Ho Chi Minh City. The seat to be considered to determine the jurisdiction of the local court is the current headquarter of the party to carry out the sentence and not the seat at the time of the contract. (f) Authorized an representative for the applicant in the proceeding: According to the Arbitration Law, the party requesting the recognition for enforcement of the arbitral award is entitled to authorize a representative to act on its behalf at the proceeding (from the moment of submission of the application, supplement the dossiers, attending the meetings or hearing, obtaining the summons by the court and making appeal). This regulation on legitimate representative can be interpreted in broad sense to include both individuals and law fi rms. However, according to Civil Proceeding Code, involved parties shall be entitled to appoint individual as their representative in litigation proceeding. The Vietnamese courts do not accept appointment of an organisation, i.e. law fi rm, as an authorised representative in litigation proceeding.25 The same approach is applicable by the courts in regard to proceeding of recognition of foreign arbitral award. Many foreign companies that do not know about this requirement have faced diffi culties upon requesting for enforcement in Vietnam. In 2013, Hanoi People’s Court dismissed the application for recognition and enforcement of the arbitral award on the grounds that under Vietnamese law the representative must be an individual, but a corporation cannot act as legitimate representative in the proceeding. (g) Burden of proof in case of refusal to enforce the award: Except for cases of refusal related to public policy and arbitrability where the judges shall act on their own, the New York Convention provides that it deems to enforce the award party to ‘provide the competent authority of the country where recognition and enforcement is sought, proof’ (Article V.1). The Civil Proceeding Code, hence, is silence on this issue and thus is not specified which party must provide the proof.

25 Nguyen Cong Phu, ‘Practice of recognition and enforcement of foreign arbitral award at the People’s Court of Ho Chi Minh City’ in Conference on 20 years of implementation of New York Convention 1958 on recognition and enforcement of foreign arbitral award, organized by Ministry of Justice, (HCMC 2014).

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Theoretically, based on the Constitution and the Law on conclusion, accession to and implementation of treaties assessment if there is a difference between the rules of the Civil Proceeding Code and the New York Convention regulating the same matter, the provisions of the Convention shall prevail.26 To that end, the court may put the burden of proof on the party seeking for the refusal of enforcement of the award. However, in practice, as the judges would usually refer to regulations in the Civil Proceeding Code, while Article 370 of the Code does not specify which party shall bear the burden of proof, some judges have a position that the party to request recognition or enforcement of award shall have a burden of proof that the other party, obliging to perform the award, is duly notified by the arbitration. If that party does not certify the timely receipt of such notification, the arbitration award cannot be enforced, unless the party, requesting the enforcement of the award, can prove the opposite.27 This practice, in fact, is not in the light of Article V of the New York Convention and therefore must be regulated by the law. (h) Piercing the corporate veil: In some cases companies try to avoid liability by means of dissolution or reorganization when the company ceases to exist ending up as a hollow shell with only debts and no assets. Other times, a subsidiary will turn out to have no assets, because the assets have been transferred to sister companies, or because the parent company has kept the subsidiary undercapitalized. Claiming party therefore aims to collect debts from newly created companies, the sister companies, the parent company, or the owners of the companies. In such a case, the Arbitration Law provides that where an enterprise as legal person is consolidated, divided, merged, its rights and obligations shall be enjoyed and assumed by the new organization that results from the change.28 The law, however, does not provide general criteria for piercing the corporate veil or determining when one person or company will be held responsible for the liability of another. It does, however, provide some guidelines for specific circumstances that will be useful for the parties within the enforcement of their awards. For instance, the guidelines of the

26 Constitution 2013, Art. 12; Law on conclusion, accession to and implementation of treaties, Art. 6 (1). 27 ibid (n 16). 28 Arbitration Law, Art. 5 (3). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 123

Supreme People’s Court provide that where the respondent is unable to pay the amount owed, the applicant may obtain payment from the entity that established the respondent if the establishing entity’s contribution of registered capital into the respondent was not paid in full or it withdrew some of its registered capital from the respondent. Similarly, if the respondent is unabl to pay the award amount, because assets have been transferred without compensation to the department in charge or to the establishing entity, the applicant may seek compensation from such entities up to the amount of the value of such assets. Companies shall also be responsible for the liability of their branches.

IV. CONCLUSION

The recognition and enforcement of arbitral awards is of fundamental importance in the arbitral process. Proper recognition and enforcement of arbitral awards serves both as a means of ensuring the effectiveness of the arbitral process, and also as a key factor favouring the use of arbitration in preference to other modes of dispute resolution.29 Parties choose arbitration as a dispute resolution process with the expectation that, absent a settlement, an award will be rendered at the end of the arbitral process. The end-product of the arbitral process, the award, is clearly of utmost importance for the parties, and the winning party expects the award to be performed without undue delay. Unless parties can be guarantied that the award will be enforced at the end of the arbitral proceedings (if not complied voluntarily), ‘the award in their favour will be only a pyrrhic victory’ and would render the arbitral process largely meaningless. Put another way, there is ‘no point in having arbitration friendly laws, well drafted arbitration rules, and competent arbitrators and counsel, if no effective enforcement mechanism is available, whether or not it is actually used’.30

29 Lord Mustill, ‘The History of International Commercial Arbitration’ in Lawrence Newman & Richard Hill (eds), The Leading Arbitrators’ Guide to International Arbitration (Juris Publishing 2004) 12. 30 J Gillis Wetter, ‘The Present Status of the International Court of Arbitration of the ICC: An Appraisal’ (1990) 91 1 (American Review on International Arbitration) 25.

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There exist many reasons for Vietnam’s arbitral award enforcement problem, some of which apply, to one degree or another, to enforcement difficulties in other areas of law as well. Culture and tradition play their role, as evidenced in an enduring emphasis on settlement, the lack of respect for law, and the continued reliance on relationships often to subvert the legal process. Ultimately, the institutional reasons must be analyzed for the improvement of enforcement. Working on with the rules will not address many of the more fundamental obstacles to enforcement, which are economic or institutional in nature. Deeper reforms are required. Nevertheless, there are a number of ways in which the regulatory framework could be strengthened that could make enforcement easier in some cases. The rules regarding the grounds for refusal should be also reduced. As a criteria for refusal of recognition and enforcement of foreign arbitral award under Article V of the New York Convention is generally vague, the harmonizing such rules with the national law, does not help to promote the arbitration. The current regulations of the Civil Proceeding Code give too much discretion to judges in their recognition for enforcement of the foreign arbitral awards. As a part of the New York Convention laying the arbitral awards enforcement on the courts and too much dependence of that enforcement on judges undermines the effectiveness of the Convention. What’s more a criteria for refusal of foreign arbitral awards should be more concrete and precise. Specifically, Article 370 of the Civil Proceeding Code must be amended to specify that the burden of proof must be put on the party requesting for refusal of recognition of arbitral award. Another crucial issue that continues to bother foreign investors is the lack of guidance on what constitutes ‘fundamental principles of Vietnamese law’ (or public order/policy). For a long time there has existed a concern that Vietnamese courts would find the enforcement of virtually any award against a Vietnamese party violating the public order/policy. Such fears were not absolutely groundless. In many cases the court appears to have interpreted the Arbitration Law’s reference to ‘fundamental principles of Vietnamese law’ as including domestic concepts of law and order. This is quite different from the generally accepted practice in the enforcement of international arbitral awards, where ‘public policy’ is assessed by the www.kulawr.ru Volume 1 April 2016 Issue 1(5) Tran Viet Dung Recognition and Enforcement of Arbitral Awards Relating to International Commercial Disputes in Vietnam 125 court within the meaning of retaining social order.31 It is believed that the court’s more expansive interpretation of ‘public policy’ likely will be a source of concern for international commercial parties assessing the reliability of arbitration award enforcement in Vietnam. To that end, it may be advisable that the Arbitration law and civil procedural law start applying the commonly known term of ‘public policy’. The Supreme People’s Court, on the other hand, must continue providing guidelines on implementation of concept of ‘public policy’ and supervise strictly the local courts’ practice in implementing the concept with regard to recognition of foreign arbitration award. The existing application mechanism should also be improved. The proceeding on recognition and enforcement of international/foreign arbitral awards could be more ‘speedy’ and efficient. The two-step process with involvement of MOJ is necessary to be removed. What’s more, the current MOJ’s decision-making process is lack of transparency. There is no hearing, and parties are not allowed to submit documents in support of their position. At least the parties should be notified that their case has been forwarded to the court and given an opportunity to provide additional documentation if they desire so. The Supreme People’s Court could further improve the situation by stipulating more clearly the time limits for each stage of the process and ensure the deadlines apply to all types of awards. It should also provide clearer guidelines as to what constitutes ‘special circumstances’, limit the circumstances under which deadlines may be suspended, and should require a hearing to extend a deadline. The court, at least, should be required to set forth the facts and reasoning in support of its decision. The parties should be then able to appeal the court’s decision. Predicting how Vietnam will end up is quite a ‘risky’ business. The road ahead is likely to be a long and bumpy one, but at least the way forward seems clear. Without deeper institutional reforms Vietnam would hardly be able to overcome its enforcement problems. Whether Vietnam’s leaders have enough political will to carry out deeper

31 Michael Hwang S.C, ‘Recognition and Enforcement of Arbitral Award’ in Michael Hwang (eds), Selected Essay on International Arbitration (Academy Publishing 2013) 237–304; Alan Redfern et al, Law and Practice of International Commercial Arbitration (5th edn, OUP 2009) 103.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 126 KUTAFIN UNIVERSITY LAW REVIEW institutional reforms or not remains to be seen. In the meantime they can start by tightening the rules for enforcement and patching up holes in the regulatory framework.

Bibliography

Blanco Elena, Dung Tran Anh & Umut Turksen, ‘Evolving to Perfection?: Enforcement of international arbitral awards in Vietnam’ (2011) 11 6 Journal of World Investment and Trade Dai Do Van, Tran Hoang Hai, Vietnamese Law On Commercial Arbitration (National Political Publishing House 2012) Dai Do Van, L’application de la Convention de New York de 1958 par les juridictions Vietnamiennes (2014) Dai Do Van, ‘Setting aside arbitral award: Shortcomings and Resolutions’ in Conference on ‘Refusal to Recognise the Arbitral Award’ (Ho Chi Minh City University of Law 2015) Hwang Michael S.C, ‘Recognition and Enforcement of Arbitral Award’ in Michael Hwang (ed), Selected Essay on International Arbitration (Academy Publishing 2013) Lord Mustill, ‘The History of International Commercial Arbitration’ in Lawrence Newman & Richard Hill (eds), The Leading Arbitrators’ Guide to International Arbitration (New York Juris Publishing 2004) Lovels Hogan , Arbitration in Vietnam (2013) Oanh Dang Hoang, Vietnamese regulations on recognition and enforcement of foreign arbitral awards – Griffin’s View on International and Comparative Law (2003) Phu Nguyen Cong, ‘Practice of recognition and enforcement of foreign arbitral award at the People’s Court of Ho Chi Minh City’ in Conference on 20 years of implementation of New York Convention 1958 on recognition and enforcement of foreign arbitral award, organized by Ministry of Justice, HCMC (2014) Redfern Alan et al, Law and Practice of International Commercial Arbitration (5th edn, OUP 2009) Wetter Gillis, ‘The Present Status of the International Court of Arbitration of the ICC: An Appraisal’ (1990) 91 1 (American Review on International Arbitration) www.kulawr.ru Volume 1 April 2016 Issue 1(5) 127

ARTICLE

THE BALANCE BETWEEN HUMAN RIGHTS AND INVESTMENT TREATY OBLIGATIONS IN OIL AND GAS INDUSTRY

Vasily N. Anurov (Russia)

Author PhD (Law), Kutafin Moscow State Law University, 2000 LLM (Mineral Law and Policy) with distinction, Dundee, Scotland, 2009 Senior lecturer, Private International Law Department, Kutafin Moscow State Law University, and Arbitrator of the Vilnius Court of Commercial Arbitration Email: [email protected] Abstract The need to respect human rights is being invoked by host states as a pretext for excusing violations of investment treaty obligations. In Suez (and others) v. Argentina the arbitral tribunal held that: “Argentina is subject to both international obligations i.e. human rights and treaty obligation [sic], and must respect both of them equally. Under the circumstances of these cases, Argentina’s human rights obligations and its investment treaty obligations are not inconsistent, contradictory, or mutually exclusive”. This statement suggests an idea of proportionality, which should be maintained by a host state when faced with the need to comply with the aforementioned international obligations. This article examines various ways in which arbitrators should consider the interaction between human rights and investment obligations imposed on a host state, with particular reference to investment projects relating to oil and gas industry. Keywords human rights, investment treaty obligations, oil and gas industry, principle of proportionality, concession contracts

DOI: 10.17803/2313-5395.2016.1.5.127-141

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ABBREVIATIONS BIT Bilateral investment treaty CYArb Czech (& Central European) Yearbook of Arbitration CYIL Czech Yearbook of International Law HR Human rights ICSID International Centre for Settlement of Investment Disputes ILM International Legal Materials MMSD/IIED Mining, Minerals, and Sustainable Development / International Institute for Environment and Development OGI Oil and gas industry OJEC Offi cial Journal of the European Communities TABLE OF ABBREVIATED DOCUMENTS NAMES Articles on the Draft Articles on Responsibility of States for Responsibility Internationally Wrongful Acts, adopted by the of States International Law Commission at 53rd session, General Assembly resolution 56/83 of 12 December 2001 Charter of the Charter of the United Nations, 26 June 1945 United Nations (entered into force on 24 October 1945) Charter of Charter of Fundamental Rights of the European Fundamental Union, 7 December 2000 Rights of the European Union European Convention for the Protection of Human Rights and Convention on Fundamental Freedoms, 4 November 1950 (entered Human Rights into force on 3 September 1953) Universal Universal Declaration of Human Rights, 10 Declaration of December 1948, General Assembly resolution 217 Human Rights (III) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 129

TABLE OF ABBREVIATED CASE NAMES Azuriz v. Azurix Corp. v. The Argentine Republic, ICSID case Argentina No. ARB/01/12, Award, 14 July 2006 CMS v CMS Gas Transmission Company v The Argentine Argentina Republic, ICSID Case No. ARB/01/8, Award of 12 May 2005 Sempra v. Sempra Energy International v. Argentine Republic, Argentina ICSID case No. ARB/02/16, Award, 28 September 2007 Siemens v. Siemens A.G. v. The Argentine Republic, ICSID case Argentina No. ARB/02/18, Award, 6 February 2007 Suez v Suez, Sociedad General de Aguas de Barcelona, S.A. Argentina and Vivendi Universal, S.A. v. Argentina, ICSID Case No. ARB/03/19, Decision on Liability of 30 July 2010

TABLE OF CONTENTS

I. Introduction ...... 130 II. The interaction between international investment law and human rights ...... 131 III. The prerequisites for the application of the proportionality principle ...... 132 IV. The common denominator in the proportionality principle ...... 134 V. The interaction between concession contracts and human rights ...... 136 VI. The application of the principle of proportionality in the oil and gas industry ...... 138 VII. Conclusions ...... 140 Bibliography ...... 141

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I. INTRODUCTION

Until now, international attitudes towards human rights (HR) have been debated in the light of abuses and violations committed by autocratic and repressive regimes in countries where foreign investors engaged in the exploration for and extraction of natural resources, particularly in the oil and gas industry (OGI). As foreign companies tried to obtain licenses and permits – which were and continue to remain indispensable prerequisites for achieving the goals of concession contracts – they had to stomach human right abuses committed by these regimes.1 Thus the mainstream of discussion converged on the inadmissibility of such abuses and adherence to international HR standards. In the first decade of this century Argentina for the first time invoked its obligations to safeguard HR as a defence against the pleadings submitted by a foreign investor alleging violations of the investment treaty provisions.2 Although this position was not accepted by the arbitral tribunals, the problem concerning the interaction between these obligations should not be forgotten, as other host states may choose the same tactic in future disputes with foreign investors. The main aim of this study is to analyse how the HR obligations of the host state may influence its investment treaty obligations, particularly in the OGI where risks of potential violations are higher than in other types of commercial activity involving foreign investors.

1 Breaking New Ground, Mining, Minerals, and Sustainable Development (MMSD/IIED, London and Sterling, VA, United Kingdom: Earthscan Publication Ltd., 2002) 174. 2 CMS Gas Transmission Company v. The Republic of Argentina, ICSID case No. ARB/01/8, Award, 12 May 2005 (CMS v. Argentina); Azurix Corp. v The Argentine Republic, ICSID case No. ARB/01/12, Award, July 14, 2006 (Azuriz v Argentina); Siemens A.G. v The Argentine Republic, ICSID case No. ARB/02/18, Award, 6 February 2007 (Siemens v. Argentina); Sempra Energy International v Argentine Republic, ICSID case No. ARB/02/16, Award, 28 September 2007(Sempra v Argentina); Suez, Sociedad General de Aguas de Barcelona, S.A. and Vivendi Universal, S.A. v Argentina, ICSID Case No. ARB/03/19, Decision on Liability of 30 July 2010 (Suez v Argentina) < http://www.italaw. com > accessed 1 September 2015. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 131

II. THE INTERACTION BETWEEN INTERNATIONAL INVESTMENT LAW AND HUMAN RIGHTS

The fact that the most bilateral investment treaties (BITs) and multilateral investment treaties, including the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention), North American Free Trade Agreement (NAFTA), the Energy Charter Treaty (ECT) fail to address the issue of HR renders the invocation of HR before arbitral tribunals in investment disputes a highly precautious matter. An unwillingness to tackle substantive matters from an HR perspective may also be discerned even at the beginning of arbitration proceedings when arbitrators rule on jurisdiction. The consensual nature of arbitration could pose a serious impediment for the ability of arbitral tribunals to settle issues that are not mentioned in BITs or investment contracts.3 As noted above, HR is a typical example of such a category. Paradoxically, consent to arbitration may play the opposite role. One could argue that ‘the arbitration agreement entails the full renunciation of all guarantees set forth in Article 6(1)’ of the European Convention on Human Rights (ECHR).4 A reluctance to engage with HR may also be found out in arbitral tribunals’ analyses on the merits. Their positions are frequently asserted in a terse reply on the host state’s arguments, which are rejected mostly on procedural grounds. In CMS v Argentina the arbitral tribunal found that there was ‘no question of affecting fundamental human rights’,5 in Siemens v Argentina that the host state’s position in relation to HR had not been ‘developed’6 and in Azurix v Argentina that the issue had not been ‘fully argued’.7 In Sempra v Argentina the arbitral tribunal carried

3 C Reiner and C Schreuer, ‘Human Rights an International Investment Arbitration’ in PM Dupuy, F Francioni, EU Petersmann (eds), Human Rights in International Investment Law and Arbitration (OUP 2009) 82. 4 A Jaksic, ‘Procedural Guarantees of Human Rights in Arbitration Proceedings. A Still Unsettled Problem’ (2007) 24 (2) Journal of International Arbitration 164. 5 CMS v Argentina, para 121. 6 Siemens v Argentina, para 79. 7 Azuriz v Argentina, para 261.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 132 KUTAFIN UNIVERSITY LAW REVIEW out a more far-reaching analysis. It held that the balance between HR of consumers and property owners could have been struck by tools other than those used by the host state in order to cope with economic and social crisis, restore ‘the constitutional order and [ensure] the survival of the State’. Moreover, the tribunal did not share the respondent’s view that the constitutional order had been ‘on the verge of the collapse’ – which in the respondent’s opinion provided the reason for upholding HR standards to the detriment of investors’ rights.8 In Suez v Argentina the arbitral tribunal went further and refused to recognize the incompatibility between HR obligations imposed on the host state and its investment treaty obligations.9 As this statement seems to address the key problem in the most explicit way possible, it is necessary to assess the arbitrators’ arguments in detail.

