Analysis of positive and negative aspects of the new draft law “On Agricultural Land Turnover” was discussed at the meeting of the Agricultural Law Committee that took place on March 18. The expert of the BRDO Better Regulation Delivery Office’s agriculture sector, member of the Agriculture Law Committee’s council of the Auditor Chamber of Ukraine Maksym Maksymenko who also is a moderator of the event participated in discussing the introduction of the agriculture land market in Ukraine.
The lawyers and agrarians devoted the main time of the meeting to the detailed analysis of the new draft law “On Agricultural Land Turnover” developed by the State Service of Ukraine for Geodesy, Cartography and Cadastre. The lawyers analyzed the proposed concept of introduction of the agricultural land market in Ukraine during the event. Also the main aspects the related alternative options were discussed separately.
Experts mentioned some negative provisions for the developed version of the draft law. Following the discussion, participants of the meeting highlighted the negative effects of the draft law in its current version, which, in their view, has signs of manipulation by government agencies.
Following the discussion, participants decided to work out a specific position of the Agriculture Law Committee of the Auditor Chamber of Ukraine on this matter.
To protect the interests of Ukrainian flour and cereal manufacturers, it is needed to divide the grain quota and the flour quota. The Better Regulation Delivery Office (BRDO) Food&Agriculture Sector Head Andriy Zablotskyi expressed this opinion in his report “EU Export Procedure Changing: is it a new strategy for the sector?”
Certification and quota allocation policy concerning the flour production in the framework of the Association Agreement with the EU, development of the export strategy to enter the European markets, real prospects for Ukrainian manufacturers were just some of topics to be discussed by experts and practitioners during the seminar “Flour and cereal exports to the EU: from theory to practice”.
In his report, Andriy Zablotskyi raised the issue of imbalances in grain, flour and cereal exports to the EU and special aspects of quota allocation under the Association Agreement with the EU. The expert noted that the tariff quota for product supplies combines grain and flour supplies. Thus, the Ukrainian flour manufacturers are in unequal conditions with grain exporters.
Flour and cereal products cannot enter the market actively in the framework of quotas, although it has a bigger added value while being more profitable for the state in terms of implementation, including for the reason of the administration procedure.
“The manufacturer must find a partner in the European Union or register his own business, which would have an import history at least of 1 year, to enter the EU markets. Moreover, during this year the manufacturer must supply his products to the EU countries paying 172 euros of import duty per ton. It significantly reduces the competitive ability of our manufactures,” the BRDO Food&Agriculture Sector Head said.
According to the expert, the dividing of quotas will allow Ukrainian flour and cereal manufacturers to pass the certification procedures in a more efficient way and get the possibility not only to be competitive on the EU markets but also to avoid the competition on the exports with the corn traders.
The analyst of the European Bank for Reconstruction and Development (EBRD) Olga Ivanchenko, the Ukraine Investment & Trade Facilitation Center’s (ITFC) expert Olexandra Brovko, the Ukrainian Industry Expertise Head Volodymyr Vlasyuk and other experts showed the Ukrainian manufacturers of the flour and cereal production segment the detailed export algorithm from the first to the last step by the concrete examples.
As of February 8, according to the Ministry of Agrarian Policy and Food, Ukraine had exported 24.4 million tons of grain for the last 8 months of 2015/2016 marketing year. By the way, it exported 203 thousand tons of flour for the same period. According to the SC “DERZHZOVNISHINFORM”, EU countries became the main customers of Ukrainian agricultural products, but the volume of flour products in the export structure is small.
An improvement of regulatory policy in the construction sector became a discussion topic during the LIGA:HUB “State Regulation in the Construction Field” panel discussion organized by the Company “LIGA: Zakon” on the “INTERBUILDEXPO-2016” platform on March 23. The Construction Sector Head Olena Shuliak represented the Better Regulation Delivery Office during the discussion.
The Vice Chairman of the Verkhovna Rada Committee on Construction, Urban Development, Housing and Communal Services Petro Sabashuk, the Deputy Minister of Committee on Construction, Urban Development, Housing and Communal Services Maxim Malashkin, the Head of the State Regulatory Service Ksenia Lyapina, business representatives and experts took part in the discussion of topical questions in the field of construction regulation.
