Energy sector a systemic analysis of economy, foreign trade and legal regulations
Lecture Notes in Networks and Systems 44
Oleg V. Inshakov Agnessa O. Inshakova · Elena G. Popkova Editors
Energy Sector: A Systemic Analysis of Economy, Foreign Trade and Legal Regulations
Lecture Notes in Networks and Systems Volume 44
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Oleg V. Inshakov Agnessa O. Inshakova Elena G. Popkova •
Energy Sector: A Systemic Analysis of Economy, Foreign Trade and Legal Regulations
Editors Oleg V. Inshakov Volgograd State University Volgograd Russia
Elena G. Popkova Volgograd State Technical University Volgograd Russia
Agnessa O. Inshakova Volgograd State University Volgograd Russia
This book is dedicated to Oleg V. Inshakov (1952–2018) with love and gratitude.
Energy is rightly considered to be one of the strategically important sectors of the economy of our country, the normal functioning and further development of which depends on the economic growth of the Russian state and the strength of its positions in the foreign economic arena. At present, Russia is one of the largest exporters of oil, gas and other energy resources to many countries of the world. Trade in energy resources occupies an important place in Russia’s foreign economic turnover and can rightfully be called a key branch of national exports, whose contemporary development is directly dependent on the state of the legal foundations providing it. The issues of legal regulation of the turnover of energy resources1 are no less important on the scale of the entire international community, which is conditioned by the objective signiﬁcance of the fuel and energy complex in the life activity of our planet. Strengthening the processes of globalization, active growth and interpenetration of national economies striving for innovative development and unevenness in the world economic distribution of energy resources cause the emergence of complex dilemmas and new challenges in the legal regulation of international energy cooperation. The law is designed to regulate the foreign trade
For the purposes of this study, taking into account its limited scope, the study of problems of legal regulation of obligations in the sphere of foreign trade turnover of energy resources and its uniﬁcation will be limited to regulatory, contractual and local regulation of export–import activities of oil and gas companies, as well as judicial practice accompanying this activity. The concept of “energy resources” will be interpreted mainly in the narrow sense in relation to the legislative approach, as stipulated, for example, in paragraph 1 of Art. 2 of the Federal Law of 23.11.2009 No. 261-FZ “On energy conservation and on improving energy efﬁciency and on introducing amendments to certain legislative acts of the Russian Federation”. Thus, as an energy resource as a “carrier of energy, the energy of which is used or can be used in the implementation of economic and other activities, as well as the type of energy (atomic, thermal, electrical, electromagnetic energy or another type of energy)” in this book, and also according to the majority of the normative, theoretical and empirical bases of the research used in it, it will mainly mean oil and gas as the most frequently used objects of civil rights in the ﬁeld of energy resources export. vii
turnover of energy resources and the disagreements that arise in the course of its implementation between countries. The objective signiﬁcance, the share of the Russian fuel and energy sector in the total volume of cross-border turnover of energy resources and the dynamic development of international cooperation in the energy sector cause the relevance of the research appeal to the problems of improving legal regulation, capable of ensuring a balance of interests of all participants in these social relations— economic entities of producing countries, suppliers, consumers and transiters of energy resources. The necessity and importance of law in this sphere are determined by the subject of regulation itself—energy as a special object of civil rights and a product that is in high demand. In foreign trade turnover, energy resources are a transnational product, which implies the complication of emerging legal relations by a foreign element and the participation of another legal system. This makes it necessary to study the issues of applicable law, that inevitably arise before the settlement of conflict and have a signiﬁcant impact on the content of a foreign trade contract. In the book, researchers solve the task of conducting a comprehensive analysis of uniﬁed international and national level of substantive law, intra-state conflict regulation of foreign economic activity, international trade and judicial practice in the energy sector. The relevance of modern scientiﬁc research on the strategy, methods and tools for the formation of adequate legal conditions for foreign trade in energy resources, including within the framework of basic civil contractual designs, can’t be overemphasized. Relations arising between participants in the process of international movement of national energy resources need to be negotiated. Therefore, a signiﬁcant place in the book is devoted to the study of the current legal regulation, the main directions of its development, as well as the principles and mechanisms for unifying the foreign trade contractual relations of the Russian Federation in the sphere of international turnover of national energy resources. According to the Energy Strategy of Russia for the period until 2030 (Energy Strategy of Russia for the period up to 2030, 2009), the main vectors for the development of the fuel and energy complex are the transition to a path of energy-efﬁcient and innovative development, as well as the integration of Russia into the world energy system. The guidelines for energy development, set by the country’s main strategic act, allow us to conclude that the study of the problems of the legal regulation of the foreign trade turnover of energy resources and its uniﬁcation acquires particular urgency and practical signiﬁcance. Provided that the research takes into account the need to enhance high-tech, innovative activities in the energy sector and the expediency of close cooperation between the Russian Federation and international organizations and integration associations. Modern world economic development is impossible without the implementation of innovative activities consisting in the introduction of the latest high-performance technologies and equipment, the use of advanced world experience, improving the environmentally friendly production of raw materials and the level of its processing, the transition to the use of modern raw materials, fuel, energy, based on the use of
