Author: Anna-Marie Dobbelstein

A new law effective January 1, 2020 (No. 439-FZ*) allows employees to choose for an electronic format of the labour book (= the mandatory registration of an employee’s labour history), instead of the paper format.

As a result employers are obliged to notify their employees of changes to the maintenance procedure for labour books and of the right to opt for the paper or electronic format. This must be done by the employer no later than 30 June 2020. Employees then have the right to make their choice until December 31, 2020 by means of submitting the relevant application form. Notification failure will result in the administrative liability of the employer up to 50.000 Rub (about 725 euro) according item 1 Clause 5.27 Code of administrative offences.

Additionally, the employer has to notify the Pension fund of the choice made by employees in their application. Failure to fulfil such obligation will result in administrative liability of the employer in accordance with the draft Law No 748758-7 dated 08.07.2019.

In addition to a notification requirement, the employer must bring local regulations on maintenance of the labour books into accordance with the Law.

We will be happy to inform you about requirements in more detail or help you draft the relevant applications and procedures.

* Federal Law of 16-12-19 No 439-FZ “on amendments to the Labour Code of the Russian Federation with regard to the generation of information on labour activity in electronic format”.

** Draft “On amendments to the Code of the Russian Federation on administrative offenses regarding the establishment of administrative responsibility for violation by the employer of the deadlines for the submission of information on labour activity or for the submission of incomplete and (or) inaccurate information”.

Unexpectedly, on 15 January 2020, Russian president Vladimir Putin announced a radical overhaul of the constitution. It is to include about ten changes to the constitution and would distribute powers is a different manner, giving the parliament more authorities in some cases. Overall the Russian Federation is to remain a ‘strong presidential republic’.

The same day Mr. Dmitri Medvedev offered his resignation as a prime minister. In his place, former head of the tax service Michail Misjoestin was appointed. Mr Medvedev will take on the rol of vice-president of the Russian Security Council.

There are however still many questions on the potential impact of these changes and the reasons behind them. Possibly they will allow for a new role of Mr. Putin after 2024 when his presidential term will end.

For more information please refer to https://raamoprusland.nl/en

On 2 December 2019 a law came into effect increasing fines for non-compliance with the Russian data localisation requirements. The proposed fines could amount to a maximum of 6 million RUB (approximately 85,000 EUR) for a first offence and 18 million RUB (approximately 255,000 EUR) for a repeat offence.

Since 1 September 2015 it is required by Russian law that the personal data of Russian citizens are stored and processed using databases located in Russia. This requirement can be complied with for instance by placing the database with personal data of Russian citizens in a Russia-based data centre or server.

Until present fines for failure to provide information as required by data localisation legislation were very low (up to 5,000 RUB or appr. 67 eur). Instead Roskomnadzor, the Russian data protection authority, had the right to block the website of a company in breach of the rules.

We recommend you to carefully review your procedure for data processing and localization. If you are in doubt about the interpretation of the law, we are happy to provide clarifications.

You may also be interested in the following article: https://www.themoscowtimes.com/2020/01/03/will-russia-enforce-new-internet-laws-i2020-a68802

We wish you all Happiness, Health and Prosperity for the year 2020.

May you enjoy the holidays with your dear ones.

We hope to be in touch again in the year ahead.

Please note that our Russian offices will be closed from January 1- 8, 2020.

1. Being a member of the Eurasian Economic Union, Belarus gives its investors access to the markets of Russia, Kazakhstan, Armenia and Kyrgyzstan with 184 000 000 consumers. 
2. Belarus can not boast of plentiful mineral resources. However, it has another treasure:  its talented and educated people.  Belarus was called the “assembly shop” of the Soviet Union.  It has 52 universities, 16 000 IT graduates each year.  Belarusians are highly qualified in medicine, IT, mechanical engineering, construction, agriculture and in other fields.
3. The capital of Minsk is only 2 hours by plane from most European capitals. Belarus has extensive and well-taken-care-of network of roads, highways and railways making the country very suitable for transit.
4. The Belarusian government strives to make Belarus a heaven for IT start-ups as well as for the IT “veterans”.  Hi-Tech Park (HTP) has been functioning since 2005. IT companies in HTP are exempt from all corporate taxes, including VAT and profit tax, as well as from customs duties, etc.  About 1,2 billion people all over the world use the mobile apps developed by HTP residents. Belarus has one of the world’s most progressive IT legislation. The Decree of 2018 On Development of Digital Economy, among many other things, made cryptocurrency exchanges, mining, smart-contract, blockchain, etc.  legal.  Operations with tokens (mining, buying, exchange, etc.) are VAT exempt.
5. The country is friendly to investors. It has six free economic zones and there is a National Agency on Investments and Privatization.  Being an element of the so-called “Silk Road”, the Great Stone Industrial Park recently established with active Chinese participation welcomes new members.  It is a big-scale project with the prospect of becoming a large transnational business hub.

On 06 December 2019 the Ukrainian Rada (the Parliament) passed a law adopting an important amendment to the Code of Labour Laws of Ukraine. 

In particular, it introduces a new Article 5, whereby electronic documents drawn up  according to Ukrainian law are considered written documents for the purpose of labour law.

The law will make possible conclusions of labour contracts between employers and employees in electronic form.

The law is entering into force on the day following the date of its official publication.

Please feel free to contact us if you wish to be updated on the publication date or if you need other assistance in labour issues.

1.        Ukraine is a big European state and a big market with 42 million consumers.  The country is rich in natural resources (fertile lands, coal and ore mining (marganese, titanium, iron).  The Ukrainian GDP at current prices is almost 131 billion USD.  Ukrainian workers are cheap, disciplined and well-educated.

2.       Excellent geographic position.  It is a potential commercial hub between Europe and Asia.  Through Ukraine passes one of the branches of the so-called Silk Road from China to Europe.

3.       Ukraine is booming with reforms.  Since 2015 there has been a National Anticorruption Bureau.  Struggle against corruption is seen as a vital prerequisite to economic prosperity.  Economic reforms envision high-tech agriculture, machine-building and IT as principal economic growth drivers.  Since February of 2019 currency transactions are regulated by a liberal law ‘On Currency and Currency Transactions’.  Investors shall not bother about transferring their money abroad.

4.       Ukraine made its choice:  the country promptly strives to obtain membership in the European Union as well as in NATO.  The Association Agreement with the EU has been active since 01 January 2016.  A Free Trade agreement governs the trade between the EU and Ukraine.

5.       Warren Buffet, the famous American investor, said once, “Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”  Now Ukraine is “marked down”, so to say.  So, be among the ones who are in time to take their positions at this potentially highly-lucrative market.

Juralink is extending its services to Ukraine and Belarus. We are pleased to welcome Vladimir Zenkovich, an experienced local lawyer, to our team. Vladimir has previously worked on corporate and contract law from Minsk, both as an attorney/ consultant and as a corporate lawyer. Vladimir has graduated from Belarusian State University in Minsk, Belarus. He received his LL.M. at the University of Minnesota Law School, USA. 

He is fluent in Belarussian, Russian and English.  We have come to know Vladimir as a competent and reliable lawyer from a number of short assignments in the past and we look forward to a structural co-operation.

If you have any questions on legal issues in Ukraine or Belarus, please feel free to address Vladimir.  His phone is +375 29 684 80 85.