As Olena Shuliak stated, construction sector rules are regulated by 1 683 regulatory acts (42 laws and 336 Cabmin’s resolutions). However, 158 of them were adopted during the Soviet period. The BRDO expert said that construction volume decline in Ukraine was a consequence of inefficient state policy in the construction sector.
For instance, Olena Shuliak noted in her report that the contribution of the construction industry in the structure of Ukraine’s GDP has fallen by 4 times (from 8% to nearly 2%), and the number of officially registered workplaces has reduced by 2.5 times in that period (from almost 680 to 278 thousands). The expert specifically addressed the fact that Ukraine was included to the list of TOP-15 countries in terms of construction permits cost.
Having analyzed a particular construction case in Kyiv, the BRDO Construction Sector Head gave an example of certain cases of excessive or inefficient use of regulatory tools in the industry and the consequences of such regulation. Olena Shuliak analyzed all stages of construction in details and stated that land allocation in Kyiv needed 17 contacts with officials and 55 separate documents. The whole procedure lasts 2-3 years. For example, the connection of buildings to the electricity supply networks can last up to 277 days.
“The current situation in the construction regulation sector does not assist the sector development. Conflicting regulations, a lack of investor’s guarantees and unclear legislative rules are the factors, which not only hinder the construction development in Ukraine, but also do not give an opportunity to stimulate other industries. We should pay attention to the fact that the construction industry provides at least 30 orders to contiguous ones. And this is not only hundreds of thousands of workplaces, but also billions of dollars in revenue,” Olena Shuliak concluded.
Changes in the regulatory policy regarding the construction sector must become one of the main issues of legislative work in the near future. Statesmen who took part in the discussion panel assured the expert and professional environment of that. The Better Regulation Delivery Office calls business representatives and the public to join this process and send proposals to [email protected]. All proposals and comments sent to the Better Regulation Delivery Office (BRDO) will be taken into account while preparing the conclusions.
The Better Regulation Delivery Office (BRDO) prepared 21 draft regulations, began to review the regulatory legislation and create an analytical system that will become a common information field for state and business representatives during the first months of its activity. The BRDO head Oleksiy Honcharuk announced that during the presentation of projects and first working results.
The independent non-governmental structure BRDO (Better Regulation Delivery Office) was established in autumn 2015 to improve the regulation. The Ministry of Economic Development and Trade of Ukraine initiated the Office’s establishment.
According to the Minister of Economic Development and Trade of Ukraine Aivaras Abromavičius, deregulation is one of the key reforms in Ukraine, because it covers all sectors of economy. The last year showed positive trends of its implementation. In particular, more than 100 barriers for business operation were removed. “We initiated the BRDO by taking the experience of a similar structure in the UK in order to speed up these processes,” Abromavičius said.
The Deputy Minister Yuliya Klymenko noted that it is necessary to analyze and process many adopted laws, resolutions, orders and so on to create the effective regulation in Ukraine. It is so because any regulatory act has a certain effect on business. And, this effect can and should be measured in money.
Yuliya Klymenko
“While realizing that no ministry has sufficient resources to quickly analyze and change regulatory frameworks now, the Ministry of Economic Development and Trade has initiated the BRDO’s establishment. We made significant efforts to gather a powerful team that is independent and even today helps public authorities and economic sectors reduce regulatory burdens,” Yuliya Klymenko said.
The head of the State Regulatory Service Kseniya Lyapina expressed the hope that the Better Regulation Delivery Office together with the State Regulatory Service would be able to break down the matrix of the post-Soviet government.
The BRDO’s primary focus is on four economic sectors, which need improving the effectiveness of state regulation the most, in particular – in the area of SME’s activities. Therefore, agriculture, construction, energy industry and transport became a priority for analysis. Particular attention is also paid to the control and supervision area.
The team of five sector managers, lawyers and economists was created as well as successful projects were started during the first months of its work. First and foremost, the Office is working in two directions: law-drafting activity (drafting regulations) and analytics (reviewing regulatory environment and developing effective regulation concepts).