renewable and alternative energy sources. In this regard, the study reflected the issues of legal regulation of innovation in the energy sector. Today, the external economic regulation of the energy sector can’t be limited only by the domestic methods of a single country. The processes of globalization of the world economy, internationalization and liberalization of the energy sector, as well as the mutual integration of the fuel and energy complex of various states rely on close interstate cooperation, including, in the ﬁeld of lawmaking of international organizations and integration associations. For international entities involved in the process of forming a balanced external economic regulation, there are many tasks, aimed at solving problems related to the fragmentary and unsystematized nature of their activities, the issues of their legal personality and competence, the lack of a uniﬁed strategy and the difﬁculties in developing uniform standards because of the predominance of interests a single state taken over international interests. Uniﬁcation and harmonization of the fundamental principles and norms of international law and Russian legislation regulating cooperation in the world energy market is included in the Consolidated Plan (“road map”) of the state energy policy activities for the period until 2030, which ensure the implementation of the Energy Strategy of Russia. Solutions of practical problems proposed in the book are aimed at overcoming by legal methods and means the consequences of energy crises, the destruction of energy systems, the uneven distribution of energy resources and the “energy hunger” of certain regions, lagging behind the technological development and integration of the energy sector. The identiﬁed problems are, among other things, the consequence of the prevailing disunity of the national foreign economic regulation with international norms and standards. At the present stage, one can’t fail to take into account the growing influence of economic and legal integration, acting as the starting point for the necessary legal uniﬁcation of all levels of legal regulation in analysing the prospects for the development of legislation in the ﬁeld of energy. In this regard, it is obvious the need to study international integration forms of cooperation and the legal foundations of foreign trade energy relations that are developed as a result of their activities. From the point of view of the development of national law and the economy of the Russian state, research in this direction is primarily of interest from international integration associations with the participation of the Russian Federation, such as the CIS, the EAES and the BRICS. In addition, it is important to understand the priority directions of development, the system, principles and essence of the legal foundations of international integration associations—the largest foreign economic partners of Russia, of which the EU is a bright representative. The growth of the degree of energy interdependence, the strengthening of the internationalization and globalization of world energy, and the indisputability of comprehensive international cooperation to ensure energy security that is becoming widespread lead to further development and improvement of the institutions of the world energy policy of legal support and its uniﬁcation in the sphere of foreign trade turnover of energy resources at the global level. The study of the legal regulation
of the foreign trade turnover of energy resources in the Russian Federation, which needs to be improved and uniﬁed, is systemic in the book. All elements of the legal regulation of foreign trade in the energy sector, both general and special legislation, including uniﬁed norms of international legal regulation, strategic and framework acts, national legislation, as well as soft law, recommendatory and technical standards have been studied. The research reflects theoretical and practical aspects of self-motivation of energy saving by business entities within their corporate market responsibility, as well as regulatory mechanisms for motivating energy conservation in the interests of ensuring sustainable development of the economy. Issues of progressive development and uniﬁcation of legal regulation in the energy sector within the framework of the interstate associations are studied in the book considering the special integration potential of the energy industry of law. Analysis of the effectiveness of existing models of the general legal energy policy of many countries, legal methods and tools used to implement it and create a uniﬁed energy regulation including in the sphere of trade turnover is an important research task, which is of great practical importance for the socioeconomic modernization of the Russian Federation. Volgograd, Russia
Oleg V. Inshakov Agnessa O. Inshakova Elena G. Popkova
Foreign Trade Activities and Turnover of Energy Resources: Concepts, Legal Foundations and Contracting Frameworks
Importance and Sources of Legal Regulation of Foreign Trade Activities and Turnover of Energy Resources . . . . . . . . . . . . . . . . . . . . Agnessa O. Inshakova and Igor P. Marchukov
