Mercenary Motives: Unpacking the Kremlin’s Opposition to Settling the Legal Status of Russian Private Military Companies

Much like this (purported) photo of a Russian mercenary in Syria, the legal status of Russian private military companies is quite blurry.

On 27 March 2018, the Kremlin notified the State Duma that it disapproved of a draft law seeking to regulate Russian private military companies (PMCs). The draft law in question, submitted this past January by deputies associated with the social democratic “A Just Russia” (SR) party, proposes placing the Ministry of Defense (MoD) in charge of licensing PMCs, as well as harmonizing their legal status with relevant provisions of the Russian Constitution and Criminal Code. The bill also mandates that PMCs must be registered as private limited companies, or “obshchestva s ogranichennoj otvetstvennost’yu” (OOO), and must maintain an initial capital of no less than RUB 10 million (approximately USD 174,600).

Articulating the legal basis behind its position, the Kremlin argued that the abovementioned bill violated Article 13.5 of the Russian Constitution, which, among other proscriptions, prohibits the establishment and activity of OOOs engaged in the creation of “armed formations.” Russian media report that the bill is also opposed by the MoD, the Ministry of Finance, the Ministry of Internal Affairs, the Russian Guard, the Federal Security Service, the Investigative Committee of the Russian Federation, the Federal Protective Service, and the General Prosecutor’s Office.

As noted above, the SR draft law on PMCs was introduced in January 2018. That same month, Russian Foreign Minister Sergei Lavrov spoke out in favor of creating a legislative basis for PMC activities after Grigoriy Tsurkan, a Russian mercenary working for the PMC known as“Wagner,” was executed by the Islamic State. A month later, hundreds of Russian contractors affiliated with Wagner were reportedly killed by U.S. aircraft and artillery fire during a joint assault with pro-Assad militiamen on a Kurdish-held oilfield in eastern Syria.

This latter debacle has prompted a great deal of speculation regarding how PMCs like Wagner might factor into Putin’s broader foreign policy stratagem. Some have asserted that the Kremlin uses contractors working for Wagner and other PMCs in order to provide plausible deniability of its ongoing military operation in Syria, which has the additional benefit of watering down the actual number of Russian casualties, thus avoiding irritating domestic audiences already wary of Russia being drawn deeper into the Syrian quagmire. Others maintain that the Kremlin has, in fact, effectively ceded operational control over the activities of Wagner and other PMCs to their respective shareholders, allowing the latter to pursue their own commercial interests — at least, so long as those interests demonstrably coincide with the Kremlin’s own interest in ensuring the survival of the Assad regime.

Indeed, leaked documents indicate that OOO Evro Polis (Tax Identification Number 5024166727) – a Moscow Oblast-based entity affiliated with Wagner principal and Putin ally Yevegeny Prigozhin – was contracted by the Syrian government to secure Syrian oilfields in exchange for a 25% stake in the profits produced by same fields. Prigozhin was reportedly in contact with Putin’s Chief of Staff, Anton Vaino, the day prior to the February incident, the existence of this contract strongly suggests that OOO Evro Polis provides PMC services abroad with the Kremlin’s imprimatur. So much was reflected by the US Treasury Department’s decision to impose sanctions on OOO Evro Polis in January 2018. Yet here it is also worth noting that Treasury imposed separate sanctions on Wagner – identified simply as “PMC Wagner,” with no Tax Identification Number given – back in June 2017. This begs the question: if OOO Evro Polis is understood to constitute a legal entity qua being an OOO distinct from Wagner, then what is Wagner?

One possibility may be that Wagner is the trade name that OOO Evro Polis employs when providing PMC services abroad. Yet per Article 1538 of the Russian Civil Codex, Russian companies are not required to register trade names with state organs; as such, there is no way to verify whether Wagner and OOO Evro Polis are one and the same entity. Corporate records do show that OOO Evro Polis registered a branch office in Damascus on 25 May 2017, but this too does not definitively tie the company to Wagner. Adding to the confusion, some media outlets have conversely characterized OOO Evro Polis as being a front for Wagner, which can be interpreted as meaning that Wagner is behind OOO Evro Polis. Whatever the case, all available information suggests that Wagner does not represent a private military company, at least not in sense of being a corporate entity registered with the Russian Federal Tax Service or any other competent economic authorities.

