TNK-BP’s “Suspended Punishment”

Oxford Analytica has a great piece up quoting political scientist Dr. Alena Ledeneva of the University College of London, who says that investors are pulling away from BP’s despite the company’s insistence that their assets in Russia are safe. Ledeveva says there is growing fear of “suspended punishment” for foreign investors:

Ledeneva believes the official rules governing investment in the Russian economy are deliberately opaque, mercurial, and inconsistent. Merely participating in the economy means inevitably transgressing one law or other, nolens volens. Everyone is under threat of punishment, but actual punishment is ‘suspended’, ready to be enforced at the whim of those in authority. In this regulatory imbroglio — Russian capitalism at its most unruly — any number of transgressions can be invoked to clamp down on an individual or firm, ranging from the mortal (tax evasion) to the venial (getting fire regulations wrong).