Cablegate: The Russian Ngo Law One Year Later

Published: Thu 20 Dec 2007 09:31 AM
DE RUEHMO #5884/01 3540931
P 200931Z DEC 07
E.O. 12958: N/A
1. (SBU) More than year after the implementation of
controversial amendments with tougher reporting requirements
for Russian non-governmental organizations, the fears of
extensive, politically-motivated NGO closures have not
materialized. A USAID-funded study, civil society
assessments and Embassy observations indicate: only 32
percent of Russian NGOs are in compliance, with foreign
financed human rights organizations more capable than most of
fulfilling the GOR requirements. Small, often
service-oriented NGOs are disproportionately affected, with
some choosing to operate as non-legal entities instead.
While noncompliance leaves most NGOs vulnerable to
prosecution, there is no evidence of a GOR campaign to use
the amendments to shutter NGOs. However, there are instances
of localized conflicts with the Federal Registration Service
and a few cases that appear politically motivated.
Complicating assessments of the amendments has been the
absence of reliable statistics on the number of active NGOs.
The endemic institutional weakness of Russian NGOs have
magnified the effects of the amendments. We will continue to
urge GOR modifications to the amendments that will help bring
NGOs into legal compliance, in a manner that does not impinge
upon their ability to operate transparently and effectively.
End Summary.
ICNL Assessment of NGO Law
2. (SBU) The results of a December 2007 USAID-supported
study by the International Center for Not-for-Profit Law
(ICNL), assessing the cumulative impact of the new April 2006
reporting requirements for Russian NGOs, broadly tracks with
the impressions of the Embassy and other long standing
observers of Russian civil society. (Note: This cable does
not assess the registration law's effect on international
NGOs, with all of those American NGOs in contact with the
Embassy having secured registration by the end of October
2006.) The report's key findings include:
-- Only 32 percent of Russian NGOs are in compliance with the
reporting requirements. ICNL notes that the high level of
noncompliance suggests a large number of inactive NGOs.
-- Human rights organizations - particularly Western
financed NGOs - are more likely and more capable of meeting
the higher reporting standard.
-- The burden of the new reporting requirements falls
disproportionately on small NGOs, which suffer from a
shortage of staff, institutional capacity, and even
rudimentary understanding of the legislative requirements.
-- While noncompliance leaves NGOs vulnerable to
prosecution, there is no evidence that the Federal
Registration Service (FRS) has systematically fined or taken
actions to close organizations that have failed to file
reports on time or accurately.
-- There is no evidence of the law being disproportionately
applied to the detriment of human rights groups; however, the
nature of the reporting requirements and the law's ambiguity
with respect to certain provisions allow government officials
"excessive discretion" in interpreting and enforcing the new
Who Suffers: Small NGOs Without Foreign Financing
--------------------------------------------- ----
3. (SBU) Observers broadly agree with the ICNL conclusion
that the law disproportionately burdens small NGOs, which
lack the staff and resources to file accurate reports. By
law the NGO must file an annual report detailing its
activities for the next year. Foreign NGOs must also
complete quarterly financial reports indicating their funding
sources. In a September assessment, the Center for the
Development of Democracy and Human Rights (CDDHR) noted that
NGO registration documents comprise at least 60 pages. Even
minor changes in the organization's CEO or address require
submission of notarized documents within three days of the
change. A delay could result in a substantial fine, and two
fines could result in de-registration. However, no
organization to date has been fined or de-registered for
failure to comply. The FRS has new authority to audit NGOs
for compliance with the new law. The CDDHR report indicates
that from January to April, FRS audits had discovered
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violations by 6,000 NGOs although most of the violations
minor in nature (e.g., missing protocols or improper
4. (SBU) According to both Moscow Helsinki Group (MHG)
Director Lyudmila Alekseeva and World Wildlife Fund Director
Igor Chestin, the "innocent bystanders" in the registration
process are the small, often service-oriented organizations,
which were never the target of GOR suspicions of "orange
revolutions." In contrast, Alekseeva told us that all major
human rights and environmental organizations had survived
unscathed, with MHG itself "untouched" by the new process.
