Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
IN THIS ISSUE:
New State Duma
Takes Shape .......................1
Election Results .....................1
Party Standings .....................2
Duma Organization ................3
Committee Changes ..............3
Business Group
Representation ....................5
Upcoming Legislative
Session ................................5
Priority Legislation .................6
Photo: kommersant.ru
New State Duma Takes Shape
In late December, the new State Duma was convened
early by a special order of the Cabinet, as President
Putin requested that the legislators get to work as soon
as possible. The process of determining leadership
roles in the new Duma has provided more detail on how
the ruling United Russia party plans to work with the
other parties and with the government during this spring
term. While it is still early to say exactly what direction
this Duma session will take, the election results and the
first organizational steps taken by the Duma leadership
provide some insight.
Election Results
The parliamentary elections on December 2 reinforced
the four-party system that had to a large degree developed by the end of the previous Duma. The results also
further marginalized the “liberal” wing of the political
spectrum, with the pro-Western SPS and Yabloko parties
finding very little support among voters, leading to their
exclusion from the Duma. At the same time, the Duma
avoided a radical shift to a two-party system comprised of
only United Russia and the Communist Party.
Despite winning an unprecedented 315 seats and the
power to unilaterally change the Constitution, United
Russia was unable to establish itself as the sole party
of power. Notably, while he campaigned on behalf of
the party, President Putin did not become a member of
United Russia following the election campaign. Newcomer Fair Russia, in its “younger brother” role, appears
to have successfully wrested away pro-Putin voters who
do not support United Russia. Despite this success, the
future of Fair Russia remains unclear.
Moscow
t
Washington
t
London
t
UNITED RUSSIA
KPRF
Duma Seats:
Duma Seats:
315 (70%)
57 (12.7%)
Votes:
Votes:
44,339,051 (64.26%)
7,997,098 (11.59%)
LDPR
FAIR RUSSIA
Duma Seats:
Duma Seats:
40 (8.9%)
38 (8.4%)
Votes:
Votes:
5,626,628 (8.15%)
5,351,737 (7.76%)
Kyiv
t
Riga
t
almaty
t
SOCHI
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Party Standings
UNITED RUSSIA: Although it clearly met
its goal of attaining a constitutional majority, United Russia has not transformed
this success into real leverage in the
makeup of the Cabinet. At present, only
three members of the Cabinet (Deputy
Prime Minister Alexander Zhukov, Agriculture Minister
Alexei Gordeev and Natural Resources Minister Yuri
Trutnev) are members of the United Russia party.
also contains a diverse group of prominent businessmen, television personalities and sports figures.
Similarly, the main Kremlin centers of influence have
retained their representatives in Deputy Speaker
positions in the Duma:
Lyubov Sliska: Sechin Group (siloviki);
Vyacheslav Volodin: Surkov Group (ideology/politics);
Valery Yazev: Gazprom Group.
The allocation of key positions within the State Duma
continues to reflect the three main political groups
within the United Russia party: the Unity (Edinstvo) group (Boris Gryzlov, Sergei Shoigu, Vladimir
Pekhtin); the Fatherland (Otechestvo) group (Yuri Luzhkov, Vyacheslav Volodin); and the All-Russia group
(regional bosses such as Oleg Morozov and Artur
Chilingarov). The United Russia faction in the Duma
In short, the balance of power from the previous
Duma continues largely unchanged in the new
Duma. While lines of influence remain the same, the
personalities do not: approximately half of the current
United Russia deputies did not hold seats in the previous Duma, which is in line with the average rotation
for the body overall.
FAIR RUSSIA: The highest turnover
among parties was within Fair Russia,
itself an amalgamation of the former
Rodina, Party of Life, and Pensioners’
Party factions. Rodina candidates, who made up a
large part of the old faction, were removed: only 3 of
37 members of the Rodina faction are now represented in the Fair Russia faction in the new Duma. The
new list of deputies also includes 18 former members
of the Communist Party, United Russia, Yabloko, and
SPS, as well as independents who were previously
deputies under the discontinued single-mandate
system (in which one-half of the Duma seats were
allocated according to direct regional elections, with
the other half apportioned to political parties).
