NGOS: SILVER LINING BUT A LOOMING DARK CLOUD

C O N F I D E N T I A L SECTION 01 OF 03 MOSCOW 000695

SIPDIS

SIPDIS

E.O. 12958: DECL: 02/15/2017
TAGS: PHUM PGOV PREL KDEM EAID RS
SUBJECT: NGOS: SILVER LINING BUT A LOOMING DARK CLOUD

REF: MOSCOW 476

Classified By: Ambassador William J. Burns. Reasons 1.4 (b, d).


1. (C) SUMMARY: After initial difficulties in getting
re-registered, our U.S. and foreign NGO contacts have resumed
normal activities and express little concern over the
follow-on reporting requirements. The Federal Registration
Service (FRS) surprisingly has even expressed interest in
working more closely with the NGO community and the Embassy,
including in seeking a U.S.-based NGO to serve on a Public
Council. The bottom line is that ten months after the NGO
law came into effect, it has consumed large amounts of NGOs'
time, but has not halted their work. At the same time, many
here see it as more evidence that the environment for NGOs is
becoming more tightly controlled. They point to the Dutch
NGO Russia Justice Initiative, already twice refused
registration and under increasing scrutiny, as an example of
how selective pressure can be brought to bear under the new
law. We will continue to urge GOR officials to reduce the
burden on Russia's relatively large and active NGO community.
END SUMMARY.

SILVER LINING: COMMON SENSE LARGELY PREVAILS
--------------


2. (C) Our foreign NGO contacts generally agree that the NGO
law has had no major effect on their operations, aside from
the time and effort required to submit registration documents
and subsequent reports. Now that most foreign NGOs have been
re-registered, the concerns many NGOs voiced earlier have
eased, but have not completely disappeared. Thus far, NGOs
reported far less difficulty in completing required,
quarterly follow-on activity and financial reports than in
applying for re-registration, although a new round of more
comprehensive annual financial and activity reports will be
due in April. Human Rights Watch (HRW) Country Director
Allison Gill said HRW would minimize details on its work
required in the reporting, particularly research trips to
Chechnya, but it had no intention of abandoning such
activities. Other NGO contacts told us concerns about the
reports were tied more to the lack of guidance from the
Federal Registration Service (FRS). In the absence of
official guidance --expected soon but unlikely to give much
more specific instructions -- FRS officials have instructed
NGOs to use "common sense" in completing the reports. Ford
Foundation Executive Director Steven Solnick submitted Ford's
annual program reports in October and told us he has heard
nothing from FRS and did not expect to.

FRS SEEKS BROADER COOPERATION WITH NGOS
--------------


3. (C) Anatoliy Panchenko, deputy head of the FRS Department
on Registration of NGOs, told Emboffs recently that FRS had
been satisfied with the results of the registration process.
As of February 5, FRS had re-registered 200 foreign NGOs, 109
of them based in the U.S. There had been 18 organizations
refused, but 10 of them had been approved after resubmitting
their applications. FRS conducted technical reviews of the
applications, and concerns that the process would be
politicized had been shown to be untrue, he noted.


4. (C) We asked about reporting requirements, including
whether rumors that NGOs would have to keep extremely
detailed records of events, were true. Panchenko
acknowledged that FRS would be unable to handle the volume of
reports from foreign NGOs. His department, which reviewed
registration applications, not just for NGOs but for
religious organizations and others required to register, had
a staff of six. The department monitoring reports had a
staff of seven. Panchenko said in most cases, FRS would
acknowledge receipt of the report and do nothing else. There
may be times that reports would be reviewed if suspicions
about a particular NGO arose, he added.


5. (C) In fact, FRS wanted to broaden its cooperation with
NGOs and other key actors in trying to make the registration
process more transparent, Panchenko said. He expressed
willingness to have FRS officers participate in seminars
explaining reporting requirements. He welcomed questions
from the Embassy or NGOs and agreed to consider posting
answers on the FRS website. FRS had also been working
closely with the Public Chamber and Ella Pamfilova, Chair of
the Presidential Commission on Development of Civil Society
Institutions and Human Rights. FRS was pursuing formation of
a "public council," in conjunction with the Public Chamber,
to monitor FRS activities. Panchenko said the council would
include one or two members of the Public Chamber and others
from the organizations registered by FRS. He suggested that
a representative from a foreign NGO -- possibly an American
given that American NGOs were the majority -- should serve on

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the council. Contacts have told us that other FRS officials
have been equally enthusiastic about FRS participation in
fora with the NGO community. Panchenko has asked the
International Center for Non-profit Law to work with FRS in
analyzing implementation of the legislation.

