The Office reports key problems Ukrainian businesses faced in 2015 and most significant results
In 2015, the Business Ombudsman Council received 585 complaints from Ukrainian entrepreneurs and successfully closed 164 cases. The Office also reported that governmental agencies implemented 81% out of 131 recommendations issued by the BOC in 2015.
“In 2015, we experienced exponential growth in terms of received complaints, closed cases, and the overall financial impact of our investigations. Direct financial impact of all 164 closed cases amounted to UAH 2.3 billion”, said Algirdas Semeta, Business Ombudsman, during a press conference in Kyiv on February 4, 2016. He also stressed on the non-financial impact of BOC’s operations for complainants, such as: permits and licenses were finally obtained, criminal cases against complainants were closed, tax reporting accepted, state officials penalized, etc.
Complaints came to the BOC from all regions of Ukraine. Nearly a half of all complaints were lodged in Kyiv (247). In descending order, complaints were also received from Kharkiv (48), Kyiv (37), Dnipropetrovsk (36), Zaporizhzhia (21), and Odesa (21) Oblasts. The majority (82%) of complaints were lodged by small and medium enterprises (SMEs).
The “anti-ranking” of complainees has basically remained unchanged, with State Fiscal Service of Ukraine being the leader of the chart (43% of complaints). 7% of complainants challenged each of the actions of the Prosecutor’s Office and the Ministry of Justice of Ukraine. 6% of complaints was lodged against each of Municipal administrations (councils) and the Ministry of Internal Affairs.
In 2015, the BOC prepared 6 reports with systemic recommendations for the Government of Ukraine on: getting access to electricity; problems with business activity due to Anti-Terrorist operation and the annexation of Crimea; administrating business taxes; and problems with cross-border trading in Ukraine (two of them – on employing mechanism of criminal prosecution to inflict pressure on business and on behavior of state monopolies were presented during the press conference on February 4, 2016). There are already palpable results following the implementation of the recommendations in the reports of the previous quarters.
For instance, conclusions the BOC provided to the World Bank on improving access to electric grids helped Ukraine’s positions in the reputable Doing Business rating rise from 184th to 138th place. Following our efforts Ukrainian businesses received over UAH 2 billion as compensation for employees mobilized for a specified term. The Council also elaborated recommendations for improving the Tax Code of Ukraine. At the moment, a range of recommendations on VAT budget refund, VAT electronic administration and eliminating “state 9” have been implemented. The BOC experts will continue to work with the Ministry of Finance of Ukraine, the State Fiscal Service of Ukraine and the Tax and Customs Policy Committee of the Parliament of in order to ensure that all its systemic recommendations are reflected in the new version of the Tax Code due in the first half of 2016.
In 2015, the BOC signed 3 Memoranda of Partnership and Cooperation with the key government agencies that have strong impact on Ukraine’s business climate: the State Fiscal Service, the Ministry of Justice and the State Regulatory Service of Ukraine. By the end of the year, the BOC and these agencies collectively reviewed over 60 complaints that were submitted to the Business Ombudsman.
In June 2015, the Business Ombudsman started his working visit schedule, where he meets with both business and government representatives to discuss most urgent issues and opportunities to improve investment potential of these regions. In 2015, he visited 9 regions of Ukraine: Chernigiv, Kharkiv, Lviv, Odesa, Dnipropetrovsk, Donetsk, Rivne, Volyn and Cherkasy regions.
Report for IV Quarter of 2015 is available here: http://bit.ly/1Ksf2sN
