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11.06.2014

Moscow’s ‘special economic zone’ could dispossess Crimeans

   

Grandiose plans for the Crimea reveal Moscow’s disregard for the rights of any Crimeans, including the ethnic Russians it claimed to be protecting when it invaded and annexed the peninsula. Moves to create a ‘special economic zone’ could result in mass evictions with the fast-track compensation procedure likely to leave people significantly worse off.  

Russia’s Minister on Crimean Matters Oleg Savelyev announced on June 10 that a bill on making the Crimea a special economic zone [SEZ] should be tabled in the State Duma in autumn.  The final draft may be a long way off, however initial reports in the Russian media give serious grounds for concern. 

Talk of a special economic zone began soon after the annexation in mid-March.  Russian president Vladimir Putin submitted a draft law back in April on creating a gambling zone in Crimea.  Kremlin-paid Russia Today reported this to be just part of the Crimea’s glowing future, with $7 billion investment and creation of the SEZ which would “help lure big investors with tax incentives”.

As of June 2014, grandiose promises for the Crimea’s social and economic development have been put on hold, the peninsula is facing problems even with food supplies, but Moscow is still determined to create the SEZ. 

Gazeta.ru reported seeing an initial draft law at the end of May.  According to this, the Crimea  become a special economic zone for 49 years, until 2064.  Those wishing to become residents of the SEZ would have to pay 150 million roubles [around 4.4 million USD]  to receive tax benefits.  Gambling will be legal everywhere except in Sevastopol.

Most ominously, the bill provides broad power to forcibly remove people’s land and property in order to develop infrastructure.  Vedomosti reports that the plan is for a fast-track procedure already in force on new territory in Moscow.   In accordance with this, people are informed within seven days that a decision has been taken to forcibly remove their land.  The owner has three months to agree with compensation, otherwise the land is removed through the court.  The person then has only 10 days to appeal.

Putin has claimed that the SEZ will enable Russian capital to come to the Crimea and Sevastopol and accelerate the peninsula’s development.  Judging by the plans so far reported, super-rich residents of this SEZ will receive tax and customs incentives and preferential access to infrastructure.  And in order for this infrastructure to be created at top speed, a large number of Crimeans will end up losing their homes.

In theory, all those affected will be compensated.  Tell that, however, to the residents of Sochi who fell victim to a previous grandiose plan launched in the Kremlin.  In order to hold the 2014 Winter Olympics in the semi-tropical Russian resort of Sochi, major environmental damage was caused to the whole area and promises of compensation for land appropriated have in many cases remained on paper.

The process in the Crimea could be further ‘accelerated’.  Since the right to land has not been processed according to Russian laws, and the plots of land are not clearly delineated, Russian officials will deal with the law much as the Kremlin did with Ukraine’s sovereign borders – as they choose.  The draft law, Vedomosti reports, allows officials to initiate registration of the property in order to then remove it.

There is normally no time limit on appealing against such decisions to take land away.  Vsevolod Sazonov, head of the Bar Association, warns that the ten-day period for appealing will deprive owners of any chance of asserting their rights. The time frame is totally unrealistic with valuation of the property, assessment of damage, etc. taking a lot longer. Owners will lose out in any case since they will be compensated according to the market price whereas the infrastructure will make all prices skyrocket.

The problems are exacerbated in the Crimea since plots of land are not clearly divided and the appropriation of a particular site could affect many people.  According to Maxim Kuznechenkov from the law firm Baker & McKenzie the procedure was even tighter in Sochi with a month’s warning and the court order coming into effect immediately.  Vedomosti quotes a Russian official who claims that people in Sochi were paid the market price or had the opportunity to get quality accommodation in exchange.  This was not the experience of the people interviewed in Alexander Gentelev’s important documentary about Sochi Putin’s Games.

Three months and 10 days to appeal are also draconian.  The problems for Crimean Tatars are likely to be especially acute especially for those who have refused Russian citizenship. Many own agricultural land which according to Russian legislation cannot be owned by non-Russian nationals. Mass corruption and political motives  also meant that many Crimean Tatars were not allocated the land to which they were entitled.  In desperation many have squatted unoccupied land.  In an ominous move within days of seizing power back in early March, the deputy prime minister of the Kremlin’s puppet government, Rustam Temirgaliev stated that Crimean Tatars will be ‘asked’ to move from land unofficially occupied to free them up for ‘social needs’.

Just a few months on, it seems clear that nobody will be ‘asked’, just moved, while the plan afoot is to develop an enticing playground for the super-elite.  Perhaps eventually benefits will be felt by ordinary Crimeans, but their needs, and wishes, are as incidental now as they were when Moscow began its blitzkrieg annexation.

Halya Coynash
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