The fact that Wagner and similar PMC entities all appear to operate on behalf of the Russian state, and not against it, thus undermines the legal argument behind the Kremlin’s opposition to the SR draft law. For all intents and purposes, Wagner and its contemporaries occupy a legal gray zone in Russia. Because they are not legal corporate entities as such, their operations technically do not violate Article 13.5 of the Russian Constitution. Moreover, some Russian legal commentators have interpreted Article 13.5 as applying only to entities (commercial and other) that organize armed activities with the aim of violating Russia’s territorial integrity and/or fomenting internal unrest. Given that the SR bill provides for MoD oversight of PMCs, there ought to be a limited risk of legal status being granted to PMCs bent on overthrowing the Russian government.

For this reason, it is curious that the Kremlin based its opposition to the SR draft law on Article 13.5 of the Russian Constitution, especially considering that Article 359 of the Criminal Code of the Russian Federation explicitly prohibits mercenary activities. Article 359 defines mercenary activities as “the recruitment, training, financing or other material support of a mercenary,” and prescribes punishments ranging from four- to fifteen-year jail terms and/or fines up to RUB 500,000 (approximately USD 8,720). Russian courts have handled cases involving Article 359 offenses on numerous occasions since 2013; however, the majority of these legal actions were undertaken against defendants accused of involvement with Ukrainian nationalist militias or with Syrian militant groups opposed to the Assad regime (see the Slavonic Corps case). In other words, the Russian government’s application of Article 359 may be generously described as selective, if not politically biased.

One could argue that the Kremlin opposes legalizing PMCs precisely because their indeterminate legal status amounts to a feature, and not a bug, of their utility vis-à-vis creating plausible deniability for Russian military and intelligence operations abroad. There is much to recommend this thesis from a tradecraft perspective. However, there is no less reason to surmise that Putin and certain of his allies fear that placing PMCs under MoD jurisdiction would leave them vulnerable to a shadow coup staged by proxies of the military and national security establishment. At the very least, this would certainly make for a good Tom Clancy thriller.

Whatever the case, SR is by no means the only group in Russia seeking to create a legal basis for PMCs. Interest groups like the Moscow-based Association of Military-Security Companies, for example, have increasingly lobbied the Kremlin to resolve the legal status of PMCs and other armed security firms, arguing that legalizing their activities would be a value-add in terms of Russia’s military and counterterrorism capacities. Even so, the costs of regulating the PMC industry may well outweigh any such benefits, not least being the reputational risk associated with passing legislation contravening the International Convention against the Recruitment, Use, Financing and Training of Mercenaries. Even though Moscow is not a party to this convention, adopting such a measure would only serve to further weaken Russia’s already diminished credibility as a guarantor of international law.

Perhaps Putin, emboldened by his all-too-convincing victory at the polls earlier this month, will test the waters of economic liberalization during the first hundred days of his fourth presidential term by legalizing Wagner and others of its ilk. The fact that no less a hardliner than Foreign Minister Lavrov supports legalizing PMCs over the objections of the Russian security establishment suggests that this particular issue may emerge as a new front in the perennial competition between the siloviki and reformist camps of Politburo 2.0.  Or perhaps there is room for compromise – an arrangement where, to paraphrase Mao, market reforms might grow out of the barrel of a gun.

– Allen Maggard

[In Translation] “Conservatism for an Epoch of Instability: Self-awareness, Self-development, and Self-esteem” by Fyodor Lukyanov

Note: The following text is an approximate translation of the first chapter of Conservatism in 21st Century Foreign Policy, an edited volume of essays published jointly by the Russian International Affair Council’s in-house analytical journal, Russia in Global Affairs, and the Moscow-based Institute of Socioeconomic and Political Research¹ in May 2017. In this chapter, author Fyodor Lukyanov² argues for the adoption of a “conservative” foreign policy informed both by Russia’s unique historical experience and by its identity as a distinct pole of civilization. Lukyanov suggests that “self-awareness” of Russia’s rich cultural inheritance is essential to the country’s ability to successfully navigate the (reputed) breakdown of the “liberal” international order. However, Lukyanov maintains that Russia cannot effectively utilize these elements of its identity without first jettisoning its political fixation on the Western world. – Allen Maggard

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The conservative worldview has been at the heart of Russian politics for many years. On numerous occasions, President Putin has deemed conservatism as his political credo, and this has been met with support from a significant portion of Russia’s intellectual and ruling class. It is the understanding of the current administration that conservative approaches correspond best to Russia’s national psychology. They are also well-suited to finding answers to large-scale challenges which loom over the nation and society as a result of changes in the global situation.

