Russia’s authorities continue to crack down on opposition figures and journalists they have designated “foreign agents.” In the latest set of measures, they will be barred from earning income on their Russian assets, with proposed bans on collecting money from the sale or rental of property, through dividends or as interest on savings. In short, the authorities continue to come up with new ways to leave the handful of foreign agents still in Russia with fewer and fewer sources of income.
- A bill currently working its way through Russia’s State Duma would require foreign agents to receive payments for certain activities into special accounts — the same way foreign companies from unfriendly countries are obliged to receive dividends. Funds from these accounts can only be accessed once the “foreign agent” status is revoked. This is almost impossible, so in effect the funds are frozen — and unusable — indefinitely, except for the payment of government fines.
- The measures were published as amendments to a second reading of a bill targeting other income streams for foreign agents. As often happens in Russia, the bill’s scope changed significantly between the first and second readings. At first, the legislation was only about halting royalty payments to musicians and authors who had left Russia. But even before the bill had its first reading, speaker Vyacheslav Volodin decided to expand it, probably after securing approval for his initial calls to more broadly restrict the incomes of foreign agents. “Those who harm Russia by insulting its citizens and participants in the special military operation, should not get rich at the expense of our country,” he wrote on his Telegram channel.
- The package of amendments now includes restrictions on other forms of income that have nothing to do with creative work: such as income from selling or renting property, selling vehicles, and savings and investment returns.
- The restriction on property income is particularly hard-hitting. Apartments obtained during privatization after the Soviet era are typically the largest assets that many Russian families have. Amid soaring prices for rental property in Moscow, an emigrant might be able to fully support himself in an inexpensive country like Armenia or Georgia by renting out an apartment in the Russian capital. The ban on investment returns is also interesting. The register of foreign agents has already been manipulated and this means it can be further weaponized to settle scores in the business community.
- Russia currently lists 493 individuals as foreign agents. These include prominent journalists, politicians, activists, cultural figures and scientists. But there is another unpublished register of people affiliated with foreign agents (for example, employees of an organization that has been labelled a “foreign agent”) which encompasses about another 1,000 people. It would be entirely logical for the authorities to extend these restrictions to that larger group. The Duma is in fact eager to go much further and make all Russians who criticize the Kremlin from abroad liable to have income channeled into these special, unusable, accounts. Volodin directly stated that for those who “are not classified as foreign agents but who speak negatively of Russia after leaving” there will also be restrictions on property and assets.
Why the world should care
Vladimir Putin’s regime remains true to itself. It loves to use economic methods to strangle the opposition — having previously enjoyed success on this front. Now it will be even more difficult for those designated foreign agents to survive in exile.
