The Government has extended the moratorium on scheduled audits of businesses until 2030

Pepeliaev Group advises that the Russian Government has adopted Resolution No. 372 dated 10 March 2023 (the “Resolution”), which extends until 2030 the moratorium on audits introduced in 2022[1], and provides for other specific aspects of control activities.

The moratorium on scheduled audits has been extended until 2030

The Resolution provides that, until 2030, scheduled audits of business under the federal laws “On state control (supervision) and municipal control in the Russian Federation”[2] and “On protecting the rights of legal entities and individual entrepreneurs when state control (supervision) and municipal control are carried out”[3] are performed only with respect to:

• items subject to control that are classified under the categories of extremely high and high risk;

• dangerous production facilities of danger class II,

• hydro-technical structures of class II.

Conditions have been outlined in greater detail with regard to the issuing of instructions to remedy violations

The Resolution abolishes the rule that instructions to remedy identified violations are served on the party that is subject to control only if such violations create an immediate threat to life, a risk of severe damage to health, a natural or man-caused emergency , or damage to national defence and state security.

The expiry of the period for complying with such instructions issued after 1 March 2023 is a ground for holding an unscheduled audit of the controlled person.

Provision has been made for preventive visits that cannot be declined

The Resolution provides for the opportunity to conduct, during the period until 2030, preventive visits to persons under control; no right to decline the visits is provided for.

Preventive visits can be made:

• on the instructions of the Russian President;

• on the instructions of the Russian Prime Minister;

• on the instructions of the Russian Deputy Prime Minister approved by the Russian Deputy Prime Minister who is the Government Chief of Staff.

In the above situations the purpose of a preventive visit is, among other things, to assess whether compulsory requirements are being met. The visitors may conduct an inspection, select samples, request documents, perform tests, and conduct an instrument-aided survey or an expert review.

The timeframe for a preventive visit is 1 business day, but it may be prolonged or suspended for a period required for the instrument-aided survey, conducting expert reviews or making tests.

What to think about and what to do

The moratorium has been extended with a view to reducing the administrative burden on business in the current complex economic situation.

We recommend taking account of the control and supervisory activities set out in the Resolution when business processes are planned or conducted.

Help from your adviser

Pepeliaev Group has an extensive track record of comprehensive business support in issues of compliance with legislation, the identification and assessment of legal risks, and the development of proposals to mitigate the risks identified.

Pepeliaev Group’s lawyers are ready to provide legal assistance when you liaise with state authorities during state control procedures, and litigate, if necessary, to appeal against orders, or against liability being imposed based on the outcome of control measures.

[1] See the Russian Government’s Resolution No. 336 “On the specifics of organising and exercising state control (supervision) and municipal control” dated 10 March 2022.

[2] Federal Law No. 248-FZ dated 31 July 2020.

[3] Federal Law No. 294-FZ dated 26 December 2008.