Basic Concepts of Legal Regulation of Foreign Trade Activities of Energy Resources Turnover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Agnessa O. Inshakova and Igor P. Marchukov
Foreign Trade Contracts as a Contractual Basis for International Civil Circulation of Energy Resources: Concept, Types, Content . . . . . . Agnessa O. Inshakova and Igor P. Marchukov
Applicable Law as an Essential Condition for a Foreign Trade Contract for the Supply of Energy Resources . . . . . . . . . . . . . . . . . . . . Agnessa O. Inshakova and Igor P. Marchukov
Factors that Determine the Development of Foreign Trade Activities in the Energy Sphere and of its Economic-Legal Regulation
Innovation as an Integral Condition for the Development of Modern Foreign Trade Turnover of Energy Resources and its Legal Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Agnessa O. Inshakova and Alexander I. Goncharov Innovative Technologies of Oil Production: Tasks of Legal Regulation of Management and Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Agnessa O. Inshakova, Alexander I. Goncharov and Elena I. Inshakova
Motivation of Energy Saving Within the Corporate Market Responsibility of Economic Entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . Elena G. Popkova, Oleg V. Inshakov and Aleksei V. Bogoviz
Regulatory Mechanisms of Energy Conservation in Sustainable Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 Elena G. Popkova, Oleg V. Inshakov and Aleksei V. Bogoviz Energy Efﬁciency as a Driver of Global Competitiveness, the Priority of the State Economic Policy and the International Collaboration of the Russian Federation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Oleg V. Inshakov, Lyudmila Y. Bogachkova and Elena G. Popkova The Transformation of the Global Energy Markets and the Problem of Ensuring the Sustainability of Their Development . . . . . . . . . . . . . . . 135 Oleg V. Inshakov, Lyudmila Y. Bogachkova and Elena G. Popkova Part III
Authority of International Legal Entities and Integration Unions on the Development of Civil Legal Regulation of the Foreign Trade Turnover of Energy Resources
TNCs as Subjects of Economic Activity and Lawmaking in the Sphere of Foreign Trade in Energy Resources . . . . . . . . . . . . . . . . . . . . . . . . . . 151 Agnessa O. Inshakova, Evgenia E. Frolova and Igor P. Marchukov Participation of International Organizations and Integration Associations in the Development of Legal Regulation of Foreign Trade in Energy Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 Agnessa O. Inshakova, Elena I. Inshakova and Igor P. Marchukov The General Energy Policy and Ways of Development of Legal Regulation of the Foreign Trade Turnover of Energy Resources of the Russian Federation and the EU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187 Agnessa O. Inshakova, Evgenia E. Frolova and Igor P. Marchukov Common Energy Policy and Development Paths Legal Regulation of Foreign Trade Turnover of Energy Resources in the CIS and in the EEU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207 Agnessa O. Inshakova, Alexander I. Goncharov and Igor P. Marchukov General Energy Policy and Ways of Development of Legal Regulation of Foreign Trade Turnover of Energy Resources of the BRICS Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227 Agnessa O. Inshakova and Igor P. Marchukov
Lyudmila Y. Bogachkova Department of Applied Informatics and Mathematical Methods in Economics, Institute of Management and Regional Economics, Volgograd State University, Volgogrаd, Russia Aleksei V. Bogoviz Federal State Budgetary Scientiﬁc Institution “Federal Research Center of Agrarian Economy and Social Development of Rural Areas – All Russian Research Institute of Agricultural Economics”, Moscow, Russia Evgenia E. Frolova Institute of State and Law, Russian Academy of Sciences, Moscow, Russia Alexander I. Goncharov Department of Civil and International Private Law, Institute of Law, Volgograd State University, Volgograd, Russia Oleg V. Inshakov Department of Economic Theory, World and Regional Economics, Science of the Russian Federation, Volgograd State University, Volgograd, Russia Agnessa O. Inshakova Department of Civil and International Private Law, Institute of Law, Volgograd State University, Moscow, Russia Elena I. Inshakova Department of Economic Theory, World and Regional Economics, Institute of Economics and Finance, Volgograd State University, Volgograd, Russia Igor P. Marchukov Department of Civil and International Private Law, Volgograd State University, Volgograd, Russia Elena G. Popkova Department of World Economics and Economic Theory, Volgograd State Technical University, Volgogrаd, Russia
Foreign Trade Activities and Turnover of Energy Resources: Concepts, Legal Foundations and Contracting Frameworks
Importance and Sources of Legal Regulation of Foreign Trade Activities and Turnover of Energy Resources Agnessa O. Inshakova and Igor P. Marchukov
currency, customs and tax legislation. The expanding influence of international organizations on the development of an array of national civil-law regulation in the sphere of trade in energy resources has been established. Are investigated in comparison with applicable in the Civil Code of the Russian Federation legislative approaches to the issues of choice of applicable law, used in international regulations: Regulation—Rome I and the United Nations Convention on Contracts for the International Sale of Goods 1980 (Vienna Convention). Based on the analysis of various theoretical approaches, as well as the practice of international commercial arbitration, the authors consider the issue on the limits of application of the provisions of the Vienna Convention to the foreign trade contract for the supply of energy resources, practical recommendations are given on the content of the contract with regard to establishing an appropriate way to exclude the application of the provisions of the Vienna Convention to contractual relations under study.
