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    Georgia, Russia: Legal showdown at the International Court of Justice / Moldovans back Russia again / Pawn shops lending money to be dealt with / Russian defense ministry may increase conscription age to 30 / Legislation for Skolkovo innovation hub adopted


    Georgia, Russia: Legal showdown at the International Court of Justice

    On September 13, the International Court of Justice (ICJ) will start examining a Georgian lawsuit against Russia over alleged ethnic cleansing.

    Submitted on August 12, 2008, the final day in the Georgian-Russian conflict, Moscow stands accused of violating the 1965 International Convention on the Elimination of All Forms of Racial Discrimination. The lawsuit also calls on the court to persuade Russia to facilitate the return of Georgian refugees to the breakaway provinces of Abkhazia and South Ossetia.

    This paper's sources said that Russia plans to contest the court's jurisdiction and to note that Georgia failed to meet all the court's requirements before it submitted its case to the ICJ.

    A source at the Georgian Ministry of Justice said the convention had been chosen to justify Tbilisi's grievances against Russia because article 22 stipulates that all violations be examined by the ICJ. Moreover, the defendant is unable to block the case's examination.

    In September 2008, the court conducted initial public hearings on Georgia's lawsuit and ruled in Russia's favor.

    Then Tbilisi requested that the ICJ persuade Moscow to withdraw its troops from Abkhazia and South Ossetia, facilitate the return of Georgian refugees, guarantee their property rights, facilitate the reintegration of Sukhumi and Tskhinvali and compensate Georgia.

    In its October 15 ruling, the court declined to support Tbilisi's requests.

    An ICJ source said Russia had submitted its objections to the Georgian lawsuit and contested the court's jurisdiction on December 1, 2009. These objections will become the subject of these current hearings in the Hague.

    The Russian side will set out its stance first today during three-hour deliberations in line with the relevant procedures. The Georgian side will then have an opportunity to voice its objections tomorrow. The source said it would take the court between two weeks and several months to reach a verdict.

    A source close to the hearings said, instead of engaging with, and arguing against Georgia's claims, Moscow decided first to call for the case to be dropped in line with formal criteria. That is why Russia is now contesting the court's jurisdiction.

    Russian objections submitted to the ICJ suggest that the court should not examine the Georgian lawsuit because it has been artificially linked with the 1965 convention.

    Moscow's main legal argument is that Georgia had not accused Russia of racial discrimination against its population before it submitted the lawsuit, the source added.

    Although the UN, the Organization for Cooperation and Security in Europe and a mixed controlling commission for resolving the South Ossetian conflict had repeatedly examined "frozen" conflicts in Abkhazia and South Ossetia before the 2008 war, Tbilisi did not voice any official complaints against Moscow.

    Nezavisimaya Gazeta

    Moldovans back Russia again

    Russia may regain its lost influence in Moldova if it seizes the chance offered by upcoming parliamentary elections in the republic, according to Valery Klimenko, head of the Equality public movement in Moldova.

    This suggestion is based on the failure of the constitutional referendum launched by the ruling westward-leaning alliance For European Democracy. In his view, Moldova is on the verge of making a U-turn.

    This would not be the first time something similar has happened in Moldovan history: Mircea Snegur, the first president of independent Moldova, and the National Radicals who backed him, did everything possible to sever relations with Russia and align with Romania. His quarrel with Moscow went so far that he declared war on Russia. His aides had to rescue the situation by pleading inaccuracies in the translation from Moldovan to Russian.

    The second president, Petru Lucinschi, tried to befriend Moscow, but simultaneously paved the way to greater westward orientation. He was the one who drafted an agreement, later signed by President Vladimir Voronin, on joining the World Trade Organization and developing relations with the European Union. Voronin, who succeeded Lucinschi, abruptly re-directed the country's foreign policy, turning it eastwards. True, this friendship with Russia was short-lived. In 2003 he quarreled with Moscow refusing to sign the "Kozak memorandum" that extended Russia's military presence in the area for another 20 years.

    The acting president is trying to succeed where Snegur failed: Mihai Ghimpu is seeking to integrate Moldova into the EU and reunite with Romania. In so doing he is coordinating his moves with Romania's President Traian Basescu. But the September 5 referendum demonstrated that the population does not trust Ghimpu and his partners in the alliance: there was a voter turnout of only 29% and at the end of last week the Central Election Commission officially declared it invalid.

    Valery Klimenko, the leader of the Equality movement, told Nezavisimaya Gazeta that not only Russian-speaking citizens, but also members of the nation's titular ethnicity would favor parties whose manifestos emphasize closer ties with Russia. The explanation for this is that many Moldovans earn their livelihoods in Moscow and on the Russian market where they have traditionally sold everything they grow in Moldova's fields. A recent warning by the Russian environmental watchdog to suspend the import of Moldovan wine and fruit further pitted the population against the government.

    Marian Lupu, Democratic Party leader, also backs a good relationship with Russia, according to Arkady Barbarosh, director of the Moldovan Institute for Public Policy. The analyst notes that a recent survey carried out by his institute demonstrated that if direct presidential elections were held today, Lupu would win a majority vote.

    RBC Daily

    Pawn shops lending money to be dealt with

    The sums of money borrowed at pawn shops are comparable to bank loans, say financial experts at Russia's Central Bank. Representatives of the League of Pawn Shops say that this can be accounted for by the increasing activity of bogus pawn shops engaging in illegal cash-out transactions. Moscow's police confirm this is the case and have already initiated criminal proceedings against a large interregional chain of pawn shops which used to lend up to 2 billion rubles per month.