VISA GLITCH RESOLVED
--------------


6. (C) Foreign NGO representatives have reported minor
problems with amending bank accounts, tax accounts, and motor
vehicle registrations arising from minor name changes
required by FRS, such as renaming an organization a branch
office rather than a representative office. International
Rescue Committee, for example, could not drive its vehicles
because local branches of the State Automobile Inspectorate
would not consider a copy of the FRS registration certificate
as sufficient to amend IRC's vehicle registration. It had to
produce a letter from its headquarters noting the name had
been changed.


7. (C) FRS officials quickly resolved a potential problem
connected to visa renewals for expatriate NGO workers.
Previously, the Federal Registration Chamber sponsored such
visas, but the new legislation did not address that issue.
FRS reached agreement with the registration chamber to
continue its sponsorship, and our contacts have reported no
visa troubles for expatriate staff.

AMENDMENTS EXPECTED?
--------------


8. (C) Dr. Aleksandr Auzan, the president of the Institute
of the National Project "Social Contract," told us that he
expected the NGO law would soon be amended, relaxing
registration and reporting requirements. Auzan conducted a
survey on the economic impact of the requirements on NGOs and
the GOR. His research found that the costs of implementation
were excessive. Senior officials, including President Putin,
recognized that the law was ineffective in meeting stated
goals of identifying terrorist organizations. Putin and
others also now considered an Orange Revolution extremely
unlikely and were far less wary of foreign NGOs, Auzan added.
Auzan claimed that shortly before the NGO bill's second
reading last year, the Presidential Administration realized
there were problems with it. It had planned to amend it and
send it back to the Duma, where it would have been
"forgotten." Unfortunately, as international criticism grew,
including the adoption of a resolution by the House of
Representatives, the Kremlin changed its mind. Deputies to
Human Rights Ombudsman Lukin and to Commission on Development
of Civil Society Institutions and Human Rights Chair
Pamfilova have told us they are recommending a second look at
the reporting requirements, which they believe impede the
efficiency of NGOs (reftel).

THE DARK CLOUD
--------------


9. (C) Contacts at the twice-refused Dutch NGO Russia
Justice Initiative (RJI) are increasingly suspicious of FRS's
motives. FRS refused RJI in part because it was registered
as a representative office, not a branch office. FRS
maintains its should be a branch office because it conducts
programs. (FRS has made a similar ruling in the cases of two
other NGOs in considering their applications.) RJI's
attorney told us, however, that each time RJI submitted its
application, FRS found new reasons not to register it. RJI
and Human Rights Watch had filed identical applications, the
attorney said, and HRW was registered with little trouble
while RJI was rejected.


10. (C) Additionally, RJI's affiliate in Ingushetiya, which
is registered as a Russian NGO, has been notified that the
Ministry of Justice will be inspecting the office to ensure
that its activities are in accordance with its charter.
RJI's attorney told us that its biggest concern was not that
the office would be found out of compliance, but that
government officials could get access to files containing
names and addresses of victims of abuses who intended to
file complaints to the European Court of Human Rights,
putting them at risk of retaliation. Other Russian NGO
representatives have told us that incidences of such document
checks have increased recently. Panchenko told us that FRS
has asked tax authorities to close down NGOs that have
continued operating without applying for registration.


OTHER LEVERS
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11. (C) RJI is the only case we know of where

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re-registration problems may be attributable to more than GOR
bureaucratic inefficiency. Russian NGO contacts have also
noted difficulties experienced by a gay rights NGO in Tyumen
that has not been registered. Our contacts emphasize that
the GOR has shown it can use other levers in dealing with
NGOs, such as accusations of extremism in the liquidation of
the Russian-Chechen Friendship Society, tax audits of
Memorial and other organizations or, in the cases of some
foreign NGOs, restrictions on where they can work or denial
of visas to expatriate staff. In most cases, such tactics
have been used to harass organizations and limit their
effectiveness, rather than shut them down. At the cost of
considerable time, effort, and money, NGOs have managed to
continue working. Memorial has thus far been able to defeat
tax claims in court, according to contacts there.
International Rescue Committee is currently prohibited from
working in North Ossetia by local officials sensitive to any
activity in the disputed Prigorodniy region, but continues to
work in Ingushetiya and Chechnya. The Russian-Chechen
Friendship Society has reconstituted itself by registering
two new organizations.

COMMENT
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12. (C) We have not seen signs that NGOs are modifying
their behavior because of the law. Thousands of NGOs
continue to press forward on their independent agendas and
contribute to Russia's developing civil society. Clearly,
however, the registration law has contributed to a climate of
greater GOR control and provides another lever to selectively
target both foreign and local NGOs. Many NGOs are concerned
about being subjected to further scrutiny. We will continue
to urge the GOR to provide maximum transparency and clarity
in implementing the law, supporting those GOR officials who
seek further amendments to reduce the law's reporting burdens.
BURNS