2 Materials The basis of the analysis in this chapter of the analysis was made by sources included in the system of Russian law in the sphere of foreign trade in energy resources: program documents, normative legal acts of all levels of positive regulation, as well as model contracts and other soft law documents that have a recommendatory character. In particular, these are the main strategic program acts, ﬁrst of all, the Energy Strategy of Russia for the period until 2030. The basis for the analysis of domestic regulation was the provisions of the Constitution of the Russian Federation, and Part 3 of Sect. 6 “Private International Law” of the Civil Code of the Russian Federation. In addition, the provisions of the federal laws in the sphere of energy regulating relations in the fuel and energy complex regardless of the speciﬁc industry or covering relationships in several energy sectors at once. These laws include: Federal Law of 21.07.1997 No. 116-FZ “On Industrial Safety of Dangerous Production Facilities”; Federal Law of 21.07.2011 No. 256-FZ “On the Safety of the Fuel and Energy Complex”; Federal Law of 03.12.2011 No. 382-FZ “On the state information system of the fuel and energy complex”; Federal Law of 23.11.2009 No. 261-FZ “On Energy Saving and on Improving Energy Efﬁciency and on Amending Certain Legislative Acts of the Russian Federation”; Law of the Russian Federation of 21.02.1992 No. 2395-1 “On Subsoil”; Federal Law of 30.11.1995 No. 187-FZ “On the Continental Shelf of the Russian Federation”; Federal Law of 21.07.2005 No. 115-FZ “On Concession Agreements”. The provisions of the Federal Laws regulating activities in a particular energy sector are explored, in particular: Federal Law of 26.03.2003 No. 35-FZ “On Electric Power Industry”; Federal Law of 27.07.2010 No. 190-FZ “On Heat Supply”; Federal Law of 21.11.1995 No. 170-FZ “On the Use of Atomic Energy”; Federal Law of 31.03.1999 No. 69-FZ “On gas supply in the Russian Federation”.
Importance and Sources of Legal Regulation of Foreign …
The provisions of some normative acts under development, in particular, the draft Federal Law “On the peculiarities of the turnover of oil and oil products in the Russian Federation” are analyzed. The main regulatory legal acts governing foreign economic activity in the export of energy resources include the Federal Law of 08.12.2003 No. 164-FZ “On the Basics of State Regulation of Foreign Trade Activity”, Federal Law of 18.07.1999 No. 183-FZ “On Export Control”; Federal Law of 10.12.2003 No. 173-FZ “On Currency Regulation and Currency Control”. In addition to federal laws, a large number of sub-legislative acts have been analyzed among sources of Russian energy law: Decree of the Government of the Russian Federation of 27.12.2010 No. 1172 “On approval of the Rules for the Wholesale Electricity and Capacity Market and on Amending Certain Acts of the Government of the Russian Federation Regarding Regulation”; Decree of the Government of the Russian Federation of 29.12.2011 No. 1178 “On pricing in the ﬁeld of regulated prices (tariffs) in the electric power industry”, etc. Among the universal, regional and bilateral international legal instruments analyzed in the work: the Vienna Convention on the International Sale of Goods of 1980; The Paris Convention for the Protection of Industrial Property of 1883, the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958; Convention on the Physical Protection of Nuclear Material; New York Convention on the Limitation Period in the International Sale of Goods of 1974; The Hague Convention on the Law Applicable to Contracts for the International Sale of Goods, 1986; Regulation No. 593/2008 of the European Parliament and the Council of the European Union “On the law subject to application to treaty obligations (“Rome I”)”; European Energy Charter; Agreement to the Energy Charter; Protocol to the Energy Charter for Energy Efﬁciency and Related Environmental Aspects of 1994; The Mountain Charter of the Member States of the Commonwealth of Independent States of 1997; Agreement on cooperation in the ﬁeld of exploration, exploration and use of mineral resources in 1997; Agreement on cross-border cooperation in the ﬁeld of exploration, development and protection of the bowels of 2001, etc. The analysis of the level of international regulation is presented in the study on the basis of “soft” uniﬁed rules of recommendatory nature, such as the Rules for the interpretation of trade terms “Incoterms”; Principles of international commercial contracts Unidroit; Terms of contracts for the construction of industrial facilities, the uniﬁcation of which is carried out by the International Federation of Consulting Engineers, etc. Investigations of sources of legal regulation of the foreign trade turnover of energy resources are devoted to the works of leading Russian scientists who compiled the theoretical basis of this chapter of the book. Among them are works published in monographs, periodicals recommended by the Higher Attestation Commission of the Ministry of Education and Science of the Russian Federation, as well as those included in international analytical citation bases. Evaluation of the current conflict regulation and conflict principles, which are the basis for determining the law applicable to obligations, including in the ﬁeld of foreign trade regulation of energy resources turnover is presented in the works of Asoskov (2012).
A. O. Inshakova and I. P. Marchukov
Classiﬁcations of internal statutory and legal acts are devoted to the works of Romanova (2014). The issues related to the deﬁnition of the limits of application of the Vienna Convention are considered in the proceedings: Alekseev (2014), Sukhanov (2008), Kochetov (2013). Advantages of application in the sphere of legal regulation of foreign trade turnover of energy resources of international business practices, in particular, the Unidroit Principles, are studied on the basis of works by Nikolyukin (2013), Arifﬁn and Yaakub (2017). Questions about the limits of the application of the norms of the Vienna Convention were also examined on the basis of the materials of international jurisprudence, in particular, the decisions of the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation.
