On September 20, 2022, a law amending the Criminal Code of the Russian Federation (hereinafter the "Criminal Code") was submitted to the Federation Council of the Russian Federation.

With the above amendments, new offences relating to breaches of state contracts on state defense order or contracts entered into for the purpose of performing a state defense order will be introduced.

A new Article 201.2 is being introduced into the Criminal Code. It provides for criminal liability for violation of the terms of a state defense contract or the terms of a contract entered into for the purpose of performing a state defense order.

The subject of the offense is a person who has been subjected to administrative punishment in the form of an administrative fine for the act provided for by Parts 1 and 2.1 of Article 14.55 of the Code of Administrative Offenses of the Russian Federation (hereinafter the "Administrative Offences Code"), that is, for violation of the terms of the state defense contract or the terms of the contract entered into for the purpose of performing a defense state order.

Paragraph 1 Article 201.2 of the Criminal Code provides for punishment in the form of:

• a fine of 1,000,000 to 3,000,000 rubles or in the amount of the wages or other income of the convicted person for a period of 1 to 3 years, with deprivation of the right to hold certain positions or to engage in certain activities for up to 10 years; or
• imprisonment for a period of 4 to 8 years with a fine of 500,000 to 1,000,000 rubles, or in the amount of the wages or other income of the convicted person for a period of 3 to 4 years, with deprivation of the right to hold certain positions or to engage in certain activities for up to 3 years.

At the same time, according to the remark to Article 201.2 of the Criminal Code, a person who has committed a crime under Paragraph 1 Article 201.2 of the Criminal Code is released from criminal liability if they voluntarily eliminated the violation of the terms of the state contract on state defense order or the terms of the contract entered into for the purpose of implementing a state defense order.

Paragraph 2 Article 201.2 of the Criminal Code contains a qualified corpus delicti, which provides for increased liability if:

• damage inflicted on the Russian Federation amounts to no less than 5% of the price of the state defense contract, but no less than 5,000,000 rubles;
• if a state defense order is not fulfilled.

Punishment for the crime provided for by Paragraph 2 Article 201.2 of the Criminal Code is imprisonment for a period of 5 to 10 years, with deprivation of the right to hold certain positions or to engage in certain activities for a period up to 5 years.

Also, a new Article 201.3 is being introduced into the Criminal Code. The article establishes criminal liability for refusal or evasion of conclusion of a state defense order contract or a contract necessary for fulfillment of a state defense order.

The subject of the offence is a person who has been subjected to an administrative punishment in the form of an administrative fine for an act provided for by Parts 1 and 2 of Article 7.29.2 of the Administrative Offences Code.

The offence under Article 201.3 of the Criminal Code is punishable by:

• a fine of 1,000,000 to 3,000,000 rubles or in the amount of the wages or other income of the convicted person for a period from 1 to 3 years, with deprivation of the right to hold certain positions or to engage in certain activities for up to 10 years; or
• imprisonment for 4 to 8 years with a fine of 500,000 to 1,000,000 rubles, or in the amount of the wages or other income of the convicted person for a period of 3 to 4 years, with deprivation of the right to hold certain positions or to engage in certain activities for up to 3 years.

Liability under Article 201.3 of the Criminal Code is incurred if entering into such a state contract or agreement is mandatory under federal law.

Similar corpus delicti are introduced by Article 285.5 and Article 285.6 of the Criminal Code, with the subjects of these offences being officials.