Prosecutor's car locks. Bestchange locked again

This week we wrote our old client bestchange.ru . If anyone knows, bestchange is the largest online monitoring service of electronic currency exchange, which has been operating since 2007 and collects information from more than 400 active exchangers. The administration of the service reported that they received a letter from the hoster, who received a notice from Roskomnadzor about the inclusion of the site in the Unified Register, and therefore the site will be blocked.

At first, we thought it was some kind of mistake, because a year ago we canceled the court decision on their website. What was our surprise when we found out that this time the site is blocked on the basis of a different court decision, like two drops of water similar to the previously canceled St. Petersburg decision. We dig deeper into the network and found this decision made by the Kuibyshevskiy District Court of the city of Omsk four months later. The same site, all the same grounds sucked from the finger of the public prosecutor.

Let me remind you that in May 2017, the October Court of St. Petersburg ruled to block the Bestchange service and 39 other online exchangers at the suit of the city prosecutor’s office, guided by similar arguments, saying that bitcoin is a surrogate, and the dissemination of information on surrogates is prohibited by law. In addition, in the opinion of the prosecutor's office, the irreversibility of transactions in the blockchain does not provide the possibility of implementing legal mechanisms for ensuring the fulfillment of obligations by the parties to the transaction.
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After the appeal appeal of a judicial act in February 2018, the St. Petersburg City Court overturned the decision as unlawful and unjust due to the fact that the site owners were not involved in the process, which violated their right to state their arguments in a fair trial.



Already on the new round of consideration of the case, after the annulment of the judicial act by the appeal, the court did not consider the petition of the prosecutor on the merits, and found quite reasoned grounds in the CAS RF to “wrap” the lawsuit. They say that the mandatory pre-trial procedure has not been observed.



After that, the St. Petersburg prosecutor's office on the supervision of the implementation of laws on highly sensitive sites (apparently we now have the Internet - this is a particularly secure facility, which basically explains the current trend to regulate everything that can be regulated on the network) did not continue to rock the boat and did not file a second claim. And besides, by this time, the Supreme Court also formulated its position on another cryptocurrency website bitcoininfo.ru.

On April 20, 2018, the Supreme Court, abolishing judicial acts of the first and second instance, made a number of important conclusions that are mandatory for the lower courts to take into account:

• claims of prosecutors on the recognition of information illegal for the purpose of blocking should be considered in the procedure of CAS RF

• such claims cannot be considered in the courts at the location of the prosecutors. They should be considered at the location of Roskomnadzor or its territorial body (which, too, is quite controversial, because territorial departments do not have access to the registry, and they cannot contribute or remove anything from there)

• Site owners and content authors should be involved in the case, because such court decisions are not only capable of limiting their rights, but also give rise to the obligation to remove content

As it can be seen, the cassation instance went away from the slippery question related to the determination of the legal status of cryptocurrencies, however, the value of the said Definition is difficult to overestimate, since the Supreme Court for the first time determined at least some imputed rules in the order of considering such claims that entail blocking web resources in the country. Later, this position was also reflected in the Review of Judicial Practice of the Supreme Court of the Russian Federation on Administrative Cases N 2 (2018) "(approved by the Presidium of the Supreme Court of the Russian Federation on 04.07.2018).

When considering a new case, the prosecutor rejected the claim, arguing that in recent years the current legislation has changed, the provisions of which are aimed at legalizing cryptocurrencies, including Bitcoin (which, of course, wasn’t true at that time only been made but not accepted)



However, even the refusal of the lawsuit did not allow the prosecutor's office of St. Petersburg to take responsibility. For filing an unfounded claim, the court sought 150,000 rubles from the St. Petersburg city prosecutor's office in favor of the site owner, which was a rather unprecedented event in Russian jurisprudence. Currently, prosecutors are trying to appeal this Definition.

It should be noted that on March 12, 2019, the State Duma at the plenary meeting nevertheless adopted in the third, final reading amendments to the Civil Code of the Russian Federation on “digital rights” , which suggests that the cryptocurrency was still given the “green light”. These amendments provide the basis for regulating relations within the digital economy in the Russian Federation. Currently there are two more bills under development: on Digital Financial Assets (which include cryptocurrencies, including Bitcoin) and Crowdfunding, but a start has been made to legalize cryptocurrencies.

We have repeatedly drawn attention to the fact that there is no connection between the prosecution authorities of different subjects. They work in a vacuum, cut off from each other. On the same site, on the same grounds, 2 or 3 court decisions can be made in different subjects. And if they all come into force, you will have to cancel each of them, because the RKN argues that it alone does not solve and is obliged to execute the judicial acts issued.

What is the saddest thing about all this is that it’s not even the fact that the courts and prosecutors do not interact with each other, taking from them precious time that could be spent on something more serious and important, but that the courts and Prosecutors have extremely low legal qualifications, absolutely do not follow the change in judicial practice, including the position of the Supreme Court on the issues of judicial interpretation of laws.

We have no doubt that we will cancel the unjust judicial act and again punish the senseless prosecutor with a ruble. It's a question of time. But we still have to live in this madness, and the Internet business in Russia literally survive under the enthusiastic calls of the country's leadership to build a bright digital economy.