3 Methods In the process of research, the general scientiﬁc dialectical method was used, and also methods are used: formal-logical, system-structural, comparison method. In the process of interpreting the results of the research, methods of synthesis, classiﬁcation and generalization were used. The research also used private-science methods: formal legal, the principle of evaluating legal processes, the method of comparative analysis, and others.
4 Introduction Energy resources are a global commodity of the modern foreign economic market. In the foreign trade turnover of the Russian Federation, the sale of energy resources and carriers is not simply an essential, but rather a predominant place. It can be safely asserted that the priority development of the fuel and energy sector as the basis of modern society in the 21st century has the character of one of the global trends in the development of the world economy and is singled out as a key branch of the national economy of Russia, as well as an important element of the country’s economy. In fact, the energy sector, ensuring the vital activity of all branches of national economy, contributes to the uniﬁcation of not only the subjects of the federation, but even the strengthening of interstate socio-economic relations, and to a large extent determines the formation of the country’s fundamental macroeconomic indicators. Natural fuel and energy resources are the national property of the Russian Federation, the effective use of which forms the necessary prerequisites for the transition of the state’s economic system to a path of sustainable development that ensures an increase in the level of the well-being of the population (Dudikov 2014).
Importance and Sources of Legal Regulation of Foreign …
Russia is one of the main energy suppliers for many foreign countries of the world. Thus, according to the Analytical Center under the Government of the Russian Federation, Russia produces about 10% of the world’s primary energy, about half of this ﬁgure is exported (Energy Bulletin 2017). Prime Minister Dmitry Medvedev on December 22, 2016 before the meeting to discuss the draft “Energy Strategy of Russia until 2035” reported that the fuel and energy complex provides more than a quarter of Russia’s gross domestic product and half the budget revenue (Medvedev 2017). The successful development of the foreign trade turnover in the energy sector of Russia largely depends on the proper legal regulation of relations in the energy sector—the branch of the national economy, encompassing energy resources, the search for, extraction, generation, transformation, transmission, distribution and use of various types of energy. The necessity and importance of legal regulation in this sphere are determined by the subject of regulation—energy as an important commodity that is in high demand not only in the Russian Federation, but all over the world. In the process of creating an effective legislative framework regulating energy relations, all factors affecting the development of modern reality, as well as existing economic realities and the main trends that transform them, should be taken into account. At the same time, it should be noted that the objective signiﬁcance, the share of the Russian fuel and energy sector in the total volume of cross-border turnover of energy resources, and the dynamic development of the energy industry in Russia necessitate a continuous improvement of the legal regulation that ensures the balance of interests of all participants in public relations in the energy sector. Speaking about the system of legal regulation of energy resources as an object of foreign trade turnover, it should be noted that it includes elements of both general and special legislation, norms of technical regulation, as well as international legal regulation based on uniﬁed substantive rules of international treaties, customs of international business turnover and soft law norms, developed by various international organizations (Carr 2013).
5 Inside the State Level as an Element of the System of Legal Regulation of Foreign Trade Turnover of Energy Resources At the domestic level, since the adoption of the Constitution of the Russian Federation at a national referendum on 12.12.1993 (The Constitution of the Russian Federation 1993), the legal regulation of relations in the sphere of foreign trade in energy resources has always been and is being given considerable attention. The constitutional basis of Russia’s energy law is the provisions of the Constitution of the Russian Federation on the support of competition, freedom of economic activity, guaranteeing the unity of the economic space, free movement of
A. O. Inshakova and I. P. Marchukov
goods, services and ﬁnancial resources (Article 8), free use, disposal and disposal of land and other natural resources by the owners (Article 36), on the RF federal energy systems being in charge of the RF (Article 71), on the joint jurisdiction of the RF and the RF subjects with land, subsoil legislation, environmental protection environment and issues of ownership, use and disposal of land, mineral resources and other natural resources (Article 72) (Gorodov 2012). The development of the above constitutional provisions was followed by the adoption of a number of laws aimed at regulating various relations in the fuel and energy sector of the country. Relations in the ﬁeld of foreign trade between economic entities in Russia are regulated, ﬁrst of all, by the Civil Code of the Russian Federation. In the Civil Code of the Russian Federation, in addition to general provisions on the treaty, there are special provisions governing energy relations. The norms of § 6 of Chapter 30 of the Civil Code of the Russian Federation are devoted to the contract of energy supply, the object of which is energy as a special commodity with speciﬁc properties, namely, impossibility, unlike other things (goods), accumulation and storage; continuity of the production, transmission and consumption process; impossibility of energy return after transmission; the need for special devices for its detection in the network, etc. The energy supply contract is the main contractual construction that mediates the turnover of energy goods in the Russian Federation (Balzhirov 2012). The national legislator refers to the energy goods electric, thermal energy, gas, oil, oil products (Article 539, 548 of the Civil Code of the Russian Federation). By its legal nature, the foreign trade deal on transferring energy resources to the other party is a supply contract, with a number of features. Despite the variety of contractual relations for the transfer of energy carriers (a continuous supply contract, a supply agreement through an afﬁliated network, a separate power supply agreement, etc.), their legal regulation is determined by the norms of Chapter 30 of the Civil Code of the Russian Federation as having a single legal nature of purchase and sale. In addition, part 3 of Sect. 6 “Private International Law” of the Civil Code of the Russian Federation regulates general provisions on foreign economic activity, in particular, these are issues related to: • deﬁnition of the right to be applied to civil-law relations with the participation of foreign persons or to civil-law relations complicated by another foreign element; • qualiﬁcation of legal concepts in determining the law to be applied; • the application of the law of the counterparty country and the establishment of its content; • deﬁnition of the right to be applied in determining the legal status of legal entities; • State participation in civil law relations, complicated by a foreign element; • deﬁnition of the right to be applied to property and personal non-property relations (Marchukov 2012).