Discussion about a conservative political model began in Russia during a sharp upsurge of international activity. This activity did not always take place at Moscow’s will. Global tensions expanded distinctly from the mid-2000s onward. The crises in Ukraine and Syria have demonstrated that the erosion of the former international order had entered its final stages, while the construction of a new order will be accompanied by upheaval. And although Russia, of course, has struggled for the restoration and reinforcement of its own international positions, it has spent too much time and effort dealing with external factors.

Under such global conditions and against the backdrop of an epochal fracture, what role might conservatism play in foreign policy? If this concept is generally applicable to international affairs, then might one use it to interpret the experience of the past? We at Russia in Global Affairs have attempted to answer such questions by collaborating with the Institute of Political and Socioeconomic Research on a project concerning foreign policy conservatism in the 21st century. Within the framework of this project, we held a series of conversations in the form of roundtables, webinars, international conferences, ordered a series of articles and studies, and finally prepared a comprehensive report. The most significant results of our work are contained in the following pages.

Our work arrived at an unexpected conclusion. From the very beginning, we expected to isolate out of different periods of Russian political practice discrete instances from which to derive a certain set of tenets or core narrative. The history of Russian diplomacy from the time of Tsar Vladimir I up to the “new thinking” of the Gorbachev years³, of course, makes very interesting food for thought. But a foreign policy framework based on this historical framework is unlikely to succeed. In effect, no distinctly conservative form of foreign policy exists. This became apparent to us rather quickly.

There are, of course, general features of a nation’s foreign policy without which it is impossible to speak about a specifically conservative approach. Absent of ideology and messianism, the foremost task of foreign policy is to support national interests and reinforce sovereignty. These precepts are customarily associated with the school of political realism.

But the essence of conservatism is precisely that does not constitute a defined set of practices or postulates that can be brought to life in the international arena in order to attain a desired result. Conservatism is by definition grounded in the nation, with its attention being directly mainly towards one’s own state and society, the development of which constitutes the main task. Creating favorable conditions for carrying out this task is the principal aim of foreign policy.

Such a hierarchy of priorities conforms perfectly to the realities of the contemporary world, which is changing more and more quickly before our very eyes. Our reference points are changing. The epoch of global openness and the liberal world order that began in the West during the 1980s, and which spread across the whole world after the Cold War, is entering a new phase. The world is again fragmenting, and it is not yet possible to determine how far this fragmentation will go.

Whatever one thinks Donald Trump’s eccentric behavior and his attempts to introduce the customs of real estate development into the field of international relations, the slogan “America first” is not merely the whim of some odd billionaire, but a reflection of urgent sentiments. By no means have these sentiments appeared solely as a result of Trump and others of his anti-mainstream cohort elsewhere. Rather, liberal globalization has reached a limit beyond which it begins to be met with anxiety and rejection by the citizens of the world’s leading countries. Even if Trump were absent from the world stage, another more ordinary politician would be raising the banner of protectionism in keeping with the preferences of the electorate.

If America turns in on itself, this trend will spread everywhere. Yet whether we like it or not, for today and for the foreseeable future the United States will set the tone for global politics. This, in fact, has already happened with Europe, except that the crisis of expansionist policy there became apparent before it could even be put to use. Despite Xi Jinping’s appeals in defense of globalization, Beijing’s style of political practice depends on active protectionist measures to defend its domestic market and on an ideology which emphasizes the primacy of an original cultural tradition.

