Sanctions against Patriarch Kirill make the conflict between Russia and the West a clash of religious values, writes Valdai Club Programme Director Ivan Timofeev.
The UK Treasury has published another list of Russian individuals subject to financial sanctions. Along with 11 other Russians, the Patriarch of Moscow and All Russia Kirill is included. The use of restrictive measures against Patriarch Kirill represents is a new stage of escalation in relations between Russia and the West. Sanctions may affect the foreign activities of the Moscow Patriarchate. However, the political consequences are far more important. Whether willing or not, London is adding a religious dimension to the hornet’s nest of its current problems. At first glance, a technical and relatively minor political move can have disproportionately serious consequences.
Sanctions against Patriarch Kirill will do nothing to achieve the stated goals of British sanctions — to counter “Russian aggression” against Ukraine. Church support for the Russian government will only become more decisive. However, they will give rise to additional new risks, which will be extremely difficult, if not impossible, to control. The British officials, by zealously “punishing” the Russian religious leader, are doing a disservice to their own country and the rest of the Western community. Religion is an extremely sensitive topic, capable of heating up any conflict at an uncontrollable speed.
Let’s start with the possible material consequences of the sanctions for Patriarch Kirill and the Russian Orthodox Church. Blocking financial sanctions mean that individuals under UK jurisdiction are prohibited from engaging in any financial transactions with the blocked persons. Their assets are frozen. That is, formally they remain the property of the blocked person, but it is practically impossible to use them. One of the key questions is whether such restrictions on Patriarch Kirill affect the property of the ROC in the UK, as well as its activities? At first glance, the answer is no. The list of blocked persons did not include the Moscow Patriarchate as an institution. There are no legal entities subordinate to the Moscow Patriarchate among them.
However, they may still have problems in connection with the concept of ownership and control. Part 4 of the December 2020 UK Financial Sanctions General Guidelines clarifies that blocking sanctions apply to any entity that is directly or indirectly owned or controlled by a person subject to blocking sanctions. Here we mean, first of all, property relations. The British regulator applies the “50% rule” when the criterion for control is the ownership of shares of 50% or more of a controlled entity. Such a rule is quite applicable for companies and corporations, but not for the Church. Patriarch Kirill heads the Russian Orthodox Church, but cannot be considered its “owner”. However, the Guidelines contain other control criteria. For example, such a criterion could be the expectation that the person may be able to carry out the activities of the organisation in accordance with its requirements. Its decryption is again more suitable for business. So, for example, the concept of such opportunities includes the appointment of a board of directors or key managers, control of the bank accounts of the organisation or its economic resources. But its application to other legal entities, including those subordinate to or associated with Patriarch Kirill, is not ruled out. That is, there is an element of legal uncertainty.
The main difficulty here may arise in connection with the so-called excessive compliance of foreign counterparties of the ROC. Today, the practice has developed when foreign counterparties are forced to excessively comply with the law, due to the threat of administrative and even criminal measures against violators of the sanctions regime, as well as the uncertainty of some rules. In other words, it is easier to over-execute and refuse a transaction than to carry it out with the risk of subsequent problems with the regulator. Especially excessive compliance is typical for banks, which are the most vulnerable due to their large number of transactions, and are frightened off by the experience of some violators incurring multi-million (and sometimes billion) fines for failing to meet the requirements of sanctions regulators.
Moreover, British sanctions may also affect the excessive compliance of banks and counterparties in other jurisdictions. The procedure for monitoring a counterparty through databases of sanctioned persons will inevitably reveal to them the connection of any institution of the Moscow Patriarchate with Patriarch Kirill. Again, from a procedural point of view, this will mean, at a minimum, transactional delays, regardless of whether it is under British jurisdiction or not. Such delays today are due to the very connection of the deal with Russia, even if there are no persons under sanctions involved. The appearance of such persons increases the risk of disrupting the transaction.
At the same time, in comparison with the material side of the issue, the political consequences seem to be much more important. Sanctions against Patriarch Kirill make the conflict between Russia and the West a clash of religious values. You can argue as much as you like that these are not sanctions against the Russian people; that the sanctions against Patriarch Kirill are allegedly imposed for supporting the Russian authorities in their policy on the Ukrainian issue, that the British authorities have nothing else in mind, that this is a purely legal issue, and not a reason for a value conflict, etc. This will also include analytical notes by Russophobes on how the ROC is used as a tool of “soft power” in the post-Soviet space and beyond. The problem, however, is that we do not only live in a world of bureaucratic schemes and technocratic politics.
At the same time, the sanctions against Patriarch Kirill do not bring the British authorities one iota closer to the implementation of the declared goals of the sanctions policy. Formally, they must “change the behaviour” of the person under sanctions. That is, in the bureaucratic scheme, after the imposition of sanctions, Patriarch Kirill must refuse to support the Russian authorities on the Ukrainian issue. At the very least, sanctions should “raise the price” of such support. What will actually happen? The Church’s support for the Russian authorities will only increase. The ROC is likely to face some material damage from the sanctions against Patriarch Kirill, but it will also only increase the energy of the consolidation of Church and state. In other words, the sanctions will have the opposite effect of what’s expected and will be a disservice.