All the wrong gold: authorities to raise fines for illegal trafficking in precious metals

The authorities propose to toughen liability for repeated offenses in the circulation of precious metals and stones. This follows from the draft law, which was read by Izvestia. Fines for legal entities and private entrepreneurs will increase 1.5-2.5 times, but will still remain small - no more than 200 thousand. The punishment will be for repeated refusal to register and for failure to provide data on the turnover of precious metals. Whether such an insignificant tightening will allow to prevent the growth of the shadow market - in the material "Izvestia".

Penalties for illegal circulation of precious metals

Ministry of Finance has prepared amendments to the CAO, which relate to toughening liability for repeated (within a year) offenses in the circulation of precious metals and stones (DMDK). Now there are no increased amounts for violations of the law that companies commit for the second time.

If a business is repeatedly brought to administrative responsibility for failure to register for special registration, fines will increase: for individual entrepreneurs - from 80-100 thousand rubles to 120-160 thousand, and for legal entities - from 120140 thousand rubles to 160-180 thousand, follows from the bill (Izvestia has it).

Penalties for repeated violation of the rules of accounting of precious metals or provision of data on their movement in the state information system (GIIS DMDK) are also toughened. Penalties will increase for officials (from Br20-50 thousand to Br50-70 thousand), for individual entrepreneurs (from Br30-60 thousand to Br60-100 thousand), for legal entities (from Br50-80 thousand to Br100-120 thousand).

- Today's penalties do not allow to effectively counteract individual entrepreneurs and legal entities that systematically work without special registration. They purposefully take advantage of the low size of the penalty and ignore the requirements of the legislation in order not to display information about the facts of DMDC turnover," explained "Izvestia" in the Ministry of Finance.

This allows criminals to trade in jewelry of unknown origin, which is unacceptable, as consumer confidence in such products falls, and the economic security of the country as a whole decreases, the ministry said.

The explanatory documents also say that unscrupulous players create a shadow market for DMDC, since it is profitable to conduct illegal activities even taking into account the cost of paying fines. As a result, it will be difficult to talk about fair competition: market participants who will go beyond the legal framework will only be more, which in the long term will affect the investment climate, it says.

- To protect the interests of entrepreneurs working in the legal field, the bill emphasizes the increase in fines for repeated violations within one year," the Ministry of Finance emphasized.

The annual illegal turnover of jewelry amounts to about 50 billion rubles, estimated back in 2021 by Russian Deputy Finance Minister Alexei Moiseyev. When asked by Izvestia what it is now, the ministry, as well as the Assay Chamber, did not answer the question.

At the same time, the Assay Chamber supports the initiative, since the repetition of a violation of the law means that it was committed not by mistake, but deliberately, they told Izvestia.

- The rules of circulation of precious metals and stones exist, first of all, to protect the interests of consumers, and those who violate them, infringe on the rights of citizens, while gaining a competitive advantage over market participants who comply with the rules, - added in the Assay Chamber.

What is the illegal circulation of precious metals in Russia?

It is often profitable for organizations to sell jewelry made of precious metals in retail without registration and reflection of operations even taking into account the costs of paying fines already provided for in the Administrative Code, said Maxim Barashev, managing partner of the law firm BBNP, a member of the Moscow regional branch of Delovaya Rossiya.

However, the absolute size of fines even after the increase looks small. However, regulation in the DMDC sphere is so complicated that any inspection by the Federal Assay Chamber almost inevitably leads to the detection of certain violations, emphasized Vladimir Zboykov, Executive Director of the Business Russia Committee on Precious Metals, Precious Stones, Jewelry Art and Folk Art Crafts.

A fine can be imposed for every error or inaccuracy in the information entered into the information system - then the total amount will be quite substantial.

- This measure primarily has a fiscal purpose - to replenish the budget. However, the increase in fines for offenses creates a greater attraction to work in the black market," warned Vladimir Zboykov.

According to his estimates, now the share of illegal jewelry is only 10% of the total turnover. He believes that the shadow market works most comfortably through online marketplaces.

However, experts cite much less positive estimates. According to Khadzhimurad Belkharoev, associate professor at the Faculty of Economics of the Russian Academy of Sciences, the total share of the turnover of illegal jewelry, stones and metals in our country is about 50%. Whereas the official turnover is more than Br3 trillion. That is, it is important to legalize the uncontrolled shadow sector.

Compliance with the law should be financially more profitable than ignoring it, added Khadzhimurad Belkharoev.

The activity of the shadow market has an extremely negative impact on budget revenues, agrees Antonina Levashenko, head of the Center-OECD IPEI of the Presidential Academy. For 2025 it is planned to increase the collection of fines and various non-tax payments by almost 20 billion rubles, said Associate Professor of the Department of Sustainable Development Finance of Plekhanov Russian Economic University Mikhail Gordienko. According to him, the proposed measure is relevant and is aimed at both potential growth of budget revenues and further improvement of the precious metals market.

This is not the first initiative of the Ministry of Finance in the field of precious metals. As Izvestia previously reported, the ministry wants to oblige gold refineries to track the origin and route of each batch of incoming raw materials. The ministry also proposed to suspend special registration of a company or individual entrepreneur working with precious metals if their license is no longer valid.