The diverse political background and continuing lack
of a cohesive ideology are causing fissures in the
unlikely Fair Russia union. These divisions were
most apparent during the vote to select the leader of
the party – nearly half of the members voted against
“consensus” candidate Nikolai Levichev.
KPRF: The Communist Party, the only
true opposition party clearing the 7%
threshold to make it into the parliament,
succeeded in boosting its representation in the new Duma while also demonstrating the
highest retention rate – 30 of their 47 deputies in the
previous Duma continue to hold their seats.
as the KPRF candidate in the March 2 presidential
election has bolstered his position within the party.
Immediately following the December 2 Duma elections, there were rumors that Zyuganov might step
aside and allow a protégé to be the party’s presidential nominee; however, he quickly dismissed this
idea, and the party once again fell in line behind its
leader.
The nomination of party leader Gennady Zyuganov
LDPR: Having lost one charismatic and
attention-grabbing figure, Alexei Mitrofanov, to Fair Russia, the LDPR gained
another with Andrei Lugovoi (Scotland
Yard’s primary suspect in the London
murder of Alexander Litvinenko), who is now a regular guest on Sunday political programs. In general,
Visit our website: http://www.pbnco.com
Despite its pro-Kremlin views, Fair Russia has not
received any favoritism in the division of deputy
chairman positions in committees, as the anti-Kremlin Communists were awarded a disproportionately
greater number of such spots relative to Duma seats
held.
nearly two-thirds of LDPR’s representatives in the
previous Duma are not seated in the new convocation. The main reason for this rotation was the quiet
departure of businessmen and sponsors who began
questioning LDPR’s future in the months leading up
to the election.
Page 2 of 7
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Duma Organization
The new Duma management structure has not
changed significantly compared to its predecessors.
The Chairman, Boris Gryzlov, represents the United
Russia party, as do the First Deputy Chairman (Oleg
Morozov) and six of the nine Deputy Chairmen. The
remaining three Deputy Chairman positions were
split among the other parties represented in the
Duma (Fair Russia, KPRF and LDPR). Notably,
there is now only one First Deputy Chairman instead
of two, as was previously the case.
Additionally, those heading United Russia’s inter-factional groupings were not afforded the rank of Deputy
Chairman, as was the case in the last Duma; instead,
they were made First Deputy Faction Leaders. Simultaneously, the Duma regulations were amended
to give these heads of inter-factional groups the
same rank and privileges as Deputy Chairmen. The
obvious reason behind this move was to accommodate the growing number of top-level party members
and prevent internal conflicts.
Committee Changes
The number of Duma committees has increased from
29 to 32. In contrast to the previous Duma, in which
United Russia rewarded itself with all committee
chairmanships and first deputy slots, the party now
feels comfortable allowing representatives of other
parties to hold such posts. As a result, six committee chairmanships were given to the minority factions
(two each).
KPRF – Committee on Industry; Committee on National Affairs;
Fair Russia – Committee on Science and Scientific
Technologies; Committee on Women, Family and
Children’s Issues;
LDPR – Committee on CIS Relations and Compatriot
Affairs; Committee on Youth Affairs
Structurally, several important committees have been
modified either to find a place for a specific person or
to delegate an important subject to a deputy with relevant experience who is trusted by the government.
Thus, the former Committee on Industry, Construction and Scientific Technologies has been divided
as follows: the Committee on Industry headed by
KPRF representative Yuri Maslyukov; the Committee
on Construction and Land Affairs headed by Martin
Shakkum (land issues were taken from the Committee on Property headed by Viktor Pleskachevsky);
continued on page 4
Visit our website: http://www.pbnco.com
Page 3 of 7
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Committee Changes (continued)
and “Scientific Technologies” oversight (of growing
importance due to the nanotechnology emphasis)
was delegated to the Committee on Science. Likewise, the Committee on Energy, Transportation and
Communications was disbanded and separate comChairman
mittees on energy (Yuri Lipatov, UR) and transportation (Sergei Shishkarev, UR) were created. Oversight
of communications was delegated to the Committee
on Information Policy headed by popular television
host Valery Komissarov.