As early as several years ago – long before Brexit and Trump – Ivan Krastev⁴, who is one of the sharpest commentators on the West’s ideological and political tendencies, noted a change in the way existing political establishments around the world were defining their objectives. If before the leading world powers once mobilized their internal resources for the purpose of increasing their influence abroad, now the opposite holds true; they are trying to use external opportunities in order to deal with internal problems.

This is the paradoxical consequence of globalization, with its ideology of ideological postmodernism, de facto erasure of the borders between the “external” and “internal”, and negation of sovereignty. But using external factors to resolve internal matters is fraught with a loss of control, insofar as external factors are far more powerful and variable than are any national government. All nations –  from the tiniest to the most important – have, without exception, encountered this phenomenon, though it has become a tremendous problem for larger nations especially. Small countries are naturally in the habit of acceding to different forms of external power, as they simply would be unable to survive otherwise; for great powers, however, the realization that there is a limit to what is possible within their own territory has come as a shock.

The pro-Brexit camp’s rallying cry of “Let’s take back our country” has become a political leitmotif for less inclined parties and movements as well. The ability of governments to inform their citizens about how they are in a position to determine the direction and quality of the development of their countries and nations has become a key to success. This indicates that the global political landscape will inevitably change, probably through a sequence of shocks and a surge in protest activity. However,  this change will take place sooner or later, and the political classes of those leading countries with a long traditional of state control will have to adapt themselves to the new condition.

This will happen quickly, for the “nation state” is being rehabilitated, with the left as well as the right converging around it while otherwise holding diametrical positions on other issues. The necessity of preserving sovereignty – not only in the political sense of the state but also from the point of view of identity –  is once more perceived as the norm. The liberal, cosmopolitan utopias of the late 20^th century are retreating into the dark.

To reiterate, these tendencies are universal. They materialize, of course, in different parts of the world and in various cultures, as does too the desire for a distinct identity. And, it is true, sometimes the pendulum swings in the opposite direction: global development has always been cyclical in nature since the turn towards openness and universalization is inevitable sooner or later. And it may happen faster than did previous ‘great cycles’ – all the same, the rate of change has now greatly increased. Even so, it will not take place within the coming years, which promise to be quite full of events.

Russia has not yet adapted to these external changes. We, of course, are no strangers to change. However, the processes that await us are expected to be especially complex. In the quarter of a century since the end of the Cold War and the Soviet Union’s collapse, Russia has existed in a paradigm of recovery – recovery of the state, of the economy, of the political system, and of our international positions. This, of course, is a simplification, but one might say that Russian society and the state fell apart in the wake of the events of 1991. Everyone is free to evaluate the past for themselves – there were ups and downs, fatal errors and wondrous achievements. Even so, that epoch has ended; foremost of all, it ended in peace.

Not only Russia, but also the West and thus the rest of world in general, existed in a “post-Cold War” system. Yet whereas one (namely, Russia) harbored a sense of defeat and a desire to extract revenge, the other (namely, the West) experienced the sensation of euphoria and ardent self-admiration. During the period between 2008 and 2016 (i.e., from the onset of the global financial crisis to Brexit and Trump), that same sense of ecstasy in the West gradually gave way to one of alarm, as it became clear that the world was heading in a different direction than had been predicted at the close of the previous century. A good many things – not practically everything – need to be started anew proceeding from the basis of other perspectives and circumstances.

As Ivan Krastev correctly noted, an entire generation in the West has been raised in the belief that the Cold War constituted the main event of the second half of the 20^th century. Now, however, it turns out that decolonization amounted to a much more significant development, given that its consequences in the form of instability and migratory flows from south to north affects the lives of Europeans and Americans much more than anything else. Yet migration not only presents a challenge to their socioeconomic systems but also to the cultural sustainability of the societies receiving these migrants.

For contemporary Russia, a conservative agenda presents the most effective means of responding to global change and the coming cycle of upheaval. What does this mean in practice?

The main thing is that Russia needs to learn to be itself: to search for reference points within itself; to direct its efforts toward its own capabilities; and to manage, as well as expand, those capabilities. This means that Russia needs to stop comparing itself with or imitating other countries; conversely, it could also violently disassociate itself from the example of others. This pertains first and foremost to the morbidly Western-centric fixation of Russian politics and political thought, which has often led to dead ends of one kind or another. With the East now taking on a leading role in the world, Russia’s inability to put aside its preoccupation with the West simply contradicts the trajectory of global development.

