Maria Ostashenko

Dear Ladies and Gentlemen! The authorities in Russia and the rest of the world have recently been paying more and more attention to data protection issues. This is evidenced by the numerous laws adopted in this regard, the increased activities of the Russian Federal Service for Supervision of Communications, Information Technology and Mass Media (Roskomnadzor), despite a moratorium on scheduled inspections, and the serious amendments that are expected to be introduced to broaden liability for violations of data protection laws. For example, in a report that Roskomnadzor issued for 20231,we can see that a total of RUB 266,324,329 in administrative fines were imposed last year compared with RUB 109,579,160 in 20222. This means that, despite the moratorium on scheduled inspections, Roskomnadzor more than doubled its efforts to hold individuals accountable for violations of legislation on the protection of personal data in 2023 compared with the previous period. Russian data protection laws impose numerous requirements on operators, and companies must expend enormous resources and be highly vigilant in the processing of personal data to comply with them. As a result, internal teams and DPOs often have questions about which requirements are most critical and pose the greatest risk to business. The list of requirements may vary depending on the size of the business and the company’s industry, business model, and other factors, however, there are issues that will be crucial for most operators. In this brochure, we have highlighted such issues for the current period and invite you to learn more about them: - The importance of written consent; - Inspections by Roskomnadzor; - Requirements for online resources; - The "extraterritorial" principle of the application of the personal data law; - Localization trend; - Cross-border data transfer; - Anonymous data; - Personal data breaches; - Notification of a personal data breach; - Personal liability of management and imposition of criminal liability. You can download the brochure [here](https://www.alrud.ru/upload/ALRUD%20upload/2024/Newsletters/ALRUD_Data_Protection_What_Do_Operators_Need_To_Know_in_2024.pdfmsdynttrid=ewOpCEpu51bnuK8ks-Bn_lKQGfLYV0MMdbORdRYMYnM 'here'). [gosdoklad_za_2023_ 03042024.pdf (rkn.gov.ru)](https://rkn.gov.ru/docs/gosdoklad_za_2023_03042024.pdfmsdynttrid=2UrE_VEIyl0-bkddTp6e1hac51Q6c14-uN1Fe3b6dsw 'gosdoklad_za_2023_ 03042024.pdf (rkn.gov.ru)') [2022_RKN_goskontrol.pdf](https://rkn.gov.ru/docs/2022_RKN_goskontrol.pdfmsdynttrid=BbXoNLdry4VKtr6nj6xUaV6vyiZbS8FX-DMiOG5XHb4 '2022_RKN_goskontrol.pdf')

Dear Ladies and Gentlemen! We would like to inform you about the adoption of a new law that simplifies the procedure for blocking ‘mirrors’ of blocked websites, as well as new restrictions related to the use of foreign information security services. More details [here](https://www.alrud.ru/upload/ALRUD%20upload/2024/Newsletters/ALRUD_New_legislative_changes_in_the_IT_sector_in_June_2024.pdf 'here').

On 30 May ALRUD industrial team held a seminar on review of legal trends and regulatory developments in the sphere of healthcare and pharmaceuticals that can be faced by Russian companies. The webinar was supported by IMEDA. The experts covered the following topics within the webinar: - Settlements of foreign trade contracts in the climate of sanctions and countersanctions. - VAT: requalification of scope of delivery bonuses into commodity grant while offsetting counterclaims. - Intellectual property protection in the climate of sanctions and countersanctions. - Parallel imports. - Restriction of rights for the use of European Software. - Restriction of payments under license agreements for the use of intellectual property rights. - Patent rights protection and compulsory licensing trends. - AI in medical goods: current regulations and practical issues. [Maria Ostashenko](https://www.alrud.com/people/MariaOstashenko/ 'Maria Ostashenko'), Partner and Head of Healthcare and Pharmaceutical Industry team of ALRUD, [Ilya Khodakov](https://www.alrud.com/people/KhodakovIlya/ 'Ilya Khodakov'), Senior Associate in the Intellectual Property Practice, [Sergey Artemiev](https://www.alrud.com/people/SergeyArtemiev/ 'Sergey Artemiev'), Senior Associate in the Tax Practice, [Natalia Bashmakova](https://www.alrud.com/people/BashmakovaNatalia/ 'Natalia Bashmakova'), Senior Associate in the Commercial Practice, [Dina Kravchenko](https://www.alrud.com/people/DinaKravchenko/ 'Dina Kravchenko'), Senior Associate in the Regulatory Practice, [Elizaveta Kostyuchenko](https://www.alrud.com/people/ElizavetaKostyuchenko%20/ 'Elizaveta Kostyuchenko'), Associate in the Intellectual Property Practice, were the speakers of ALRUD. Sergey Vanin, Executive Director of the Association, was the speaker of IMEDA.