Committee
United Russia
Vladimir Pligin
Constitutional Legislation and State Building
Pavel Krasheninnikov
Civil, Criminal, Arbitration, and Procedural Legislation
Andrei Isaev
Labor and Social Policy
Yuri Vasilyev
Budget and Taxes
Vladislav Reznik
Financial Markets
Evgeniy Fedorov
Economic Policy and Enterprise
Viktor Pleskachevsky
Property
Martin Shakkum
Construction and Land Relations
Yuri Lipatov
Energy
Sergei Shishkarev
Transport
Viktor Zavarzin
Defense
Vladimir Vasilev
Security
Konstantin Kosachev
International Relations
Viktor Usachev
Federal and Regional Policy
Vyacheslav Timchenko
Local Self-Government
Oleg Kovalev
Order and Organization of the State Duma
Valery Komissarov
Information Policy, Information Technologies and Communication
Olga Borzova
Public Health
Grigory Balyhin
Education
Valentin Denisov
Agrarian Issues
Natalia Komarova
Natural Resources, Environment and Ecology
Grigory Ivlev
Culture
Sergei Popov
Public Unions and Religious Associations
Anton Sikharulidze
Sport
Valentin Pivnenko
Issues of the North and the Far East
Nikolai Kovalev
Veterans’ Relations
Valery Chereshnev
Science and Scientific Technologies
Elena Mizulina
Women, Family and Children’s Issues
Fair Russia
KPRF
Valentin Kuptsov
National Relations
Yuri Maslyukov
Industry
LDPR
Pavel Tarakanov
Youth Issues
Aleksei Ostrovsky
CIS Relations and Compatriot Affairs
Visit our website: http://www.pbnco.com
Page 4 of 7
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Business Group Representation
According to official candidate declarations, 16.6%
of Duma deputies are businessmen, equivalent to
the number who reported their occupations as civil
servants. Among the businessmen, 47 are heads
of companies, 1 is a financial director, 12 are deputy
directors, 8 are listed as advisors and heads of
departments, and 2 are individual entrepreneurs.
While according to the declarations there are fewer
business representatives than in the previous Duma,
it is clear that the real number of deputies with vested
business interests remains at similar levels. While
Duma regulations require deputies to give up any
formal business employment, unofficial affiliations
nevertheless persist.
All major industrial and financial groups are represented in the Duma, and their representatives serve
in prominent positions on relevant committees. For
example, major oil and gas interests can be reflected
as follows:
Gazprom: Deputy Speaker Valery Yazev, Natural
Resources Committee Chair Natalia Komarova;
Deputy Chairman of the Committee on Natural
Resources Valery Proziorovsky, First Deputy Chairman of the Committee on State Duma Regulations
Vladimir Aseev.
The interests of the metallurgy sector are represented by Andrey Skotch (Metalloinvest), Andrei Morozov (MMK), Valery Draganov and Valentin Bobyrev
(RUSAL), and Victor Zubitsky (Tulachermet).
Most of the representatives of big business are
in the United Russia faction – in business terms,
membership in the ruling party yielded the maximum
return on investment. The concentration of business resources in this respect is higher than in the
previous Duma. However, the KPRF faction contains
delegates from the regional business and food industry (KPRF is a traditional supporter of vodka lobby
interests). The business representatives in Fair Russia include its main sponsor Alexander Babakov, who
has extensive investments in Russia and Ukraine,
and Sergey Petrov, owner of Rolf Group.
Rosneft and Lukoil: Chair of the Committee on
Northern Regions and Far East Valentina Pivnenko,
Upcoming Legislative Session
The new Duma has adopted a broad legislative
program for its committees as well as a subset of key
priorities for the spring session. The broad legislative
program contains more than 600 bills, many of which
are holdovers from the previous session. The “priority program” of 38 bills consists largely of government
initiatives that are certain to be addressed by the
Duma in this session. Additionally, United Russia
has developed its own priority legislation list, which
is even more selective and includes legislation that
has not yet been introduced but is expected shortly.
