One of the key Soviet tenets was that the Communist Party must not be constrained by anything. Consequently, the Party refuted the rule of law. With the bureaucratization of communist power, some law or rules became necessary, but the socialist legal system served the Party. Its function was to enforce the commands of the government that was subordinate to the Communist Party. Formally, crimes against the state were judged more severely than crimes against individuals, although that idea never took root in public sentiment.

The socialist states had many rules that were alien to a market economy. Most private enterprise or entrepreneurship was criminalized as “speculation.” Unemployment was not pitied but prohibited as “parasitism” and was punished with labor camp. Because only a minimum of personal property was allowed, little legislation existed for the defense of private property rights. Nor did the state have any need for financial legislation, although Central European countries maintained some prewar legislation on their books.

A legal system with prosecutors and judges had existed under socialism, but, peculiarly, the public prosecutors were superior to the judges. Defense councils were not common and had little authority. Soviet judges were not particularly corrupt, but they were obeying political orders and the prosecutors. They were few and poorly trained for commercial disputes. Debt collection services barely existed.