III. THE PREREQUISITES FOR APPLICATION OF THE PROPORTIONALITY PRINCIPLE

When the tribunal in Suez v Argentina asserted that ‘Argentina’s human rights obligations and its investment treaty obligations are not inconsistent, contradictory, or mutually exclusive’10 it delineated the interaction between these obligations from the logical point of view. As a matter of fact, it ruled out the marginal approach to a given problem in considering these obligations from the angle of logical contradiction or opposition. It would not be an exaggeration not to limit the tribunal’s view merely to the narrow facts of Suez v Argentina but to establish it as a general rule. However, a mere declaration that the host state’s HR obligations and its investment treaty obligations are not incompatible is not sufficient. It does not cover all scenarios in which they may converge on the rallying point or otherwise diverge from each other. Also the host state’s HR obligations may not be applied by the tribunal if the host state does not comply with a specific preliminary test. This argument was invoked in

8 Sempra v Argentina, para 332. 9 Suez v Argentina, para 262. 10 ibid. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 133

Suez v Argentina and was based on four prerequisites for the defence of necessity. As was noted in CMS v Argentina all of these conditions ‘must be cumulatively satisfied’.11 This test complicates the task of the host state in excusing itself for the non-compliance with its international obligations. In Suez v Argentina the host state failed to meet two conditions for the defence of necessity which enabled the tribunal to reject Argentina’s plea based on the defence of necessity, including arguments regarding HR obligations. Moreover, these arguments do not constitute a key part of the conclusion arrived at by the tribunal in response to the contending parties’ position. They were made obiter in the analysis section, which can hardly be considered as an appropriate place for expressing an opinion concerning the pleadings. In accordance with the Article 25 of the Articles on the Responsibility of States (2001),12 necessity may not be invoked by a State as a reason for precluding wrongfulness if the international obligation in question excludes the possibility of invoking necessity. The tribunal in Suez v Argentina classified this rule as the third condition for the defence on necessity and summed it up succinctly in one phrase: ‘Treaty obligation does not exclude necessity defense’.13 The literal meaning of this formula explicitly emphasizes an object of the exclusion – the defence of necessity. On the contrary, Argentina’s plea was based on the priority of HR obligations over its investment treaty obligations, arguing that the latter should be excluded: ‘… Argentina’s human rights obligations to assure its population the right to water somehow trumps its obligations under the BITs and that the existence of the human right to water also implicitly gives Argentina the authority to take actions in disregard of its BIT obligations’.14 Thus, Argentina’s arguments and the tribunal’s conclusion in relation to the former’s HR obligations addressed different issues.

11 CMS v Argentina, para 313. 12 Draft Articles on Responsibility of States for Internationally Wrongful Acts, adopted by the International Law Commission at 53rd session, General Assembly resolution 56/83 2001 accessed 1 September 2015. 13 Suez v Argentina, para 262. 14 ibid.

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Bearing in mind this level confusion concerning the object of analysis, the paradoxical decision made by the tribunal will come as no surprise, finding that Argentina satisfied the third condition for the defence of necessity whilst at the same time denying its plea justifying BIT violations on the basis of the need to safeguard HR. Nevertheless, the cumulative test poses an obstacle which must be overcome by the host state if it intends to invoke its HR obligations as a basis for exemption from the obligation to comply with its investment treaty obligations. Particular attention should be placed on the host state’s behaviour before and after an economic and financial crisis which forced the host state to undertake measures contrary to its investment treaty obligations.15 In order to find that these measures were not unlawful and consider the host state’s arguments with regard to its HR obligations on their merits, the tribunal should conclude that these measures were the only way of satisfying its essential interests against a grave and imminent peril and in addition that the host state did not contribute to the emergency situation. These conditions for the defence of necessity became a stumbling block in CMS v Argentina and Suez v Argentina and will most likely play a similar role in future cases, including disputes relating to concession contracts for oil and gas exploration.

IV. THE COMMON DENOMINATOR IN THE PROPORTIONALITY PRINCIPLE

The term ‘proportionality’ implies a common denominator between two given magnitudes. In this study these are investment treaty obligations and HR obligations, both of which are imposed on the host state. It is not an easy task to discover their common denominator as they cannot be considered as homogeneous phenomena. It would be useful to refer to the legal framework on foreign concessions which combines two mutually competing goals: on the one side, the foreign investor’s right to

15 Draft Articles on Responsibility of States for Internationally Wrongful Acts with commentaries. Report of the International Law Commission on the work of its 53rd session in Yearbook of the International Law Commission (2001) II 80–84 accesssed 1 September 2015; N Rubins and S Kinsella, International Investment, Political Risk and Dispute Resolution (Oceana, 2005) 59–61. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 135 extract profits and to recoup investment costs and on the other side the need to attain certain health and social objectives. In Suez v Argentina these objectives could be considered as a basis for adjusting the tariff regime in accordance with the Water Decree of the Argentine republic. If the tariff regime or any other agreed equilibrium between the foreign investor’s revenue and expenditures is subject to a very thorough review due to an abuse in the invocation of the above reason, it will give rise to an allegation of a breach of the BIT in question. Hence, there is no doubt that investment treaty obligations and HR obligations are inter-related. In order to ensure that this interaction is not a zero-sum game, it is necessary to elaborate the common denominator, as mentioned above. This should reflect the economic achievements of the host state in safeguarding HR at the time the concession contract was concluded in addition to a threshold below which they should not fall. The first indicator is the relevant benchmark for the foreign investor, as it should not bear excessive responsibility for any deterioration in HR standards for which it was not at fault. On the other hand, the second one is necessary to elucidate the blurry boundaries of minimal standards of HR. The requirements of these standards result from the increasing abyss between the high level of protection for HR maintained in developed, export-capital countries and the modest results achieved by import- capital countries in this area.16 Although they possess rich reserves of natural resources, particularly, oil and gas, the benefit for the public at large in these countries grows more slowly in comparison with developed countries (with rare exceptions, such as for instance Saudi Arabia). Returning to Suez v Argentina, the human right to water asserted by Argentina as a vital important value capable of justifying violations of its BIT obligations may be measured by different indices depending on which quality of potable water may be considered as essential for

16 As Moshe Hirsch states, ‘fundamental disputes regarding the content and implementation of international human rights law have often evolved along political and ideological lines (for example, East-West states, developing- developed states, Christian-Islamic states)’ (M Hirsh, ‘The Interaction between International Investment Law and Human Rights Treaties: A Sociological Perspective Research Paper’ (2013) 06 (13) International Law Forum of the Hebrew University of Jerusalem Law Faculty accessed 1 September 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 136 KUTAFIN UNIVERSITY LAW REVIEW consumers in order to safeguard the human right to water. Was the high level of nitrates in the water alleged by Argentina sufficient to terminate the concession contract and to invoke its HR obligations as justification for violating its BIT obligations? Unfortunately, this issue usually falls beyond the scope investment arbitration in terms of dispute resolution procedures.

V. THE INTERACTION BETWEEN CONCESSION CONTRACTS AND HUMAN RIGHTS

The principle of universal respect for HR is considered to be a fundamental principle of international law, a jus cogens rule with the highest legal force. This rule is proclaimed in the Preamble and in Article 55 of the Charter of the United Nations17 and cannot be annulled by other international treaties, including BITs. Suez v Argentina is a unique example of a case in which the human right in question contains a direct indication of the commodity produced by the foreign investor as a result of compliance with its obligations under the concession contract. Argentina referred to it as a ‘human right to water of the inhabitants of the country’. Although this right is not directly mentioned in the Universal Declaration of Human Rights,18 the terminology used by Argentina in its pleadings was not refuted either by the claimants or by the arbitral tribunal in its analysis and conclusions. However, the most appropriate approach to determining the legal nature of the right to water was seemingly expressed in amicus curiae submissions, which stated that ‘human rights law recognizes the rights to water and its close linkages with other human rights, including the right to life, health, housing, and an adequate standard of living’. The fi rst right (the right to life) is refl ected in Article 3 of the Universal Declaration of Human

17 The Charter of the United Nations, 26 June 1945 (entered into force on 24 October 1945) accessed 4 May 2015. 18 Universal Declaration of Human Rights, 10 December 1948, General Assembly resolution 217 (III) accessed 1 September 2015. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 137

Rights, Article 2 of the European Convention on Human Rights19 and Article 2 of Charter of Fundamental Rights of the European Union.20 The remaining part of the wording fi ts in better with the formula provided for under Article 25 of the Universal Declaration of Human Rights: ‘Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing...’21 Hence, the right to water should be considered not as an autonomous human right but as an element of the aforementioned HR. As regards oil and gas concession contracts, the interaction between commodities to be produced by foreign investors and HR is weaker and vaguer than in Suez v Argentina. Oil and gas require more complicated processing in order to produce a final product which can be used in utilities and vehicles than the production of drinking water does. Thus, the only way to find out the required linkage is to adopt an amicus curiae approach. The extent of the correlation between HR and the concession contract reveals itself in the significance of the commodity produced by the foreign investor in the everyday life of society. The most important social value is life and the conforming human right should be superior to all other secondary or derivative values, such as health, housing and an adequate standard of living. In Suez v Argentina the host state underscored this superiority in an explicit manner: ‘Because of the fundamental role of water in sustaining life and health and the consequent human right to water, it maintains that

19 Convention for the Protection of Human Rights and Fundamental Freedoms, 4 November 1950 (entered into force on 3 September 1953) accessed 1 September 2015. 20 Charter of Fundamental Rights of the European Union, 7 December 2000, OJEC, 18 December 2000 accessed 1 September 2015; A Rainer and E Meindl, ‘The EU Charter of Fundamental Rights and Public Policy in International Arbitration Law’ in AJ Belohlaveg and N Rozehnalova (eds), The Relationship Between Constitutional Values, Human Rights and Arbitration (CYArb 2011) 87-102. 21 With some modifications this formula is reproduced in Article 11 of the International Covenant on Economic, Social and Cultural Rights, 16 December 1966 (entered into force on 3 January 1976) accessed 1 September 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 138 KUTAFIN UNIVERSITY LAW REVIEW in judging the conformity of governmental actions with treaty obligations this Tribunal must grant Argentina a broader margin of discretion in the present cases than in cases involving other commodities and services’.22 This approach may be applied to OGI if the role of products produced in OGI is considered to be sufficiently strong in order to sustain the secondary values that should be protected by a host state as well as the most important value – life.

VI. THE APPLICATION OF THE PRINCIPLE OF PROPORTIONALITY IN THE OIL AND GAS INDUSTRY

Ideally the host state should observe both its investment treaty obligations and HR obligations. However, there may be some extraordinary situations in which adherence to the concession contract threatens a deterioration in standards of living, health and housing in the host state in question. Such a negative scenario seems to be highly improbable, but not impossible. In any event, an objective yardstick is required in order to define when compliance with the concession contract will result in a devastating impact on human rights. As mentioned above, this objective yardstick is offered by the proportionality principle. In order to secure a perfectly proportional arrangement in OGI it is necessary to take into account the role of the final products produced under the concession contract in maintaining the aforementioned standards and the negative consequences resulting from the failure to provide these products. As usual, the main goal of concession contracts concluded in countries rich in natural resources is to export oil and gas. Therefore, foreign consumers’ interests are mostly undermined through non-compliance with concession contracts. In this case, it would be unreasonable for the host state to invoke an HR remedy against a violation of its BIT obligations. In addition, the type of concession contract or stage of the investment project plays a significant role within the application of the proportionality principle. Obviously, even concerted actions regarding oil and gas exploration or feasibility studies into projects could hardly

22 Suez v Argentina, para 252. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 139 be sufficient to produce the commodities required, which only appear during downstream activity. The mere expectation on the part of the host state of achieving a certain level of HR standards should not be considered as justification for the review or termination of the concession contract as there are no final products – which is a conditio sine qua non for ensuring these standards – and, consequently, no participation of the foreign investor in safeguarding HR. Hence, the proportionality principle will be applied when it can be proved that the foreign investor’s behaviour, i.e. non-production or production of substandard final products, somehow worsens the admissible standards of living, health and housing in the host state. Without this causation no foreign investor can be forced to take its share of the responsibility for the failure to safeguard HR. Where all of the preliminary requirements for the application of the HR test are met, what difficulties will the arbitral tribunal have to deal with in implementing the proportionality principle? The main problem relates to the need to assess expert opinions submitted by the parties in dispute, including in particular in relation to the host state’s compliance with its HR obligations, which requires specialist professional knowledge. On some occasions, the arbitral tribunal could benefit from an amicus curiae submission as occurred in Suez v Argentina, where five non-governmental organizations submitted a joint amicus curiae submission which was mentioned by the arbitral tribunal in its analysis and conclusions. Nothing would have prevented the claimant from going beyond its mere observations on the aforementioned submission and providing an expert opinion. As HR standards encompass various approaches adopted by distinguished and prominent scholars, there is a presumption that expert opinions will differ widely on this matter. Thus, the arbitral tribunal’s task will be complicated by the need to choose the most appropriate opinion and its discretionary power will be the main driving force in arriving at conclusions as there are no authoritative guidelines on the application of the proportionality principle in the HR context. As a result, it will lead to unpredictable awards, at least in the near future. It will take a long time to elaborate a unified approach including precedents with persuasive effect for other arbitral tribunals. Suez v Argentina cannot be considered as a starting point for this process. It is more likely that it will appear

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 140 KUTAFIN UNIVERSITY LAW REVIEW as a deviation from the need to provide a direct answer concerning the contending parties’ arguments concerning the interaction between the host state’s HR obligations and its investment treaty obligations. The second field of difficulties concerns the proportionality of the measures taken by the host state on public policy grounds in extraordinary economic circumstances. What measures can the host state undertake when faced with violations of HR? Will it be possible to renegotiate the terms of the investment contract, including any tariff revision, or to terminate the contract unilaterally if this is the only way of safeguarding minimal standards of HR? It would appear that the arbitral tribunal should balance the legitimate and reasonable expectations of the foreign investor against the host state’s ‘right to regulate the provision of a vital public service’,23 as was held in Suez v Argentina. It should be noted that the host state may invoke its HR obligations if performance of the concession contract would breach minimal standards of HR. If it is not possible to prove a violation of minimum standards the foreign investor’s claim in the investment dispute will withstand the challenge and the claimant will have to initiate other alternative dispute resolution proceedings.

VII. CONCLUSIONS

Although the arbitral tribunal in Suez v Argentina rejected Argentina’s plea invoking an HR remedy against the claims of BIT violations, it certainly provided an impetus for discussion as to whether the host state’s HR obligations may in some cases absolve it from its investment treaty obligations. The lack of any leading guidelines regarding possible arguments and instruments which may be used by the host state within the context of the settlement of investment disputes significantly complicates its task in elaborating effective defences. Therefore, the HR remedy will not pose a serious threat for foreign investors over the next few years, particularly in disputes relating to concession contracts for oil

23 P Mates and M Barton, ‘Public versus Private Interest – Can the Boundaries be Legally Defined?’ in AJ Belohlaveg and N Rozehnalova (eds), Protecting the Interests of Host Countries in the International Investment Protection System (CYIL, 2011). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Vasily N. Anurov The Balance between Human Rights and Investment Treaty Obligations in Oil and Gas Industry 141 and gas exploration as it would be highly problematic for the host state to prove that the end products produced under these contracts perform a key role in maintaining minimum standards of HR.

Bibliography

Jaksic A, ‘Procedural Guarantees of Human Rights in Arbitration Proceedings. A Still Unsettled Problem’ (2007) 24 (2) Journal of International Arbitration Hirsh M, ‘The Interaction between International Investment Law and Human Rights Treaties: A Sociological Perspective Research Paper’ (2013) 06 (13) International Law Forum of the Hebrew University of Jerusalem Law Faculty accessed 1 September 2015 Mates P and Barton M, ‘Public versus Private Interest – Can the Boundaries be Legally Defined?’ in AJ Belohlaveg, N Rozehnalova (eds), Protecting the Interests of Host Countries in the International Investment Protection System (CYI 2011) Rainer A and Meindl E, The EU Charter of Fundamental Rights and Public Policy in International Arbitration Law in AJ Belohlaveg, N Rozehnalova (eds), The Relationship Between Constitutional Values, Human Rights and Arbitration (CYArb 2011) Reiner C and Schreuer C. ‘Human Rights in International Investment Arbitration’ in PM Dupuy, F Francioni and EU Petersmann (eds), Human Rights in International Investment Law and Arbitration (OUP 2009) Rubins N and Kinsella S, International Investment, Political Risk and Dispute Resolution (Oceana, 2005)

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 142 KUTAFIN UNIVERSITY LAW REVIEW

ARTICLE

THE CONSTITUTIONAL REGULATION OF PROPERTY RIGHTS1

Ilya Iksanov and Polina Krasnova (Russia)

Authors Ilya Iksanov PhD (Law), Lomonosov Moscow State University, 2008 Associate Professor, Constitutional and International Law Chair, Financial University under the Government of the Russian Federation, Email: [email protected] Polina Krasnova Student, Financial University under the Government of the Russian Federation Email: [email protected] Abstract Exemption from the dogmatic approach to the study of problems in the industry and constitutional law coincided in time with the trends toward deregulation and liberalization of the economy that determines the demand for special analysis of the new role of constitutional law in the regulation of social and economic relations. The article analyzes the judicial practice of the Constitutional Court of the Russian Federation and the constitutional courts of foreign countries on the issues of property, covering the significant differences in the constitutional legal and civil legal regulation of property rights, as well as the impact of the legal views of courts on the economic relations and their stability. Constitutional regulation of economic relations includes issues of property, labor, exchange, distribution, consumption of material and spiritual

1 The work was carried out following the state assignment by the Government of the Russian Federation: scientific research of the Constitutional and Municipal Law Chair of the Financial University under the Government of the Russian Federation, year 2013. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 143

wealth. At the same time public relations related to the distribution and consumption of goods are in the sphere of not only economic, but also primarily social relations. An integrated approach to the investigation of the constitutional regulation of the economic relations in Russia, and property rights in particular, is of great practical importance. At the present moment, the legal rules of the Russian Federation are not able to effectively regulate the freedom of economic relations, and if necessary, to limit property rights in the interests of the entire society. This raises the question of the parity between the constitutional law and economic relations, as well as the issue of the legal regulation of property rights. The present paper uses both Russian and foreign sources. Keywords Constitutional legal regulation of the economic relations; the relationship between law and economics; constitutional economics; the limits of public interference in the constitutional law; constitutional-legal aspects of property rights; legal views of the Constitutional Court of the Russian Federation

DOI: 10.17803/2313-5395.2016.1.5.142-157

TABLE OF CONTENTS

I. Introduction ...... 144 II. The importance of constitutional law in regulating public relations in the economy sphere ...... 144 III. The involvement of the institution of property rights in some court cases ...... 145 IV. The constitutional law concept of private property rights ...... 147 V. The defi nitive opinion on the status and rights of bona fi de owner ...... 152 Bibliography ...... 156

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 144 KUTAFIN UNIVERSITY LAW REVIEW

I. INTRODUCTION

The period between the 1930s and the 1980s was characterized by the interpenetration of legal and economic doctrines and concepts. The economic analysis was successfully applied by American economists and legal experts to the investigation of the constitutional legal relations and restriction of the property rights in the interests of the society and the state in the USA during the Great Depression in the 1930s. Scientific schools of constitutional economics were created based on the University of Chicago (Friendman, Coase, etc.), Virginia Polytechnic Institute (Buchanan, Tullock) and University of California, Los Angeles (Alchian, Demsetz).

