Russian election officials file lawsuits to remove State Duma candidates who own foreign assets

Russia’s Central Election Commission (CEC) has decided to file lawsuits with the Supreme Court seeking to bar a number of candidates from running in September’s State Duma election because they own foreign assets.

As reported by Kommersant, the lawsuits concern seven candidates from the Party of Growth and Russian Party of Freedom and Justice (RPSS). A source told the newspaper that election officials may also file a similar claim against candidates from the Yabloko Party.

The CEC moved to remove candidates with foreign assets after receiving the results of a corresponding audit conducted by the Central Bank. Eight candidates from the Yabloko, New People, and LDPR parties have been barred from running in the elections on the basis of this report already. Some of them held single shares in Apple, Pfizer, and Intel. Through the courts, the CEC plans to remove candidates who dispute the results of the audit and refuse to withdraw from the election voluntarily or in accordance with a decision from their party.

Dmitry Potapenko — one of the candidates from the RPSS that the CEC is seeking to remove from the elections through the courts — said that he familiarized himself with the Central Bank’s report. According to him, the audit lists representatives of nearly every party, including United Russia. “As far as I understand, people worked through Russian brokerage offices and have no foreign accounts. How the CEC will act in this situation is very unclear,” Potapenko said.

The foreign assets Potapenko holds are shares in Yandex and Sberbank. As it turns out, even shares in Russian companies that are traded on foreign exchanges can be deemed foreign assets, Potapenko said, perplexed. 

Sberbank shares are traded on the London Stock Exchange, while Yandex Securities are traded on the NASDAQ. According to Kommersant, these assets are considered “foreign financial instruments,” as are foreign company shares included in the investment portfolios of Russian banks. 

The first candidate to be barred from running in the upcoming State Duma elections for holding foreign assets was Pavel Grudinin, a former presidential candidate for the Communist Party (KPRF). In July, the CEC removed Grudinin from the KPRF’s party list based on a determination by the Attorney General’s Office that he owns shares in a Belize-based company.

According to Russian law, candidates are supposed to close their foreign bank accounts, remove all cash and valuables from foreign banks located outside of Russia, and “dispose of foreign financial institutions,” before running for election.