European Court of Human Rights: Khodorkovsky Case

Lord Trimble Excerpts

Tuesday 23rd July 2013 Lords Chamber

Asked by

[Lord Trimble]

To ask Her Majesty’s Government what representations they have made to the governments of Russia and other European countries about the Khodorkovsky case at the European Court of Human Rights.

[Lord Trimble]

My Lords, the question is, “Why Khodorkovsky?”. There are a number of reasons. First, he is a successful businessman. He turned around a high-cost loss-making company into profit and increased production so that by 2003 it produced 20% of Russia’s oil and was Russia’s second-largest taxpayer. The leading Russian business newspaper, a joint Financial Times/Wall Street Journal venture called Vedomosti, awarded Khodorkovsky its entrepreneur of the year prize. Secondly, he challenged Putin. In a televised confrontation with Putin he cited opinion polling showing, among other things, that half the public believed that corruption had spread to a majority of state officials—including at the highest levels—and that more than 70% thought the use of the official justice system a waste of time. He concluded, “Corruption is spreading in this country. You could say that it started right here. And now is the time to end it”.

Thirdly, many feel that Putin’s response—arresting Khodorkovsky in October 2003 and driving his company into bankruptcy—marked a turning point in the development of the regime. The journalist Andrei Kolesnikov, described by Ben Judah as “the only ever defector” from Putin’s inner circle of St Petersburg friends, recalled a conversation with Putin in 2005 when he said, “I don’t like that after you arrested Khodorkovsky, I lost the feeling that I lived in a free country. I have not started to feel fear—”. Putin then interrupted him and said, “And did you not think that this was what I was aiming for”?

Kolesnikov recalls that after Putin’s inauguration in 2000 he was approached by a senior member of Putin’s inner circle to manage some funds for him. The funds initially came as gifts from various oligarchs. Kolesnikov was told that Putin wanted part of this money put into offshore funds. By 2005, $200 million had accumulated in this fund. In that year he was told to build a small house by the Black Sea for Putin—just 1,000 square metres, costing just £14 million. The project ballooned. The house became four times the size and was joined by a casino, a church, swimming pools and helipads, a summer amphitheatre and a winter theatre. Until the 2008 financial crisis, Kolesnikov divided the special fund between the building project and investments in a host of other businesses across Russia. Then he was told that all the funds were to be spent on the Black Sea palace. Kolesnikov later broke with Putin and fled the country. Ben Judah, in his book Fragile Empire, comments:

“What the Kolesnikov documents seem to show us is that Putin never changes. Instead, as he has grown more powerful, he grew ever more corrupt … He cannot change—and as long as he is in power, neither can Russia. Nor can the incestuous relationship of power and corruption that spiralled out of control under Yeltsin ever end”.

In 2007, after four years in detention, Khodorkovsky, whose trial had concluded in 2005 with an eight-year sentence, would have been eligible for release on parole, but in February of that year, new charges were announced which led to another conviction in December 2010. In February 2004 Khodorkovsky made his first application to the European Court of Human Rights, which concerned the circumstances of his arrest and pre-trial detention. In May 2011 the court ruled that there had been breaches of the convention and awarded the modest claim for $10,000 in full.

In March 2006 a second application was made to the ECHR concerning the first trial. This was ruled admissible in 2011 and last week it became known that judgment would be given on 25 July. A third application to the ECHR remains pending as does a fourth. As to the substance of these cases, I think it is sufficient to note that the International Bar Association’s Human Rights Institute, which had an observer at the second trial, concluded that the proceedings were unfair and had not produced clear proof of guilt. Many others agree.

Khodorkovsky will become eligible for parole in a year’s time but there are fears of a third trial. These fears are reinforced by current events. Sergei Magnitsky, a young lawyer who exposed a huge tax fraud in which many government officials were involved, was arrested and died in prison in 2009. Last month he was posthumously tried and convicted of tax offences. Bill Browder, a British citizen, was convicted in his absence in the same trial. How do the Government view that conviction? Last week Alexei Navalny was convicted of embezzlement in another sham trial. Navalny came to prominence as a blogger exposing official corruption. He coined the phrase, “United Russia is the party of crooks and thieves”, and was prominent in the demonstrations protesting the fraudulent elections in 2010 and 2012. Putin weathered those protests, which were mainly confined to the emerging Moscow middle class. This led Navalny’s wife, Julia, to say in despair, “Putin has decided to turn Russia into an authoritarian state like Belarus. He is pushing, a bit here, a bit there, to find out how far he can go. And there is only one thing that can stop him. A gigantic protest, or the West”.

Yet Putin’s current policy is based on a huge gamble. In 2007 he could balance the budget on an oil price of $40 a barrel. In 2012 he needed a price of $110 a barrel and he cannot compensate by increasing production. The technological changes pioneered by Khodorkovsky have run their course and oil production is predicted to decline by 20% in the coming decade, while shale and liquefied natural gas pose long-term problems for Russia’s gas.

What should we do? First, we should be careful about the messages we send. Sixty individuals have been identified as being involved in the tax fraud Magnitsky uncovered and in his torture and death. In the USA, legislation has been enacted banning them from entering the US. In April, Dominic Raab tabled a Written Question asking if any of those had visited the UK. Mark Harper replied in July saying that the Government,

“is already aware of the individuals on the list and has taken the necessary measures to prevent them being issued visas for travel to the UK”.—[Official Report, Commons, 18/4/13; col. 499W.]

However, a few days later he wrote to Hansard with a different Answer, this time saying in a letter that “applications for travel ... are flagged up for careful consideration on a case by case basis, no decision has been made to refuse their leave outright”. The amended Answer went on to refer to the longstanding policy not to disclose details of records of individuals and to reiterate that applications were treated on their merits,

“in line with our usual practice”.—[Official Report, Commons, 9/7/13; col. 2MC.]

The best thing that I can say about this apparently craven response by the Home Office is that it may be driven by a fear that in the absence of legislation it could not defend the policy to deny entry, but I am sure that the Kremlin will regard this as a fear of offending it.

The same, I fear, is true of last week’s decision by the Home Secretary to refuse a request by Sir Robert Owen, the coroner conducting the inquest into Litvinenko’s death. The coroner had requested a public inquiry because he could not hear in public secret evidence that might show the involvement of the Russian state in Litvinenko’s murder. Theresa May’s letter to the coroner conceded that international relations were a factor in the decision, and went on to say that inquests were more readily explainable to foreigners than an inquiry established by the Government under a chairman appointed by the Government. I am sure that the reaction to that in the Kremlin can be imagined. On this issue, I must ask the Minister: does this letter indicate that the Government are intending to amend or even abandon the Inquiries Act 2005, with the Home Secretary saying in effect that she could not use that Act in this case for the reasons that she gave?

In conclusion, we should have no illusions about the regime, and neither avert our eyes nor appease. Russia’s legal system is an extension of the ruling party, and the party and the Government as a whole are deep in corruption and will stop at nothing to preserve their power. I hope that the European Court of Human Rights will indicate the fundamental rights and freedoms of the convention in the cases that come before it, but what do we say to such a member of the Council of Europe? We should firmly oppose human rights abuses and the distortion of democracy; we should remind the Russians of their obligations as a member of the Council of Europe; we should press for a European law on the Magnitsky case—I say European because the Russians are adept at trying to divide the European countries on these issues—that imposes visa bans and freezes assets; and we should address the corruption that pervades the Russian system and, at the very least, stop the laundering of the dirty money that flows from there to here. That at least would hurt them in their pockets.