II. THE IMPORTANCE OF CONSTITUTIONAL LAW IN REGULATING PUBLIC RELATIONS IN THE ECONOMY SPHERE

Public nature of constitutional law means that economic relations are regulated not only by civil law. Civil law as a private one is unable to guarantee economic freedoms of an individual and to reflect the constitutional order based on the liberties of an individual and a citizen. Being a kind of economic constitution of the state, the Civil Code cannot contradict Constitution of the Russian Federation, and constitutional law still remains the main branch of Russian law, regulating, among other things, public relations in the economy sphere based on the precedence of the rights of human and civil rights, but in the interests of the society and the state as a whole. In any society, the subject matter of constitutional law includes changing social relations. The globalization of the world economy and the cyclic recurrence of the world economic crisis raise the question of the financial elite’s interest in their periodical occurrence, detrimental for the society and state. In this case, willful non-disclosure of the possessed information about the next wave of economic crisis becomes a right abuse of a sort.2 Then, the opposition between private and public methods of

2 K Lenaerts, ‘Constitutionalism and the Many Faces of Federalism’ (1990) 38 American Journal of Comparative Law 1997. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 145 legal regulation of the economy in times of economic depression becomes especially dangerous.3 Prevention of crisis phenomena in the economy is impossible without the state centralism and unity of command in the administration. However, those public legal enforcement actions generally should not violate human personal liberties guaranteed by the Constitution of the Russian Federation.

III. THE INVOLVEMENT OF THE INSTITUTION OF PROPERTY RIGHTS IN SOME COURT CASES

Property right as a complex legal institution is specified above all by civil standards. Beyond any question, any legal right defined in civil law as a right of property at the same time is a constitutional property right. However, a constitutional property right is not the same with a right of possession, use and disposal in a civil legal sense. A concept of constitutional right of property is broader than that of civil rights.4 The theory of law assumes that the moments of the emergence and the termination of the constitutional property rights of a citizen or a legal entity do not coincide with the moments of the emergence and the termination of the civil law right to private property. A complicated case regarding the termination of the rights of ownership to a residential building and its residential land took place at the time of the seizure of land in Adlersky City District, Sochi, Krasnodar Krai, on the grounds of the Federal Law ‘On the organization and holding of the XXII Olympic Winter Games and the XI Paralympic Winter Games 2014 in Sochi CITY, the development of Sochi CITY as a mountain climate resort and the amendment of certain legislative acts of the Russian Federation’ No. 310 of December 1, 2007.5 Within the preparation for the XXII Olympic Winter Games in 2014, a resident of the urban locality Krasnaya Polyana had his land plot seized and his rights of ownership terminated under a court decision with the payment of the market value compensation. In addition, the court

3 EF Gerding, Bubbles, Law and Financial Regulation (Routledge 2013). 4 Han Dayuan, ‘Constitutional protection of the right to private property in China’ (2013) 1 China Legal Science 6. 5 Legislation Bulletin of the Russian Federation 2007, No. 49, art. 6071.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 146 KUTAFIN UNIVERSITY LAW REVIEW ruling stated that the seizure took place for the sake of the construction of a railroad by JSCo ‘RZD’ (Joint Stock Company ‘Russian Railways’). Subsequently, the route of the monorail railway changed under the process of the road’s design. Two years later, the ex-owner of the land plot discovered that a hotel was being built on the alleged site of the construction of the railway, while the hotel in this case was not one of the items of the Program of Olympic objects building according to the Resolution of the Government of the Russian Federation of December 29, 2007 No 991 ‘On the Program of building Olympic objects and development of Sochi as a mountain resort’. The ex-owner applied to a court of general demanding restitution. However, the claim was dismissed because the court considered the seizure of the land plot to be legal, made in accordance with the Civil Code of the Russian Federation.6 This case was not tried at the Constitutional Court of the Russian Federation, although its subject meets all the requirements according to the Federal Constitutional Law No. 1-FKZ ‘On the Constitutional Court of the Russian Federation’ of July 21, 1994.7 An important decision of a similar nature was made by the Constitutional Court of Austria in the beginning of the twentieth century.8 An Austrian citizen’s land plot was seized for the state needs. He received the due pecuniary compensation. However, three years after the withdrawal, the ex-owner discovered that the seized land plot was not being used for the public needs. The ex-owner appealed to the court, demanding to return his land plot under the condition of the repayment of the pecuniary compensation. The appeal was dismissed with a reference to the current civil law.9 Based on law the courts ruled that, as the civil right itself was terminated as a result of the seizure of the land plot for state needs, the plaintiff’s appeal is lack of substantive basis. However, when the ex-owner appealed to the Constitutional Court, his claims were upheld. The Court’s position could be related to the fact that the time of the termination of the constitutional right of private

6 ibid (n 4). 7 Legislation Bulletin of the Russian Federation 1994, No. 13, art. 1447. 8 K Heller, Outline of Austrian Constitutional Law (1989). 9 M Conant, The Constitution and Economic Regulation: Objective Theory and Critical Commentary (Transaction Publishers 2011). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 147 property should be associated not with the moment of the actual seizure of the land plot, but with the realization of the purpose for which the plot had been seized.10

IV. THE CONSTITUTIONAL LAW CONCEPT OF PRIVATE PROPERTY RIGHTS

The constitutional right to private property guarantees the existence of a number of other constitutional rights, creating conditions for their realization.11 The realization of the constitutional right to a free use of the entrepreneurial abilities and other economic activities not prohibited by the law is possible only under the condition of ‘private property’. The function of constitutional private property rights to create conditions for the realization of other constitutional rights ― is of such great importance that it constitutes the basis for the assumption that the constitutional-legal concept of property rights is broader than the civil law of ownership. It is this constitutional approach that allows us to extend a legal protection over such property rights, even if from the point of view of a civil concept of property rights that protection is not not applicable to the property right. In particular, the constitutional legal protection guaranteed above all by the rules of the art 35 of the Constitution of the Russian Federation, was provided by the Russian Federation Constitutional Court in a number of its decisions. Thus, the judgment of the Constitutional Court of the Russian Federation No. 8-P, dated by May 16, 2000 stipulates as follows: ‘According to art 35 (3) of the Constitution, no one can be deprived of his property except by a court decision; expropriation of property upon state requirements can be made only in case of prior and equal compensation’. The concept of ‘property’ mentioned in the Article in its constitutional-legal sense covers, among other things, real rights and the incorporeal rights, including those of creditors. This approach was

10 M Stelzer, The Constitution of the Republic of Austria: A Contextual Analysis (Bloomsbury Publishing 2011). 11 JW Ely, ‘The Constitution and Economic Liberty’ (2012) 35 Harvard Journal of Law and Public Policy 27.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 148 KUTAFIN UNIVERSITY LAW REVIEW applied in the judgment of the Constitutional Court of the Russian Federation dated 17 December 1996 regarding the testing of the constitutionality of the paragraphs 2 and 3 of the first part of the art 11 (1 (2) (3)) of the Law of the Russian Federation ‘On the Federal Bodies of the Tax Police’ of June 24, 1993 and corresponds with the interpretation of this concept by the European Court of Human rights, which is the basis of the implementation of the Article 1 of the Protocol No.1 to the Convention for the Protection of Human Rights and Fundamental Freedoms’. The constitutional concept of private property right is interpreted broader than the civil law one not only by the European Court of Human Rights, but also by many Western European constitutional courts. That interpretation of property right includes a wide range of rights, such as a right of the accumulation of pension funds and the compensation of the income lost due to the infringement of the good name.12 As pointed out by the European Court of Human Rights in Jatridis case, the concept of ‘property’ in the art 1 of the Protocol No. 1 to the Convention has an independent content, which definitely is not limited to demesne of fee: some other rights and benefits constituting assets can also be related to ‘property law’, and thus, to ‘property’ for the purposes of the given provision. And in Beyeler case court maintained that the concept of ‘property’ stipulated in the first part of the Article 1 had an autonomous meaning, which did not come down to demesne of fee and was not dependent on the formal qualifications under internal law: some other rights and benefits constituting assets could also be interpreted as ‘property rights’ and thus as ‘possessions’ for the purposes of the given provision. The idea that the Art. 35 of the Constitution of the Russian Federation protects not only the private property rights, but a wide range of property rights, was used once again by the Constitutional Court of the Russian Federation in its judgement 6-P dated by April 21, 2003 on the case of the constitutionality test of the provisions of art 167 (1) (2) of the Civil Code of the Russian Federation. The central matter of that ruling is a contradiction between the two methods of protection of violated civil rights and the opposite legal stances of the general jurisdiction courts and

12 ibid. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 149 the arbitration courts. In this regard, it is believed that the Constitutional Court of the Russian Federation gave preference to vindicatory action, adopting the legal stance of the arbitration courts. The Constitutional Court of the Russian Federation accepted neither the idea that a bona fide owner is the proprietor, nor the idea that illegal bona fide possession is an actual state, and not a legal right. Usually, the Constitutional Court of the Russian Federation is not open to express its opinion on the issue debated in the doctrine. What is it about that case that forced the court to make an exception? According to professor Gadzhiev, it was being aware that the issue was in achieving a delicate balance between the legitimate interests of the owner, as well as the bona fide purchaser.13 To solve the problem, it was necessary to apply the general legal pro rata principle. Assuming that the owner enjoys a fully valid legal right, while the bona fide purchaser’ possession is only an actual state, searches for a balance were doomed to failure. In this case it is useless to try to apply the constitutional pro rata principle (Constitution of the Russian Federation, art 55 (3), implying a search of the balance of equally protected values. The discussion whether possession is either a right or a fact has gone on for centuries. As a result, there are two opposite points of view and a compromise one. ‘Polar poles’ are the points of view of Paul and Papinian in Roman law, of G.Dernburg and B.Vindsheyd in German law, of D. Meyer and G. Shershenevich in Russian civil law. The compromise point of view belongs to V. Khvostov who believed that legal possession was a right, though a right of a very meager content.14 From our point of view, the approach adopted by the Constitutional Court of the Russian Federation to a greater extent resembles the position of Khvostov.15

13 Gadzhiev G.A. Konstitutsionnye osnovy sovremennogo prava sobstvennosti / Zhurnal rossiiskogo prava. 2006. № 12. S.20-41 (GA Gadzhiev, ‘The Constitutional Foundations of the Modern Property Rights’ (2006) 12 Journal of Russian Law 20-41). 14 Gadzhiev G.A., Barenboym P.D., Lafitskiy V.I, Mau V.A. Konstitutsionnaya ekonomika / Otv. red. G.A Gadzhiev. M.: Yuristinform, 2010 (GA Gadzhiev, PD Barenboym, VI Lafitskiy, VA Mau, Constitutional Economics (G Gadzhiev ed, Yuristinform 2010)). 15 Khvostov V.M. Sistema rimskogo prava. Sbornik / M.: Spark, 1996 (VM Khvostov, System of Roman Law (Spark 1996)).

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First of all, it is important to point out the fact that the Constitutional Court of the Russian Federation ruled that based on the content of the art 35 (2) of the Constitution of the Russian Federation in its connection with the arts 8, 34, 45, 46 and 55 (1), the rights of possession, use and disposal of property were provided not only for the owners but also for other participants of the civil circulation. In cases when the property rights to an item of property in a dispute that emerged on the statutory grounds also imply other people apart from the owner, other owners and users of the item in question should be also guaranteed protection of their rights by the state. According to the Constitutional Court of the Russian Federation, such property rights include rights of bona fide purchasers. At first glance, this provision may seem extremely controversial. Interpreting the constitutional provision, containing in art 35 (2) of the Russian Constitution, the Constitutional Court considers ownership (which involves the possession with powers such as possession, use and disposal) and possession as autonomous property rights. It turns out that art 35 of the Constitution of the Russian Federation guarantees the state protection not only for the constitutional right to private property, but also for a wide range of various property rights. It is obvious that such an interpretation is very similar to the one by the European Court of Human Rights, the Convention’s provisions on respect for property contained in art 1 of Protocol No. 1 to the Convention for the Protection of Human Rights and Fundamental Freedoms. Thus, bona fide owners can be regarded as holders of property rights specifically only in the light of their participation in the ‘civil commerce’. Upon a detailed look at the text of the judgment of the Constitutional Court of the Russian Federation testing the constitutionality of the provisions of art 167 of the Civil Code it becomes clear why the judgement of the Constitutional Court of the Russian Federation No. 202-O of November 27, 2001 also links the recognition of the rights of bona fide purchasers of bonded cars to their acquisition ‘in the course of turnover’. The civil commerce exception to a large extent explains why as a result of the ruling of the court the state of actual misappropriation becomes a property right of a bona fide owner. Provement of that the bona fide possession is not just an actual fact, but also a property right can be found in a systematic and logical interpretation of the rules of the Civil Code of the Russian Federation. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 151

The art 234 (2) of the Civil Code of the Russian Federation contains a rule according to which before the acquisition of a property by virtue of acquisitive prescription a person owning the property is entitled to protect his/her possession rights from third parties who are not owners of the property, as well as from those who cannot own it by virtue of another provision stipulated by law or agreement. It is well-known that a right to protection is merely an element, a legal authority within the content of any civil right. This element of the main content of legal right is sought when other elements of legal right are under a threat, i.e. when legal right is in a special, infringed condition. Thus, the provision on ‘right to protection of their possession’ of art 234 (2) of the Civil Code of the Russian Federation, in combination with art 11 of the Civil Code of the Russian Federation stipulating judicial remedies for the violation of civil rights, must be interpreted as a recognition by civil legislation of certain property rights of bona fide owners. Attention to this problem was drawn by K. Sklovsky. He pointed out that the revival of acquisitive prescription in the Russian legislation (art 234 of the Civil Code of the Russian Federation) raised the question whether that originated the right of ownership when judicial remedies were enforceable. In his opinion, an acquisition prescription of a possession is not a reason to be protected either from the owner or other right holder. That is why such ownership cannot be opposed to rights of the owner or other right holder as a competitive right, therefore coexisting with those rights just as a fact. Hence is a recognition of the fairness of the statement by D. Meyer ‘As long as a prescription has not led to this right, there is no property right’. However, at the same time monograph by Sklovsky (2000) reflects uncertainty of his position, as he writes: ‘If we assume that a right of action itself allows us to consider a relation described in art 234 of the Civil Code to be a right, then in any case that right lacks the features that would allow to consider it an absolute (because it is not protected from any person) and corporeal (because it is not passed along with a property, and is transferred only by way of personal succession).’16

16 Sklovskiy K.I. Sobstvennost’ v grazhdanskom prave: ucheb.-praktich.posobie / 2-e izd. M.: Delo, 2000 (KI Sklovskiy, Ownership in Civil Law: Training Manual (Case 2000)).

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Apparently, the Constitutional Court of the Russian Federation by no accident states that a bona fide possessor has a legal right, calling it fairly abstractly a property right.