For those without the technical assistance at hand, however,
compliance has been difficult and exacerbated by a lack of
resources to obtain the expertise. The seven-person
environmental NGO Baikal Ecological Wave told us that it
needed to hire two individuals to deal with reporting
requirements and to ensure compliance with tax and labor
5. (SBU) Some NGOs have reportedly decided to forego formal
registration and operate instead as non-legal entities or
"movements." While these groups are restricted in what they
can do, and are prevented from opening bank accounts or
renting space as an organization, they can still legally
operate. MHG confirmed this trend, with Alekseeva giving two
examples -- "Mothers of Children in Wheelchairs" and "Union
of Deceived Investors" -- who jettisoned the registration
process and MHG office space for their meetings. Alekseeva
noted the irony that registering as an NGO increased an
organization's vulnerability, whereas operating as a
non-legal entity (with the attendant restrictions) left
activists better protected.
The Fall-Out Is Small
6. (SBU) While the 2006 amendments could be deployed to shut
down NGOs, our contacts have not noticed a systematic effort
by authorities to do so. INCL's Daria Miloslavskaya
recounted scattered instances of NGOs experiencing problems,
but was not able to link them to the new requirements, nor
could she pinpoint a specific reason why a particular NGO
experienced problems with the FRS. The CDDHR report also
indicated some cases of NGOs running afoul of the local FRS
offices, but could identify no FRS pattern of behavior. This
conclusion tracks with Embassy's assessment: in our travels
around the country and frequent contacts with the NGO
community, we have not discovered any systematic effort to
use the amendments to shutter NGOs.
7. (SBU) We are aware of a few active organizations that
were sanctioned under the NGO law. A notable case occurred
on October 24 when the FRS suspended the operations of the
Samara chapter of the USAID-funded election monitoring NGO
Golos for six months for violating financial reporting
requirements. Golos maintained that the charges were
politically motivated, and that regional authorities had
sought to close down Golos because of its perceived
connection to opposition groups. Golos claimed that it was
not given sufficient time or afforded due process to answer
the allegations. Nationwide, however, Golos succeeded in
fielding 3,000 observers during the December 2 Duma
elections, with only a handful of its staff facing official
restrictions (reftel). In the case of the Educated Media
Foundation (Internews), the GOR used federal crime and tax
laws to freeze the NGO's accounts and seize its computers.
With respect to the Russian-Chechen Friendship Society, the
GOR secured an extremism conviction against its Director,
which served as the basis for the registration denial.
8. (U) The CDDHR report notes other prominent cases of NGOs
experiencing bureaucratic problems with the FRS. For
example, the human rights flagship "Memorial" could not
register a change in its CEO because the FRS first demanded
evidence that it was a "national" organization. The report
documented instances of FRS warnings or refusals to register
changes sometimes for minor violations or infractions. In
Voronezh, the Center for Public Awareness, Arts and Cinema
"Youth" was denied a change of CEO due to typographical
errors in the documents. In Ryazan the local FRS suspended a
local human rights group for one month because it allegedly
held meetings in a private apartment. The St. Petersburg NGO
Bellona was cited for undertaking commercial activity, since
the FRS considered the publication of donors' names in
Bellona's reports as "advertising" for sponsors. In
Bashkortostan, the FRS suspended the activities of one NGO
because the CEO was ill and could not be present on the day
of an FRS audit. The FRS in Tyumen twice refused to register
Rainbow House, a gay youth organization, as an NGO since its
activities "undermined the security of the Russian
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Federation." The CDDHR report noted that these and other
examples indicate that the FRS may have overstepped its
authority or misinterpreted the law, but did not identify any
systematic targeting of human rights NGOs.
NGO Noncompliance Raises Vulnerabilities
9. (SBU) The amended NGO law has increased substantially the
vulnerability of most NGOs to official scrutiny, since the
vast majority of organizations are not in full compliance.
According to the FRS, while NGOs were required by law to
submit financial reports by April 15, only 20 percent did so.
By the first of July, the compliance rate increased to 28
percent, and by October 31 to 32 percent.
10. (SBU) Although FRS Chief Vasilyev attributed this low
compliance rate to the willful decision of NGOs to ignore the
law, contacts in the NGO community more often note ignorance
of the law itself or the difficulty of full compliance.
ICNL's Miloslavskaya reported that at most 30 percent of NGOs
fully understand the scope of the amended NGO law.