The world is once again regaining the diversity which, as it appeared at the end of the 20^th century, would disappear and be replaced by averaged-out patterns of a “correct” arrangement. Demand for ideological clarity is returning, though interest in the civilizational approach – which liberal dogma has rejected as “reactionary” – is becoming more and more evident. This is an extremely substantive change for Russia, as following the collapse of the Soviet Union efforts to inscribe a new ideological framework along the lines of “empire, nation, and state” all failed.

The imperial age had come to an end, yet Russia, which developed into a supernational commonwealth over the centuries, cannot become a nation-state without experiencing a total collapse. As such, discussion on the subject of civilization tends much more to be in keeping with the distinctive features of Russia and its interrelations with its neighbors to the West and to the East. The self-awareness which Russia needs in the near future rests in the formation of civilizational identity.

The question is not one of “turning” in the direction of the West or the East, as is usually said for simplicity’s sake. Russia task is to strike a balance between the worlds and civilizations which adjoin it and which, of course, accord it influence. The Eastern vector is more important at the moment only because it is clearly underdeveloped, having previously been overshadowed by the Western-centric vector mentioned above. Russia does not need to adopt Eastern values, but it needs to understand them.

Russia does not need to adopt Eastern values, but it needs to understand them since cooperation with those countries who subscribe to these values will expand in the future. In this respect, efficacy must be an integral part of conservative policy: philosophical arguments and ideological slogans are not much perceived in the East, though actual achievements, the ability to do business, are well appreciated.

The Russian conservative model for the second decade of the 21st century is one of self-knowledge, self-development, and self-esteem. This model features domestic and foreign components, but rational self-interest and concentration on domestic policy objectives should take precedence over all else, including considerations of ambition and prestige. To be sure, the realist school of international relations against great importance to ambition and prestige; but rational sufficiency is the determining factor in everything.

The outside world clearly does not offer Russia peace of mind. Stolypin’s dream of twenty years without turmoil⁵ are just as unrealizable today as they were one-hundred years ago. But here we are, at least, in the same position as everyone else. Of course, in a world that is fundamentally changing, everyone is ultimately responsible for its finding its own way of surviving and attaining success. And this is an entirely conservative formulation of the issue at hand.

Footnotes

1. The Institute of Socioeconomic and Social Research (ISSR) is a Moscow-based think tank indirectly affiliated with the Kremlin. ISSR was established by a Decree of the Russian President in June 2012; it appears to be funded in part by the ruling United Russia party of Russian President Vladimir Putin.

2. Fyodor Alexandrovich Lukyanov serves as editor-in-chief of Russia in Global Politics. In addition to this role, Lukyanov heads the Russian Council on Foreign and Defense Policy and is Director of Research for the Valdai International Discussion Club.

3. The term ‘new thinking’ comes from a speech delivered by Mikheil Gorbachev before the United Nations General Assembly in December 1988. In this speech, Gorbachev announced his intention to reduce the number Soviet troops stationed in Eastern Europe. Many historians believe that this action opened the door to the wave of revolutions which swept the Soviet bloc that following year; for this reason, ‘new thinking’ is used by some in Russia as a derisive byword for the Gorbachev administration’s foreign policy.

4. Ivan Yotov Krastev is a Bulgarian political scientist known for his extensive writings on democracy and populism in Eastern Europe. A full bibliography of his work can be found here.

5. Pyotr Arkadyevich Stolypin served as prime minister of the Russia Empire from 1906 to 1911. During his time in office, Stolypin sought to implement an ambitious land reform program aimed (among other things) at dissolving traditional practices of communal ownership among Russia’s peasant class. Stolypin believed that the economic efficiency of the Russian Empire would increase as a result of such reforms, though he recognized that these could not be effectively implemented against the backdrop of social and political instability. Boasted Stolypin: “Give me twenty years of peace, both at home and abroad, and you will not recognize Russia.” Stolypin was shot dead by a leftist revolutionary in September 1911.