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Dmitry Grigorenko informed the President about the progress made in fulfilling his instructions concerning the reform of the oversight system in the Russian Federation. The discussion focused on ways to improve the mechanism of the ‘regulatory guillotine’, mandatory pre-trial appeal, standardisation of rules for introducing mandatory requirements for business, and the introduction of a risk-based approach.

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President of Russia Vladimir Putin: Good afternoon.

Deputy Prime Minister – Chief of the Government Staff Dmitry Grigorenko: Mr President, the Government of the Russian Federation is now reforming the oversight system in accordance with your instructions. In 2019, we launched the ‘regulatory guillotine’ mechanism, essentially aimed at conducting an inventory and updating all existing mandatory requirements, cancelling redundant or irrelevant ones, and re-approving effective ones.

I report that we have completed this project. As a result of this work, we have conducted an inventory of all existing mandatory requirements. Out of just over 318,000 requirements, slightly more than 143,000 were cancelled as irrelevant, redundant, no longer necessary or viable. The remaining requirements have been updated and reapproved.

It is important to note here that the Government was not carrying out this project alone, but with the participation of business representatives. We have set up 43 industry-specific groups, with two-thirds of the representatives of business communities and business associations, and in fact, those groups did most of the work.

A little less than a year ago, when you visited us at the Coordination Centre, you noted and emphasised that the Government was to take account of feedback from business associations and individuals in its decision-making. As we took inventory and updated mandatory requirements, we certainly paid heed to the feedback from citizens and business associations, which the Coordination Centre helped collect.

We also understand well that now our task is not to remain complacent. We must avoid the adoption of new mandatory requirements that are either outdated or excessive. This is why we drafted a federal law and adopted it a bit over a year ago. We have a legally approved provision that says all mandatory requirements in the Russian Federation are subject to reapproval once every six years. This is a very important time interval. Why? Because requirements are verified and updated, if necessary, during these six years.

In addition to establishing common rules and uniform standards for introducing mandatory requirements, it is also important that two dates have been fixed legally to introduce them: March 1 and September 1. Before, every department had its own rules and procedures.

In practical terms, this is very convenient for both businesses and the state. Why? Because it enhances the discipline of the state that has to adopt mandatory requirements within a certain time frame. Businesses appreciate this even more because, first, they know when to expect the publication of requirements, and second, they have an opportunity to prepare for their introduction the best they can.

It is also important to note that, in addition to the ‘regulatory guillotine’ mechanism, a significant role belongs to the form of monitoring compliance with any mandatory quality requirements because in general it is possible to disrupt any of these and any regulations through the type of control.

This is why we reformed the control and oversight procedures at the same time. Eighteen months ago, we adopted a federal law on control and oversight. In addition to establishing common uniform rules, standards and definitions for all oversight bodies, it introduced, by law, an obligation to apply a risk-based approach, and we are already doing this in practice.

This is important because it changed the entire procedure and approach to control and oversight. Now an inspection is scheduled not based on the letters of the alphabet or the existence of a plan but proceeding from risks and the correlation to maximum or minimal risks applied by each oversight department. In simple terms, if a business falls in the minimal risk zone in terms of compliance with mandatory requirements, the probability of it being inspected is close to zero.

We are already seeing positive results from this. The number of inspections has been cut more than in half compared to 2019. We conducted a bit over 1.5 million inspections in 2019, and a little over 700,000 inspections in 2021. So they have been reduced by over two times. I am deliberately not comparing this figure with 2020 because, as you recall, we had a moratorium in the pandemic year.

Vladimir Putin: Of course.

Dmitry Grigorenko: This included inspections.

But we understand that our oversight activities are a constant search for a balance between the interests of the state and the interests of business, and disputes are inevitable where these interests meet. This is why we simultaneously conducted separate reform aimed at simplifying, as much as possible, a procedure for challenging the results of inspections.

What was it like before? If there was a dispute on the results of an inspection, was there any recourse? Perhaps only in court. But any court process always takes time, lawyers and money, while time is a major resource for businesses. So, we have adopted a legally binding standard on introducing a mechanism for a mandatory pre-trial appeal.

This is how it works. A complaint is lodged via the gosuslugi government services website in the digital format. It must be reviewed within 20 working days at most. An applicant receives a response to his complaint via the government services website as well. This is all without fees, quick and convenient. Importantly, the entire pre-trial appeal system and the inspections are recorded in the Unified Information System. This is a cloud-based system.

In other words, we are seeing all procedures in real time from the start of an inspection to the end and from the start of a complaint to its resolution. We know who is being inspected, why, and the results of the inspection. We have integrated this system into the prosecutor’s office with which we must coordinate our plans for inspections by law. Naturally, this system allows us to see in real time the status of the procedure and the cause-and-effect relationship with a view to adjusting both the procedure and the law wherever necessary.

Vladimir Putin: All right. This is really very important. We have been working on this for years. I hope very much that what has been done recently, including with your participation, will have a positive impact on the national economy in general.

Dmitry Grigorenko: Mr President, I would like to thank you for the adopted decisions and the support for these reforms, because without these decisions we would have hardly accomplished this.

However, we understand that we should not stop at this but should move further. We will continue working on upgrading the mandatory requirements, including the removal or minimisation of red tape and detailed adjustments in control and oversight procedures. Seeing the first results of the pre-trial appeal system upon its launch, we will naturally continue improving this mechanism. We hope that after the implementation of these measures, people will complain less, if at all.

Vladimir Putin: All right.