Typically, an NGO will learn of a particular requirement only
after the FRS has conducted an audit and noted a deficiency.
At that point, the organization will have earned an
administrative warning. After two such warnings the
organization can be shuttered.
Number of Active NGOs Difficult to Assess
11. (SBU) An analysis of the effects of the new reporting
requirements is made more difficult by the absence of any
reliable data on the number of active NGOs in Russia. Prior
to implementation of the 2006 amendments, non-profit or
non-commercial organizations registered with the tax
authority, whereas social movements or social organizations
registered with the Ministry of Justice. Neither government
agency routinely released statistics on the numbers of
registrants. The Federal Registration Service currently has
responsibility for registering both types of organizations;
however, even this organization may not know the true number
of NGOs. Miloslavskaya told us that in some regions the tax
authority still has not transferred some NGO registration
records to the local FRS.
12. (SBU) As a result, wildly disparate estimates circulate
on the scope of Russian civil society. FRS Chief Sergey
Vasilyev, in an interview with Rossiyskaya Gazeta, estimated
there were 216,000 registered. In a May 2006 statement, the
Ministry of Foreign Affairs cited 400,000 NGOs, whereas
Moscow Helsinki Group (MHG) Chairperson Lyudmila Alekseeva
alleged 650,000 in 2005, with Miloslavskaya unwilling even to
provide a rough estimate of the number of NGO's operating in
Russia during that time period. We could not locate
corroborating information for either the MFA or MHG estimate.
Miloslavskaya maintained that the number of NGOs today does
not differ much from before the amendments, since most
Russian NGOs went along with the new rules and its reporting
requirements as they were not subject to re-registration.
ICNL had not detected any large number of NGOs declining
registration under the new rules or changing status to
unregistered social movements. While the ICNL report notes
that the FRS applied for the closure of approximately 2,600
NGOs for failure to adhere to legislation pre-dating the
April 2006 amendments (compared to 8,761 new registrations),
neither ICNL nor other civil society watch groups have found
evidence that these were active organizations.
NGO Structural Weaknesses Continue
13. (SBU) Ford Foundation Director Steven Solnick told us
that the endemic weakness of civil society in Russia has
magnified the effect of the new amendments and reporting
requirements on the NGO community. NGOs in Russia have grown
too dependent on Western financing, he said, and have
remained too isolated from popular opinion. Wrapping up five
years as Ford Foundation head, Solnick concluded that NGOs
were less resourceful now in diversifying funding. They
eschewed volunteers, and remained anachronistically hostile
to media campaigns and other modern tools for building ties
with the public. The GOR had succeeded in "crushing"
community activism, according to Solnick, and flagship human
rights organizations were blinded by an elitism that flowed
from a Soviet intelligentsia-like bias against the "masses."
"If Putin closed Moscow Helsinki Group tomorrow," Solnick
asked, "would any one come out on the streets in protest?"
14. (SBU) Alekseeva agreed with the thrust of Solnick's
critique, but attributed civil society weakness to the
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immaturity of democracy in Russia and the fact that
revolutions have always been handed down from above and not
won by the people. Alekseeva expressed satisfaction that the
increasingly authoritarian nature of the Putin government
would mean the "fight for democracy begins now." What had
been accomplished by civil society, she emphasized, was the
promulgation of knowledge and the inculcation of an
expectation of human rights (which were only "so-called" in
Soviet times). As long as times were good and coffers full,
Alekseeva downplayed real movement forward. However,
Alekseeva argued that grievances were accumulating and when
they came to a boil it would be civil society's
responsibility to ensure that a new generation of human
rights activists was prepared to capitalize on public anger.
15. (SBU) When the amendments were passed, the NGO community
rightly feared that the requirements would be used to target
watchdog groups and perceived opponents of the Putin regime.
That has not happened and, ironically, the Western-financed
human rights organizations have been among the most capable
of meeting the new administrative burdens. However, the
vulnerability of the NGO community to fines and selective
prosecution is real. We will continue (along with EU
countries and in support of Russian voices) to urge GOR
reform of the NGO amendments that will ease the reporting
requirements (or exempt certain categories all together),
clarify the implementing legislation, define the scope of
audits, and restrict the FRS's ability to close NGOs.
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