Dear Ladies and Gentlemen! Please be informed that, as of 20 May 2024, Decree [No. 430](http://publication.pravo.gov.ru/document/0001202405200027?index=1 'No. 430') of the Russian President introduced a temporary restrictive procedure for the purchase by Russian residents of exclusive rights to the results of intellectual activity and means of individualization from “unfriendly” foreign rights holders (“Decree No. 430”).

Dear Ladies and Gentlemen! On 17 April 2024, amendments to the Code of Administrative Offences of the Russian Federation (“CAO RF”) will enter into force. From this time, there will be greater liability for the distribution of advertisements via SMS, email and push messages without the recipient’s consent. In addition, increased liability will be imposed for advertising of consumer loans with an incomplete cost. The changes are as follows: - Violation of advertising distribution via telecommunication networks; - Failure to provide the full costs of consumer loans in advertising.

Dear Ladies and Gentlemen! We would like to inform you about an important legislative initiative in the regulation of critical information infrastructure (CII), as well as the lifting of the moratorium on antitrust inspections of accredited IT companies from 28 March 2024.

Dear Ladies and Gentlemen, We would like to share with you an updated digest of the most significant laws and bills and regulatory innovations in the Technology, Media & Telecommunications sector for the period from June 2023 to February 2024, as well as trends in the future regulation of this industry. The TMT industry is currently experiencing significant regulatory pressure with changes constantly being made for both its service providers and the customers who use their products. As such, the regulation of hosting providers’ operations in Russia indirectly extends to a large number of companies that use the services of foreign providers. Given the growing role of information technology in the economy and the resulting threats to data security, there is an obvious trend towards regulating the TMT industry, searching for solutions to ensure the greater security and transparency of processes in the online environment, as well as increased liability for violations of requirements for individual players, such as social networks, hosting providers, people who work with biometric data, as well as the rules for working with information. The changes affect both major players on the Russian and international markets, as well as small companies that are forced to provide virtually the same level of response. This digest presents current legislative and regulatory changes in the TMT sector, namely in information technology, media content, advertising, personal data, telecommunications, e-commerce, retail, and antitrust regulation. It provides details about the main changes and initiatives over the past year, as well as the key findings of law enforcement practice in this regard.

