Vendors who offer extra merchandise may be penalized with a fine of 1 million rubles.
Surge in Consumer Violations Related to Additional Charges in Russia Over Four Years
The number of registered consumer violations tied to the imposition of additional goods and services has nearly quadrupled over the past four years, according to the state report "Protection of Consumer Rights in the Russian Federation." In 2020, there were 1,109 such cases, but by 2024, this figure swelled to 4,132.
The penalties for such offenses are currently somewhat insignificant, with fines ranging from 2,000 to 4,000 rubles for officials and between 20,000 and 40,000 rubles for legal entities. A bill submitted to the State Duma aims to increase these fines, with potential penalties of 100,000 to 300,000 rubles for officials and 250,000 to 1 million rubles for legal entities.
Vladimir Gutenev, Chairman of the State Duma Committee on Industry and Trade and co-author of the initiative, noted that companies in the housing and utilities sector and car dealers are the most frequent offenders. The practice of including unjustified and unrendered services in utility bills, amounting to several hundred to 1.5-2 thousand rubles per payment, results in hundreds of thousands of rubles in ill-gotten gains. The existing fine ranges of 2-2.5 thousand rubles are not considered sufficient deterrents, Gutenev explained.
Moreover, consumers who are defrauded of a few hundred rubles rarely seek legal recourse, whether by going to court, engaging with the Society for the Protection of Consumer Rights, or approaching Rospotrebnadzor. Consequently, the true number of affected individuals is likely significantly higher than the reported 4,000.
In addition, car sales companies allegedly overcharge for services such as car insurance, sometimes adding up to four times the market rate. Similarly, customers buying airline and railway tickets online are often forced to pay for unnecessary additional insurance.
More than 250 of Gutenev's colleagues have endorsed the proposed bill, which could be considered during the spring session. Previously, there were concerns raised by the Bank of Russia about the actions of banks imposing insurance when processing online loans, with discussions underway to increase fines to 0.1% of the bank's own funds (capital).
In broader context, ongoing efforts to regulate and enforce consumer protections in Russia are evident. For instance, there is a draft law concerning the platform economy, which includes proposals for fines for marketplaces violating trading rules. The proposed fines under discussion range from up to 500,000 rubles for any violation of the law on digital platforms to 1 to 2 million rubles for more serious infractions. The focus remains on strengthening consumer protections through regulations and penalties.
Sanctions and export controls in Russia primarily concern geopolitical issues rather than consumer violations, with the European Union and UK tightening sanctions on Russia, focusing on entities supporting military operations and energy exports.
Finance and business sectors have been under scrutiny due to an increase in consumer violations related to additional charges in Russia over the past four years, with several sectors identified as frequent offenders. For instance, companies in the housing and utilities sector and car dealers are accused of charging unjustified and unrendered services, leading to significant revenue and resulting in fines ranging from thousands to millions of rubles. The proposed bill aims to increase these fines as a deterrent, while ongoing efforts to regulate and enforce consumer protections in Russia continue, particularly in the digital platform economy.
