As non-governmental groups are increasingly scrutinized on issues of political involvement and financial transparency, they face a tougher welcome from governments around the globe--especially those outside of the Western liberal democratic mold. Most recently, attention has shifted to Russia, where a new law was passed to reign in NGO activities.

Before heading for the banquet hall to celebrate the end of the fall session on December 23, 2005, the deputies of the Russian Duma (lower house of parliament) voted almost unanimously to approve “federal law N18-F3”--the controversial new NGO/NCO initiative. This legislation aims to regulate the activities of non-governmental and non-commercial organizations operating in the Russian Federation and includes the establishment of new registration procedures and stricter monitoring of NGO activities, financial contributions, and budgets. Within days of passing the Duma, the legislation sailed through the upper house of parliament by an even larger margin. On January 10, President Putin signed the amended version of the bill into law, which will take effect in early April.

Tatyana Kasatkina, the executive director of Memorial, one of Russia’s leading human rights groups dedicated to preserving the memory of the victims of Soviet repression, assessed the new measure rather bluntly: “This will mean the destruction of civil society in Russia.” But whether this statement hits the mark or is melodramatic will depend on the implementation of the law.

The original version of the bill, which stipulated that all foreign and Russian non-governmental organizations must re-register with the government authorities, raised a firestorm in the West. U.S. Secretary of State Condoleezza Rice opined that Russia should be cautious with this legislation, while the U.S. House of Representatives passed a non-binding resolution, approved by a vote of 405-15, describing the measure as having “the effect of severely restricting the establishment, operations and activities of domestic, international and foreign nongovernmental organizations in the Russian Federation.”

A number of Russian human rights organizations pointed out the proposed legislation’s inconsistencies with the European Human Rights Convention and Russia’s own constitution, which stipulates the freedoms of association and expression. Council of Europe Secretary General Terry Davis noted that “such rules may be incompatible with the general prohibition of discrimination and I will not be surprised if there is an appeal to the European Court of Human Rights on this issue.”

But while Putin has insisted at his annual news conference that “states cannot use NGOs as an instrument of foreign policy on the territory of other states,” western policymakers believe that the Kremlin, fearing the perceived role of foreign organizations in orchestrating the “color revolutions” in other former Soviet states, is launching a preemptive strike against a repeat in Russia’s pivotal 2008 presidential elections.

But a close reading of the text of the law as well as a closer analysis the composition of the Russian civil society will indicate a rather different, but no less ominous, reality of Russian politics: the centralization of power has decreased the importance of the legal code.

In comparison to the laws of other countries and even by Western democratic standards, this is a rather ordinary piece of legislation--and it is essential for Russia. In Russia’s amorphous legal environment, statutes regulating NGO/NCO activities haven’t been substantially updated in a decade. The legislation has been vetted by the Council of Europe and does not significantly differ from similar laws in the Western democracies.

In the United States, for instance, the Foreign Agents Registration Act (FARA), enacted in 1938 as a Congressional response to the spread of Nazi propaganda before World War II, is still on the books. According the Department of Justice (http://www.usdoj.gov/criminal/fara/q_A.htm), “The Act requires every agent of a foreign principal to register with the Department of Justice and file forms outlining its agreements with, income from, and expenditures on behalf of the foreign principal. These forms are public records and must be supplemented every six months.” The new Russian law requires an annual inspection. According to the text of the amended legislation, an organization can be investigated--and subsequently banned--only if it “engages in extremist activities, uses its legal NCO status to launder funds contrary to Russian law, or violates freedoms and rights of the individual.” Moreover, any decision to shut down a civic association can be appealed in Russia’s courts.

But the substance of the new law itself is not the cause for alarm. Rather, the warped legislative process employed to enact it should be the biggest cause of concern to Western media and policymakers. The law passed the Duma with lighting-quick speed, only to be interspersed with “vital input” from President Putin. Feigning a response to the worldwide consternation over the purportedly antidemocratic measure, the President wisely suggested that the law be amended for the second reading. Dutifully, the pliant Duma promptly removed the most offensive clauses of mandatory re-registration for foreign-based entities as well as the mandatory notification of authorities for those wishing to start non-legal (“informal”) groups.