V. THE DEFINITIVE OPINION ON THE STATUS AND RIGHTS OF BONA FIDE OWNER

From our point of view, this property right is a new corporeal right. By virtue of this right a bona fide owner obtains the ability to influence the subject directly and to meet entrenchments on it by third parties.17 In this case, the direct influence on the subject is not to be understood only as ‘holding in hands’, as the physical possession of the thing. Possession by a bona fide purchaser, as opposed to simply holding, implies a certain property power. The fact that a legal right is limited in time, as opposed to the majority of absolute rights, does not impede its recognition as a corporeal right.18 After all, the temporary nature of the right of lifetime inheritable possession does not prevent it from being recognized as a corporeal right. Obviously, the specific nature of the basis for the origin of bona fide possession right is its characteristic feature.19 Unlike other corporeal rights bona fide possession as a basis of its complex legal structure has a legal decision by virtue of which this right originates, being a the pre- condition for its occurrence. Till the moment a judicial decision in favor of bona fide owner is not held, their status is defined as unlawful bona fide possession. At the same time, due to vindication restrictions, a bona fide purchaser obtains a property right. The determination of a good faith is an act of justice, which in accordance with art 118 (1) of the Constitution of the Russian Federation is carried out only by a court, hence the existence of a judicial act is an obligatory condition. The new property right of a bona fide purchaser also arises in the case of the expiry of the statue of limitations regarding vindicatory actions (art 199 of the

17 LY Yueh, The Law and Economics of Globalization: New Challenges for a World in Flux (2009). 18 JH Banker, Yvonne Ekern, Constitutional Law: Principles and Practice (2009). 19 J Harrison, ‘The Constitution of Economic Liberty’ (2008) 45 San Diego Law Review 709. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 153

Civil Code of the Russian Federation). The good faith of the possession must be acknowledged by court based on certain legal facts. Thus, the Constitutional Court of the Russian Federation in its judgement testing the constitutionality of the provisions of art 167 of the Civil Code of the Russian Federation acknowledged a property right of bona fide purchasers. The operative part of the judgement stipulates that the provisions of art 167 of the Civil Code of the Russian Federation in their constitutional and legal interpretation mean that they cannot be applied to bona fide purchaser, unless directly specified by law. Does this mean that the Constitutional Court of the Russian Federation does not consider it possible to apply art 167 of the Civil Code in cases of the reclamation of dwelling premise or other property by its owner from a bona fide purchaser? Can the juddgment of the Constitutional Court of the Russian Federation be interpreted as stipulating express precedence of property rights of bona fide purchasers over the right of property? We believe that such understanding of the judgment of the Constitutional Court of Russian Federation would be too straightforward.20 Moreover, if in the past courts of general jurisdiction neglected the enforcement of civil law limiting the owners’ right to recover, giving precedence to the enforcement of the provisions of art 167 of the Civil Code of the Russian Federation stipulating for restitution, the ‘literal’ interpretation of the judgment of the Constitutional Court of the Russian Federation is dangerous as the other extreme.21 In fact, the Constitutional Court of the Russian Federation expressed no opinion on the priority of the property rights of bona fide purchasers, provided by the rules of limited vindication (art 302 of the Civil Code of the Russian Federation). Section 3 para 1 of the declaration of intent of the judgement of the Constitutional Court of the Russian Federation confirms that the Civil Code of the Russian Federation in accordance with the arising from the Constitution of the Russian Federation fundamental principles of civil law (art (1) 1 of the Civil Code of the Russian Federation) does not limit the citizen’s choice of ways of protecting violated rights; citizens and legal entities by virtue

20 SA Gregory, ‘Do Constitutional Property Clauses Matter?’ (2007) 33 3 Cornell Law School Forum 4 21 ibid (n 14).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 154 KUTAFIN UNIVERSITY LAW REVIEW of art 9 of the Civil Code of the Russian Federation are entitled to make that choice at their own discretion. The right to choose a method of the state protection of the rights and freedoms can also depend on the essence of the constitutional right under art 45 of the Constitution of the Russian Federation. Restitution, as it was rightly pointed out by Sklovsky, is a very peculiar requirement in its legal nature: being neither corporeal nor binding, it has a strong public-law element, i.e. it is not purely a private law remedy.22 Vindication, by contrast, is a typical private law remedy. Thus, the application of restitution with its considerable public-law element does not always allow to have a balance between legitimate interests of the owner and a bona fide purchaser. In certain cases, it is preferable to use vindication in order to reach that balance. Owners, parties to the agreement, third parties to the agreement, bona fide purchasers – all of them are the members of civil commerce.23 Based on the general legal principle of justice, the protection of property rights and property rights of bona fide purchasers should be realized on the basis of ratability and proportionality, in order to ensure the balance of rights and legitimate interests of all of the participants of civil commerce (subsection 2, para 4 of the declaration of intent of the judgment of the Constitutional Court of the Russian Federation No. 6-P of April 21, 2003). Regulating the bases for the origin and termination of the right of ownership and other real rights, contractual and other obligations, the bases and the implications of the invalidity of transactions, federal law should stipulate for such methods and mechanisms of the enforcement of property rights that would protect not only the owners but also the bona fide purchasers as the participants of civil commerce (subsection 2, para 6 of the declaration of intent of the judgment of the Constitutional Court of the Russian Federation No. 6-P of April 21, 2003). In order to determine in which cases priority should be given to the protection of the the owner’s rights and in which – to the rights of the bona fide purchaser, the Constitutional Court of the Russian Federation

22 ibid (n 13) 79. 23 Daniel McGrory, ‘Civilizing the Russian Underground Economy: Requirements and Prospects For Establishing a Civil Economy in Russia’ (1995) 5 Transnational Law and Contemporary Problems. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 155 suggested that courts should use two constitutional principles as an objective criterion: a) the principle of ratability and proportionality, and b) the principle of stability of the civil commerce. The crucial provision for the understanding of the legal stance of the Constitutional Court of the Russian Federation is contained in the last two paras of Section 3.1 of the declaration of intent of the judgment of the Constitutional Court of the Russian Federation of April 21, 2003: ‘The rights of a person who considers him/herself to be a proprietor shall not be protected by a lawsuit against a bona fide purchaser through a legal mechanism set out in art 167 (1) (2) of the Civil Code of the Russian Federation.’ So, if between the owner of the property and a bona fide purchaser no deal has been effected, the latter should be regarded as a third party against which no legal action claiming the declaration of invalidity of transaction and the application of the consequences of its invalidity can be taken. Such protection is possible only through upholding of the vindication claim, provided the stipulated by art 302 of the Civil Code of the Russian Federation grounds, which authorize the reclamation of the property even from a bona fide purchaser (gratuitousness the property acquisition by the bona fide purchaser, withdrawal of the property from the possession of the owner against their will, etc.). A different interpretation of provisions of art. 167 (1) (2) of the Civil Code of the Russian Federation would mean that the owner has an opportunity to resort to such a remedy as a recognition of invalidity of all of their assignment of assets transactions, i.e. to demand restitutes not only when it comes to one (the first) unlawful transaction, but also when the disputed property was acquired by a bona fide purchaser through subsequent (second, third, fourth, etc.) transactions. Thus, there is an objective criterion - the number of deals made between the owner and the bona fide purchaser. A chain of those transactions is part of the civil commerce, the stability of which must be maintained by both constitutional and civil law.24 If that chain has several links, the interests of the bona fide purchaser tend to outweigh the rights of the owner, for the idea of the stability of the civil commerce is realized in the interests of the purchaser.

24 M Ellist, ‘Drafting Constitutions: Property Rights in Central and Eastern Europe’ (1994) 19 Yale Journal Int’l Law 197

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The application of the provisions of art 35 (2) of the Constitution of the Russian Federation as providing public recognition and protection for such property rights as the rights of a bona fide owner turned out to be necessary in order to ensure the courts, applying Art. 167 of the Civil Code of the Russian Federation and having a sufficient degree of discretion, to independently decide in every individual case which measures are appropriate and should be taken based on the need to find a reasonable balance between legitimate interests of the owner and those of the bona fide owner. By disclosing constitutional legal meaning of art 167 of the Civil Code of the Russian Federation Constitutional Court of the Russian Federation demonstrated the importance of the basic principle of private law – the ensuring the stability of the civil commerce.

Bibliography

Banker JH, Ekern Y, Constitutional Law: Principles and Practice (2009) Conant M, The Constitution and Economic Regulation: Objective Theory and Critical Commentary (Transaction Publishers, 2011) Dayuan Han, ‘Constitutional Protection of the Right to Private Property in China’ (2013) 1 China Legal Science Ellist Mark, ‘Drafting Constitutions: Property Rights in Central and Eastern Europe’ (1994) 19 Yale Journal Int’l Law Ely JW, ‘The Constitution and Economic Liberty’ (2012) 35 Harvard Journal of Law and Public Policy Fishkin J & William E, ‘Is the Constitution Responsible for Electoral Dysfunction? The Anti-Oligarchy Constitution’ (2014) 94 Boston University Law Review Gadzhiev G.A., Barenboym P.D., Lafitskiy V.I., Mau V.A. Konstitutsionnaya ekonomika / Otv. red. G.A. Gadzhiev. M.: Yuristinform, 2010 (GA Gadzhiev, PD Barenboym, VI Lafitskiy, VA Mau, Constitutional Economics (GA Gadzhiev ed, Yuristinform 2010)) Gadzhiev G.A. Konstitutsionnye osnovy sovremennogo prava sobstvennosti / Zhurnal rossiiskogo prava. 2006. № 20. (GA Gadzhiev, ‘The Constitutional Foundations of the Modern Property Rights’ (2006) 20 Journal of Russian Law) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Ilya Iksanov, Polina Krasnova Constitutional Regulation of Property Rights 157

Gerding EF, Bubbles, Law and Financial Regulation (Routledge 2013) Gregory SA, ‘Do Constitutional Property Clauses Matter?’ (2007) 33 3 Cornell Law School Forum Harrison J, ‘The Constitution of Economic Liberty’ (2008) 45 San Diego Law Review Heller K, Outline of Austrian Constitutional Law (1989) Khvostov V.M. Sistema rimskogo prava. Sbornik / M.: Spark, 1996 (VM Khvostov, System of Roman Law (Spark 1996)) Lenaerts K, ‘Constitutionalism and the Many Faces of Federalism’ (1990) 38 American Journal of Comparative Law McGrory Daniel, ‘Civilizing the Russian Underground Economy: Requirements and Prospects For Establishing a Civil Economy in Russia’ (1995) 5 Transnational Law and Contemporary Problems Sklovskiy K.I. Sobstvennost’ v grazhdanskom prave: ucheb.-praktich. posobie / 2-e izd. M.: Delo, 2000 (KI Sklovskiy, Ownership in civil law: training manual (Case 2000)) Stelzer M, The Constitution of the Republic of Austria: A Contextual Analysis (Bloomsbury Publishing 2011) Yueh LY, The Law and Economics of Globalization: New Challenges for a World in Flux (2009)

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HUMANISTIC VALUES IN LAW

ARTICLE

REGULATORY DECISIONS OF THE CONSTITUTIONAL COUNCIL OF THE REPUBLIC OF KAZAKHSTAN AND THEIR IMPACT ON DEVELOPING AN EFFECTIVE SYSTEM TO PROTECT THE RIGHTS OF MAN AND OF THE CITIZEN

Saule K. Amandikova (Kazakhstan)

Author Doctor of science (Law), Kazakh Humanitarian Law University, 2005 Professor, dean of the legal department, Gumilev Eurasian National University Email: [email protected] Abstract The article disclosures the role of the Constitutional Council of the Republic of Kazakhstan in ensuring effective human rights protection system. The Constitutional Council performs its authority on the interpretation of provisions of the Constitution, thereby affecting the formation process of a national system of law. The author analyzes the regulatory decisions of the Constitutional Council which will eventually contribute to the rule of law and the formation of a ‘living’ constitution. Keywords Constitutional Council, the Republic of Kazakhstan, interpretation of legal norms, constitutional control, rights and freedoms

DOI: 10.17803/2313-5395.2016.1.5.158-172

www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 159

TABLE OF CONTENTS

I. Introduction ...... 159 II. The Constitution of the Republic of Kazakhstan and international human rights standards ...... 160 III. The Constitutional Council of the Republic of Kazakhstan: Its powers and the role in rights’ protection ...... 161 IV. Signifi cance of preventive constitutional control ...... 163 V. Interpretation of the Constitution as the most important part of the Constitutional Council's impact on the protection of human rights ...... 164 VI. he Constitutional Council as a body providing indirect protection of human rights ...... 169 VII. Conclusion ...... 170 Bibliography ...... 171

I. INTRODUCTION

One of the most important indicators of a state development nowadays is an estimation of the legal regulation and a level of human rights and freedoms realization. A democratic state seeks to ensure full observance of rights and freedoms guaranteed by Basic Law. In addition, the declaration of human rights and freedoms and their proclamation in the legislation are essential prerequisites for creation of a truly open, free society, because the rule of law, pluralism and human rights are necessary conditions for democratic society existence. In the last decades of the XXth century ‘the idea of human rights became of the ideological importance, since most states began to fix their commitments in the field of human rights not in special regulations, but in national constitutions, which significantly increased the responsibility of States to respect and ensure human rights and freedoms.’1 Being aware

1 Kubeev E.K., Amandykova S. K. Konstitutsiya Respubliki Kazakhstan: teoretiko- pravovoy analiz / Almaty: Bilim, 2008 (EK Kubeev, SK Amandykova, Constitution of the Republic of Kazakhstan: Legal Analysis (Bilim, 2008)) 176.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 160 KUTAFIN UNIVERSITY LAW REVIEW of the role of human rights and freedoms, as an element of statehood, the international community tends to ensure not only the formal proclamation of human rights, but also to create a real mechanism of their functioning and protection. Kazakhstan is not an exception as well, making big steps towards building a democratic state. Therefore, there is recognized a need for creation and development of an effective human rights system, which shall include: a legal regulation of human and civil rights, their guaranteeing, and an appropriate protection mechanism.

II. THE CONSTITUTION OF THE REPUBLIC OF KAZAKHSTAN AND INTERNATIONAL HUMAN RIGHTS STANDARDS

The challenge of legal regulation of human and civil rights is performed by the Basic law of Kazakhstan, which norms reflect the international standards of human rights ‘created as a result of a long work of the majority of democratic states in order to develop coordinated positions in the field of human rights. International standards are constituted as a regulatory minimum, which determines a level of a state regulation with the acceptable deviations in one state or another in the form of its excess or concretization’.2 Taking into account the international standards, the Constitution of the Republic of Kazakhstan includes the whole list of rights related to the categories of basic and recognized by the international community. It is specified that each and all individuals, their lives, rights and freedoms are the highest values of the State (art 1) which belong to every person from birth and are recognized as absolute and inalienable, and define the contents and implementation of laws and other normative legal acts (art 12) . Those conceptual provisions of the legal status of man and

2 Realyzatsiya prav cheloveka v Respublike Kazakhstan posredstvom mezhdunarodnykh instrumentov: monografiya / Pod. obshch. red. prof. Zh. D. Busurmanova. Astana: GU ‘Institut zakonodatel’stva Respubliki Kazakhstan’, 2011 (Realization of Human Rights in the Republic of Kazakhstan by Means of the International Instruments: the Monograph (Zh D Busurmanov ed, The Institute of Legislation of the Republic of Kazakhstan, 2011) 28. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 161 citizen - as the Chairman of the Constitutional Council of the Republic of Kazakhstan Mr Rogov mentioned – ‘oblige the legislator to consider, first of all, international standards and put human rights at the center’,3 and determine a movement of constitutionalism in Kazakhstan. The concept of constitutional rights and freedoms enshrined in the Constitution of Kazakhstan of 1995 is based on universal values, to which a civilized society has come through a long way. Many of the provisions of the Universal Declaration of Human Rights adopted by the UN General Assembly on December 10, 1948, are reflected in the Constitution of the Republic of Kazakhstan today. It should be noted that the natural law concept of rights and freedoms found its comprehensive expression in the Constitution of Kazakhstan. According to it a man is a source of his natural rights and freedoms, which are recognized as absolute and inalienable ones, in accordance with art 12 of the Constitution of 1995.4 It is worth mentioning that rights and freedoms of an individual regardless of his/her nationality are recognized, guaranteed and protected by the state. At the same time, human rights and freedoms are not identical to the rights of the citizen, although they are related with each other, but not totally the same. The rights and freedoms of man and citizen is a fundamental base of the Constitution intended to recognize a person as the supreme value of the Kazakhstan society. Enforcement of human rights and freedoms is one of the principles of the constitutionalism, which is being created in Kazakhstan.

III. THE CONSTITUTIONAL COUNCIL OF THE REPUBLIC OF KAZAKHSTAN: ITS POWERS AND THE ROLE IN RIGHTS’ PROTECTION

It should be noted that the national concept of human rights is based on a coordinated system of human rights protection mechanism

3 Rogov I.I. ‘Zashita prav cheloveka organami konstitutsionnoy yustitsii: vozmozhnosti i problemy individual’nogo dostupa’ (II Rogov, ‘Protection of Human Rights by Bodies of Constitutional Justice: Opportunities and Problems of Individual Access’) < http://www.constcouncil.kz/rus/vyst/? cid=0&rid=703> accessed 16 February 2016. 4 The Сonstitution of the Republic of Kazakhstan of August 30, 1995 (with last changes and additions from May 21, 2007).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 162 KUTAFIN UNIVERSITY LAW REVIEW which cornerstone is the state responsibility for the formation and realization of constitutional status of man and citizen. One of the most important elements of that mechanism is the Constitutional Council of the Republic of Kazakhstan, since ‘its competency and duty is to create a special school of constitutional interpretation, the basis of which should be based on values of Kazakhstan constitutionalism which are: man’s interests as the supreme value of a society, creation of favorable life conditions, extending rights and freedoms protected by means of the rule of law and supported by law’.5 To manage with that task the Constitutional Council is authorized to officially interpret the Constitution norms, to monitor the compliance of the acts of public authorities to the Constitution, which are the important means of ensuring the supremacy of democratic principles. The official interpretation by the Constitutional Council is carried out by taking resolutions. According to the art 4 of the Constitution those resolutions are the integral part of the law of the Republic of Kazakhstan. They should be based only on the Constitution of the Republic of Kazakhstan and any other regulations could not contradict them. According to art 4 of the Law of the Republic of Kazakhstan adopted on March 24, 1998 № 213-I ‘On Legal Regulations’ Constitutional Council resolutions are outside of the hierarchy of all other legal regulations.6 During the period of its existence and activity Constitutional Council has adopted a significant number of acts related to the official interpretation of the Constitution which have a strong affect on the further formation of the constitutional concept of rights and freedoms of man and citizen in Kazakhstan. That influence is clearly seen when analyzing the activity of the Constitutional Council in the main directions of its powers. In this regard, one might agree with the opinion of D.M. Baymakhanova who notes that functions of the Constitutional Council of Kazakhstan to protect rights and freedoms of man and citizen are carried out by it within several directions: preliminary or preventive constitutional control for the compliance of regulations, which didn’t enter into a legal force, to the Constitution; official interpretation of Constitutional norms; consideration of courts appeals on recognition of some acts unconstitutional; and addressing

5 ibid (n 1) 90. 6 The Law of the Republic of Kazakhstan ‘On Normative Legal Acts’ (March 24, 1998). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 163 to the Parliament with the Message about a constitutional legitimacy conditions in the country.7

IV. SIGNIFICANCE OF PREVENTIVE CONSTITUTIONAL CONTROL

Analyzing each of those directions, in our opinion, it is necessary to start with a function of preliminary or preventive constitutional control for the compliance of regulations, which didn’t enter into force, to the Constitution. The mentioned function is the most efficient, since upon the President appeal there were ruled unconstitutional in whole or in part some laws adopted by Parliament, as well as some international contracts (25 cases for the whole period of the Constitutional Council activity).8 Almost every standard resolution of the Constitutional Council of the Republic is directed on the protection of the concrete rights and freedoms of man and citizen. In its decisions the Constitutional Council sets the direction of the development of legal system, law-making and law-enforcement practices towards to their compliance to the modern understanding of the rights and freedoms enshrined in basic international acts.9 It would be useful to pay our attention on the decision of the Constitutional Council of February 11, 2009. The Constitutional Council found a violation of the constitutional principle of legal equality while analyzing the Law ‘On Modifications and Additions of Some Acts of the Republic of Kazakhstan Regarding a Freedom of Religion and Religious

7 Baymakhanova D. M. Konstitutsionniy Sovet RK i ego deyatel’nost’ po zashchite prav i svobod cheloveka i grazhdanina / Pravovaya reforma v Kazakhstane. 2008. №2 (42). S. 7-14. (DM Baymakhanova, ‘The Constitutional Council of the RK and Its Activities for Protection of the Rights and Freedoms of Man and Citizen’ (2008) 2 (42) Legal Reform in Kazakhstan 7). 8 Rogov I.I. ‘VliyanieresheniyKonstitutsionnogoSovetaRespubliki Kazakhstan nazakonodatel’stvo i pravoprimenitel’nuyupraktiku’ (II Rogov, ‘Influence of Decisions of the Constitutional Council of the Republic of Kazakhstan on the Legislation and Law-enforcementPractice’) http://ksrk.gov.kz/rus/press- center/vyst/?cid=0&rid=433. 9 Natsional’nyy plan deistviy v oblasti prav cheloveka v Respublike Kazakhstan na 2009―2012 gody / Pod obshch. red. T.D.Abisheva, S.T. Tursunova. Astana, 2009 (The National Plan of Actions in the Field of Human Rights in the Republic of Kazakhstan for 2009-2012 (TD Abishev, ST Tursunova eds, 2009)).

