News
22.12.2021

Ukraine has introduced RaidBarometer — an index assessing the dynamics of raider attacks

Is it possible to assess the situation with “registration” raiding in Ukraine and the effectiveness of public authorities in combating it?

This phenomenon that implies gaining control over business assets by manipulating information from state registers is a long-standing one in Ukraine. However, public authorities still do not have reliable data on the raiding status and dynamics. No summary statistics on “registration” raiding are kept, and data that may directly or indirectly indicate raider attacks are inconsistent and fragmented across different government agencies. 

As a result, the public has no opportunity to assess and measure the effectiveness of “anti-raiding” initiatives. In turn, this increases the dissatisfaction of citizens and businesses and discourages potential investors.

Moreover, public authorities that have to combat raiding do not have the tools to assess the situation and, consequently, cannot identify effective further steps to combat this phenomenon and ensure the inviolability of private property rights.   

Given these problems, Ukraine ranked 106th in the recent rating of protection of property rights among 129 countries.

To help solve the outlined problems, experts from the Better Regulation Delivery Office (BRDO) have developed RaidBarometer — an index assessing the dynamics of raider attacks.

“RaidBarometer 2020 is a result of the first comprehensive attempt to assess “registration” raiding in Ukraine. We analyzed the dynamics of raider attacks and assessed the effectiveness of public authorities in counteracting this phenomenon. RaidBarometer should improve the interaction and accountability of institutions in the areas of law, justice, and law enforcement. Additionally, the Index will help public authorities to formulate and improve state policies in the area of guaranteeing property rights,” Oleksii Dorogan, BRDO CEO, said.

The Index is based on a comprehensive calculation methodology and consists of the assessment of the registration raiding dynamics, the assessment of the effectiveness of public authorities in combating raiding, and public perception of raiding.    

“We use annual calculation indicators. According to the results of calculations, we have the following categories: 0-1 — “catastrophic situation”; 1.1-5 — “unsatisfactory”; 5.1-8 — “neutral, there are some problems”; more than 8.1 — “optimal, there is a healthy business environment,” Julia Kornieieva, a chief economist at BRDO, said.  

According to experts, RaidBarometer 2020 is “5.8” — this indicates the average situation with registration raiding in the country: there are problems that need to be addressed by the relevant public authorities. In particular, public policies in the area of state registration need to be further improved to create an environment for preventing raider attacks.

“At the same time, the effectiveness of certain public authorities, namely the Board of the Ministry of Justice and courts, in combating raiding has increased,” Maksym Maksymov, a lawyer at BRDO, said. “Some positive results in combating raiding are also confirmed by the society’s opinion: according to the survey, the situation with “registration” raiding in Ukraine has improved by 35% during the year.”

RaidBarometer 2020 will form the basis for monitoring “registration” raiding and the effectiveness of public authorities in counteracting it in the coming years. This will increase public awareness of this issue and the ability of public authorities to formulate and improve public policies in the area of guaranteeing property rights.  

“Last month, we presented our other research in the area of “registration” raiding — the White Paper “Roadmap for preventing land raiding”, in which we proposed a list of measures to be taken to reduce registration raiding within the two-year planning horizon. They include: providing systematization and standardization of business registration processes, improving the efficiency of administrative appeals, creating risk subsystems of state registers, eliminating gaps in legislation. In the future, we plan to advocate for our proposed initiatives and participate in projects for their implementation,” Tymur Mykhailov, a lawyer at BRDO, said about the plans of the Better Regulation Delivery Office in this area.  

The analytical report “Assessment of registration raiding in Ukraine”, the presentation, and the White Paper are available on the project page.