Common sense victory: enterprise receives fuel trading license

Complainee:  The State Tax Service (STS)
Complaint in brief: Oil Premium Trading House LLC, a Zaporizhia-based fuel and lubricants supplier approached the Business Ombudsman Council. The company could not obtain a fuel wholesale trading license from the STS for a long time (the license).
During the summer of 2020, the complainant applied to the STS for a license several times in a row, but received refusals every time as if due to an error in the submitted documents. It turned out that an incorrect address in the permit for operation of hazardous machinery, mechanisms and equipment (one of the documents submitted with the application) had been indicated. In particular, only the land plot postal code without the letter “A” was specified. The complainant corrected inaccuracy in the address almost immediately. However, it just so happened that at this very time the labor protection legislation got deregulated. In particular, a permitting procedure was replaced by a declarative one. The complainant approved a declaration of compliance of material and technical facilities with labor protection legislation requirements for corresponding equipment (Declaration). After that, the complainant applied to the STS for a license again and this time was denied once again. The STS still insisted that the applicant should have provided the permit rather than the Declaration as part of the application. The STS backed up its position by the fact that the law regulating the procedure for issuing licenses uses the term “permit”, not “declaration”. The Council helped clear up the situation.
Actions taken: During investigation of the complaint and position preparation, the Council’s investigator emphasized the inconsistency of legislation in the field of fuel trade licensing and use of hazardous equipment. Thus, positive changes and deregulation occurred in the use of hazardous equipment, were not properly taken into account in fuel trade licensing. This is quite a common problem of the so-called “quality of the law” arising from time to time when it comes to regulating complex areas. Such a conflict can be resolved by applying a systemic approach interpretation of legislation as the Council’s investigator in charge repeatedly stressed during discussion of circumstances of the complaint. We also had to mention the presumption of legality of taxpayer’s decisions, which means that in case of law ambiguity, the decision must be made in favor of a taxpayer.
Result achieved: After lengthy discussions, the STS nevertheless accepted the Council’s recommendations and issued a long-awaited license for the company giving the right to wholesale fuel. The complainant thanked the investigator and the Council’s team for their assistance: “We present our compliments and express gratitude to the Business Ombudsman Council’s team for prompt, high-quality, professional end efficient work in consideration of our complaint. The systematic operation of the Business Ombudsman Council allowed us to restore our legal right and obtain a license and to focus on doing business and further development of the enterprise without a considerable waste of time and money on litigation. We believe that the Business Ombudsman Council ensures effective systematic communication of business with the government, state bodies and local government authorities, represents and protects business interests in state bodies and helps build the rule of law in the state”. The case was successfully closed.