Law-drafting activity
The BRDO together with the ministries and deputies prepared 21 draft regulations in priority areas. 9 of these draft laws will have a significant impact on improving Ukraine’s positions in the World Bank’s Doing Business rating. According to Oleksiy Honcharuk, the ranking is not a goal in itself, but implementing the best international practices can solve a number of problems in Ukraine by creating more favorable conditions for business and increasing the investment attractiveness.
Regulatory environment review
An important focus of the BRDO analytical work is a systematic assessment of the regulatory environment – Rolling Review. According to the manager of this project Oleksiy Dorohan’, the Office developed a method, by which each document can be reviewed on certain criteria.
335 regulations have been already analyzed. Based on the results of the analysis, about 25% of regulatory acts are acting outside the fundamental principle of legality. The effectiveness of regulatory acts can be estimated only in 5% of cases. You can get additional information on the Rolling Review results at the BRDO website.
Analytical system “Prostir”
To make the system efficient, it is important to create a predictable and effective regulatory environment that will take into account real needs of society and economic needs of business with the state functionality in a balanced way.
Therefore, the BRDO is working on the information and analytical system “Prostir” (simple smart regulation). The system will enable law makers and regulators to analyze the combined effect of any regulatory function on certain markets and make informed decisions based on the analysis of macroeconomic indicators.
The government introduced a Draft Law on Amendments to the Law of Ukraine “On peculiarities of state regulation of business entities involved in the sale and export of wood products” to establish legal grounds of timber accounting and sale to comply with requirements of the EU-Ukraine Association Agreement, developed with the support of the Better Regulation Delivery Office (BRDO), for the Parliament’s consideration.
From November 1, 2015, there is the moratorium on export of all round wood species, except the pine, for ten years. This step faced with misunderstanding of our European partners as it contradicts COT and DCFTA rules.
The main reason of the moratorium introduction is unclear principles of allocation of forest resources by forestry enterprises leading to the situation when domestic manufacturers were provided with the raw materials by the leftover principle, and foreign customers paying bribes to the department heads were provided on a priority basis. That is why, there were almost no investments in the woodworking industry last years – state forestry enterprises were unreliable business partners.
According to the BRDO expert Igor Lavrynenko, to remove the moratorium on the timber export, carry out our obligations under the COT and provide domestic manufacturers with the raw material, the Government suggested the following regulatory mechanism for timber market proposed to be formalized in legislation:
The Draft Law provides for the mandatory sale of all industrial timber amount only by auction without “direct” contracts, which are often accompanied with bribes.
The State Regulatory Service supported Better Regulation Delivery Office (BRDO) experts’ proposals and comments to two draft license conditions developed by the Ministry of Ecology and Natural Resources.
On March 22, Draft license conditions concerning conducting economic activities on hazardous waste management and Draft license conditions concerning conducting economic activities on highly dangerous chemicals production, listed by the Cabinet of Ministers Ukraine, were considered during the common meeting in the SRS, where BRDO experts on control and supervision were invited. According to the results of discussion, all comments made by the BRDO after the analysis would be taken into consideration as amended by the Ministry of Ecology and Natural Resources.
Comments and proposals of experts to the drafts harmonize the Ministry of Ecology and Natural Resources’ initiatives with Ukrainian legislation while eliminating the duplication of responsibilities of state control (supervision) authorities and reducing the risks of non-competitive conditions assignment for the licensees.
“The SRS actively engages the BRDO in handling the different legislative initiatives. And in the most of the cases it supports our conclusions and proposals. We appreciate this efficient cooperation and believe that it is the best assessment of our team work. We are grateful to the SRS for the opportunity to make the dialogue with different parties of regulatory policy and get an effective result,” Volodymyr Holovatenko says.
The optimization of draft license conditions considered at the meeting on March 21, does not provide the reducing the control level of the hazardous waste and highly dangerous chemicals production. Proposed by BRDO experts proposals and comments will help to formalize the responsibility of supervision and control authorities foreseen by Ukrainian legislation more clearly. And avoiding the duplications of regulatory functions by other government entities will help to economize the state budget.
