Legal experts warn of arbitrary application as Russia expands powers against citizens overseas

A new Russian law that comes into force on 1 September will permit the seizure of property belonging to citizens living abroad as a provisional measure in administrative proceedings, a development that legal experts have characterised as a significant expansion of state powers against the diaspora and one that may have a chilling effect on public expression among those residing outside Russia. The legislation, which allows courts to freeze assets such as apartments without the owner's presence and without requiring the value of the assets to be proportionate to the fine imposed, has prompted concern among human rights advocates who note that the list of offences that could trigger such seizures – including "discrediting" the armed forces, insulting state officials, calling for sanctions, or publicly comparing the Soviet Union to Nazi Germany – is drafted in terms vague enough to encompass a broad range of commentary and expression. Duma speaker Vyacheslav Volodin, during the bill's first reading, stated that the amendments targeted those who had "left our country in a difficult hour, who do petty dirty tricks and get nothing for it, while earning money here and continuing to rent out their apartments", though legal observers have noted that the law contains no clear criteria defining what constitutes an "offence against the interests" of the state.

In practice, the law allows administrative cases to be heard without the accused's presence if they are abroad, a procedure that Russian courts had already employed for administrative and even criminal cases, though the use of asset seizure as a provisional measure is new. Anastasia Burakova, founder of the Ark project, has noted that asset seizure falls short of confiscation or expropriation – owners would theoretically be able to recover their property upon paying any fines imposed – but she warned that the provisions were "uncontrollable" because "any comment, any statement could become grounds for a case of 'discrediting the army', an old forgotten post – 'dissemination of extremist material'". The law also permits courts to prohibit the owner from renting out the property and receiving rental income while it remains under seizure, and it allows for the consideration of administrative cases in the absence of the accused if they are outside the country, a provision that effectively denies defendants the opportunity to present their case.

Human rights lawyers have noted that the new legislation is likely to have what one described as a "strong cooling effect", leaving Russians abroad in a state of permanent legal vulnerability, potentially driving self-censorship and reducing public participation among those seeking to avoid the risk of asset seizure. For those considering transferring property, there are options available, though each carries its own complexities and risks. One such option is the donation of property to a trusted relative or associate – a deed of gift – which lawyers say is the most common and tax-efficient method for transferring property to close family members, who under Russian law include parents, grandparents, grandchildren and spouses, while more distant relatives or unrelated individuals would face a 13 per cent personal income tax on the property's cadastral value, with non-residents facing a 30 per cent rate.

The deed of gift must be executed in Russia by a Russian notary, a requirement that necessitates a power of attorney for the absent owner, though the law prohibits a donor from granting a power of attorney to the same individual to whom they are donating the property, meaning that a third party is always required. The power of attorney must specify the nature of the transaction, the recipient, the property address, and the authority to interact with Rosreestr – the state registration service – and the Multifunctional Centre (MFC), with additional provisions allowing the representative to deregister the owner if necessary. There are two routes for obtaining a power of attorney: through a Russian consulate, which is generally preferred by lawyers as it allows Russian notaries to verify the document's authenticity through the consular database, or through a local notary in the country of residence, with documents from states party to the Minsk Convention requiring only a translation, while those from signatories to the Hague Convention must also bear an apostille.

The deed of gift must be prepared in the region where the property is located, and the notary will draw up a contract in triplicate – for the representative, the recipient and Rosreestr – and forward the documents for registration, with the new owner receiving an extract from the Unified State Register (EGRN) the following day. Lawyers caution that donors should carefully consider the risks of donating property to a spouse, as in the event of divorce the property would be considered their sole property rather than jointly acquired assets subject to division. All transactions are only possible with privatised property, though the owner can also arrange for privatisation by power of attorney if they have other registered residents' consent.

An alternative to donation is sale, though this involves tax considerations: the minimum holding period for exemption from personal income tax on residential property is generally five years, though this is reduced to three years if the property was received as a gift from a close relative, inherited, obtained under a life annuity agreement, privatised, or is the owner's sole residence. For those registered as "foreign agents", tax exemptions do not apply and they must pay 30 per cent on the sale, while non-residents are subject to the same exemption rules but pay 30 per cent if the holding period is less than the minimum. A power of attorney for sale requires provisions authorising the signing of the purchase agreement, the filing of documents with Rosreestr and the MFC, and interaction with banks, and it can specify who receives the proceeds – though lawyers advise using the owner's own Russian account to avoid complications.

Payment can be made by bank transfer to the owner's Russian account, or through a bank letter of credit or notary deposit, both of which ensure that funds are released to the seller only once the buyer's ownership is confirmed by the EGRN extract. The list of required documents includes copies of the owner's internal Russian passport, the buyer's and representative's original passports, the EGRN extract, the original power of attorney, any required spousal consent, and the documents establishing ownership, while additional items such as proof of paid utilities, BTI plans, a certificate of no registered residents, and a psychiatric certificate may be requested depending on the case. For owners who are still registered at the property, a separate power of attorney and notarial declaration for deregistration are required. For those inheriting property, similar procedures apply, with a separate guide available for that specific scenario.