We would like to inform you about important potential changes regarding the state accreditation rules for IT companies1 and the current moratorium on inspections of IT companies2. 1. Changes in the state accreditation rules for IT companies The Ministry of Digital Development, Communications, and Mass Media of the Russian Federation ("Ministry of Digital Development") has introduced a draft decree of the Russian government ("Draft Decree")3, which simplifies the procedure for Russian companies to obtain state accreditation for information technologies. The Draft Decree also suggests including a requirement for predominant Russian ownership of such IT companies as a condition for obtaining IT accreditation. Consequently, IT companies with significant foreign ownership will be unable to obtain the corresponding accreditation. The most important proposed changes to the state accreditation rules are noted below. Foreign participation in IT companies The Draft Decree introduces a new criterion for obtaining state accreditation for IT companies, which states that the share of foreign individuals in economic entities must not exceed 50% of the IT company’s authorized capital. Otherwise, companies will be denied state accreditation. In order to confirm whether an IT company has foreign participation, extraordinary checks and planned procedures for such confirmation may be conducted. Simplifying the state accreditation process for IT startups In order to develop startups, the Draft Decree would make it possible for small technology companies created less than three years ago to obtain state accreditation without taking into account the criterion for income from their IT activities. Annual planned accreditation confirmation procedure The Draft Decree establishes a single method to apply for the annual procedure to confirm state accreditation. The application may only be submitted electronically through the personal account on the Gosuslugi portal. As part of the confirmation procedure, the Draft Decree proposes reducing the number of periods for which compliance with the criterion for the average monthly size of payments and other remuneration accrued to individual employees is checked. Data will be subject to verification for two quarters: the fourth quarter of the previous year and the first quarter of the current year. Organizations that received accreditation in the year of their establishment, as well as those that submitted an application for state accreditation after 25 April, i.e., after the deadline for such organizations to submit calculations of insurance contributions for the quarter preceding the date of the inspection to the tax authority, will be exempted from the planned check. Please note that if the Draft Decree is adopted, most of the changes will come into force on 1 May 2024. However, for the criterion related to foreign participation, a different effective date is provided – 1 August 2025. 2. Possible lifting of the moratorium on antitrust regulation inspections for accredited IT companies On 5 March 2024, Director of the Federal Antimonopoly Service of Russia (“FAS of Russia”) Maxim Shaskolsky said during a Federation Council committee meeting that the service’s authority in terms of inspections of IT companies was slightly limited due to Decree No. 448 of the Government of the Russian Federation dated 24 March 2022 “On Specific Aspects of State Control (Supervision) and Municipal Control of Accredited Organizations Engaged in Activities in the Field of Information Technologies, and on Amendments to Certain Acts of the Government of the Russian Federation” (“Decree 448”), which states that that scheduled inspections by state and municipal control bodies of IT companies from the state register shall not be carried out until 31 December 2024. The FAS of Russia plans to lift these restrictions soon. Public information shows that no draft amendments had been made to Decree 448 as of the time this newsletter was sent out. Therefore, we are providing you with an overview of the possible key changes that might follow the removal of the restrictions imposed by Decree 448: - {{1.}} State control (supervision) and municipal control in accordance with the Federal Law “On State Control (Supervision) and Municipal Control in the Russian Federation” will be resumed. - {{2.}} The federal exercising of state control (supervision) and municipal control in accordance with the Federal Law “On the Protection of the Rights of Legal Entities and Individual Entrepreneurs in the Exercising of State Control (Supervision) and Municipal Control” will be resumed. - {{3.}} The scheduled control (oversight) activities and scheduled inspections for control specified in paragraphs 1 and 2 above will be included in the plans for scheduled control (oversight) activities and plans for scheduled inspections no earlier than the end of 2024. We will continue to monitor these legislative initiatives and keep you informed of any updates. Decree No. 1729 of the Government of the Russian Federation dated 30 September 2022 on the Approval of the Regulation on the State Accreditation of Russian Organizations Conducting Activities Related to Information Technologies [https://fas.gov.ru/publications/24278](https://fas.gov.ru/publications/24278 'https://fas.gov.ru/publications/24278') The text of the draft decree of the Russian government “On Amending Decree No. 1729 of the Government of the Russian Federation dated 30 September 2022” can be found on the federal portal of draft regulatory legal acts (ID: 02/07/03-24/00146156).

Dear Ladies and Gentlemen! We would like to inform you about significant legislative initiatives that impose increased administrative liability for violations of personal data processing, as well as criminal liability for unlawful personal data trafficking and data breaches.

On October 26, our firm held a webinar dedicated to the current legal trends and regulatory changes in the pharmaceutical and healthcare industry, which companies may face in Russia. During the webinar ALRUD experts have covered topics such as: - Expansion of mandatory labeling requirements - Harmonization of Russian and EAEU legislation - Acceleration of registration of new medicines - Extension of counter-sanctions measures - Latest trends of regulatory clearance of transactions - Focus on the pre-audit analysis of business as the main direction of the new tax policy - Current findings and trends in enforcement practice in patent disputes and registration of generics - Settlements under foreign trade contracts: requirements and restrictions of currency legislation The speakers of the webinar were: [Maria Ostashenko](https://www.alrud.com/people/MariaOstashenko/ 'Maria Ostashenko'), Partner, [Dina Kravchenko](https://www.alrud.com/people/DinaKravchenko/ 'Dina Kravchenko'), Senior Associate, [Ksenia Erokhina](https://www.alrud.com/people/ErokhinaKsenia/ 'Ksenia Erokhina'), Senior Associate, [Ilya Khodakov](https://www.alrud.com/people/KhodakovIlya/ 'Ilya Khodakov'), Senior Associate, [Sergey Artemiev](https://www.alrud.com/people/SergeyArtemiev/ 'Sergey Artemiev'), Senior Associate and [Alexander Artemenko](https://www.alrud.com/people/AlexanderArtemenko/ 'Alexander Artemenko'), Associate. More information on the services and expertise of ALRUD's Healthcare and Pharmaceutical Industry team can be found [here](https://www.alrud.com/services/HealthcarePharmaceutical/ 'here').