Importance and Sources of Legal Regulation of Foreign …
Thus, Sect. 6 of the Civil Code of the Russian Federation, substantially updated in 2013, establishes the main provisions on the procedure for foreign trade activities by business entities (Inshakova et al. 2017). As notes A.V. Asoskov, the level of our conflict regulation in general can be compared with the leading countries. When working on amendments in 2013, all the latest trends are taken into account, in particular, some conflict solutions are borrowed from the new Regulations that appeared in the EU, primarily “Rome I” and “Rome II” (Bagaev 2016). Equally important role in the legal regulation of the international sale and purchase of energy resources is played by the norms of public law, in particular export, currency, customs and tax legislation (Ugrin and Yanishevskaya 2016). Among the codiﬁed laws, the Land Code of the Russian Federation (The Land Code of the RF 2001), the Urban Development Code of the Russian Federation (Urban Development Code of the RF 2005), the Tax Code of the Russian Federation (The Tax Code of the RF 1998), the Code of the Russian Federation on Administrative Offenses (The Code on Administrative Offenses of the RF 2001), and the Criminal Code of the Russian Federation (The Criminal Code of the RF 1996) play a signiﬁcant role in the complex legal foundations of the foreign trade turnover of energy resources. In the Russian Federation, many special regulatory and legal acts regulate the sphere of public activity in question with an international character. Romanova V.V. offers a huge array of legislative acts divided into conditional groups: (1) federal laws in the ﬁeld of energy that regulate certain relationships in the fuel and energy sector regardless of the speciﬁc industry (electric power industry, oil industry, gas industry, etc.) or covering relations in several energy sectors, and (2) federal laws governing relations in a particular energy sector (electricity, heat, gas, etc.) (Romanova 2014). If we rely on the proposed dichotomy, then the ﬁrst type of special federal laws in the energy sector should include, in particular, the Federal Law of 21.07.1997 No 116-FZ “On industrial safety of hazardous production facilities” (Federal Law 1997); Federal Law No 256-FZ of July 21, 2011 “On the Safety of the Fuel and Energy Complex” (Federal Law 2011b); Federal Law No 382-FZ dated 03.12.2011 “On the State Information System of the Fuel and Energy Complex” (Federal Law 2011c), Federal Law No 261-FZ of 23.11.2009 “On Energy Saving and Improving Energy Efﬁciency and on Amending Certain Legislative Acts of the Russian Federation” (Federal Law 2009), Law of the Russian Federation of February 21, 1992 No 2395-1 “On Subsoil” (Federal Law 1992), Federal Law of November 30, 1995 No 187-FZ “On the Continental Shelf of the Russian Federation” (Federal Law 1995b), Federal Law of July 21, 2005 No 115-FZ “On Concession Agreements” (Federal Law 2005). The second group of federal laws that regulate activities in a particular energy sector include, in particular: Federal Law No 35-FZ of March 26, 2003 “On Electric Power Industry” (Federal Law 2003b), establishing the legal basis for economic relations in the electric power industry, the basic rights and obligations of electric power industry entities operating in the sphere of electricity consumers, the
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procedure for exercising state supervision in this area of economic activity; Federal Law No 190-FZ of July 27, 2010, “On Heat Supply” (Federal Law 2010), which deﬁnes the legal basis for the relations existing in connection with the transfer of heat energy, the functioning of heat supply systems, and also establishes the rights and obligations of consumers of thermal energy, heat supply organizations (Gorodov 2012), heating network organizations; Federal Law No 170-FZ of November 21, 1995 “On the Use of Atomic Energy” (Federal Law 1995c), which establishes the legal basis and principles for regulating relations arising from the use of atomic energy; Federal Law of March 31, 1999 No. 69-FZ “On gas supply in the Russian Federation” (Federal Law 1999b), which deﬁnes the legal, economic and organizational basis for relations in the ﬁeld of gas supply in the Russian Federation and is aimed at meeting the state’s needs for a strategic form of energy resources. In order to prevent violations of antitrust laws in the sphere of trade in oil and petroleum products, the Federal Antimonopoly Service of the Russian Federation, with reference to the provisions of the Energy Strategy of Russia for the period until 2030, developed a draft Federal Law “On the Speciﬁcs of the Turnover of Oil and Oil Products in the Russian Federation” (Energy strategy of Russia for the period up to 2030 2009), whose purpose is to determine the basis for state regulation of trade in oil and oil products in the Russian Federation. Activities on the export of energy resources, refers to foreign economic activity. One of the main regulatory legal acts in this area is the Federal Law No 164-FZ of 08.12.2003 “On the Basics of State Regulation of Foreign Trade Activity” (Federal