It is to re reminded, that the BRDO launched a special section on its website with draft regulations coming from the SRS and the Ministry of Economic Development and Trade to get the BRDO expert review.
The Better Regulation Delivery Office calls business representatives and the public to join this process and send proposals to [email protected]. All proposals and comments sent to the Better Regulation Delivery Office (BRDO) will be taken into account while preparing the conclusions.
An improvement of regulatory policy, problematics and development prospects of the industrial parks network became a discussion topic during the roundtable “Industrial property and Industrial parks” organized by the Ukrainian Building Community on March 21. The Head of Better Regulation Delivery Office (BRDO) Oleksiy Honcharuk was the moderator of discussion.
Ukrainian leading experts in the field of industrial parks development in Ukraine participated in the discussion. In particular, the Chairman of Verkhovna Rada Committee on Industrial Policy and Entrepreneurship Viktor Halasyuk, the Vice Chairman of Verkhovna Rada Committee on Construction, Urban Development, Housing and Communal Services Petro Sabashuk, the Head of Association of Industrial Parks of Ukraine Ihor Nikolin and others took part in the round table meeting. The BRDO Construction Sector Analytical expert Serhij Seredyuk also attended in the discussion panel.
By UNIDO (The United Nations Organization on Industrial Development) definition, industrial park is a land divided on segments by pre-engineered plan, with the building (or without), with single infrastructure for group of manufacturers’ common use. Historians think that the Trafford Park in English Manchester is the first specially created industrial park. It was founded by Ernest Hall in 1896. The businessman prepared and created the transport and engineering infrastructure on the 10 hectare territory and started to sell and farm out prepared lands for manufacturers. Here, in Trafford Park, Henry Ford opened his first plant in Europe in 1910.
Nowadays, the leaders of this trend are highly developed industrialized countries: the United States with nearly 400 parks, as well as Germany and China, where this specific real property segment has become much more perspective in comparison with separate offices and storage facilities. For example, industrial parks provide 18% of Hungarian industrial production, generating production release of 6 billion US dollars annually and creating more than 110 000 jobs.
The members of the roundtable “Industrial property and Industrial parks” in Kyiv discussed world experience and prospects of industrial parks in Ukraine. Prominent attention was paid to the analysis of the existing legislative framework to intensify the process of attracting investments in this segment. Particularly, in the issues of legislative harmonization in construction field. Separately, it was noted the necessity of solving the regulation problem related to the opening and development of the network of parks in Ukrainian realities. This issue is closely related to the implementation of the draft law #2844 on removal of the regulatory barriers for the development of industrial parks network in Ukraine.
The first Ukrainian concept on the creation of industrial parks network was developed in 2006, but, in fact, the activity in this field was started nearly three years ago with the adoption of the Law “On Industrial Parks” in 2012. During that period, 12 industrial parks have been registered in Ukraine, and only 4 of them (according to the Association of Industrial Parks experts) are really operating. It is the Lviv Industrial Park ‘Ryasne-2’, Korosten Industrial Park, Svema Industrial Park in Shostka and “Solomonovo” in Transcarpathia. Another ones stay at the project stage.
“The problem of industrial parks development is intersectoral. This issue needs the legislation harmonization in many fields – land development, building, taxation, etc. Better Regulation Delivery Office (BRDO) experts have the necessary experience in organizing the effective co-operation between different government authorities, experts and business representatives to analyze the existing regulatory framework and develop necessary changes,” the Head of BRDO Oleksiy Honcharuk stated.
Summarizing the roundtable results, the participants agreed to continue professional and special consultations to solve the problems, which are the barriers for the development of the industrial parks network, in an efficient way.
According to experts, the creation of specialized zones for industrial development can provide up to 20% of economy growth. Moreover, the creation of such industrial parks in Eastern Ukraine will help not only to renovate the economic potential of our country, but also to speed up the solving of many social and economic problems of the region.
The Verkhovna Rada of Ukraine registered four draft laws developed by the Better Regulation Delivery Office (BRDO) together with a group of people’s deputies of Ukraine and designed to strengthen Ukraine’s positions in the Word Bank’s Doing Business 2017 rating of ease of doing business.
