Russia needs help with the small print

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The Independent Online
The author is professor of comparative law at University College, London, and has advised the Russian government on law reform.

DESPITE the current disarray, all the formal ingredients are now in place for tackling the next generation of market- orientated legal reforms in Russia: new constitution, new parliament, revitalised presidency; there will be a new government, and in the offing are a restructured judiciary and procuracy. Will the West finally grasp the opportunity?

The European Commission has just released the report of the joint European Union/Commonwealth of Independent States task force on law reform in the former Soviet republics, which sets out a strategy for law reform assistance and, more important, suggests minimum quality standards for such assistance. The recommended priorities for law reform are sweeping: first, a new civil code - the mother of all market-economy relations - in each state. This will cover ownership, lease, pledge, contracts, intellectual property, inheritance, conflicts of law, and should be followed by a new generation of legislation on land, natural resources, the environment, foreign trade, companies, taxation, customs and so on.

Most of what now exists dates from the Soviet era, much of it from the pre- Gorbachev days. The failure to reform this legislation remains the single major obstacle to foreign investment in Russia and the CIS. It is here that the real obstacles lie, unseen by the layman and the economist, but quite familiar to the lawyer involved in an actual investment or commercial transaction. Legal risk remains unnecessarily high in the CIS.

Modernising Russian and CIS law will not be enough, however. The task force strongly recommends the secondment of more foreign law advisers to assist the individual states. The need is especially acute in Central Asia and Transcaucasia, where the number of legally trained individuals is exceptionally small.

Just as the entire body of legislation requires replacement or renewal, so does the entire legal profession. Those who teach the law must be trained to think and teach analytically and be exposed to the innovations in legal education that were anathema to the former Soviet Union. Retraining the existing legal profession has hardly begun. Staff who operate legal institutions (notaries, registrars and the like) need training in market-economy values and practices, as do the personnel of those institutions that work closely with the legal infrastructure (bankers, insurance personnel, accountants, brokers), together with those in the mainstream legal institutions (judges, arbitrators, parliamentary draughtsmen, investigators, law enforcement officials).

The overall commitment of Western technical assistance to the CIS has been modest, the amount actually delivered has been pathetic, and the amount dedicated to law reform has been infinitesimal on both counts. But, given the task force's strictures on quality standards for law-reform assistance, that may be just as well.

Experience suggests that legal advice on future legislation is best given not in the abstract, but in the actual process of drafting a legislative act or international treaty. The drafting teams should be small (four to five people), joint (including lawyers from the CIS and the West), and have the requisite linguistic and professional skills. For the Western participants that means a mastery of law in the respective states and of the Russian language and the ability to bridge the legal and linguistic gap between CIS law and Western law.

The team as a whole must be capable of producing a draft law in Russian that meets the requirements of the market economy, is of the most advanced appropriate standard for the state concerned, and can be integrated into the existing system of legislation and practice.

This is a demanding, but not impossible, standard. Small drafting teams need to be backed up by review panels composed of Western legal specialists willing and able to make a critique of the draft and appropriate machinery needs to be in place so that the draft, once produced, commands the due attention of government and parliament.

There are sterling examples of this approach at work: draft pledge, trust, company, securities, and an Anglo/Russian legal assistance treaty have been prepared that fully comply with these criteria. Unfortunately, most Western law reform assistance falls well short of task force recommendations.

Lawyers, law firms and international institutions with no knowledge of CIS legal systems or languages offer drafts prepared in the Western style and in appalling Russian translation to competing groups within the CIS political establishment. There is no joint drafting, token - if any - CIS representation on the drafting bodies, no command of local law, local conditions, local drafting conventions, local precedents. Review panels, when they exist, are offered English versions of drafts that are wildly at odds with the original. The critiques prepared by the panels, composed in English, of course, are then translated back into Russian with varying degrees of accuracy. Small wonder that law reform advice of this ilk is held in low esteem by the recipient states.

The European Union is well placed, if the institutional and political will is present, to act upon the recommendations of the task force. Compared with other forms of technical aid, law reform assistance is relatively inexpensive, and at this stage of legal development in the CIS, perhaps one of the few bargains left.