The Committee on Economic Development of the Parliament of Ukraine recommended for consideration draft law No. 5837, which reboots the system of state control and introduces new principles of state inspections of businesses. BRDO participated in the development of the document.
State inspections have always been associated with corruption among Ukrainian entrepreneurs. After all, the existing state control system is mainly focused on detecting violations in business and applying sanctions in the form of fines. Year after year, every second inspection records a violation, but the number of violations, despite the applied fines, does not decrease. In addition, entrepreneurs appeal the imposition of fines in court in their favour. All this does not contribute to a real reduction of risks at enterprises, trust in regulatory bodies, and also creates an unnecessary burden on the judicial system of Ukraine.
The most important thing is that draft law No. 5837 proposes to rebuild the state control system into a service with an emphasis on a risk-oriented approach to business inspections. That is, the lower the degree of risk of the entity’s activity, the less often it will be inspected and the shorter the inspection period will be.
In particular, the bill proposes the following:
- to introduce voluntary civil liability insurance of business activities – if an enterprise with an average and insignificant degree of risk has such insurance, the number of scheduled inspections will decrease (the period between inspections will increase by at least one and a half times: for an average degree of risk – from 3 to 4.5 years, for an insignificant one – from 5 to 7.5 years);
- to introduce a voluntary audit of the activities of entrepreneurs as a preventive measure – violations of the legislation will be prevented without the application of sanctions, which will also allow to reduce the number of scheduled inspections – by one and a half times;
- to create in control bodies the institute of public councils on state control issues with the participation of business representatives;
- to introduce the responsibility of the head of the control body for non-compliance with procedural requirements by subordinates and the disciplinary responsibility of officials of the control body in the event that the court confirms the illegality of the decision of this control body (reprimand);
- to expand and improve the functionality of the Inspection Portal – control measures and document exchange will be carried out electronically, an e-cabinet is being introduced for entrepreneurs with the possibility of filing complaints and refusing comprehensive inspection through the e-system.
The inspection portal was developed by BRDO’s team in collaboration with the Government in 2017 and was fully operational in November 2022.
The adoption of draft law No. 5837 will be a powerful signal for Ukrainian entrepreneurs and international investors about the introduction of transparency and accountability in the processes of state inspection, will create prerequisites for the development of SMEs and the attraction of investments in Ukraine.
Therefore, we call on people’s deputies to support this extremely important document for Ukrainian entrepreneurs.