This is the draft law #4187 (on improvement of state regulation of construction process), #4188 (on introduction of trust law as a way to ensure the performance of obligations), #4194 (on the use of seals by entities and individual entrepreneurs) and #4195 (on simplification of newly established entity registration for single tax payers and payers of value added tax developed together with the Easy Business organization).
According to experts, the adoption of these documents will allow to take 7 of 43 steps of the Boing Business 2017 Roadmap created by BRDO experts jointly with the Ministry of Economic Development and Trade of Ukraine and approved by the Government in December 2015.
Proposed draft laws harmonize requirements for architectural entities with EU directives and organize regulation of certain categories of construction projects; improve the credit access legislation; simplify the rules for using seals in economic activities of business entities; simplify and make the business entity registration more transparent for VAT payers and make it easier to choose the simplified taxation system.
The World Bank Doing Business rating is the result of annual reviews that estimate the ease of doing business based on 10 indicators in 189 countries. The rating components assess regulations controlling the activities of SMEs during the whole lifecycle and their actual use in practice.
The source: “Economichna Pravda“
The Verkhovna Rada of Ukraine has just 77 days to review and approve 23 draft laws and resolutions that will provide Ukraine with a place in the TOP 50 of the Doing Business ranking of ease of doing business created by the World Bank.
The Deputy Minister of Economic Development and Trade of Ukraine Yuliya Klymenko, the First Deputy Minister of Justice of Ukraine Natalya Sevostyanova and the head of the Better Regulation Delivery Office BRDO Oleksiy Honcharuk, who participated in a press conference on the first results of execution of the roadmap for implementation of best practices of quality and effective regulation as reflected in the Doing business ranking’s methodology by the World Bank Group, reported that on March 15.
In autumn 2015, the Ministry of Economic Development and Trade of Ukraine together with BRDO experts developed a program of 43 steps to simplify the business environment in Ukraine. On December, the Cabinet of Ministers approved this Roadmap. Each step involves approving specific documents amending the existing legislation, removing certain barriers and harmonizing procedures that exist in Ukraine with the best international practices. Experts estimate that taking just the first 23 steps of the plan by May 31, 2016 will provide Ukraine with a place in the TOP 50 of countries for ease of doing business.
The press conference participants stated that 23 draft laws and resolutions have been already worked out at this moment: 11 documents have been already registered (based on 2 laws), another 12 – have been developed and are in the process of final discussion and approval or registration.
The Deputy Minister of Economic Development and Trade of Ukraine Yuliya Klymenko said that increasing Ukraine’s position in the Doing Business ranking is not a goal in itself for participants of this process. She is convinced that first of all, it is a positive signal for investors.
There are 77 calendar days to the scheduled date of May 31, when the first 23 steps of the plan should be implemented. As Yuliya Klymenko noted, the Verkhovna Rada of Ukraine has only 25 working days from the whole term.
The Deputy Minister of Justice of Ukraine Natalya Sevostyanova said that each step could significantly improve Ukraine’s positions in the ranking. For example, just the adoption of a procedure of online registration for business entities in 24 hours would allow Ukraine to move up from rank 70 to rank 30 in terms of “Business registration”.
The systematic work over improving conditions for business development requires close cooperation between different structures, because the whole list of Roadmap’s steps implies the cooperation of various state administrative bodies and businesses. Natalya Sevostyanova believes that this is the issues, where the assistance of state expert organizations is very important and effective. The First Deputy Minister of Justice specially focused on a role of the Better Regulation Delivery Office BRDO in working out the draft laws and establishing the system of communications for regulatory policy between all participants.
“Achieving the better position in the Doing Business ranking is, first of all, the evaluation of reforms in Ukraine by the world economic community. We need to show the world that we are part of civilized economic environment. They have to begin to trust us. In particular – large consistent investors,” Oleksiy Honcharuk said.
