Government Agencies Implemented 75% of Business Ombudsman’s Recommendations

The Business Ombudsman Council (BOC) published a report with third quarter results for 2016, summing up its activities in defense of Ukrainian business interests. Over this reporting period, the BOC received a record number of complaints for the entire period of work in Ukraine – 242 – and successfully closed 119 cases. Direct financial impact of investigations during the reporting period amounted to UAH 1.5 billion (three times as big as in QII), and cumulative financial impact of institution’s operations reached almost UAH 5 billion.
Small and medium-sized businesses remained the main source of complaints (75%). Inquiries were coming predominantly from manufacturers, agribusiness, wholesalers and telecommunications providers. Most active complainants were in the city of Kyiv (113) as well as in Kyiv (21), Kharkiv (14), Odesa (11) and Dnipropetrovsk (11) regions. There were no complaints from Vinnytsia region and the Crimea.
Tax issues remained the most problematic for entrepreneurs in the reporting quarter (48% of all complaints received), yet the number of inquiries regarding electronic VAT administration dropped by 30% compared to the previous quarter. There was increase in the number of complaints against state companies, local councils and municipalities’ actions, the State Security Service of Ukraine and the customs issues. On the other hand, we observed decrease of complaints regarding the Ministry of Justice actions and legislation drafts/amendments especially regarding deficiencies in regulatory framework at the level of local councils/municipalities. The dynamics of complaints regarding actions of state regulators and the Prosecutor’s Office actions barely changed in the reporting quarter.
The State Fiscal Service of Ukraine (including the State Tax Inspection and the Customs Service), as well as enforcement agencies (including Prosecutor’s Office, National Police, State Security Service and Ministry of Internal Affairs of Ukraine) remained leaders of the complainees’ anti-chart – 56% and 12% respectively. New participants appeared on the BOC anti-ranking, such as top state bodies (the Parliament, the President, and the Cabinet of Ministers of Ukraine), the Ministry of Finance, the Antimonopoly Committee of Ukraine, as well as state enterprises. In this quarter, the Ministry of Social Policy, the Ministry of Ecology and Natural Resources, the Ministry of Economy and Trade of Ukraine dropped off the anti-chart.
In the third quarter, 7 new employees joined the BOC’s team. The team was able to reduce the average time of conducting investigations from 104 days in QII to 89 days in QIII.
For transparency of interactions during investigations and preparation of recommendations, the BOC signed three new memoranda of cooperation and partnership – with the Kyiv Municipal State Administration, the National Police and the National Agency on Corruption Prevention. Dialogue with government agencies became even far more productive: the rate of implemented recommendations grew to 75% (compared to 64% in QI 2016, and 70% in QII).
The BOC’s experts prepared a new set of systemic recommendations for the Government of Ukraine, dedicated to the problems in the sphere of protection and control of economic competition.
“This quarter became record-setting for us in many ways – we received the largest number of complaints since launch of operations, government agencies increased the rate of implemented recommendations to 75%, we signed three memoranda of cooperation with government agencies, and reached UAH 5 bln. of financial impact for businesses. The vital role to play in achieving these results was the extension of our team. I am pleased that the Council has become the voice of the Ukrainian entrepreneurs they didn’t have before”, notes Algirdas Semeta, Business Ombudsman.
You can find QReports in English and Ukrainian here: https://boi.org.ua/en/reports/

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