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Associations’ adopted by Parliament and submitted to the President of Kazakhstan for signature.10 ‘The Constitutional Council mentioned that a list of those categories of individuals who should be provided with privileges and whose legal interests should be protected by authorized bodies was illegally narrowed by that law. Its norms had a discrimination character, limited a freedom of conscience, broke the constitutional principles of equality of citizens and religious associations before the law and of balance between restriction of rights and freedoms and constitutionally significant goals.’11

V. INTERPRETATION OF THE CONSTITUTION AS THE MOST IMPORTANT PART OF THE CONSTITUTIONAL COUNCIL’S IMPACT ON THE PROTECTION OF HUMAN RIGHTS

In our opinion, a priority direction of the Constitutional Council on the realization and protection of human rights is clearly seen while analyzing its resolutions including the one ‘On the Official Interpretation of Constitutional Norms’. Importance of interpretation of the Constitution by the constitutional control body is emphasized by S. Udartsev who notes that the Constitutional Council ‘in the course of the activity may discover some new meanings – which are not visible from the first sight - of the constitutional norms which helps to adopt (or to decide not to adopt) new regulations and to open a door for the development of the new directions of the law-making process. For example, by broadening a sense of a constitutional norm, specifying its new meaning shades, the Constitutional Council supports new legislation development and makes new sectors of a legal sphere enter into a constitutional field.’12

10 The resolution of the Constitutional Council of the Republic of Kazakhstan № 1 ‘Onverification of the Law of the Republic of Kazakhstan ‘On modification and additions in someacts of the Republic of Kazakhstan concerning a freedom ofreligiousassociations’ on complianceto the Constitution of the Republic of Kazakhstan’ 11 of February 2009 < http:// ksrk.gov.kz/rus/resheniya/?cid=10&rid=476. 11 ibid (n 8). 12 Udartsev S. Konstitutsionniy Sovet i pravotvorchestvo / Zanger. 2011. №1. S. 21. (S Udartsev, ‘Constitutional Council and Law-making Process’ (2011) 1 Zanger 21). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 165

For twenty years of its existence the Constitutional Council has resolved more than 70 applies on the clarification of constitutional norms. Among them there were officially interpreted the norms of the Section II ‘Man and Citizen’ of the Constitution: arts 10, 12, 13, 14 (1)(2), 15 (2), 16 (2), 18 (2), 23 (2), 24 (2), 26 (3), 28 (1), 39 (1).13 The existing acts of the Constitutional Council on the official interpretation of the Section II ‘Man and Citizen’ help to classify them according to the content of the provisions that are being clarified. 1. Resolutions on official interpretation of the constitutional norms- principles of the institution of human rights (recognition of human rights from the moment of birth, their ensuring, absolute character and inalienability, equality of everybody before the law and the courts). The main task of the norms-principles interpretation is specifying their obligatory observance during law-making and law enforcement processes. For example, the Constitutional Council Resolution of October 28, 1996 No. 6 ‘On Official Interpretation of Arts 4 (1) and 12 (2) of the Constitution of the Republic of Kazakhstan‘ clarifies that ‘recognition of the rights and freedoms as absolute ones should mean that they are related to every individual who is in the territory of the Republic of Kazakhstan irrespective of the fact if he/she is its citizen or not. Regarding the inalienability, according to the Constitutional Council position inalienability of the rights and freedoms should mean that no individual can be disposed of the rights and freedoms guaranteed by the Constitution by nobody including the state, unless otherwise provided by the Constitution and the laws based on it.’14 The Constitutional Council gave an official interpretation of that article three times: on October 28, 1996, on December 1, 2003, and on April 18, 2007. According to art 12 (1) of the Constitution the rights and freedoms in the Republic of Kazakhstan are guaranteed by the Constitution. It means that they are guaranteed by the state within the norms of the Constitution and other constitutional regulations. The Constitutional Council in its resolution ‘On Official Interpretation of the Constitution of the Republic of Kazakhstan’ of October 28, 1996

13 The Set of Resolutions of the Constitutional Council of the Republic of Kazakhstan (Astana 2010). 14 ibid (n 13) 26.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 166 KUTAFIN UNIVERSITY LAW REVIEW interpreting norms of arts 4 (1) and 12 (2) of the Constitution, first of all, recognizes constitutional rights and freedoms as the absolute ones. According to art 12 (2) the fundamental rights and freedoms determine the content and application of laws and other regulations.15 2. Resolutions of the Constitutional Council on the interpretation of the constitutional norms of citizenship and differences in the status between man and citizen. The example is the Resolution ‘On Official Interpretation of Arts 10 and 12 of the Constitution of the Republic of Kazakhstan’ of December 1, 2003 No. 12 which explains in detail the citizenship principles in the Republic of Kazakhstan: unity, constitutional and legal legitimacy of citizenship and value of this institution for the Kazakhstan statehood. ‘The institution of citizenship is the determining attribute of the sovereignty, independence and the constitutional system of the Republic, since its citizens are “the only source of the state power” and “exercise the power directly through a republican referendum and free elections, and also delegate their power to the state bodies” (art 3 (1) (2) of the Constitution). The Constitution differentiates legal status of the individual, using the terms “citizen of the Republic of Kazakhstan”, “every”, “everyone”, “foreigners”, and “stateless persons”. Thus, it’s important to understand that mentioned “every” and “everyone” concerns both, citizens of the Republic and the individuals who are not holding a citizenship. Thereby, Constitution establishes different set of rights and freedoms for each group, as well as different duties that they are supposed to perform.’16 Interpreting the art 12 (3) of the Constitution which says: ‘The citizen of the Republic has rights and performs duties already due to its status’ the Constitutional Council believes that constitutional legal status of the citizen of the Republic of Kazakhstan means to have all the rights and freedoms and to perform duties established by the Constitution, laws and other regulations of the Republic of Kazakhstan.

15 The Resolution of the Constitutional Council of the Republic of Kazakhstan № 6/2 ‘OnOfficialInterpretation of Paragraph 1 of Article 4 and Paragraph 2 of Article 12 of the Constitution of the Republic of Kazakhstan’28of October 1996 < http://ksrk.gov.kz/rus/resheniya/?cid=11&page=6> accessed 17 February 2016. 16 ibid (n 13) 316. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 167

At the same time the Constitutional Council in its resolution No. 12 of December 1, 2003 ‘On the Official Interpretation of Arts 10 and 12 of the Constitution of the Republic of Kazakhstan’, interpreting the norm of art 12 (4) of the Constitution of the Republic of Kazakhstan, which says ‘foreigners and stateless persons have rights and freedoms and perform duties guaranteed for citizens, if other isn’t provided by the Constitution, laws and international treaties’, establishes that for foreigners and stateless persons it is provided a different, more limited constitutional legal status. Thus, limited constitutional legal status means that rights and freedoms provided by arts 33 (2), 41 (2), 51 (4), 79 (3), and 86 (3) of the Constitution don’t apply to foreigners. There are also some other rights that do not apply to foreign citizens according to requirements of the Constitution, laws and other regulations, and also in the cases provided by international treaties of the Republic of Kazakhstan.17 3. Resolutions of the Constitutional Council explaining a substance of one or another constitutional right. Those are: right to judicial protection (art 13 (2)), right to privacy of personal deposits and savings (art 18 (2)), right to freedom of associations and activity of nongovernmental associations (art 23 (2)), right to social protection against unemployment (art 24 (2)), right to social guarantees in case of illness (art 28 (1)). Here is an extract from the Resolution of the Constitutional Council ‘On Official Interpretation of Art 23 (2) of the Constitution of the Republic of Kazakhstan’ (July 5, 2000, No. 13/2): ‘Containing in art 23 (2) of the Constitution a ban for a judge to be a member of any party or labor union shall not mean a restriction for a judge to be a member of the other nongovernmental associations as well as to create such organizations for realization and protection of common interests of judicial community, according to the norms of Constitution and the laws of the Republic of Kazakhstan.’18 4. Resolutions, explaining limits and grounds for restrictions of constitutional rights. This group of acts of the Constitutional Council is addressed, first of all, to the legislator who is obliged to observe the constitutional borders of restrictions of human rights. So, for example, in the Resolution of February 27, 2008 No. 2, the Constitutional Council

17 ibid (n 13) 313. 18 ibid (n 13) 183.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 168 KUTAFIN UNIVERSITY LAW REVIEW focuses the attention of the legislator on the fact that ‘while adopting a law, there must be considered constitutional limits of possible restrictions of human rights and freedoms, and no distortion of the idea of constitutional rights and freedoms or restrictions that would not go together with constitutionally defined purposes are possible.’19 In 1996 the Constitutional Council gave an official interpretation on limits and grounds of restrictions of the following constitutional rights: right to life (art 15 (2)), right to personal liberty (art 16 (2)), right to privacy of personal deposits and savings (art 19(2)), property rights (art 26 (3)), etc. One of the latest in interpretation practice is the Resolution of the Constitutional Council of August 20, 2009 No. 5 which clarifies that a restriction of the right to privacy of personal deposits and savings is a prerogative for the legislator and the legislator has no right to authorize other government body or the official to regulate limits of restriction of personal deposits and savings privacy by subordinate acts’.20 In the academic field it is always discussed a question of limits of official interpretation of the Constitutional norms by a constitutional control body. In this regard we believe that ‘an initial position, the basic principle of the Constitution interpretation could be its self- sufficiency recognition, so it should mean that clues for understanding the Constitution are inside its norms’.21 Application of that principle in the activity of the Constitutional Council of the Republic of Kazakhstan can be seen in the texts of its resolutions where it is always specified a norm on the basis of which the interpretation was given. So, the Resolution of the Constitutional Council of the Republic of Kazakhstan No. 12 of December 1, 2003 ‘On the Official Interpretation of Arts 10 and 12 of the Constitution of the Republic of Kazakhstan’ provides the following interpretation: ‘Taking into account the importance of citizenship institution for Kazakhstan statehood as well as for the legal status of citizens, art 10 (3) of the Constitution establishes a norm according to which “the state doesn’t recognize a citizenship of any other state for individuals holding a citizenship of the Republic

19 ibid (n 13) 454. 20 ibid (n 13) 490. 21 ibid (n 1) 84. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 169 of Kazakhstan”’. That norm should mean that a dual citizenship is not allowed in Kazakhstan, so a foreign citizen cannot be a citizen of the Republic at the same time.22

VI. HE CONSTITUTIONAL COUNCIL AS A BODY PROVIDING INDIRECT PROTECTION OF HUMAN RIGHTS

According to Zh. Busurmanov, the Constitutional Council of the Republic of Kazakhstan is a body of the indirect protection of human rights. He logically explains it by the fact that constitutional rights in Kazakhstan can be protected by the Constitutional Council not directly but through the courts of general jurisdiction.23 The one should admit that it is a right view, since guaranteeing observance of constitutional rights of an individual can be carried out by consideration of courts appeals on a recognition of a regulation unconstitutional. Art 72 (2) of the Constitution of the Republic of Kazakhstan mentions the ground for the courts appeals to the Constitutional Council. It is a vision of law or other regulatory legal act, which is to be applied when considering a case, as an infringing on human and civil rights and freedoms provided by the Constitution. As significant consequences of consideration of courts appeals by the Constitutional Council, in our opinion, can be regarded, first of all, providing concrete legal recommendations to the court, and secondly, removing an unconstitutional regulation from a legal system in order to avoid a negative legal impact. As a result, a decision of the Constitutional Council answers interests of a big number of citizens who might be the parties of similar legal relationship in future.24 It is a question for discussion if a number of those who can apply to the Constitutional Council, should be increased. A great number of

22 ibid (n 13) 313. 23 Busurmanov Zh. D. Konstitutsionniy Sovet – institut oposredovannoy zashchity prav cheloveka i grazhdanina v Respublike Kazakhstan / Zanger. 2011. № 1. S. 31–33 (ZhD Busurmanov, ‘The Constitutional Council as the Institution of the Indirect Protection of the Rights of Man and Citizen in the Republic of Kazakhstan’ 2011 (1) Zagner 31. 24 ibid (n 23) 31.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 170 KUTAFIN UNIVERSITY LAW REVIEW scholars, members of Parliament, representatives of public associations propose to provide citizens with a right to apply to the Constitutional Council, if a law or other regulatory legal act violates constitutional rights and personal freedoms of a citizen while its applying by the authorities. This point of view is shared by developers of the National plan of actions in the field of human rights for 2009-2012.25 The opposite point of view is shared by the well-known scholar, the ex-member of the Constitutional council Zh. Busurmanov who doesn’t consider it necessary to provide citizens and public associations with a right to apply to a constitutional control body, thereby making a difference between the Constitutional Council and the Constitutional Court. He suggests that a number of individuals enabled to apply to the Constitutional Council should be increased by means of in including other representatives of human and civil rights protection: Chief State Prosecutor, Minister of Justice and Commissioner for Human Rights.26 In our opinion, it is fair, since all those persons, due to powers guaranteed to them, face with the contradiction of current laws and other regulations to constitutional rights and freedoms. We would like to pay a special attention to the activity of the Constitutional Council regarding realization of the political rights of citizens, including a right to participate in state administration. This is a due diligence on legitimacy of the activities of federal importance which involve political rights of citizens, namely legitimacy of the Presidential and Parliament elections and of the republican referendum (art 72 (1) of the Constitution of the Republic of Kazakhstan).

VII. CONCLUSION

Thus, the influence of Constitutional Council resolutions on formation of theoretical aspects of the concept of human rights as well as on formation of effective system of protection of human and civil rights is indisputable. At the same time it should be noted that recommendations of Constitutional Council members on how to improve the legislation are being defined according to the law-enforcement practice. Above

25 ibid (n 9) 125. 26 ibid (n 23) 32. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Saule K. Amandikova The Impact of Regulatory Decisions of the Constitutional Council of the Republic of Kazakhstan on the Formation of an Effective System of Man and Citizen Rights Protection 171 all, development of the national concept of human rights is impossible without human belief in a real functioning of the Constitution and rights and freedoms protection. Among ways of achieving that goal is keeping people informed about conditions of the constitutional legality in the country by means of annual Messages of the Constitutional Council which would contain not just a review of general activity of the Constitutional Council, but also concrete recommendations on how to improve legislation of the Republic of Kazakhstan. At the end it is worth mentioning that the present article contains only general aspects of that huge impact, which the Constitutional Council has on formation and functioning of the Kazakhstan concept of human rights and formation of effective system of protection of human rights.

Bibliography

Baymakhanova D. M. Konstitutsionniy Sovet RK i ego deyatel’nost’ po zashchite prav i svobod cheloveka i grazhdanina / Pravovaya reforma v Kazakhstane. 2008. №2 (42). S. 7―14. (DM Baymakhanova, ‘The Constitutional Council of the RK and its Activities for Protection of the Rights and Freedoms of Man and Citizen’ (2008) 2 (42) Legal Reform in Kazakhstan 7) Busurmanov Zh. D. Konstitutsionniy Sovet – institut oposredovannoy zashchity prav cheloveka i grazhdanina v Respublike Kazakhstan / Zanger. 2011. №1. S. 31―33 (ZhD Busurmanov, ‘The Constitutional Council as the Institution of the Indirect Protection of the Rights of Man and Citizen in the Republic of Kazakhstan’ 2011 (1) Zagner 31 Kubeev E.K., Amandykova S. K. Konstitutsiya Respubliki Kazakhstan: teoretiko-pravovoy analiz / Almaty: Bilim, 2008 (EK Kubeev, SK Amandykova, Constitution of the Republic of Kazakhstan: Legal Analysis (Bilim 2008)) Natsional’niy plan deistviy v oblasti prav cheloveka v Respublike Kazakhstan na 2009―2012 gody / Pod obshch. red. T.D. Abisheva, S.T. Tursunova. Astana, 2009 (The National Plan of Actions in the Field of Human Rights in the Republic of Kazakhstan for 2009―2012 (TD Abishev, ST Tursunova eds, 2009))

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Realyzatsiya prav cheloveka v Respublike Kazakhstan posredstvom mezhdunarodnykh instrumentov / Pod obshch. red. prof. Zh. D. Busurmanova. Astana: GU ‘Institut zakonodatel’stva Respubliki Kazakhstan’, 2011 (Realization of Human Rights in the Republic of Kazakhstan by Means of the International Instruments (Zh D Busurmanov ed, The Institute of the Legislation of the Republic of Kazakhstan 2011) Rogov I.I. ‘Vliyanie resheniy Konstitutsionnogo Soveta Respubliki Kazakhstan na zakonodatel’stvo i pravoprimenitel’nuyu praktiku’ (II Rogov, ‘The Influence of Decisions of the Constitutional Council of the Republic of Kazakhstan on the Legislation and Law-enforcementPractice’) accessed 17 February 2016 Rogov I.I. ‘Zashita prav cheloveka organami konstitutsionnoy yustitsii: vozmozhnosti i problemy individual’nogo dostupa’ (II Rogov, ‘Protection of HumanRights by Bodies of the Constitutional Justice: Opportunities and Problems of Individual Access’) < http://www. constcouncil.kz/rus/vyst/? cid=0&rid=703> accessed 16 February 2016 Udartsev S. Konstitutsionniy Sovet i pravotvorchestvo / Zanger. 2011. №1. S. 20―32. (S Udartsev, ‘Constitutional Council and Law-making Process’ (2011) 1 Zanger 20)

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ARTICLE

MORAL, INFORMATIONAL AND LEGAL ASPECTS OF PROFESSIONAL JOURNALISM Dmitry Shibaev and Nina Uibo (Russia)

