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The Real Russia. Today. Federal raids on a major booze vendor, Yandex starts censoring Telegram in search results, and sociologists look back at 2018

Meduza

Thursday, December 27, 2018

This day in history. On December 27, 2002, three suicide bombers drove two truck bombs into the Chechen Republic's heavily guarded government headquarters in Grozny, killing a reported 83 people and injuring more than two hundred victims.
  • Russian federal officials raid major alcohol vendor’s offices and warehouses, days before crucial holiday sales
  • Yandex now censors Telegram.org search results for users in Russia
  • Vadim Volkov reviews Russia’s failure to make serious progress on judicial reforms in 2018
  • Lev Gudkov summarizes Russia’s two main trends in 2018: failing militarism and rising anxieties

Losin' boozin' 🥂

On December 26, officials raided several stores that belong to the Krasnoe & Beloe (“Red & White”) alcohol sales chain. Officers from Russia’s Federal Tax Service, the Federal Alcohol Market Regulation Service, the Federal Security Service, and the Special Police Force carried out searches of the liquor vendor’s offices in Moscow and Chelyabinsk and company warehouses across the country on the morning of December 26, Red & White’s spokespeople told reporters. The searches lasted until late in the evening. According to the relative of a company employee working at a warehouse in Yekaterinburg, people in masks armed with automatic weapons “burst in and ordered everyone to the ground,” and then “herded” more than 300 staff into the cafeteria, where they were detained all day and forbidden from eating.

Federal officials seized documents and computers, as well as one bottle from each specific alcohol shipment, which were sent for analysis. Outside warehouses in various regions, delivery trucks formed long lines, waiting to pick up and drop off their cargo. On the evening of December 26, a spokesperson for Red & White said the company’s operations had come to a complete standstill, though the chain’s storefronts were still open for business. The following morning, the company’s central office in Chelyabinsk announced that staff were back on the job.

Red & White is suspected of trafficking in counterfeit labels and evading taxes, according to a company spokesperson. A source in Russia’s alcohol industry told the magazine RBC that the tax fraud accusations arose after the company licensed its stores under different legal entities. The source says this resulted in a 1.9-billion-ruble ($27.6-million) tax penalty on the company “Absolute” (which belongs to the Red & White corporation). The Chelyabinsk Arbitration Court’s website indicates that the company is trying to challenge this decision, and the next hearing is scheduled for January 25.

Mikhail Biryuk, the head of the Federal Tax Service’s Chelyabinsk branch, says “Absolute” has paid all its taxes and has no debts in the region, though he says he knows nothing about any potential tax fraud charges against the company elsewhere in Russia. The newspaper Vedomosti has reported that the case against Red & White is being conducted by the Federal Investigative Committee. Sources told the Ural-based news website Ural.ru that experts from Federal Alcohol Market Regulation Service are searching for counterfeit booze. Spokespeople for Red & White say federal officials found no evidence that the company stores or sells counterfeit alcohol.

Other unconfirmed reports suggest that the company is suspected of selling alcohol taken from a police evidence room or smuggled goods. One source told the website Znak.com that officials are investigating the disappearance of alcohol from an Interior Ministry physical warehouse in Chelyabinsk. According to this unverified rumor, former police officers were able to offload the stolen alcohol through Red & White stores. Another source offered a different version of events to the news agency Interfax, claiming that law enforcement are investigating reports that Red & White is selling smuggled goods.

One day of delays might have cost the company 100 million rubles ($1.5 million) in revenue, according to Mikhail Burmistrov, the CEO of INFOLine Analytics. Burmistrov told RBC that the company’s losses will only grow, the longer its operations are interrupted, as supply chain problems emerge. He estimates that Red & White could lose as much as five billion rubles ($72.5 million), if full operations aren’t restored before January 1.

Yandex: it's better if you're not in Russia 📡

Yandex has stopped showing search results to Internet users in Russia that link to the official website of the instant messenger Telegram, https://telegram.org. The newsletter The Bell was the first media outlet to notice the new policy.

When using the Internet in Russia and searching Google for “telegram,” the messenger’s website is the first result. Internet users in Russia who turn to Yandex for the same search, however, find no links whatsoever to https://telegram.org.

Yandex’s press office told the Telegram channel Kod Durova that the hyperlinks are deleted automatically from the search engine’s results, after they’re entered into Roskomnadzor’s registry of banned online materials. “It’s not really up to us. Apparently this link has been added to RKN’s registry. Synchronization with the registry is automatic. Yandex removes hyperlinks as new data is received,” the search engine’s spokesperson said. The hyperlink is only censored for Yandex’s users in Russia.

  • In April 2018, a Moscow district court granted a request by Russia’s federal censor to block Telegram nationwide for refusing to share encryption keys with the Federal Security Service. The messenger’s websites were subsequently added to Russia’s Internet blacklist.

Sociologists' corner 📈

👨‍⚖️ Volkov on another year of failed judicial reforms

In an op-ed for Vedomosti, sociologist Vadim Volkov reviews Russia’s failure to make serious progress on judicial reforms in 2018. At the beginning of the year, the Kremlin signaled efforts to expand the courts’ independence by dismantling mechanisms used to influence verdicts, changing the country’s judge selection and training system, and reducing judges' caseloads.

According to Volkov, the year was full of disappointments, as court chairmen and Russia’s Presidential Personnel Commission mostly retained their stranglehold on the country’s judge appointment and reappointment systems. The former mechanism favors promotions from within the court apparatus and the hasty training of judges after they’re appointed, rather than drawing on outsiders with experience as attorneys. The “presidential filter,” meanwhile, includes representatives from Russia’s law enforcement agencies, weighs in on reappointments as well as appointments, and operates without any formal grounds for rejecting candidates.

Despite two not insignificant reforms (the automatic distribution of cases and the abolition of court chairmen’s mandatory consent for judge appointments), officials rejected substantive changes, like the creation of a new federal training center for judges.

So what does all this mean for 2019? Volkov warns that Russia’s failure to develop a more independent judiciary means the country’s social conflicts aren’t going anywhere, and the economy will miss out on any spike in investment activity that accompanies improving property-right protections.

But Volkov does highlight one bright side: Russia is beginning to sidestep its judge problem by expanding the jurisdiction of jury trials, which have an acquittal rate of 15 percent that dwarfs the 0.4 acquittal rate of verdicts by judges.

👴 Gudkov says Russian pension reforms are kinda making America great again

In an interview with Novaya Gazeta, sociologist and Levada Center director Lev Gudkov summarizes Russia’s two main trends in 2018: (1) the authorities’ efforts to sustain the public’s “great power” mood through patriotism, militarism, anti-Westernism, Russian exceptionalism, and conservative cultural values, and (2) growing social discontent and anxiety about the future.

Gudkov argues that Russians’ objections to domestic policies — most notably the government’s decision to raise the retirement age — has activated a large accumulation of “mass discontent” that makes a whole array of issues more salient, weakening confidence in the future and thereby undermining one of the key pillars of Putin’s social contract. For example, Gudkov says pension reform precipitated a sudden decline in Russians’ sensitivity to anti-Western propaganda, even dragging down the approval ratings of several prominent national security officials (like Defense Minister Sergey Shoigu and Foreign Minister Sergey Lavrov). Russians are also growing more uneasy about Western sanctions, amid falling real incomes and dimmer retirement hopes.

What’s this mean for 2019? Gudkov believes that Putin’s teflon status is finally eroding, and the typical “good tsar, bad boyars” perception is losing its currency.

Yours, Meduza