As noted by experts, steps of the Doing Business 2017 Roadmap’s program are a way to systemic changes. It is not only simplifying the registration procedures or reducing the control over enterprises, but also an opportunity to systematically increase the effective development of business environment through the access to more affordable credit resources, strengthen the protection of investors’ rights and many other positive results.
On March 11, there was a meeting of debating club “A new behavior model of primary property buyers” organized by the RealEstate B2BClub Meeting in the HUB 4.0 premise. The BRDO Construction Sector expert Maria Grabowska told marketing and sales experts about legal aspects of buying the residential property in new buildings and investing in it.
Statistics shows that there are 29 square meters of living space per head in Estonia, in neighboring Hungary – 31, Austria – 43, and in Denmark – 51 m2. At the same time, the Ukrainian index is only 23 m2 per head. In 2014, the total area of the country’s housing stock has reached the lowest level of the last 5 years – 966.1 thousand m2. And this is despite the fact that there were 1 449 245 Donbass and Crimean immigrants registered by social protection authorities as of August 25, 2015.
In spite of the fact that the housing per capita in Ukraine is one of the worst in Europe, property sales on primary markets does not show any growth trends now.
A rapid decline in purchasing capacity of Ukrainian people is aggravated by the imperfect legislative framework regarding protection of investors’ rights. BRDO expert analyzed this problem in details during the debating club meeting.
The current version of 3rd part of 4th Article of the Law of Ukraine “On Investment Activity” demands the non-state investment and construction financing to be made only through the construction financing funds, real estate transaction funds and collective investment schemes by issuing housing bonds and by using other ways defined exclusively in the laws. This regulatory restriction is intended to protect investors’ rights from unconscientious real estate developers in a declarative way, but in fact, it only sets restrictions for all market participants even before starting construction works.
Unconscientious real estate developers who can carry out the double resale of property items while they are under construction also bring great risks for investors. However, none of existing housing investment vehicles in Ukraine cannot protect investors completely.
During the report, Maria Grabowska presented concrete proposals on the regulatory framework improvement prepared by the BRDO together with business representatives for marketing and sales experts.
Draft amendments to legislative acts developed by Better Regulation Delivery Office (BRDO) experts are aimed at solving the most of the problems that prevent the housing segment growth by increasing a number of investment vehicles and introducing modern technologies to control the proper use of invested funds.
Panel members confirmed previous BRDO experts’ conclusions regarding the positive impact on sales level in the residential property sector.
The Better Regulation Delivery Office calls business representatives and the public to join this process and send proposals to [email protected]. All proposals and comments sent to the Better Regulation Delivery Office (BRDO) will be taken into account while preparing the conclusions.
The State Regulatory Service supported proposals and comments on draft license conditions concerning pharmaceutical products manufacture, trade and import developed by Better Regulation Delivery Office (BRDO) experts and business representatives.
This was the subject of the SRS meeting, where the Cabinet of Ministers of Ukraine draft regulation “On approval of license conditions on economic activities in the pharmaceutical products manufacture, pharmaceutical products wholesale and retail selling, pharmaceutical products import (except Active Pharmaceutical Ingredients)” was discussed.
The BRDO Market Surveillance Sector Head Volodymyr Holovatenko and the BRDO expert Leonid Lytvynenko made their proposals and comments on the draft regulation developed together with business representatives during the roundtable organized by the BRDO.
“The SRS collaborates with experts and business representatives in the field of regulatory policy optimization. Such partnership of the state, experts and business representatives ensure the implementation of really efficient regulatory initiatives ensuring the balance of state and business interests”, Volodymyr Holovatenko says.
Although the work on the draft regulation has not finished yet, the most of questions, which required a mutual understanding between the SRS, experts and business representatives, have been solved. This effective cooperation will result in efficient license conditions that will assist in expanding the drugs range, their quality and best prices.
It is to be reminded that BRDO launched a special section on its website, where license conditions coming from the SRS and the Ministry of Economic Development and Trade will be published.
The Better Regulation Delivery Office calls business representatives and the public to join this process and send their proposals to [email protected]. All proposals and comments sent to the Better Regulation Delivery Office (BRDO) will be taken into account while preparing the conclusions.
