Rules drawn up for Roskomnadzor 'controlling purchase' under 'grounding' law for foreign IT giants
MOSCOW. July 26 (Interfax) - The Russian Ministry of Digital Development, Communications and Mass Media has drawn up rules allowing the Federal Service for Supervision of Communications, Information Technology, and Mass Media (Roskomnadzor) to monitor compliance with the restrictions on money transfers to foreign Internet giants which have refused to comply with the Russian "grounding" law.
The draft document, published on the government website of draft regulations on Monday, was developed in accordance with Clause 1 part 9 Article 14 FZ No. 236 (the federal law on "grounding"). Under the provision, Roskomnadzor may carry out transactions with a company, which does not comply with the "grounding" requirement, for the purpose of confirming as fact the provision of money-transfer services, including electronic money, and/or taking payments for such a company.
The transaction will be effected by a Roskomnadzor official by "methods applicable by consumers buying goods and services and conducting relevant transactions with legal entities, individual entrepreneurs, foreign nationals, who sell goods and services to consumers," but without direct contact between company employees and a consumer, i.e. online or by post.
This mechanism is similar to the already legally existing "controlling purchase" where the oversight agency monitors compliance by legal entities and individual entrepreneurs with the requirements for the sale of goods and services to consumers. Only in the case of the "grounding" law, the service may not be provided because payments are banned.
Public debate of the bill ends on August 20.
On July 1, President Vladimir Putin signed the so-called grounding law compelling foreign IT giants with a weekly audience in Russia of 500,000 and more, to set up proper representative officers (branches) in Russia. All foreign owners of websites, information systems, and software will be compelled to open a branch, an office, or a legal entity in Russia if they meet one of four criteria: they disseminate information in Russian or languages of the peoples of Russia, they provide advertising aimed at a Russian audience, they process Russian users' data, or they receive money from Russian citizens and legal entities.
Violation of these requirements will entail one or several of the following measures: notifying users via the search engine of its violation of the law; banning the company's advertisement; banning advertisement on the company's website; restricting money transfers and receipt of payments; banning search results; banning the collection and cross-border transfer of personal data; blocking the website in the Russian segment of the Internet.
The restrictions on money transfers would apply not only to banks but also foreign payment systems, which, if found not in compliance, would be placed on a separate register and could be blocked unless they address the failing within 30 days.