Authors Dmitry Shibaev PhD (Law), Russian Academy of Justice, 2011 Head of Social Science, Humanities and Legal Computer Science Department, NorthWestern Institute (branch) of Kutafin Moscow State Law University (Vologda) Email: [email protected] Nina Uibo PhD (Law), Saint Petersburg State University, 1982 Associate Professor, Social Science, Humanities and Legal Computer Science Department, Northwestern Institute (branch) of Kutafin Moscow State Law University (Vologda) Email: [email protected] Abstract Information society increasingly expands opportunities of mass media as a tool to manipulate a human mind. Legal and moral principles of the journalist ethics are the most discussed issues in the regulation of the mass media in Russia and abroad. The authors explore the origin of a legal status of a journalist, modern legal and regulatory acts defining a scope of the media. They also give examples of some cases from a judicial practice concerning the ethics of publications. The study and analysis have enabled the authors to formulate a number of proposals for the consideration and solution of the problems related to the impartiality and honesty of journalists. Keywords Ethics, honesty, integrity, impartiality, legal and moral regulation, shape the mindset, tolerance, legal status of a journalist

DOI: 10.17803/2313-5395.2016.1.5.173-184

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TABLE OF CONTENTS

I. Introduction ...... 174 II. International and Russian legal regulation of journalism ...... 176 III. The practice of resolving disputes by the Public Commission for Press Complaints ...... 180 IV. Findings ...... 182 Bibliography ...... 184

I. INTRODUCTION

In January 1941 the US President Franklin D. Roosevelt in his annual State of the Union address to the Congress proclaimed the concept of the ‘Four Freedoms’,1 which expresses the value of human life in developed countries. The freedom of speech and expression comes first before the others (freedom of religion, freedom from want, freedom from fear). Currently, just by force of habit, everyone takes mass media as the so called ‘fourth power’.2 The same view is held by Eric Bagerstam – ‘serious journalism deals with issues of power and practice of using it, being itself a balancing and controlling power. As it is commonly known there are three branches of state power: legislative, executive and judicial that protects public interests from despotism of the other authorities. The press and independent journalists with their system of ethical rules and principles should be regarded as the fourth power’.3 Machiavelli, however, argues that the government (state)

1 accessed 6 September 2015. 2 Zhan Zhak Russo. Ob obshchestvennom dogovore, ili Printsipy politicheskogo prava / perevod s frants. A.D. Khautina i V.S. Alekseeva-Popova. Po izd.: Russo Zh.Zh. Ob obshchestvennom dogovore: traktaty. Per. s frants. M.: KANON- press, Kuchkovo pole, 1998 (Rousseau JJ, Of the Social Contract, or Principles of Political Right (Trans. from French. CANON-press, 1998)). 3 E Bagerstam, Freedom of the Press in a Democratic Society (Tartu, Vyallingbi, 1992). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Dmitry Shibaev, Nina Uibo Moral, Informational and Legal Aspects of Professional Activity of a Journalist 175 is the instrument of violence4. In the era of information the technique to manipulate and control by force the public opinion has been developed almost to perfection. The control over the information processes creates, according to Vire (Virieu F.-H. (de)), ‘la mediocratie’. He notes, in particular, that ‘in terms of ‘la mediocratie’ people remain sovereign but their role has changed: the opinion of people matters much more than their votes in the election campaign. The society forms ‘triangles’ like ‘the government – the media – the public opinion’, ‘knowledge – the media – the students’,5 etc. The impact of the press on every sphere of human life is extremely high: it is the main link of communication between a person and the authorities (society, culture), between social groups. It is means of monitoring and feedback from the bottom to the top of the power vertical. The role of mass media is to inform the public; without that information people of older generation would have no idea of what’s going on around them. In fact, it is a primary instrument of orientation in society and the world as a whole. Finally, a role of mass media is to educate and to create a certain level of legal culture in the society. The one could hardly imagine a modern civil society without an interaction with information. Branscomb (Branscomb A.) formulates the Toffler concept of information society as follows. It is a society in which the majority of citizens are involved in the generation, collection, storage and distribution of information but not in agriculture or manufacturing6. At the same time freedom of speech and opinion does not mean a right to say anything. It also guarantees the protection of public from a dangerous, provocative, biased and incorrect information. Freedom of speech should mean a responsibility for what one says. And this is a question of the professional ethics of journalists.

4 Niccolo Machiavelli Emperor. accessed 6 September 2015. 5 FH Virieu, La Mediocratie (Paris, 1990). 6 Branscomb A, ‘Law and Culture Information Society’ (1986) 4 4 Information Society 279.

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II. INTERNATIONAL AND RUSSIAN LEGAL REGULATION OF JOURNALISM

The law on mass media of the Russian Federation in arts 49, 50, 51 covers the ethical aspects of journalism only in some part, in particular, regarding responsibilities of journalists to respect the rights and legitimate interests, honor and dignity of citizens and organizations, to maintain the confidentiality of information and (or) its sources, to refuse a job assigned by the chief editor or editorial staff if it or its fulfillment is connected with a violation of law, to comply with the ban on the election campaigning, referendum campaigning, etc. as well as with the restrictions on covert recording and the prohibition on abuse of rights of journalists.7 In fact, professional ethics is not subject to state regulation. It is formed by corporate self-regulation. State should not interfere in this sphere of activities of non-governmental organizations and civil initiatives in the media field. Public Commission on Press Complaints considers information disputes, first and foremost, of moral and ethical nature arising in the field of mass media, including cases of violation of principles and norms of the professional journalism ethics. It also considers information disputes affecting human rights in the media field8. Public Commission on Press Complaints is an agreement between more than eighty Russian mass media and according to the Charter is an independent structure of a civil society with a mission to find an out- of-court solution for specific information disputes.

7 Zakon RF ot 27.12.1991 № 2124-1 ‘O sredctvah massovoy informatcii’ / ‘Rossiyskaya gazeta’, № 32, 08.02.1992 (The Law of the Russian Federation of 27.12.1991 № 2124-1 ‘On mass media’ / ‘Russian newspaper, № 32, 02.08.1992). 8 Postanovleniye Plenuma Verhovnogo Suda RF ot 15.06.2010 № 16 ‘O praktike primeneneniya sudami Zakona Rossiyskoy Federatcii “O sredstvah massovoy informatcii”’ / Bulleten’ Verhovnogo Suda RF, № 8, avgust, 2010 (Resolution of the Plenum of the Supreme Court of 15.06.2010 № 16 ‘On the practice of courts of the Russian Federation Law’ On mass media”’/ The Bulleting of the Supreme Court , № 8, August 2010). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Dmitry Shibaev, Nina Uibo Moral, Informational and Legal Aspects of Professional Activity of a Journalist 177

The Declaration of Principles of the Conduct of a journalist of the International Federation of Journalists adopted on April 28, 1954 can be regarded as the first regulatory document which outlined the main principles of the journalist ethics. According to the Declaration the basics of the ethics are as follows: — Respect for the truth and a right to know the truth as well as a right to make comments and criticize; — Right to refer only to information that is one is sure about; no ignorance of important information; — Ban on falsification of information; — Getting information only by honest methods; — Necessity to correct and refute the information that causes serious damage; — Respect for professional privacy and confidentiality of the source of information; — Discouraging discrimination; — Avoiding professional misconduct (plagiarism, misrepresentation, abuse, slander, allegations, bribes for the publication (or concealment of information).9 In more detailed way norms of professional journalist ethics in the international level are formed by the Resolution of the Parliamentary Assembly of the Council of Europe 1003 (1993) ‘On the ethics of journalism’.10 The document emphasizes the importance to distinguish news (as facts) and opinions (as a judgment, thought or ideas), strict evidence, accuracy, precise mapping of events to avoid rumors. The inevitability of the subjective character of a journalist’s comments is stated, and that is why his/her views should not be checked for the coincidence with the reality, though it does not mean in any way a journalist’s dishonesty or intention to deny and cover-up actual facts. The Resolution debars cravings of authorities to information and censorship. It declares a need to differentiate between publishers, owners and journalists and guarantee freedom within the media as well as transparency in the activity of the media organizations. Publishers

9 Declaration of the Principles of Conduct of the International Federation of Journalists journalist. > accessed 6 September 2015. 10 > accessed 6 September 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 178 KUTAFIN UNIVERSITY LAW REVIEW and journalists cannot consider themselves to be the owners of information and information to be a product for consumption. The right to information is a fundamental right of every person, therefore to distort information in order to increase the audience and sales from advertising is unacceptable. The Resolution also proclaims a need to respect the presumption of innocence and privacy and to take readers as individuals rather than faceless mass. Media must fight for peace and tolerance, resist aggression, discrimination, confrontation and xenophobia. Mass media forms a mind of a younger generation. Consequently, it is inexcusable to propagate violence, sex and plunder as well as intentionally use obscene words and strong language. Stephen J.A. Ward in his paper ‘Global Media Ethics’11 reveals requirements for journalists. Neither nations nor any organizations should develop professional ethics independently. These requirements must be the same for the whole world. Only then the chances will appear to guarantee the integrity and impartiality and, on the contrary, to escape punishment in another country would become impossible. Referring to the Russian law, first of all, the Code of Ethics of the Society of Professional Journalists should be mentioned.12 It contains totally new provisions: — Duty to do one’s best to meet ‘heroes’ of his/her publications in order to enable a person to argue allegations in his/her respect; — Necessity of checking motives of a ‘source’ before promising an anonymity; — Requirement to find out all conditions granted in exchange for information and to abide them; — Right to safely speak about both positive and negative aspects of human nature; — Requirement not to demonstrate events that took place before, because they might have misleading character;

11 JA Stephen, ‘Ward Global Media Ethics’ (2014) 6 Magazine University of Wisconsin-Madison 42. 12 accessed 6 September 2015. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Dmitry Shibaev, Nina Uibo Moral, Informational and Legal Aspects of Professional Activity of a Journalist 179

— Possibility to use only public and legal ways of obtaining information; — Right to share true values without imposing them to others; — Right to give voice to those who usually do not have an opportunity to speak; — Focus on children and other disadvantaged groups; — Necessity to realize that a publication can cause grief and pain; — Necessity to admit that a person has more rights to protect his/ her privacy than an official seeking power, influence and public attention; — Necessity to avoid any conflicts, but to speak openly about real threats; — Being free to protest against the authorities; — Right not to join organizations and not to engage in activities to discredit the professional reputation; — Right to be accountable only to viewers, listeners, readers and other journalists; — Necessity to admit mistakes and be ready to correct them; — Right to expose the unethical practices of other journalists. Another all-levels act is the Code of Professional Ethics of a Russian Journalist of the Union of Journalists of Russia.13 There is no point to give details since its provisions are this way or another similar to those listed above. The array of the journalists’ ethical precepts can be presented as a few simple truths i.e. the recognition of the right to reliable information, objectivity, integrity, social responsibility, respect for common values and interests of the public as well as an individual, the struggle against war and other calamities, the development of a new world information and communication order.14 The main problem of the journalist ethics, however, is not in the field of standards, but it is to understand them through the legal consciousness of an individual. The above-mentioned acts as well as many other local ones specify guidelines for journalists in their professional activity. They are not numerous but the nature of this profession implicitly empowers

13 > accessed 6 September 2015. 14 The International Principles of Professional Ethics in Journalism UNESCO, 1983. < www.mediasprut.ru/ > accessed 6 September 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 180 KUTAFIN UNIVERSITY LAW REVIEW a journalist to adjudicate by forming certain images in the public consciousness. With public non-legal authority it is very important to follow the moral, not specific one, but common for everybody. Standards of any professional ethics result from the understanding of simple rules of behavior in interpersonal relations.

III. THE PRACTICE OF RESOLVING DISPUTES BY THE PUBLIC COMMISSION FOR PRESS COMPLAINTS

It is hardly possible to add something new to existing standards. The issue of the professional ethics is a matter of self-organization and personal qualities of a journalist. In this case, one of the ways to improve moral standards of press is to improve requirements for the professional education of journalists. The educational program provides for ‘understanding values and ethical guidelines to regulate journalism, knowledge of basic documents, both Russian and international, on the professional ethics that make up the framework for self-regulation’ as an element of training bachelors in journalism.15 The State Standard of education commands knowledge of theoretical and methodological requirements for professional activities. But that means the acquisition of knowledge and skills. The analysis of the decisions on the complaints submitted to the Public Commission on Press Complaints leads to the conclusion that the problem of the defections of the journalist ethics is the lack of understanding of the limits for the correct and moral conduct of a journalist in the context of the specific life situations. The indifference of a journalist to social issues covered by him/her and to the personal bitterness of the individuals as well as disrespectful and derogatory comments, creating stereotypes about people and their lives. The situations and events announced by the press are often associated with personal matters and are private in terms of morality.

15 Obrazovatelny standart realizatcii program vysshego professional’nogo obrazovaniya po napravleniyu podgotovki zhurnalistika, kvalifikatciya (stepen’) bakalavr (The educational standard of programs of higher education in the direction of training of journalism, qualification (degree) Bachelor) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Dmitry Shibaev, Nina Uibo Moral, Informational and Legal Aspects of Professional Activity of a Journalist 181

A number of cases having been considered by the Commissions illustrates the above said.16 ‘On the complaint of A.S. Rogalevich about the article ‘The Zigzag of Success’ published on the site of IA ‘Karelinform’ (the author is Pieni Ihmenin, date – 09/12/2014). The journalist under the pen name ‘Pieni Ihmenin’ published the article about the allegedly corrupted deputy (the fact has not been confirmed by the following prosecutor’s check up). Some facts in the article were distorted, some, conversely, were not mentioned and it radically changed the gist of the matter. In the article there was a clear conclusion, which infringed the principle of presumption of innocence, that the deputy was a corrupted person. Besides, the journalist ignored requirements of the journalistic ethics. It prescribes to publish full details of the case but never part of it, and be sure to get a consent to make the information public from the person a journalist is writing about. Another example is the complaint of Museum ‘Perm-36’ about the NTV – channel news items of ‘CH P’ [emergency]’ and ‘Profession – Reporter’: ‘Sponsors from the United States have opened a museum of “nationalistic sufferers” of Ukraine in Perm’ and ‘The Fifth Column’

16 Zhaloba deputata na statyu ‘Zigzag udachi’ sayta ‘KarelInform’-Resheniye Kollegii (The complaint of the deputy to the article ‘Zigzag of Luck’ Site ‘Karelinform’ Decision of the Board). accessed 6 September 2015; Zhaloba Muzeya ‘Perm-36’ na syuzhety is ‘CHP’ i ‘Professiya reporter’ NTV-Resheniye Kollegii (The complaint The of Museum “Perm-36” on the news items of ‘Emergency’ and ‘Profession Reporter’ NTV – Decision of the Board). accessed 6 September 2015; Zhaloba Yuriya Shtamova na blogi sayta radiostantcii ‘Eho Moskvy’-Resheniye Kollegii (The complaint of Yuri Shtamova on the blog site of radio-station “Echo of Moscow” – Decision of the Board) accessed 6 September 2015; Zhaloba na “LipetckMedia” iz-za statyi o sgorevshih –Resheniye Kollegii (The complaint ‘LipetskMedia’ because of articles on the burnt – Decision of the Board). < http://www.presscouncil. ru/index.php/praktika/rassmotrennye-zhaloby/4143-zhaloba-na- lipetskmedia-iz-za-stati-o-sgorevshikh-koshkakh?showall=&start=6 > accessed 6 September 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 182 KUTAFIN UNIVERSITY LAW REVIEW released in summer 2014. Those news items are ‘overwhelmed with the examples of violations of the principles of the journalistic ethics.’ Two basic ethical norms that the author has failed to comply with, are the truth and disinterest. The first one is breached by communicating knowingly false message and silencing some circumstances necessary for better understanding of the situation. The second is infringed by the fact that the same thought is behind both news items: the museum ‘Perm-36’ staff are the agents of the West supporting Ukrainian nationalists, and they hate Russia. Both TV stories, in fact, are examples of propaganda films intended to shape a predetermined and clearly defined picture of reality for a viewer. Still another complaint is about the article on the burned cats ‘LipetskMedia’, in which a journalist in an ironic manner describes the fire in a shelter for homeless animals. The journalist calls it a ‘dormitory’ and points out how the passers-by were, supposedly, happy to learn that the shelter had finally burned with all of its inhabitants. The Commission members consider the article in question to conflict the basics of journalism as an occupation, which makes distinctions between the good and the evil when it concerns tragedy, misfortune, pain, sufferings of living beings. The journalist made a contribution, even unwillingly, to the dehumanization of the society. Not every piece of information can be protected as some personal data, even private and family secrets from someone’s eyes and ears. De jure such data are not secret but it is unmoral to speak about them in public. But there are cases of rather rude and even cynical intervention into family problems of the people or their life tragedy. To create a rich description of a heinous crime, the disclosure of which evokes intense emotions on the part of the reader there is a misrepresentation of facts and a large proportion of fabrication. Shocking details are used with the aim to enhance the level of the sensationalism of information.

IV. FINDINGS

Obviously, it is not enough to know the rules of ethics. A person should have an innermost core of morality to adhere to it uncompromisingly. In a legal state it is impossible to mix the spheres of morality and law, so in such a situation the actual legal remedy is a civil lawsuit to protect one’s www.kulawr.ru Volume 1 April 2016 Issue 1(5) Dmitry Shibaev, Nina Uibo Moral, Informational and Legal Aspects of Professional Activity of a Journalist 183 honor, dignity and business reputation, good name and to apply for moral damages (mental suffering) compensation. However, the importance of the media in creating an informational and psychological environment in society is so great that the mission of the media presupposes its remedial function to glorify respect for a human and human rights and freedoms, to create a healthy atmosphere of benevolent trust in the government, the world and the media, providing spiritual balance in today’s situation of stress, social tension and cultural upsurge. The media must be seen as a base for foundation of a civil society and a democratic constitutional state. Consequently, it means that self- regulation and public initiative play an important role in society. In Germany, e.g. there is practice to create a judicial precedent for disputes in the journalistic community at the level of the Constitutional Court of Germany.17 In general, in judicial practice including the Russian courts, decisions of self-regulation bodies are not rules of law and courts take them into account if consider appropriate. But changing the understanding of the profession can be a more radical and correct solution of the problems of a journalist investigation in terms of ethics. It is necessary to update educational programs in universities in this area. In addition to the studies of the theoretical foundations of ethics journalists should undergo some kind of a personality test. Those tests should be developed with the participation of professional psychologists as well as well-known and respected journalists with an impeccable reputation. Professionally – oriented situations with non-obvious options for action should be developed to teach how to draft reports, collect information and to write critical evaluation articles and to deal with the respondents, etc. Moreover, these education jobs should be designed in such a way that their implementation is based rather on consideration of individual characteristics of students’ behavior, his / her outlook, foresight, tact, politeness, adequacy, correctness, endurance, dignity than on correct (wrong) answer options. It should be noted that this is not about aptitude (communication and analytical skills and promptness) but

17 Mel’nikov M.A. Osnovnye mekhanizmy regulirovaniya deyatel’nosti SMI. Obshchestvennoe i eticheskoye regulirovanie / Mezhdunarodnyy press-club (MA Melnikov, ‘The basic mechanisms of media regulation. Public ethics and regulation’ accessed 23 October 2015.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 184 KUTAFIN UNIVERSITY LAW REVIEW about the moral components, i.e. sensitivity, humanism, humanity, desire and ability to form the ‘ecology of human relations.’ The status of the profession should be elevated to that of a mission of destiny, which does not correspond to the current image of the ‘yellow press’ and those journalists who breach by their behavior all bounds of what is permitted, ignoring the truth and legal rights. It is important to avoid the commercialization of the media when general valuable information becomes a commodity. It is also important not to let media become an instrument of policy. The basics of journalism should be ideologized, but only in respect of the Constitution values and recognition of human rights and freedoms.