On March 9, the presentation of amendments to procedures of subsoil use and auctions for selling special permits for developing oil and gas deposits was held.
The members of the resolution drafting team – the First Deputy Minister of Economic Development and Trade Yuliya Kovaliv, the Deputy Minister of Ecology and Natural Resources Svitlana Kolomiyets, the representative of the American Chamber of Commerce and Industry Olha Adamovska and the head of the Better Regulation Delivery Office (BRDO) Oleksiy Honcharuk – commented on the approved amendments.
According to experts, today an important step towards the beginning to eliminate corruption in the subsoil use field was finally presented in Ukraine.
As noted by Oleksiy Honcharuk, 4104 special permits in this area have been granted in recent years in Ukraine. Only about 5% of them passed through a competitive auction procedure.
“Until recently, the subsoil use field was one of the most corrupt in Ukraine, including due to imperfect regulation of relations,” the Deputy Minister of Ecology and Natural Resources Svitlana Kolomiyets said.
Amendments to the Cabinet of Ministers’ resolutions #594 and #615 of 5/30/2011 significantly reduce a list of reasons to avoid the sale of special permits by auction, simplify a procedure for granting permits and specify reasons to refuse subsoil use. Also, an important fact is innovation providing business owners with the possibility to independently initiate offering some subsoil areas for auctions.
“Ukraine needs an effective regulatory policy. The adoption of amendments to the rules of granting special permits for subsoil use is the first step. It is the first step but very important to start a large-scale reform of subsoil resource management. We have to prove to the world that Ukraine can become a comfortable country for business and investors. And last but not the least – doing that through reasonable improvement of the effective regulation system,” Oleksiy Honcharuk said.
Presented amendments are aimed at introducing elements of effective and reasonable economy regulation and reducing corruption in the field of subsoil use. Specified rules for this market remove corruption barriers to ensure the participation of serious domestic and international players in auctions, set equal rules and create conditions for fair competition.
Business and public representatives supported the most of the Better Regulation Delivery Office (BRDO) proposals regarding improving the draft license conditions on pharmaceutical products manufacture, trade and import.
Particularly, BRDO experts proposed to exclude unclear provisions that “license holder must provide getting of the documentation including the one, which is being sent by licensing authorities” from the draft document.
Also, it was proposed to elaborate those proposals, which do not have clear requirements. For example, there is a requirement for a license holder to “provide permanent staff training”.
“We must clearly establish time frames and frequency of staff trainings carried out by a license holder,” the BRDO expert Leonid Lytvynenko said.
Or it can be a requirement for the executive staff “to work on a full-time basis”. BRDO experts proposed to point out that senior staff should work in pursuant to the internal labor policy and labor legislative requirements”.
Roundtable participants paid attention to the fact that license provisions must be framed with the fullest and clearest list of their quantitative and qualitative characteristics, which are important, as questionable and not specific terms create possibilities for the abusive practice during inspections”.
The BRDO Market Surveillance Sector Head Volodymyr Holovatenko pointed out that establishing obligations to perform a vague number of legal provisions in license conditions are inadmissible: “A full list of information (a data) that should be included to the document details and its form must be determined by license conditions”.
The discussion of qualification requirements for heads of pharmacies in small towns and villages also was lively. According to the draft license conditions, the requirement of having less than two years of work experience just like for the heads of pharmacies in large towns doesn’t extend to them. Professional associations’ representatives suggested to save this provision, otherwise it will be difficult to find the personnel for pharmacies in small towns and villages.
Agreed proposals received from roundtable participants will be considered and included to the BRDO conclusions and submitted to the State Regulatory Service of Ukraine and the Ministry of Economic Development and Trade of Ukraine.
It is to be reminded that the draft regulation “On approval of license conditions on economic activities in the pharmaceutical products manufacture, pharmaceutical products wholesale and retail selling, pharmaceutical products import (except Active Pharmaceutical Ingredients)” was developed by the State Administration of Ukraine on Medicinal Products.
The procedure of land plot allocation is completely legislated in Ukraine. However, it is a long-term, complicated, and non-transparent process and it contains significant corruption risks. If you sum up the time provided in the law to obtain an ownership or a use of land, you will get a period of 8.5 months. In some cases, this term is even longer and could last for a couple of years.
