In recent years, Russian State authorities have been greatly concerned about the efficiency of enforcement measures, imposed on foreign companies which have no legal presence in Russia. In practice, the only available measure was blockage of the company's web resources. This is rather difficult from a procedural perspective, while other penalties, like fines, were often ignored by non-Russian entities (although some of them do pay administrative penalties). Due to this, in the summer, Russian lawmakers adopted a new Landing Law to force IT companies to localize their business in Russia.
The Landing Law is applicable to any owner of a website/app, targeting Russian users, if the web-resource is visited by more than 500,000 Russian users daily 1. Any web-resource, including website, shall be considered to be targeting Russian users, if it meets at least one of the following criteria:
- such web-resource contains information in the Russian language and/or any other language officially recognized in the Russian regions.
- such web-resource is used for the distribution of advertising that targets Russian citizens.
- such web resource is used for processing Russian users' data.
- the owner of the web resource receives monetary funds from Russian citizens and legal entities.
Specifically, Russian lawmakers explained that, in their view, Facebook, Twitter, Google, Twitch, Bing, Amazon, Digital Ocean, Cloudflare, GoDaddy, AliExpress and some others will be targets.
The authorized regulator (Roskomnadzor) will maintain the register of foreign information resources to which the requirements of the Law apply. Roskomnadzor will send Requests for Information to companies and complete the register, based on the results of their responses, by including only those companies which fall under the criteria described above. This systematic interpretation of the Law allows a company to conclude that, unless it is included in the register, the obligatory requirements of the Law do not apply to it.
The key requirement, to be laid down by the Landing Law, is to establish a local presence in Russia. As per its current edition, it may be either a local subsidiary, branch, or a representative office, which shall be responsible for the handling of local individuals' and governmental requests, the company's representation in courts, and enforcement of decisions made by local authorities (such as to delete unlawful contents from the website, or similar).
In addition, companies will also have the following obligations:
- to place an online feedback tool for the Russian citizens and authorities on the company's website – the requirements for such feedback form are to be adopted by the Russian authorities.
- to register a personal account on the official website of Roskomnadzor, which must be used for liaising with the Russian authorities 2.
- informing its users that the company owner does not comply with the Russian laws.
- prohibition to promote the targeted company, or its information resources, in Russia.
- prohibition to use such information resources as an advertising platform in Russia.
- ban on funds transfers to a targeted company from Russia 3.
- ban on demonstration of relevant information resources, in search results.
- ban on the collection and cross-border transfer of personal
data to a targeted company.
Such measures can be applied both separately and in combination. Moreover, lawmakers noted that measures, to counteract non-compliance with the law, will be applied in stages. First of all, soft forms of sanctions will be applied, such as informing users about the violation, or ban on its advertising. Blocking a resource is an extreme form of liability, if the company will not cooperate with authorities.
In substance, the main idea of the Landing Law is to simplify communication between Russian authorities, IT corporations and related enforcement activities.
The Landing Law came into force immediately after its official publication on July 1st 2021. However, the requirement to open physical representative offices in Russia will come into effect on January 1st 2022. Therefore, we expect full-scale enforcement no earlier than in 2022.
1 According to draft regulation, daily audience is counted by a number of single user's access to each of the information resources, or software used for such access, that ensure their full loading, during the day.
2 The draft decree determines that a personal account is created on the website http://www.236-fz.rkn.gov.ru/ (the website is not working yet).
3 The regulator proposes to create two lists that Roskomnadzor will maintain. One list will include companies that do not comply with the Law and, in respect of which, the relevant decision of Roskomnadzor has been made to restrict funds transfers and payments by Russian individuals and legal entities.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.