Despite a spokesman moving quickly to insist that there are “no disagreements” between Prime Minister Vladimir Putin and President Dmitry Medvedev, it would appear the two are working at cross purposes in the fight to revitalize the image of Russian business. The Moscow Times reports today that Putin has backed a proposal by the Federal Anti-Monopoly Service to amend the Criminal Code. Amendments would affect company executives “responsible for price collusion and monopolistic activities”, and could raise penalties to up to ten years in prison. Medvedev, on the other hand, has created a mild media sensation by accusing Russian authorities of “causing nightmares” for businesses in what would appear to be a direct response to Putin’s attack last week on steel maker Mechel, causing Bloomberg to publish this piece, excitedly heralding the end of Medvedev’s puppet presidency.
The grey area seems to be the act of accusation. Putin’s scare tactics may encourage businesses to stick to the rules, but, as we know from past cases, not least that of Yukos, a company does not always have to break the rules in order to be accused of breaking the law. Increasing penalties for those who break the law is one matter – falsely accusing innocent individuals is quite another.The real test of cooperation or conflict will be in the number of sensational accusations made against big businesses, and whether or not, under Medvedev’s presidency, Russia will continue to intimidate businesses into “falling under Sechin’s ax”.