For example, in Kyiv, applicants need to apply to the officials or interested persons about 17 times during this period.
More than 50 documents are made up at the end of the whole procedure.
As for other transactions with land, such as changing the purpose or establishing land plot boundaries, the situation is a little better, but the mentioned negative issues happen there as well.
Therefore, there is a need to create tools for regulation of registration procedures for land ownership that could be more convenient for society and business. Some initiatives on this issue are currently implemented. For example, in 2015, the access to personal data of land plot owners and users was opened.
This information can be viewed with the help of a public cadastral map. Notaries received the authority to register real property titles and provide the extracts from the State Land Cadastre.
The list of essential terms and conditions for land lease agreements was reduced – there is no longer need to attach paper applications to them.
However, many registration procedures for land ownership still require to be simplified. Therefore, state government bodies worked out a new list of draft laws on deregulation of land legislation during the second half of 2015. The BRDO was also involved in this work.
BRDO experts believe that it makes sense to carry out further simplification of the land registration procedure in two stages.
The first one implies making selective amendments to the legislation that could be done quickly, within one or two months and without serious consequences for government and business.
The second one is devoted to working out and implementing comprehensive changes that involve using the e-governance technology, improving land planning activities and reducing the government employees, who make decisions in the land sector. The implementation of this stage requires at least a year.
The Better Regulation Delivery Office worked out the proposals for legislation, the adoption of which will allow to shorten the procedure of obtaining a land plot from the state-owned lands by at least two months, for the first stage.
In particular, it is proposed to abolish the mandatory permits for preparing the land-planning documentation, abolish the mandatory payment of advance fees when buying a land plot, provide citizens with the opportunity to receive public cadastral map copies and implement other deregulation measures.
The main ideas on simplification of the land registration procedures offered by different entities in the last six months are summarized in a table.
On March, 2, the Cabinet of Ministers of Ukraine supported a draft law on simplification the procedure of standard connection to electricity supply networks developed by the Ministry of Regional Development, Construction, Housing and Communal Services. The Better Regulation Delivery Office (BRDO) together with the Ministry of Economic Development and Trade participated in drafting the law.
However, the approved version of the law will be known when it is adopted by the Cabinet of Ministers’ Secretariat and published.
BRDO experts point out that if the document includes all BRDO propositions, the draft law will allow Ukraine to increase its positions in the World Bank Doing Business index and economize a lot of money for businesses.
In the primary version, it was suggested to optimize the standard connection procedure through introducing a public offer agreement and simplifying requirements for a package of documents, which could be submitted in electronic format.
Also, fines for electric organizations for exceeding the period offered for the connection procedure are being introduced.
Besides, it was proposed to introduce a new category of connection – integrated standard connection. This is connection from 160 kW to 5 MW. Thereby the principle of procedure shortening, its unification and the opportunity of simplified determination of connection costs at these power ranges are being implemented. As the economy of Ukraine grows, the number of requests for connecting to electricity supply networks in this power range can be increased, and the transparent and clearly defined procedure and clear answers to questions “what is the connection cost?” and “what is the term of providing services?” will become the factors of attracting investments. Also, the implementation of this approach will allow excluding the possibility of abusing the monopoly position by electric organizations while issuing technical conditions for the connection.
As for the non-standard connection, when the connection to networks is a serious project decision, it is needed to provide conditions for customer’s possibility to appeal technical conditions issued by an electric organization and engage contractors for design, construction and installation works at a competitive basis.
In case of the correct implementation of incentive tariffs for natural monopolies in the energy sector of Ukraine with compliance with appropriate quality and safety levels of electricity supply (at the European level), the issue of providing services of non-standard connection to electricity supply networks must be additionally addressed.
It is to be reminded, that according to the World Bank Doing Business 2016 index, Ukraine takes the 137th position (in 2015, Ukraine took the 138th position) in terms of “Connection to electricity supply networks”, the period to connect electricity-generating equipment of consumers is 263 days, and the number of procedures that need to be passed through is 5.