Law 2009), determining the basis of state regulation of foreign trade activities, the powers of the Russian Federation and its subjects in the sphere of export and import of goods and services. Regarding the foreign trade in energy resources, the law includes provisions on the legal status of Russian and foreign persons as participants in foreign trade activities, the conclusion of international trade agreements and other RF contracts in the ﬁeld of foreign economic relations, customs and tariff and non-tariff regulation, issues of licensing in the ﬁeld of foreign trade in goods and the exclusive right to export and (or) import certain types of goods, to provide favorable conditions for the access of Russian persons to foreign markets (Pozdnyakova 2014). Among the most signiﬁcant normative and legal acts, we should also mention Federal Law No 183-FZ of 18.07.1999 “On Export Control” (Federal Law 1999a), which establishes the basic directions of the legal regulation of the export control system in the Russian Federation (the principles of the implementation of state policy, the legal basis for the activities of public authorities, as well as the rights, duties, responsibility of participants in foreign economic activity). The provisions of this law are the basis for practical measures by the Government of the Russian Federation to improve the organization of oil exports. Export operations related to the international purchase and sale of energy resources, as a rule, are carried out using foreign exchange. In this regard, it is necessary to note the existing rules of currency regulation and exchange control, which are directly related to the export of energy resources (Marchukov 2016). Federal Law No 173-FZ of 10.12.2003 “On Currency Regulation and Currency Control” (Federal Law 2003a) provides for monitoring compliance with the
Importance and Sources of Legal Regulation of Foreign …
currency legislation of the Russian Federation, as well as completeness and reliability of accounting and reporting on foreign exchange transactions. The requirements of the currency legislation of the states to which the parties to the foreign economic contract belong, may imperatively prescribe in which currency the calculations are to be made. There are also situations when one of its parties insists on fulﬁlling the obligation in a certain currency. The most accessible and effective tool in these cases, which makes it possible to reduce economic losses from the change in the currency of the payment from the moment of the occurrence of the obligation to the onset of its execution,—is the right of the parties to the contract to provide for the calculation and for the expression of the amount of debt different currencies. The convertibility of many foreign currencies allows a participant in international economic turnover to choose as the currency of debt that currency whose exchange rate change is minimal or most predictable (Bublik 2015). In paragraph 2 of Article 317 of the Civil Code of the Russian Federation, the possibility of expressing a monetary obligation in foreign currency is ﬁxed. The contract may provide for the payment of the contract in rubles in an amount equal to the amount in foreign currency. Thus, the use of foreign currency solely as a currency of debt depends on the discretion of the parties to the contract. However, the currency of payment can be foreign currency only in the cases, in the manner and under the conditions established by law or in accordance with the procedure established by it (clause 3 of Article 317 of the Civil Code of the Russian Federation). Among the federal laws regulating activities in the energy sector, it should be noted: Federal Law of 17.08.1995 No 147-FZ “On Natural Monopolies” (Federal Law 1995a), which applies to relations arising in the commodity markets of the Russian Federation, in which subjects of natural monopolies take part. This law regulates the activities of natural monopolies, including in the sphere of transportation of oil, oil products, gas through pipelines; in the provision of services for the transmission of electrical energy and heat. It should also be noted that Federal Law of 26.07.2006 No 135-FZ “On Protection of Competition” (Federal Law 2006), which covers relations related to the protection of competition in order to ensure the unity of the economic space, free movement of goods, freedom of economic activity in the Russian Federation, protection of competition and creation of conditions for effective functioning of commodity markets, and in which Russian legal entities and foreign legal entities, organizations, government bodies, as well as Federal Law No 223-FZ of 18.07.2011 “On Procurement of Goods, Works, Services by Individual Types of Legal Entities” (Federal Law 2011a), which establishes general principles for the procurement of goods, works, services and basic requirements for the purchase of goods, works, services by state corporations, state companies, public companies, natural monopoly entities, organizations that carry out regulated activities in the ﬁeld of electricity supply, gas supply, and heat supply by subsidiary economic companies.