    At the beginning of this year the Central Bank reported that the demand for services offered by pawn shops had surged against 2009's sharp fall in credit activity. "Thanks to certain peculiarities of pawned property and high interest rates, pawn shops managed to avoid any significant growth in risk and increase the amount of loans by 18% against 2008," the Central Bank's report said.

    No reliable statistics on the total amount of loans taken out at pawn shops are available. Earlier this year, Dmitry Terentyev, general director of a pawn shop chain in St. Petersburg, estimated that people took out a total of between $120 million and $180 million in loans from pawn shops. Other estimates suggest that people borrowed 3.5 billion rubles at pawn shops in Moscow alone and about 20 billion rubles, or $650 million, across Russia. Still other estimates said that such loans totaled $1.2 billion.

    "People often say that pawn shops loan a lot of money but this is not true, because these estimates include fake pawn shops engaging solely in money lending," Alexander Tomson, executive director of the non-profit organization the League of Pawn Shops, told RBC Daily. According to Tomson, such offices may well be registered as pawn shops but in fact have nothing to do with them. "They don't let ordinary customers in - there is usually a guard at the door who doesn't let anyone in. However, there are also pawn shops that engage simultaneously in official and illegal activities," Tomson added.

    Pawn shops engage in money lending because they are easy to set up, the head of the pawn shop league explained. "It is both technically and economically easy to set up a pawn shop and it doesn't take much investment," Alexander Tomson said.

    However, there has been a clear growth in the volume of loans made by pawn shops even putting illegal pawn shops aside. According to the League of Pawn Shops, there was an increase of over 20% in the volume of loans offered by Russian pawn shops in 2009 and 2010. The Central Bank estimates that there are about 5,000 pawn shops across Russia but their exact number is unknown because this sector lacks a single regulatory authority. Anton Krotin, chief lawyer at the Nalogovik legal company, believes that a supervisory authority needs to be established to regulate pawn shops and expose illegal activities like, for example, buying stolen goods.

    Novaya Politika

    Russian defense ministry may increase conscription age to 30

    Last spring an original idea occurred to the Russian military: to increase the conscription age from 27 to 30 years. Vasily Smirnov, deputy chief of the General Staff, presented it in parliament in late April, adding that the spring conscription campaign would be extended until August.

    Deputy Defense Minister Nikolai Pankov recently spoke again about extending the conscription age, which means the ministry is unlikely to give up the idea.

    The main arguments include a difficult demographic situation (lack of conscripts due to a demographic gap of the early 1990s) and the need to create a more "grown-up" and "responsible" army. The reformers also cite the experience of some countries where the conscription age exceeds 30 years.

    The idea does not appeal to most Russians, which is logical in a society where draft evasion by any legal or illegal method has become a fact of life accepted by the majority of society. A longer conscription age will mean a longer period when people will do their best to evade army service.

    Official attempts to improve the image of the Russian army have so far been limited to slogans and appeals.

    By the age of 30, many young men already have an established career and a family, which makes army service especially undesirable psychologically and socially. Accepting conscription means giving up your career by allowing others to take up your place, and leaving your family, for whose livelihood you are responsible, in the lurch.

    Still, an increase in the conscription age would not have been so dramatic had the service conditions been better. A desire to sign up for military service is largely dampened by the daily news about the victims of hazing and the fact that quite a few conscripts leave the army psychologically unsound.

    This hinders conscription even when young people view military service as a duty to society they would like to honor.


    Legislation for Skolkovo innovation hub adopted

    The State Duma, the Russian parliament's lower house, adopted in the second reading a package of bills on the Skolkovo high-tech hub in the Moscow Region, including amendment to the Tax Code that grants privileges for participants; the potential shortfall of the federal budget from these privileges has been estimated.

    The Russian parliament on Friday adopted in the second reading a law on the Skolkovo innovation center, as well as amendments to other laws required for the creation of the Russian Silicon Valley. The plan is to hold the third reading on September 23.

    The high-tech hub near Moscow is defined as a specially allocated area that will house companies engaged in research and development in five priority areas of the presidential modernization plan - energy efficiency, nuclear technology, space technology and telecommunication, computer and medical technology. The Skolkovo residents will enjoy tax and other privileges.

    A managing company for the Skolkovo center will be appointed by a presidential decision and made responsible for creating and maintaining the preferential treatment regime. The managing company will own the land used by the project.

    A fast and simplified procedure will be used for passing all planning and development documents for the area. Amendments have also been made to laws regulating hiring foreign professionals: Skolkovo resident companies will not have to apply for permits to do so. Moreover, foreign professionals invited to work for Skolkovo projects will not be included in the annual quota for foreign employees.

    The Skolkovo package includes amendments to ten federal laws, as well as to the Urban Development and Tax Codes, exempting Skolkovo participants from the VAT for 10 years from their registration in the project.

    The project participants will also enjoy discounted insurance rates, 14% to the Pension Fund, and zero to the Social Insurance Fund and the Compulsory Medical Insurance Funds (both federal and local).

    As a result, the federal budget will have an annual shortfall of 400 million rubles (nearly $13 million), Yevgeny Fyodorov, head of the parliamentary committee on economic policy and entrepreneurship, told reporters.


    RIA Novosti is not responsible for the content of outside sources.

    MOSCOW, September 13 (RIA Novosti)

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