The “sudden” nature of this legislation has surprised many in the West, despite the fact that Putin signaled the need for this law in his Address to the Federal Assembly (comparable to the State of the Union) in May of 2004. At the end of the speech, the President warned that “in our country, there are thousands of public associations and unions that work constructively. But not all of them are oriented towards standing up for people’s real interests. For some of these organizations, the priority is to receive financing from influential foreign foundations. Others serve dubious group and commercial interests.”

The manner in which Putin pursued the NGO law reconfirms a disquieting reality of Russian politics: the Kremlin is the only political force in the country capable of “heeding societal demands.” The new legislation is yet another indication that the President and the ever-closing group of advisers around him define the political sphere in Russia and are the only real political force, bar none.

Another element to Putin’s success is the relatively small proportion of the civil society groups this new law impacts. It has been widely reported that there are over 300,000 civic organizations in Russia, an impressive number for a country that had very few fifteen years ago. However, as in the West, the precise activity of most of these groups, whose interests they serve, and what part of society they encompass, remains relatively opaque. Can, for example, associations in the Russian regions financed entirely out of the budgets of local administrations be plausibly defined as NGOs? As Catherine Fitzpatrick, a Russia scholar and former director of Human Rights Watch, pointed out, “activists say the [NGO] figure is more like 70,000-75,000 because they reason that there are not 1,000 viable and active NGOs in each of Russia's 89 republics and regions.”

And do ordinary Russians believe that the proposed measure is aimed at exterminating civil society in their country? According to a survey conducted by ROMIR polling agency (a partner to the Gallup International), Russia has one of the lowest rates of participation in civil (defined as “volunteer”) activities in the world: only fifteen percent of those polled indicated that they took part in such activities. The global average is twice higher, and three times as high in North America. In another recent poll conducted by the Levada Center, only 12 percent of Russians agreed that the existing civil organizations play a decidedly positive role in their country.

While troubled by a lack of popular acceptance, deprived of official support, and often a victim of bad PR, independent NGOs in Russia have nonetheless emerged as a crucial weathervane in Russia’s continuing road to democracy. Organizations such as the Helsinki Group or the Committee for Soldier’s Mothers continue to serve as a moral compass in Russia’s increasingly cloistered public space by exposing horrific crimes in Chechnya and organizing rallies and raising awareness on the issues of human rights abuses and preservation of freedom and dignity. Foreign-based NGOs, such as the Ford Foundation, have committed significant sums to facilitate educational development and community-building grants or to preserve Russia’s rich cultural heritage.

Although Putin’s wish to see tighter regulation of NGO groups is rapidly becoming reality, this law is neither revolutionary nor novel for Putin’s Russia. It is whether the Kremlin chooses to selectively utilize this legislation to punish its political opponents that will be the telling sign of whether it is transparency and accountability or control that they are after.

According to Andrei Kortunov, the president of the New Eurasia Foundation in Moscow, “the circumstances of the application of laws usually are much more important than the letter of the law in Russia. The law frequently defines only the general route, so to speak.” As evidenced by the prior expulsion of the US Peace Corps and the attack on jailed tycoon Mikhail Khodorkovsky’s Open Russia Foundation, the Kremlin does not need this particular legal instrument to remove “unwanted” groups from Russia. The most recent hysteria with “British spy-funded” NGOs and the plight of the two Caucasus-based organizations under investigation by the Russian Ministry of Justice also pre-dated the new law.

As Andrew Wilson, a prominent Russia expert, eloquently put it in recent article, the real dilemma in Russia lies with “virtual politics”--a dominant political elite (Kremlin) that utilizes the weakness of civil society and almost complete media control to subvert any real democratic grassroots politics. “Unlike traditional authoritarian states,” Wilson claims “the point is not simply to trap the population in some kind of repressive box, but to trap them in the perception that they are trapped in some kind of box. To convince them that there is no alternative.” The new NGO/NCO legislation is but another example of this unique and troubling phenomenon that characterizes the current Russian decision-making process.

Igor Khrestin is a research assistant at AEI.