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In the foreign trade of any goods, the obligatory stage is the movement of goods across the border of the state for the purpose of supply or transit. Relations in this area are regulated by customs legislation. According to Article 2 of the Federal Law of 27.11.2010 No 311-FZ “On Customs Regulation” (Federal Law 2010a, b), the customs regulation in the Russian Federation in accordance with the customs legislation of the Customs Union and the legislation of the Russian Federation is to establish the procedure and rules for regulating the customs business in the Russian Federation. The principle of freedom of transit through the territory of Russia is the main principle of customs regulation of foreign trade. In addition to federal laws, a large number of by-laws are among the sources of energy law: Decree of the Government of the Russian Federation No. 1172 of 27.12.2010 “On Approval of the Rules for the Wholesale Electricity and Capacity Market and on Amending Certain Acts of the Government of the Russian Federation on Organization Issues” (Government of the Russian Federation 2010), Resolution of the Government of the Russian Federation No. 1178 of 29.12.2011 “On pricing in the ﬁeld of regulated prices (tariffs) in the electric power industry” (Government of the Russian Federation 2011), etc. At present, the national energy policy, which determines the sustainable development of the energy sector in the long term, acquires special signiﬁcance. It embodies the goals and objectives of the development of the national energy sector, priorities and guidelines, as well as mechanisms of the state energy policy at certain stages of its implementation the energy strategy of Russia for the period up to 2030. Analysis of the provisions of this program allows us to conclude that the improvement of the regulatory and legal framework in the energy sector will follow the path of further legislation that ensures the stability, completeness and consistency of the regulatory and legal framework of this vital sphere of society.
6 The International Contractual Level of Regulation as an Element of the System of the Law of Foreign Trade Turnover of Energy Resources International legal regulation in the ﬁeld of foreign trade turnover of energy resources is mainly international agreements. In 1991, the European Energy Charter (Kolosov and Krivchikova 1997), was approved, which outlined the main ways and principles of modern international cooperation in the ﬁeld of energy (Voloshin 2015), and in 1994 the Treaty on the Energy Charter (Order of the Government of the Russian Federation 2009) was adopted—a unique multilateral international treaty containing trade, investment and transit provisions. The geographical scope of the treaty, extending to the countries of Europe, Asia (Japan, Mongolia, Turkey), the former USSR and Australia, although it takes him beyond the regional framework, but does not give him the sign of “universal recognition” and universal character.
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The creation of a competitive and open market for energy products, equipment, materials and services is one of the main ways to achieve the goal of the states that signed the European Energy Charter to improve the level of security and minimize the environmental problem; removal of obstacles in energy trade, related equipment, technologies and energy-related services; providing access to development on a commercial basis and exploration of energy resources, access to local and international markets, etc. The international instruments related to the energy sector also include the Protocol to the Energy Charter on Energy Efﬁciency and Related Environmental Aspects of 1994 (Paragraph 2017), designed to create a single energy space; The Mountain Charter of the Member States of the Commonwealth of Independent States, 1997 (The Mountain Charter of the Member States of the Commonwealth of Independent States 1999); Agreement on cooperation in the ﬁeld of exploration, exploration and use of mineral resources in 1997 (Agreement On Cooperation in the Field of Exploration, Exploration and Use of Mineral Resources 1997); Agreement on cross-border cooperation in the ﬁeld of exploration, development and protection of the bowels of 2001 (Agreement 2001), etc. Among multilateral international treaties, the provisions of which are somehow connected with the foreign trade turnover of energy resources, ﬁrst of all, the provisions of the Vienna Convention on the International Sale of Goods of 1980 (Provisions of the Vienna Convention 1990), The Paris Convention for the Protection of Industrial Property of 1883 (Paris Convention 1968), the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (New York Convention 1960), the Convention on the Physical Protection of Nuclear Material (Convention 1987), the New York Convention on the Limitation Period in the International Sale of Goods of 1974 (New York Convention 1974). Uniﬁcation of conflict rules was promoted by the development in 1986 of the new Hague Convention on the law applicable to contracts for the international sale of goods (Rosenberg 1996). The Convention contains rules for determining the applicable law to contracts for the sale of goods, the scope of the applicable law, the possibility of applying the law with which the treaty, in all circumstances, has a closer link, etc. Until now, the 1986 Hague Convention has not entered into force because of existing discrepancies, not only in doctrine, but also in the practice of applying the continental and Anglo-Saxon systems of private international law, which have become an obstacle to the recognition of the Convention by a sufﬁcient number of states. At the same time Shestakova M.P., noting the positive role of this act, correctly points out that “many formulated provisions contributed to the convergence of the positions of various states in developing common approaches to further work on the uniﬁcation of conflict rules at the international legal level, and subsequently reflected in the national legislation of a number of countries.” (Borisov and Vlasova 2014). On December 17, 2009, it began to operate with the exception of certain provisions of Regulation 593/2008 of the European Parliament and of the Council of the European Union “On the law subject to application to treaty obligations (“Rome I”) (MSUA 2017), reflecting contemporary requirements of international economic