Bibliography

Bagerstam E, Freedom of the Press in a Democratic Society (Vyallingbi 1992) Branscomb A, ‘Law and Culture Information Society’ (1986) 4 Information Society Makiavelli N, Gosudar’ / M.: Planeta, 1990 (N Machiavelli, Emperor (Planeta, 1990)) Mel’nikov M.A. Osnovnye mekhanizmy regulirovaniya deyatel’nosti SMI. Obshchestvennoe i eticheskoye regulirovanie / Mezhdunarodnyy press-club (MA Melnikov, ‘The Basic Mechanisms of Media Regulation. Public Ethics and Regulation’ accessed 23 October 2015 Russo Zhan Zhak. Ob obshchestvennom dogovore, ili Printsipy politicheskogo prava / perevod s frants. A.D. Khautina i V.S. Alekseeva- Popova. Po izd.: Russo Zh.Zh. Ob obshchestvennom dogovore: traktaty. Per. s frants. M.: KANON-press, Kuchkovo pole, 1998 (Rousseau JJ, Of the Social Contract, or Principles of Political Right (Trans. from French. CANON-press, 1998)) Stephen JA, ‘Ward Global Media Ethics’ (2014) 6 Magazine University of Wisconsin-Madison The International Principles of Professional Ethics in Journalism (UNESCO 1983) Virieu FH, La Mediocratie (Paris, 1990) www.kulawr.ru Volume 1 April 2016 Issue 1(5) 185

ARTICLE

COMBATING AN UNJUSTIFIED TAX BENEFIT IN THE RUSSIAN FEDERATION

Sergey Sergeev (Russia)

Author Student, Kutafin Moscow State Law University Email: [email protected] Abstract Realizing the need to compensate for the lack of statutory provisions combating abusive taxpayer’s practices the Constitutional Court of the Russian Federation introduced the new concept of ‘taxpayers’ conscientiousness’ (integrity.) The concept was evaluative by nature and failed to provide an effective practical treatment of the problem. It strongly enhanced the position of tax authorities and injured the interests of taxpayers. This legal deficiency was improved by the High Arbitration Court in its Regulation № 53 of 12 October 2006 ‘On Assessment by Arbitration Courts of Justifiability of Tax Benefit Obtained by the Taxpayer’. Analyzing the newly introduced concept of ‘justifiable tax benefit’, some legal scholars distinguish such validity tests as business purpose doctrine, due circumspection doctrine and substance over form doctrine. As a rule those doctrines are applied by tax authorities either in combinations or separately. Since those doctrines are of general nature, they can be applied to many cases. The present article investigates the definition and main features of unjustified tax benefit. What’s more, it will also cover extensive judicial practice. Such legal means can be found not only in Russia but also in a number of foreign countries both in legislation and in judicial practice. This article will handle the German and American counterparts of unjustified tax benefit concept. Keywords Taxation, unjustified tax benefit, tax abuse, tax benefit, tax relief, taxpayers’ integrity

DOI: 10.17803/2313-5395.2016.1.5.185-197

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 186 KUTAFIN UNIVERSITY LAW REVIEW

TABLE OF CONTENTS

I. Introduction ...... 186 II. Adopting the concept of unjustifi ed tax benefi t ...... 187 III. Common judicial doctrines applied by Arbitration courts ....188 A. The business purpose doctrine ...... 188 B. The doctrine of fi ctitious transactions ...... 189 C. The doctrine of primacy of substance over form ...... 189 D. The doctrine of due circumspection at the Choice of a Business Partner ...... 189 IV. Signs of unjustifi ed tax benefi t ...... 190 V. Combating abusive practices in foreign jurisdictions ...... 191 VI. Judicial practice review ...... 192 A. Artifi cial involvement of intermediaries ...... 192 B. Infl ating the price through the use of fl y-by-night companies ...... 193 C. Fragmentation of business ...... 194 D. Abuse of tax reliefs ...... 195 VII. Concluding remarks ...... 196 Bibliography ...... 197

I. INTRODUCTION

Taxpayers violating tax law provisions are subject to legal sanctions in accordance with the legislation. However, in certain situations a taxpayer may choose to structure his business operations in such a way that no legal provisions are formally violated, and also the amount of his tax liability gets effectively reduced. Depending on concrete circumstances of a particular case obtaining unjustified tax benefit can be qualified either as abuse of rights for the purpose of tax avoidance or tax evasion damaging the public interests of the state.1

1 Rovinski M.A. Predely dopustimogo nalogovogo planirovaniya: istoria i aktual’nye tendentsii / Moskovskiy yurist. 2013. № 2. S. 32―47 (MA Rovinski, ‘The limits of tax planning: history and important trends‘ (2013) 2 Moscow Lawyer 32). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 187

Most commonly, taxpayers use such ‘tax optimizing’ schemes to cut value added tax (VAT) or profit tax.2 Although these schemes seem to be absolutely legal, in fact, they are based on sham transactions aimed at obtaining unjustified tax benefit or unjustified tax refund from the state budget.

II. ADOPTING THE CONCEPT OF UNJUSTIFIED TAX BENEFIT

Since Russian legislation did not stipulate any provisions opposing tax fraud schemes, the courts used to apply the doctrine of ‘conscientious taxpayer’ introduced by the Constitutional Court of the Russian Federation in its Regulation № 24-P of 12.10.1998.3 However, due to the lack of commonly recognized criteria for determining the ‘taxpayers’ conscientiousness’ (integrity) this practice was not curing the situation in the real world, but instead resulted in an increased number of tax cases brought to courts. This discrepancy was partially compensated when the Plenum of the Supreme Arbitration Court of the Russian Federation (the VAS) adopted its Regulation № 53 on October 12, 2006 ‘On Assessment by Arbitration Courts of Justifiability of Tax Benefit Obtained by the Taxpayer’,4 whereby the VAS purported to reveal relevant signs of tax abuses and to elaborate a new, more comprehensive judicial doctrine. The above mentioned Regulation introduces the concept of ‘justified tax benefit’

2 Danchenko S.P. Neobosnovannaya nalogovaya vygoda: ocherednye itogi nalogovikov / Nalogovaya proverka. 2014 № 1. S. 66―78. (SP Danchenko, ‘Unjustified tax benefit: the latest results of taxmen’ (2014) 1 Tax Audit 66). 3 Postanovlenie Konstitucionnogo Suda RF ot 12.10.1998 N 24-P “Po delu o proverke konstitucionnosti puncta 3 statii11 Zakona Rossiiskoi Federacii ot 27.12.1991 ‘Ob osnovah nalogovoi sistemy v Rossiiskoy Federacii (Ruling of Constitutional Court of the Russian Federation № 24-P of 12.10.1998 ‘On the case of reviewing the constitutionality of item 1 of article 11 of the Russian Federation Law “On the basics of fiscal system in the Russian Federation”. 4 Postanovlenie Plenuma VAS RF ot 12.10.2006 N 53 ‘Ob ocenke arbitrazhnimi sudami obosnovannosti polucheniya nalogoplatelshikom nalogovoy vigody’ (Regulation of the Highest Arbitrazh Court № 53 of 12 October 2006 ‘On Assessment by Arbitrazh Courts of Justifiability of Tax Benefit Obtained by the Taxpayer’).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 188 KUTAFIN UNIVERSITY LAW REVIEW which is understood as any legal reduction of tax liability amount which may result from: — reducing taxable base; — obtaining tax deduction or tax privilege; — applying a lower tax rate, or entitlement to tax refund from the state budget. Such a benefit is deemed to be the result of economically sound business operations of a conscientious taxpayer. The term is not yet enshrined in the Russian Tax Code, which omits to provide its definition.5

III. COMMON JUDICIAL DOCTRINES APPLIED BY ARBITRATION COURTS

Following the Regulation, Russian Arbitration courts while resolving tax disputes are obligated to presume that an audited taxpayer was acting conscientiously, i.e. honestly and that the tax benefit obtained by him was justifiable. Notwithstanding, tax authorities have an opportunity to prove that the tax benefit was obtained by the audited taxpayer illegally through the following doctrines or their combinations stipulated in Regulation № 53.

A. The business Purpose Doctrine Tax benefit can be found unjustified, if commercial transactions were made for the taxation purposes without taking into account their true economic rationale or the operations entered into the records were not backed up with sound economic or other reasons (business purposes). At this point, it is important to note that tax benefit per se cannot be considered a separate business purpose. While deciding whether a particular transaction really had an underlying business purpose or not, the adjudicating body is to assess the circumstances that show the intention to attain economic effect that results from real commercial activities.

5 Nalogovyi kodeks Rossiiskoi Federatii (chast pervaya) ot 31.07.1998 N 146-FZ// SZ RF. 1998. N 31. st. 3824; 2015. N 1. str. 33. (Tax Code of the Russian Federation (first part) of от 31.07.1998 N 146-FZ/ Tax Code of the Russian Federation (first part) of 31.07.1998. N 31. p. 3824; 2015. N 1. p. 33). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 189

If the book record of a transaction does not correspond to its true economic rationale, the adjudicating body may determine the scope of taxpayers’ rights and obligations proceeding from the genuine commercial implication of the transaction.

B. The doctrine of Fictitious Transactions While pursuing tax optimizing purposes, taxpayers may enter into sham bargains i.e. the bargains that did not take place in reality but were reflected in the organization’s financial reports. Since such bargains do not entail any tax consequences, no tax benefit can be obtained. The existence and validity of a particular transaction may be substantiated by providing the following: — contracts signed by both parties; — waybills; — invoices signed by the business partner’s authorized offi cers, etc. In this situation, such circumstances as having a business partner, who does not employ any managerial or technical staff, does not have any or sufficient permanent assets, business assets, warehouse premises or a fleet of vehicles may not be deemed as a ground to consider the obtained tax benefit unjustified. Consequently, the tax claims lodged against the taxpayer can be reduced.

C. The doctrine of Primacy of Substance over Form While estimating the tax consequences of a transaction the adjudicating body will take into account the nature of relations really existing between the parties but not the format that the parties have chosen for documenting the particular commercial operation. The doctrine of primacy of substance over form is used to assess the results of the audited taxpayers’ operations, which are not backed up with sound commercial and other reasons (business purposes). It cannot be used as a separate tool for spotting the signs of unjustified tax benefit.

D. The doctrine of Due Circumspection at the Choice of a Business Partner This doctrine was introduced to oppose the use of fl y-by-night companies for tax evasion purposes. That is why choosing a business partner one should act with a due circumspection: ascertain the counteragent’s

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 190 KUTAFIN UNIVERSITY LAW REVIEW legal capability, determine the powers of its offi cers, and make sure it has a clean taxpayer’s record. According to the Ministry of Finance, as a proof of due circumspection can serve a copy of the business partner’s certificate of registration by the tax authority in order to make sure that the information about the business partner is included in the Uniform State Register of Legal Entities, as well as a checkup of the business partner’s constitutional and some other documents. If the adjudicating body using the above mentioned doctrines finds the obtained tax benefit unjustified, its ruling will mean that the taxpayer’s claims for obtaining such a tax benefit should be rejected.

IV. SIGNS OF UNJUSTIFIED TAX BENEFIT

Regulation № 53 of the Supreme Arbitration Court distinguishes two groups of signs, demonstrating unjustly obtained tax benefit. The first group comprises the features that directly point at obtaining unjustified tax benefit. These are the cases when: — the taxpayer could not have transacted a real deal due to the existing circumstances; — the result of the business activity in question could not have been achieved because the respective party did not employ managerial or technical personnel it would have needed to transact the deal; — the respective party does not have permanent and other assets; — accounting of certain business operations is selective; — the goods which are the subject of the deal were not produced or could not have been produced in the quantity, shown by the taxpayer in his financial reports. The second group comprises the signs that may point at unjustly obtained tax benefit only when they come together. These signs include: — mutual dependence of the parties of the deal; — non-systematic nature of business operations; — making all the settlements through the same bank; — violation of tax legislation in the past; — using intermediaries in business transactions, and some other. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 191

Many scholars observe Regulation № 53 as the one establishing new tax law provisions instead of clarifying the existing ones, although no such powers are vested in the Supreme Arbitration Court by the Law ‘On Arbitration Courts of the Russian Federation’.6 Since Russia belongs to the Civil law system, courts are not authorized to perform lawmaking functions; at least they do not have this authority by the virtue of law. Notwithstanding, the meaning of Regulation 53 of the VAS is binding upon the arbitration courts in Russia. This is a quite a noteworthy fact for the country with the Civil law system.

V. COMBATING ABUSIVE PRACTICES IN FOR EIGN JURISDICTIONS

Provisions combating abusive practices of taxpayers can be found not only in the legal system of Russia, but in a number of other countries. For instance, the Tax Code of Germany stipulates that no tax law provisions can be circumvented through any legal constructions.7 Abuse of rights normally entails the same tax consequences that would have occurred if an operation with underlying sound business interests of the parties had been transacted. Similar approaches can be found in the USA. Since that country’s jurisdiction uses case law, judicial discretion plays a crucial role. While trying tax law cases judicial bodies elaborate criteria that may point at abusive taxpayers’ practices and that can also be used later in future court practice. Some very interesting American case law in the fi eld of corporate tax violations is described by Blank and Staudt in ‘Corporate Shams’.8 The

6 Kalantarova E.I. O roli resheniy visshikh sudebnykh organov v razvitii zakonodatel’stva ob administrativnoy otvetstvnnosti / Administrativnoe pravo i process. 2015. № 4. S. 68-72 (EI Kalantarova, ‘On the role of the highest judicial bodies in the development of administrative liability legislation’ (2015) 4 Administrative law and procedure 68). 7 General Tax Code: Abgabenordnung, version dated 1 October 2002, published in the Federal Law Gazette (Bundesgesetzblatt) 2002, part I, at 3866 and Federal Law Gazette 2003, part I, at 61, last amended 9 December 2004, Federal Law Gazette 2004, part I, at 3310. 8 JD Blank, NC Staudt, ‘Corporate Shams’ (2012) 87 6 New York University Law Review 1641.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 192 KUTAFIN UNIVERSITY LAW REVIEW authors provide a brief overview of corporate tax abuse and describe the varied approaches of courts to drawing a line between law-abiding and abusive activities. Modern corporate tax abuse strategies often involve multiple transaction steps, many parties and tax jurisdictions and are therefore diffi cult to reveal. In the course of litigation courts employ some similar doctrines such as Sham Transaction Doctrine, Economic Purpose Doctrine, Substance Over Form Doctrine, Step Transaction Doctrine (the last one implies application of the appropriate tax treatment to formally separate deals as a single transaction). However, possible application of one or more judicial anti-abuse standards introduces uncertainty into the practice of corporate tax planning. Given the ambiguous nature of ‘judicial anti- abuse standards’, the professional community is voicing a variety of opinions regarding the factors that could be most critical in determining whether a court would uphold or reject the ‘corporation’s claimed tax treatment’.

VI. JUDICIAL PRACTICE REVIEW

Application of the concept of unjustified tax benefit in Russia has produced considerable scope of judicial practice. Below is a review of some important arbitration cases concerning the criteria for validating tax benefit.

A. Artifi cial Involvement of Intermediaries If the tax authority conducting an audit of an accountable person’s business operations reveals that involvement of intermediaries in a chain of transactions neither pursue any business purpose nor had any rationale behind it, the expenditures on such services in the respective operations will not be acknowledged as reasonable and therefore no VAT deductions will be allowed. This approach is illustrated in a case by the West-Siberian Region Arbitration Court where the authority came to the conclusion that a company had obtained unjustified tax benefit by inflating its VAT and profits tax deductions through an agency contract scheme.9 Because

9 Postanovlenie FAS Zapadno-Sibirskogo Okruga ot 12.12.2012 po delu N А46- 15539/2011 (Ruling of the Arbitrazh Court of the West-Siberian Region of 12.12.2012 in case N А46-15539/2011). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 193 both sale of goods and purchasing deals underlying the respective agency contracts were formal by nature, the tax authority treated those transactions for taxation purposes as if the company dealt with its business partners directly without any involvement of third parties. In the course of arbitration hearings the court discovered a number of important circumstances, which were also taken into account while adjudicating the case: — intermediaries assertedly engaged by the accountable taxpayer were not to be found in their registered office, did not have any technical staff, vehicles, or business assets. Neither did they hold any licenses necessary to discharge their obligations towards the accountable person; — the pretended intermediaries’ tax returns were formal and showed insignificant numbers; — cash flow on the audited bank accounts revealed not only formal transfers of the funds onto the pretended intermediaries’ accounts, but also their cash-out transactions. The court also took into account the following explanations of the participating intermediaries’ CEOs: — they did not intend to buy and resell the goods under the agency contract with the accountable person; — the documents provided during the on-site tax audit did not bear their signature. The said circumstances coming together evidence the illegal reduction of the taxable base by the accountable person and his improper claiming of VAT deductions. Therefore, the commercial transactions were recorded as if the taxpayer entered into the sales relations as an independent entity.

B. Infl ating the Price Through the Use of Fly-By-Night Companies One of the fairly common ways to minimize a business’ tax liability is making up a scheme based on an arrangement between the accountable company on the one side and an importer or producer on the other side. The Ministry of Finance points out that such an arrangement commonly involves a number of dormant companies (Letter of the Russian Tax Service of 31.10.2013 N СА-4-9/19592).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 194 KUTAFIN UNIVERSITY LAW REVIEW

The whole chain of several simulated deals transacted between sham intermediaries, dependent on the dishonest taxpayer, is designed to increase the value of the imported goods, the amount “paid” for the consignment becoming greater at each deal in the chain. Use of this scheme allows the dishonest taxpayer to understate the profit tax base by overstating his purchasing expenses and to get a VAT refund from the state budget whilst trading margin of the fly-by-night companies involved in the transaction chain is withdrawn through sham persons’ transit accounts. An example to illustrate the situation can be the case by the Moscow Region Arbitration Court,10 where it was revealed, that the audited taxpayer engaged in improper deals with a related importer whose goods were sold through various businesses founded and headed by the audited taxpayer’s employees with huge value increase at each stage of their realization.