An analysis of these legislative priorities reveals
that the Duma session will be dominated by initiatives originating in the government and not within the
legislature itself.
One of the priority initiatives is adopting legislation
on foreign investment in strategic enterprises, which
passed a first reading in September 2007. The
second reading is scheduled for March. A package of bills reforming the rules for financial market
operations and bankruptcy is also to be finalized
Visit our website: http://www.pbnco.com
during this session. Legislation on stock exchanges
sponsored by Financial Markets Committee Chairman Vladislav Reznik is set to receive a first reading
in February, and it is expected that the government
will submit to the Duma a long-awaited bill regulating
affiliated-party transactions, as well as a bill on state
registration of legal entities.
Additionally, a significant focus for deputies during the spring session will be providing legislative
support to the “national projects” in agriculture,
education, housing, and healthcare. For example,
the government is expected to submit several bills
modernizing the system of medical insurance and
state healthcare guarantees. Furthermore, extensive
legislative reforms are planned for regulation of urban
construction, land allocation and low-rise buildings (a
priority for the National Project on Housing).
Page 5 of 7
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Duma Priority Legislation: Spring 2008
I. Constitutional Rights and State Building
Amendments to Clause 7 of the Civil Procedure Code (on legal
expenses) (2nd reading)
Amendments to Code of Administrative Violations (on jurisdiction
issues)
Amendments to several laws related to public administration improvements regarding state registration (on the handling of official registration of certain types of legal entities) (2nd reading)
Amendments to Clauses 314 and 316 of the Criminal Procedure
Code (implementation of a special method of enforcing court rulings)
Committee on Civil, Criminal, Arbitration, and
Procedural Legislation
Committee on Constitutional Legislation and
State Building; Committee on Natural Resources, Environment and Ecology
Committee on Civil, Criminal, Arbitration, and
Procedural Legislation
Committee on Civil, Criminal, Arbitration, and
Procedural Legislation
Technical Regulations on Potable Water and Public Water Supply
Committee on Natural Resources, Environment
and Ecology; Committee on Public Health
Law on Water Disposal
Committee on Natural Resources, Environment
and Ecology
II. Economic Policy
Amendments to Clause 17 of the Law on Licensing of Certain Types
of Activity (production licenses for audio and visual artwork)
Amendments to the Law on Mortgage, Law on Mortgage Securities
and the Law on State Registration of the Rights to Real Estate and
Related Transactions (regarding the transfer of mortgage rights)
Law on Organization of Public Transport Services (2nd reading)
Amendments to the Law on Auditing Activities (on transfer to new
audit framework system) (2nd reading)
Amendments to the Law on Bankruptcy (2nd reading)
Amendments to Part 1 of the Tax Code and the Federal Law on Bankruptcy (harmonization of bankruptcy legislation with certain provisions
of the Tax Code) (2nd reading)
Amendments to Part 1 of the Civil Code, to the Law on LLCs and the
Law on State Registration of Legal Entities and Private Entrepreneurs
(on the legal status of the LLC) (2nd reading)
Resolution on Discipline of Public Passenger Train Employees (2nd
reading)
Law on Participation of Small Business Enterprises in Privatization of
Rented Public or Municipal Facilities (2nd reading)
Committee on Property
Committee on Property; Committee on Financial
Markets; Committee on Civil, Criminal, Arbitration, and Procedural Legislation
Committee on Transport
Committee on Property
Committee on Property
Committee on Property
Committee on Property
Committee on Transport
Committee on Property
III. Social Policy
Amendments to Clause 17 of the Law on Prevention System for Juvenile Delinquency and Neglect (2nd reading)
Committee on Women, Family and Children’s
Issues
IV. Budget, Tax and Financial Issues
Amendments to Clauses 149 and 294 of Part 2 of the Tax Code (on
compulsory civil liability motor-vehicle insurance) (2nd reading)
Committee on Budget and Taxes
Amendments to the Federal Law on the Stock Market
