PROPOSED ECONOMIC SANCTIONS BILL LIKELY TO PASS

UNCLAS SECTION 01 OF 02 MOSCOW 012232 SIPDIS SENSITIVE SIPDIS E.O. 12958: N/A TAGS: PGOV PREL ECON RS SUBJECT: PROPOSED ECONOMIC SANCTIONS BILL LIKELY TO PASS DUMA Summary -------------- ¶1. (U) On October 27, United Russia Duma Deputies submitted a bill that would empower the Russian President to impose economic sanctions against any country, legal entity, or person in the event of an "emergency situation." The bill is still in its early stages. While there are differing views about its ultimate prospects, with some suggesting it will not be speedily adopted, an initial push from President Putin and backing from the pro-Kremlin United Russia suggest it could quickly become law. Although purportedly based on the U.S. International Emergency Economic Powers Act, the bill lacks any provision for a legislative check on the President's ability to impose or lift sanctions. Some observers argue the bill would be redundant, as the appropriate legislative tools for regulating relations with Georgia and other CIS states already exist. End summary. Background on Process, Prospects -------------- ¶2. (U) On October 27, United Russia Duma Deputies Vladimir Pligin and Vladislav Reznik submitted a bill to the Duma that would empower the President to impose economic sanctions against any country, legal entity, or person in the event of an "emergency situation." We understand that the bill has not yet left the "assigning" committee. ¶3. (U) Once introduced by a deputy or deputies, a Duma bill goes to the assigning committee and, once vetted, to the Duma Council, which vets it again, then decides if it should be introduced at the Duma. At either of these stages, the bill can be returned to the author(s) for re-drafting. The purpose of vetting is to determine if it complies with constitutional law and which committee(s) will shepherd it through the legislative process. ¶4. (U) After it has been assigned to a committee, a bill must pass three readings in the Duma. The first reading is essentially an introduction. According to Galina Bodrenkova, an expert working on the Civil Affairs and Religious Associations Committee, the real drafting work occurs between the first and second readings of a bill, when interested parties contribute their input for the drafting committee's consideration. If a bill passes the second reading, the third reading is generally pro forma, as is the approval by the Federation Council and the President. Laws come into effect upon publication in the state newspaper Rossiskaya Gazeta. ¶5. (U) According to media reports, the genesis of the sanctions bill was a meeting on Georgia that President Putin had with Duma faction leaders. Observers predict a first reading in November, although the bill is not yet on the publicly-accessible Duma calendar. ¶6. (SBU) Aleksandr Moskalets, first deputy on the Constitutional Affairs Committee, told us, however, that he did not expect swift passage. Contrary to the 1990s, when crucial legislation was passed in days, today's Duma prefers to examine potential legislation more carefully. Indeed, Moskalets thought the bill might not pass. He detected in the Duma a significant minority opposed to the bill, in part because many believe that the Ministry of Emergency Affairs already has legislation at its disposal for such purposes. Political analyst Dmitriy Oreshkin agreed that concerns about Russia's image might dampen enthusiasm for the legislation. Neither Moskalets, nor Oreshkin had seen a complete text of the bill. The Draft -------------- ¶7. (U) The draft bill defines an "international emergency situation" as a "combination of factors, which present a threat to the health, to human and civil rights, as well as the security of the state." The bill permits sanctions to be imposed for four years, with extension for an additional two years possible if "the situation continues to be dangerous to the health, rights, and lawful interests of Russian citizens, or the security of the state." ¶8. (U) The bill would empower the President to suspend economic, military, or technical assistance programs; ban or limit financial transactions; ban or limit external economic operations; suspend trade or other international contracts; change import/export duties; sever or limit sea and air transportation links; restrict tourism; and/or, limit technical and scientific exchanges. MOSCOW 00012232 002 OF 002 ¶9. (U) The proposal to impose such sanctions may be made by the President, the Federation Council, the Duma, or the Government. The ultimate decision to impose them, however, is the President's. The same four entities may propose that sanctions be suspended but that decision, again, rests with the President. Like the U.S. Law? -------------- ¶10. (U) The Russian press has made much of the fact that the U.S. International Emergency Economic Powers Act (IEEPA) was purportedly used as a model for this draft bill. There are a few key differences, however. In the IEEPA, the President must report regularly to Congress, which has the power to override via concurrent resolution any sanctions imposed by the President. Comment -------------- ¶11. (SBU) Given that the Duma is controlled by the Kremlin-compliant United Russia, we believe this bill -- Moskalets's caveats notwithstanding -- has a good chance of becoming law. References to U.S. sanctions law appear to be an effort to give the bill the appropriate pedigree. If passed, the bill would retroactively legalize measures that Russia has already imposed on a number of CIS countries (Georgia, Moldova, Belarus, and Ukraine). BURNS