Window on Eurasia: New Law Says Russian Firms Can’t be Called ‘Russian’ Any More

Paul Goble

Baku, January 11 – Tens of thousands of Russian firms, foreign businesses operating in that country, and non-governmental organizations there will have to change their names if a new Russian Federation law banning the use of a country’s name in their titles is strictly applied.
This is just one of dozens of new pieces of legislation that went into effect at the start of the year, some of which are prompting individuals and groups to sue, other acts are already having unintended consequences, and still a third group of new legislation almost certain to be revised or simply ignored.
For the first time since 1927, the Russian government is setting the rules for private businesses and NGOs. According to legislation that took effect January 1, firms and other organizations will not be able to use the full or abbreviated names of the Russian Federation, foreign states, or words derived from them in their own titles.
They will also be banned from using “the official names of federal and regional organs of state power, international organizations, public organizations, and designations that run counter to public interests and the principles of humanity and morality” (http://www.vedomosti.ru/newspaper/article.shtml?2008/01/10/139390).
The only exceptions the law allows, Vedomosti explained yesterday, are firms that the government owns more than a 75 percent share and other firms who are able to convince the courts that they should be granted special treatment. The law also specifies that firms and organizations must conform to the act by their next re-registration.
Lawyers told the newspaper that they expect an enormous number of suits over this issue to land in court. Among the companies they said were likely to file cases were Aeroflot which under the terms of the law could not call itself “Russian airlines” and even the Swiss firm Nestle-Russia, which could not bear the country name.
Other possible cases could be brought by British American Tobacco or even Deutsche Bank, although the lawyers with whom Vedomosti spoke suggested that most of these firms would likely to be able to get an exemption from the strictest application of the new rule.
But many smaller firms and especially non-governmental organizations may lack the funds to challenge Russian officialdom demands that they change their name. And consequently, unless the Duma revises or revokes these provisions, the only protection they will have will be Russian case law, an uncertain defense at best.
That is only one of the new laws that have gone into effect this month in Russia. Among the others – see http://www.mk.ru/blogs/MK/2008/01/09/society/332300/ -- likely to cast a large and in some cases unintended shadow on the future of that country are measures calling for

*****The elimination of draft deferments for doctors and teachers in rural areas, a step combined with a cut in the length of required military service to 12 months but one that is likely to reduce still further the number of medical and education graduates willing to work in the Russian countryside.

*****Dramatic increases in fines and other punishments for those who violate traffic laws and, in the city of Moscow, for those who do not clean up after their dogs, write profanity on walls, or engage in prostitution, penalties that many people may seek to avoid by offering bribes to militiamen.

*****An end to the moratorium on the private purchase of cultural monuments. Some 90,000 sites will now go on the block. While purchasers must commit themselves to preserving them, many officials are likely to look the other way once the sales transaction has been completed, thus leading to a further despoliation of Russia’s heritage.

*****The clear marking of all genetically modified foods, an unusual development on the Russian scene that could help spark demands there for additional and far more dramatic consumer protection measures. And supplements to the pensions of retirees living in northern regions, a measure that could help reduce the outflow of ethnic Russians who moved into those areas voluntarily or otherwise during Soviet times.

*****And an end to the requirement that Russian firms employing foreigners or those without citizenship at locations abroad will no longer have to pay Russia’s high social tax (http://www.zvezda.ru/news_read.php?id=18761). That could lead more firms to invest abroad, thus reducing the number of jobs available to Russians at home, but it will eliminate yet another incentive for ethnic Russians without citizenship in Estonia and Latvia to seek citizenship in the Russian Federation.