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'Five Years of President Putin: An Assessment' - Foreign Policy Centre

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Justice in the Legal Reforms? Top<br />

Dr. Vadim Malkin<br />

The views on Russia’s rule <strong>of</strong> law and judiciary are both wrong and right. Legal reforms faced<br />

great challenges to change from the Soviet style to the market economy. During the<br />

Communist era, criminal courts convicted 99 per cent <strong>of</strong> those tried. Only after 1991 did they<br />

start to become more independent. Civil courts also faced a big challenge to change and<br />

corruption was rife since wages were so low. Instead <strong>of</strong> a system <strong>of</strong> law within the judiciary,<br />

there was a system <strong>of</strong> bribes. With that branch <strong>of</strong> government so weak, <strong>Putin</strong> has managed<br />

to consolidate power over it during his time in <strong>of</strong>fice.<br />

Paul Melling<br />

Great strides have been made in the last sixteen years in Russia, but do people realise that<br />

change has taken place? Is there now a rule <strong>of</strong> law in Russia? This depends on whether or<br />

not you are on the ‘radar screen’ <strong>of</strong> the Kremlin. If you are large, rich and important enough<br />

to be noticed by the bureaucracy, such as BP, you find it much more difficult to do business.<br />

The problem here is the lack <strong>of</strong> an idea <strong>of</strong> ‘conflict <strong>of</strong> interest’. The atmosphere is such that it<br />

would be almost scandalous if you did not abuse you own position for personal gain. The<br />

paradox is that if corruption did not exist, nothing would ever get done in Russia.<br />

<strong>Putin</strong>’s tax reforms have brought a greater respect for the rule <strong>of</strong> law. The flat tax <strong>of</strong> 13 per<br />

cent has made Russia a tax haven, shifting the economy from black to white. Before the<br />

change, 80 per cent <strong>of</strong> business was run on the black market. Since then, only 20 per cent<br />

remains undeclared.<br />

Changes to the Russian commercial court system have made domestic litigation the fastest<br />

growing business for Western firms in Russia. Unfortunately, if you are caught on the ‘radar<br />

screen’ then all the problems with the rule <strong>of</strong> law come to the fore: your chances are less than<br />

good if you litigate against the Russian government. The only thing that can be said <strong>of</strong> the<br />

whole system is that it is always over remarkably quickly.<br />

Top<br />

Top<br />

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