C. Fragmentation of Business According to the Russian Tax Service, another scheme frequently employed by taxpayers to reduce their tax liability is realized by fragmenting their business with the view to taking advantage of various favorable tax regimes such as simplifi ed tax system, unifi ed tax on imputed income (Letter of the Russian Tax Service of 31.10.2013 N СА-4-9/19592). The mentioned scheme can be exemplified by the case adjudicated by the Moscow Region Arbitration Court.11 Tax authority established that the audited company and its director, who was also registered as individual entrepreneur, performed a complex of transactions aimed at property and profit tax reduction. The company acting as vendor and the individual entrepreneur acting as a buyer concluded a contract of sale of non-residential premises. Later the company took a lease of its former premises from the buyer at an artificially low price. As to the

10 Postanovlenie FAS Moskovskogo Okruga ot 08.02.2013 po delu N А40- 54652/12-99-310 (Ruling of the Moscow Region Arbitrazh Court of 08.02.2013 in case N А40-54652/12-99-310). 11 Postanovlenie FAS Moskovskogo Okruga ot 16.06.2014 po delu N F05-5613/2014 (Ruling of the Moscow Region Arbitrazh Court of 16.06.2014 in case N F05- 5613/2014). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 195 entrepreneur, he paid the company for the purchased premises with the money received from the same as his dividends and rental payments. Furthermore, it was proved that prior to purchasing the premises the entrepreneur had withdrawn his ownership in that company, which evidences creating the scheme with artificial turnover of documents and circular money flow, in other words - formal nature of financial and business transactions. The scheme allowed transferring the company assets to a dependent person, who was exempt from property tax. Thus, the company benefited not only from saving on the property tax payments, but also from accounting the rental as a cost, and hence decreasing the taxable income. In a view of the above said it was held that the actions of the tax authority, which charged additional sums to satisfy profit tax requirements, were legally compliant.

D. Abuse of Tax Reliefs Another method of obtaining unjustified tax benefit is inappropriate enjoyment of tax reliefs. The above can be aptly illustrated by a case by Moscow Region Arbitration Court. A tax authority revealed a scheme arranged to obtain unjustified tax benefit by an organization employing disabled persons.12 A company formally qualified as an appropriate one for receiving tax relief in compliance with Art. 149 Para. 3 of the Russian Tax Code, i.e. a company, which sole founder was a nonprofit organisation of disabled persons; which charter capital amounted to RUB 10,000, and where over 50 % of the employees were disabled and jointly accounted for 25% in the total payroll amount) was artificially built into the chain of lease transactions for the only purpose of getting an exemption from VAT on the inflow of rental payments that constituted company’s only earning. Tax authorities assumed that the purpose that the company pursued in having the disabled persons involved in the scheme was not ensuring their social security and providing them employment to meet their health requirements, i.e. the idea that underlies state tax relief, but instead -

12 Postanovlenie FAS Moskovskogo Okruga ot 16.03.2012 po delu N А40- 21241/11-75-89 (Ruling of Moscow Region Arbitrazh Court of 16.03.2012 in case N А40-21241/11-75-89).

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 196 KUTAFIN UNIVERSITY LAW REVIEW intended to obtain unjustified tax benefit by the way of getting a non- compliant tax exemption. These considerations were substantiated by the combination of the following facts: — failure by the company to conduct any business activity besides subleasing of the real property already mentioned; — all business operations necessary for subleasing were effectively performed by third persons; — transitive nature of settlements made; — disproportion between the rental paid and rental received; — employing only four people, three of whom were disabled that would make real business activities impossible to perform in the situation where the estate was subleased to more than 300 subtenants; — too low salaries level upon to a labour contract; — maintaining the liaison with the subtenants through intermediaries; — duplication by the tenant and the intermediaries of the main job functions ascribed to the disabled persons who were represented by the company as its employees; — previous performance by the third party of the same activities with other tenants at the same premises; — all participants of the deals (including those who were previously involved in same scheme) kept open accounts in the same bank. The adjudicating body agreed with the conclusions made by the tax authority at point that all the indicators, making up VAT relief entitlement, were close to zero, which is the evidence of creating formal grounds for tax relief. A relief under Art. 149 Para. 2 and 3 of the Russian Tax Code can not be granted to an entity, which sacrifices its statutory objectives to a benefit of extraneous profit-making activity.

VII. CONCLUDING REMARKS

In a view of the above mentioned we may conclude that giving up the former evaluative term ‘taxpayer’s conscientiousness’ appears to be a positive move because the new Regulation of the Higher Arbitration Court provides Russian arbitration courts with more effective tools for www.kulawr.ru Volume 1 April 2016 Issue 1(5) Sergey Sergeev Combating Unjustifi ed Tax Benefi t in the Russian Federation 197 verifying justifiability of tax benefit. Similar provisions were introduced into many foreign legislations quite a time ago. However, the practice of filling legal gaps with judicial interpretations in fact indefinitely postpones the final legislative solution for fighting with tax fraud offences.

Bibliography

Blank JD, Staudt NC, ‘Corporate Shams’ (2012) 87 6 New York University Law Review Danchenko S.P. Neobosnovannaya nalogovaya vygoda: ocherednye itogi nalogovikov / Nalogovaya proverka. 2014 № 1. S. 66―78. (SP Danchenko, ‘Unjustified tax benefit: the latest results of taxmen’ (2014) 1 Tax Audit) Kalantarova E.I. O roli resheniy visshikh sudebnykh organov v razvitii zakonodatel’stva ob administrativnoy otvetstvnnosti / Administrativnoe pravo i process. 2015. № 4. S. 68―72 (EI Kalantarova, ‘On the role of the highest judicial bodies in the development of administrative liability legislation’ (2015) 4 Administrative law and procedure) Rovinski M.A. Predely dopustimogo nalogovogo planirovaniya: istoria i aktual’nye tendentsii / Moskovskiy yurist. 2013. № 2. S. 32―47 (MA Rovinski, ‘The limits of tax planning: history and important trends‘ (2013) 2 Moscow Lawyer)

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NOTE

LEGAL ASPECTS OF SURROGACY CONTRACTS Svetlana Morozova (Russia)

Author Alumnus of the Kutafin Moscow State Law University, 2015 Email: [email protected] Abstract This article concerns relevant issues and important aspects of surrogate motherhood. The author examines the feature of contract of surrogate motherhood and analyzes Russian and American practice. Also the article covers surrogate mother’s responsibility for breach the contract. Another problem is a subject of the contract. In reality it is a child. Somebody believes it contradicts moral norms. Lately practice deals with many disputes when surrogate mother doesn’t return a child to parents or demands to increase contract’s price. Unfortunately, there is no decision found for that so far, as well as for some other problems of surrogate motherhood in the world. Unfortunately, Russian Family Code doesn’t contain obligatory terms of the contract in question.Court ruling shows that nobody can put mother who is carrying ones’ baby to a claim to give a child to biological parents. Persons who gave a written consent for implantation an embryo to other woman can formally become parents only upon surrogate mother’s approbation. Author proposes the ways of solution of that problem. It’s necessary to make amendments to Russian Family Code regarding surrogacy contract, to regulate the registration and to establish responsibility for surrogate mother for breach of contract. Also it’s important to somehow protect biological parents. Keywords Surrogate motherhood, extracorporeal fertilization, voluntary participation, biological parents protection, surrogacy contract

DOI: 10.17803/2313-5395.2016.1.5.198-203 www.kulawr.ru Volume 1 April 2016 Issue 1(5) Svetlana Morozova Contract for the Provision of Surrogate Motherhood: Legal Problems 199

The surrogate motherhood is an accepted fact in a modern society.1 Somebody faces with the problem of conceiving and giving a birth to a child in a natural way, but most of the women want to feel happiness of motherhood and give birth by her own. Contemporary medicine science takes an opportunity of using extracorporeal fertilization when a woman carries an embryo conceived by stranger’s sex cells. Such interference with the physiological process entails both legal consequences and legal conflicts. Surrogacy emerged in 1981 in the United States of America when the first successful program of extracorporeal fertilization was implemented. Some countries, such as France, Austria, Germany, Norway, Sweden, several states of the USA flatly refuse from surrogacy because it undermines family values and define some ethic problems. There are countries where surrogacy is not forbidden but also is not regulated by the legislation: Belgium, Finland. In Russia surrogacy began to spread a few decades ago. According to Russian Federal law (Article 55) ‘On the basics of protection of the health of citizens in the Russian Federation’ surrogacy is carrying and giving birth to a child within the contract, which is signed by surrogate mother and biological parents who gave their own sex cells. Under Russian Family Code neither spouses who gave a permission for the implantation of embryo to another woman nor a surrogate mother have a right to dispute a motherhood and fatherhood, referring to the circumstances linked to surrogate motherhood, after a registration of parents in the register book of births. The Russian Health Ministry Administrative Order № 107 N ‘On the order of using of reproductive technologies, contraindications and limitations of their application’ covers health problems that do not allow a woman to give a birth and also some requirements for a surrogate mother. Surrogate mother could be a women from 20 to 35 who has got at least one her own healthy child and who gave written permission for medical intervention. Despite all those laws this sphere is still not regulated enough. In particular, there are not any legal guarantees for the biological parents.

1 Alyssa James, ‘Gestational Surrogacy Agreements: why Indiana Should Honor Them and What Physicians Should Know Until They Do’ (2013) 10 1 Indiana Health Law Review 176.

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Russian legislation does not establish any penalties for improper performance and contract breach by a surrogate mother. The nature of this contract is not defi ned, legislators and courts in many countries including Russia often follow Civil Code rule of freedom of a contract. This contract is usually called a contract of rendering services of surrogate motherhood. Considering this type of contract it should be taken into account that citizens faced with interference in the natural processes. In my opinion a key problem is a subject of the contract. In any contract there should be a subject, rights and obligations of the parties and liability for the failure of performance or improper performance of the contract. Formally a subject of the surrogacy contracts is the voluntary participation of the parties in surrogacy program. But in practice a subject of the contract is a child and that contradicts moral norms. So it is the reason for cancelation of deal in many countries. However, institute of surrogate motherhood has more advantages than disadvantages. Grace to technological progress in this sphere many women have an opportunity to have their own children using this method as well as married couples can have full family. But these advantages can take place only under effective legal regulation. Russian legislation doesn’t establish obligatory terms of this contract. In practice usually contract provides terms of preparation of extracorporeal fertilization, period of pregnancy and also period of preparation for giving birth act. The surrogate mother holds responsibility for her health and the child’s health. Besides, if artificial interruption of pregnancy happens she is deprived of all rewards and has to compensate all costs incurred earlier on for purpose of contract. The crucial term is a contract’s price. As usual it is defined by the parties of the contract. However, in practice surrogate mother often blackmails the biological parents to increase the price. The main problem is the standards of laws of some countries, according to which a surrogate mother has a right to keep a child. Under Article 33 Human Fertilisation and Embryology Act of the Parliament of the United Kingdom of 2008 the woman who is carrying or gave a birth to a child as a result of the placing in her of an embryo or of sperm and eggs, and no any other woman, is to be treated as a mother of the child. So if a woman volunteers to carry a child for someone who can’t physically carry an embryo, she is not legally a mother, but if a woman who carries the embryo will keep the child, she has to be considered as a mother. www.kulawr.ru Volume 1 April 2016 Issue 1(5) Svetlana Morozova Contract for the Provision of Surrogate Motherhood: Legal Problems 201

There are similar rules in the majority of states in the US.2 There was an interesting case at one of the USA courts. Arizona statute establishes that legally mother is the surrogate one and has a right of custody of that child. Despite the fact that Arizona Appellate Court ruled this statute unconstitutional because it denied the genetic mother protection, it has not been repealed.3 There is one of important case: Anna Johnson made a contract of surrogacy with married couple Calvert. After Anna’s conception she demanded the final payment, which was not due after a child’s birth. The trial court established Calvert as biological parents and denied Anna’s claim. Under Ohio law the individuals who provide the genes of the child are the biological parents. Law requires that those provided a child with genetics must be designated as parents biologically and legally as well.4 It’s necessary to pay attention to protectability of biological parents while signing this type of contract. A surrogate motherhood does not involve any liability for non-execution of a contract. Under the Russian Family Code motherhood and childhood are under protection of State. And nobody can put a mother who is carrying a baby (even of other biological parents) in claims to give a child to biological parents. There are a lot of cases in practice when women refuse to execute the contract and to give a child to parents. There are a lot of courts applies in this regard. However, in Russia these applies are prohibited by Family Law. In 2005 Moscow district court dealt with another interesting claim. In Moscow clinic the successful operation of extracorporeal fertilization took place, and after a child birth registration surrogate mother tried to dispute a note in Birth’s book. She motivated it that she supposed to live with baby’s father. Under the Russian Family Code (Article 52) surrogate mother has no right to dispute a note in Birth’s book. Russian Family Code includes two articles on surrogate motherhood. First is about the existence of the institute of surrogate motherhood, and

2 Erin Y Hisano, ‘Gestational Surrogacy Maternity Disputes: Refocusing on the Child’ (2011) 15 Lewis & Clark Law Review 517. 3 C Spivack, ‘The Law of Surrogate Motherhood in the United States’ (2010) 58 American Journal of Comparative Law 97. 4 Victoria L Fergus, ‘Interpretation of Ohio Law on Maternal Status in Gestation Surrogacy Disputes: Belsito v Clark’ (1995) 21 Dayton Law Review 229.

Volume 1 April 2016 Issue 1(5) www.kulawr.ru 202 KUTAFIN UNIVERSITY LAW REVIEW the second guarantees a surrogate mother the right to determine a fate of the child. However, the detailed implementation of this procedure is not stipulated that in theory suggests the emergence of various kinds of legal incidents, and in practice provides surrogate mothers the opportunity to blackmail the biological parents. In Russia the legislation regulating legal conflicts in surrogacy sphere is liberal. That means, parties of a contract are not protected because there are not any imperatives of law and any contract guarantees. Family Code doesn’t protect biological parents. According to Article 51 of Family Code married couples who gave a written consent for implantation an embryo to other woman can become parents only by surrogate mother’s consent. If the surrogate mother refuses to give the child to genetic parents and decides to stay with a baby, she will be registered as a mother of the child.5 This means that the biological parents in accordance with the Russian legislation are not legally protected, and the surrogate mother is free not to give the child and biological parents are not able to sue and to invoke the circumstance of surrogate motherhood, demanding return of the child. Sometimes a surrogate mother changes her mind and refuses to give the child. So in states where surrogacy is allowed, the biological mother does not usually win custody or visitation rights. In most cases, both a surrogate and parents sign a contract to prevent it from happening. Nonetheless, there is always a chance that a surrogate mother might win her case.6 I don’t think that it’s fair. First, the biological parents make a big step and they take a risk. Secondly, in practice they always properly perform the conditions of the contract, however, a surrogate mother has a right to leave their child, and the law has no sanctions against it. What’s more, the biological parents under the contract are obliged to support her during pregnancy and pay her a remuneration after a birth of the child.

5 Vershinina E.V. Surrogatnoe materinstvo v zarubezhnykh stranakh: sravnitel’no- pravovoy analiz / Semeynoe i zhilishchnoe pravo. 2011. № 1. (EV Vershinina, ‘Surrogate Motherhood in Russia and Foreign Countries: Comparative Legal Analysis’ (2011) 1 Family and Housing Law). 6 A Keefer, Problems with Surrogate Mothers (Livestrong 2013). www.kulawr.ru Volume 1 April 2016 Issue 1(5) Svetlana Morozova Contract for the Provision of Surrogate Motherhood: Legal Problems 203

In author’s opinion there should be some changes made in this sphere: legislator should clarify the conditions of program of extracorporeal fertilization. Also it’s necessary to make amendments to Russian Family Code regarding surrogacy contract, to regulate the registration. First of all, it’s necessary to amend Article 51 of Russian Family Code and to include a provision ‘Married couple who made a contract for surrogate motherhood must be registered as legal parents of the child’. Furthermore, a new provision should be added to Article 52 of Russian Family Code, stating ‘Biological parents have a right to dispute birth note under any circumstances’. What’s more, it’s necessary to include in Russian Family Code an obligation provision for surrogate mother to give a child to parents within the term set by the contract. Detailed conditions of program of extracorporeal fertilization would help courts to avoid many claims. Those technologies help to have a child which should have a positive effect on demographic situation, and a lot of families can be happy with the opportunity to have children.

Bibliography

Anisimov A, ‘The Surrogate Motherhood: Law, Morals and Policy’ (2013) 2 Journal of Politics and Law Fergus Victoria L, ‘Interpretation of Ohio Law on Maternal Status in Gestation Surrogacy Disputes: Belsito v Clark’ (1995) 21 Dayton Law Review Hisano Erin Y, ‘Gestational Surrogacy Maternity Disputes: Refocusing on the Child’ (2011) 15 Lewis & Clark Law Review James Alyssa, ‘Gestational Surrogacy Agreements: why Indiana Should Honor Them and What Physicians Should Know Until They Do’ (2013) 10 1 Indiana Health Law Review Keefer A, Problems with Surrogate Mothers (Livestrong, 2013) Spivack C, ‘The Law of Surrogate Motherhood in the United States’ (2010) 58 American Journal of Comparative Law Vershinina E.V. Surrogatnoe materinstvo v zarubezhnykh stranakh: sravnitel’no-pravovoy analiz / Semeynoe i zhilishchnoe pravo. 2011. № 1. (EV Vershinina, ‘Surrogate Motherhood in Russia and Foreign Countries: Comparative Legal Analysis’ (2011) 1 Family and Housing Law)

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MANY THANKS TO OUR REVIEWERS FOR THE YEARS OF 2014―2015

Maria Antokolskaja, Professor, VU University Amsterdam

Alyson JK Bailes, Adjunct Professor, University of Iceland; Visiting Professor, College of Europe (Bruges)

Gabriela Belova, Dean, Law and History Faculty, South-West University “Neofit Rilski” (Bulgaria)

Adam Bodnar, Human Rights Defender of the Republic of Poland

William Butler, Distinguished Professor, Pennsylvania State University; Emeritus Professor, University of London

Egon Cholakian, Executive Director at IRDFProject, Columbia, Harvard Universities

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Gennady Esakov, Professor, Head of Criminal Law and Criminalistics Department, National Research University Higher School of Economics (Moscow)

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Nikolay Kipnis, Assosiate Professor, Kutafin Moscow State Law University; Advocate, member of Moscow City Chamber of Advocates

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James A.R. Nafziger, Professor, Willamette University College of Law (USA) www.kulawr.ru Volume 1 April 2016 Issue 1(5) Many Thanks to our Reviewers for the Years of 2014―2015 205

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