29.04.2016 — Constitutional Court to Decide Whether It Is Lawful to Demolish Unauthorized Constructions Without Court Ruling

The Communist Party of the Russian Federation (CPRF) asked the Constitutional Court to rule as unconstitutional part 4 Art. 222 of the Civil code of the Russian Federation about extrajudicial demolition of the objects declared unauthorized construction if they are situated on territories with special land use provisions, communal areas or near general utilities.

According to literal interpretation of this norm, it is legitimate to demolish unauthorized constructions without court ruling only if the person which constructed such object s was not identified. However deeds of titles issued for that objects did not save the owners of the tents and stalls demolished in the capital in February. Thus, it is expected that Constitutional Court defines constitutional and legal sense of disputable norm, without violating the private property rights and adequately punishing the persons constructing objects with violations of the law.

28.04.2016 — Promise "One Hectare for Each Russian Citizen" to Become Reality

The president of Russia Vladimir Putin signed the Federal law dated 01.05.2016 No. 119-FZ "On special aspects of providing the citizens with the land plots in state or municipal ownership in the Far East federal district, and on amending legislative acts of the Russian Federation" that entitles each citizen of Russia to receive one hectare of land in the Russian Far East free of charge.

Thus, the land can be used in any way that does not contradict the law on condition that the allocated site has to be developed within 5 years. This law is the first step on the way to versatile development of the Far East regions.

27.04.2016 — Tendency towards understatement of recoverable judicial costs on representation is not a problem, Constitutional Court says

The Constitutional Court of the Russian Federation did not consider the complaint to rule as unconstitutional the existing recoverable representative costs provided by p.2 Art. 110 Arbitrazh Procedure Code according to which the court recovers the costs on representative services provided they are reasonable what in practice results in essential understating of the sums of the actual compensation. In particular it concerns disputes on recovering costs from government authorities. 

The Constitutional Court did not consider this norm unconstitutional. On the contrary, according to the court, it protects against unreasonable overstating of judicial costs and creates necessary balance between due-process rights and obligations of the parties. Thus, the court specified that volatile reduction of the recoverable sums is impossible without providing proofs of their excessiveness and unreasonableness.

It should be noted that it is not just due to lack of appropriate regulation on recovery of representation costs but rather established practice of unreasonable understating, including unspoken rule to recover minimum costs from the governmental authorities. Possibly, this complaint did not stipulate for positive judgment, but hoped for attention to this problem.

26.04.2016 — Russia to Join International Tax Information Exchange Scheme

The recent Panama scandal, which has disclosed Mossack Fonseca document archives on the offshore companies, pushed Russia on accession to a set of measures developed by G20 and OECD referring to transnational automatic tax information exchange and to mutual disclosure by tax authorities of taxpayers’ data (CRS MCAA).

Accession to the agreement is planned for May, 2016. Considering that terms of offshore amnesty expire on July 1, 2016, owners of foreign accounts will have only two months to seal the fate of their foreign assets. If foreign accounts are not settled or information on them is not disclosed, at the prompting of foreign tax authorities it will constitute a ground for initiation of tax and criminal proceedings.

25.04.2016 — Cadastral Value Assessment to Become Public Monopoly

The Government of the Russian Federation supported the initiative of the Ministry of Economic Development to transfer cadastral assessment of real estate from independent appraisers to public institutions. The innovation will ensure objectivity of the cadastral assessment and increase tax budget revenues.

As a rule the state cadastral assessment is carried out by independent appraisers. According to the Ministry of Economic Development engaging private companies for cadastral assessment bears risks of understating the cadastral value that implies decrease in tax budget revenues.

Transferring cadastral assessment to public institutions will allow providing objectivity of its results. Herewith, cadastral assessment will be free of charge for owners of real estate, including cases if an interested person applies for an unplanned cadastral assessment due to reduction in market value of real estate.