Committee on Financial Markets
Law on Construction Savings Banks
Committee on Financial Markets; Committee on
Construction and Land Relations
Law on Implementation of the Federal Budget for 2006
Committee on Budget and Taxes
Law on Implementation of the Pension Fund Budget for 2006
Committee on Budget and Taxes; Committee on
Labor and Social Policy
Law on Implementation of the Social Insurance Fund Budget for 2006
Committee on Budget and Taxes; Committee on
Labor and Social Policy
Law on Implementation of the Compulsory Health Insurance Fund
Budget for 2006
Committee on Budget and Taxes; Committee on
Public Health
Visit our website: http://www.pbnco.com
Page 6 of 7
Russia Election | Update
REGIONAL INSIGHT u GLOBAL IMPACT
January 2008 | Issue 5
Duma Priority Legislation: Spring 2008
IV. Budget, Tax and Financial Issues (continued)
Law on Compulsory Professional Pension Schemes (2nd reading)
Committee on Financial Markets
Law on Insurance Fee for Financing of Compulsory Professional Pension Schemes
(2nd reading)
Committee on Financial Markets
V. Defense and Security
Amendments to Clause 11 of the Law on Weapons
Committee on Security
Amendments to the Law on Emergency Rescue Services and Rescuer Status
Committee on Security
Amendments to Article 43 of the Law on Pensions for Veterans of the Military, Internal Security Services, State Fire Control Service, Narcotics Control Bodies, and
State Criminal Justice Bodies and Their Families (2nd reading)
Committee on Defense
Technical Regulations for General Fire Safety Requirements (2nd reading)
Committee on Security
Amendments to Article 107 of the Criminal Code (regarding sequence of appropriating income of criminal convicts)
Committee on Security
Amendments to Articles 11 and 44 of the Law on the RF Prosecutor’s Office
Committee on Security
Law on Administrative Control of Individuals Released from Correctional Institutes
Committee on Security
VI. International Agreements
Ratification of Agreement Between the Government of the Russian Federation and
the Government of People’s Democratic Republic of Laos on Prevention of Double
Taxation and Profit Tax Evasion
Committee on International Relations; Committee on Budget and
Taxes
Ratification of Agreement Between the Government of the Russian Federation and
the Government of Mexico on Prevention of Double Taxation and Profit Tax Evasion
Committee on International Relations; Committee on Budget and
Taxes
Termination of Agreement between the Government of the Russian Federation and
the Government of Ukraine on Early Warning Rocket and Space Control System
Committee on CIS Relations and
Compatriot Affairs; Committee on
Defense; Committee on Security
Ratification of Agreement Between the Government of the Russian Federation and
the Cabinet of Ukraine on Extending the Use of Rocket System 15P118M
Committee on CIS Relations and
Compatriot Affairs; Committee on
Defense
Ratification of Agreement Between the Government of the Russian Federation and
the United States Concerning the Safe and Secure Transportation, Storage, and
Destruction of Weapons and the Prevention of Weapons Proliferation (June 1992)
Committee on International Relations; Committee on Defense
Ratification of Agreement Between the Government of the Russian Federation and
the Government of Belarus on the Procedure for Provision of Medical Assistance
to Russian Citizens in Healthcare Facilities in Belarus and to Citizens of Belarus in
Healthcare Facilities in Russia
Committee on CIS Relations and
Compatriot Affairs; Committee on
Public Health
The PBN Company
Uspensky Pereulok, Building 4
Moscow, Russia 127006
Tel.: 7.495.775.0077
Fax: 7.495.775.0075
[email protected]
Copyright © 2008 The PBN Company. All rights reserved.
The PBN Company is an international strategic communications consultancy serving
clients worldwide from offices in Washington, London, Moscow, Kyiv, Riga, Almaty,
and Sochi. The firm delivers results-driven corporate communications, government
relations/public affairs, and financial communications services to clients throughout
the United States, Europe, the former Soviet Union and the Baltic States.
Sergey Kolmakov, Moscow
Tel.: 7.495.775.0077
[email protected]
For previous issues of Russia Election Update, please visit our website:
http://www.pbnco.com
Blake Marshall, Washington
Tel.: 1.202.466.6210
[email protected]
Moscow t Washington t London t Kyiv t Riga t almaty t SOCHI