Business Measures Pressure

Krasnodar, 12 February. Last week, Krasnodar played host to the national conference “Development of small and midsize businesses in modern conditions: problems and solution approaches,” that summoned businesspersons, governmental officials, law enforcement officers and human rights activists. The attendees gathered to analyse interaction between the business community, governmental bodies and supervisory agencies. 

Opening the meeting, its moderator Aleksandr Polidi, Senior Partner of Arka Group Consulting Company, said that over the past decade the national economy had hardly grown at all, while the global economy had grown by 30%: “It means that we cannot ignore the fact that the rate of our business growth is lagging behind. We have managed to put things in order in macroeconomics considering such basic indicators as inflation level, stability of the currency exchange rate, and employment level. For instance, we managed to forget what double figures in interest rates and inflation can mean. Nonetheless, there still remains a gap which lets us not do business as fast as we would like to.” In her speech, Elina Sidorenko, Director General of the Autonomous Non-Profit Organisation “Platform on Handling Entrepreneurs’ Pleas ‘ZaBiznes.RF’,” said: “The majority of Kuban entrepreneurs complaint about pre-investigation checks. Their figure [in our region] is about 15% higher than the national average. The second most important issue is offences committed when instituting criminal proceedings; then come falsification of evidence and unsubstantiated refusals to accept petitions <...> It is small and midsize businesses that are facing the pressure administrative structures. The business circles are often facing situations when their competitors enlist the services of law enforcement agencies to resolve their problems, and as a result business finds itself under their pressure <...> Quite often, entrepreneurs ask law enforcement bodies to sue their counterpart that infringed upon their rights, but what they are meeting is a refusal to do so.” Igor Yakimchik, regional business ombudsman, said entrepreneurs are frequently worried about land property disputes which constitute 22% of the total number of their appeals: “In 2020, the list of the most frequent complaints was topped by those about local self-government bodies (19%), narrowly followed by complaints about law enforcement agencies (16%) <...> Very often, the what the auditors do first of all they punish the complaint, which in fact kills the business sector that is trying to scramble out of the dire straits in difficult post-pandemic conditions.” 

Murat Dudarev, expert of the regional Civic Chamber, noted that “financial support of the state often becomes a problem for entrepreneurs. Many businesspersons fear to apply for subsidies, because criminal cases often appear about illegitimate use of this money. We paid attention to the fact that it became possible due to inaccuracies in the Russian Budget Code. Currently it states that in case of any fines, even if they constitute just 10% of the total sum of a subsidy, the recipient must return the entire sum