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The Business Ombudsman Council provides recommendations to state bodies on the basis of individual cases and in accordance with published systemic reports. Here we have collected information on the implementation status of systemic recommendations only.

Report name
Issued recommendations
Execution status

Systemic report “Big challenges for small business”

To consider creating a section dedicated to the SMEs’ access to finance at government-based web resources, for instance, the SME Development Office’s portal sme.gov.ua. Provide aggregation of up-to-date information on funding programs and grants, relevant educational programs for SMEs.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
The SME Development Office

Implemented

Systemic report "Control over controllers: status of control bodies reform implementation"

To propose amendments to the Law “On State Supervision (Control)” that would envisage having an exhaustive and mandatory list of control bodies. The amendments should stipulate that in dealing with a body not included on the list, a business entity would have the right not to allow representatives of such body to carry out any inspections.To ensure that any changes in this list would only be possible in the course of the legislative process if corresponding changes are made in the relevant laws on control bodies.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Regulatory Service

Implemented

To propose amendments to applicable laws which would:-define the powers of control body officials to enter data into the IAS;-enhance personal liability of officials for entering false and/or untimely entry of information into the IAS.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Regulatory Service

Implemented

Systemic report "Challenges for government and business in dealing with local government"

To regulate the issue of transferring the responsibilities and functions of the State Environmental Protection Administration in the procedure provided for in CMU Resolution No.1074 "On approving a Procedure for taking steps related to setting up, reorganizing or liquidating ministries and other central executive bodies," dated 20 October 2011.

Ministry of Finance
Ministry for Development of Economy, Trade and Agriculture of Ukraine
Ministry of Justice
Ministry of Environment and Natural Resources

Implemented
— comments: In the case of executive authorities liquidation, including territorial ones, their rights and obligations in accordance with the CMU Resolution No.1074 dated 10 October 2011, shall be transferred to another executive authority.

Systemic report "Reducing the risk of corruption and attracting investment to the construction industry"

To include regular methodological work jointly with construction managers working at regional state administrations with the commissioners of construction works in the annual action plans regarding approaches to determine the value of a procurement item through workshops, including those funded by international technical assistance programs, and to publish recommendations that will reflect a number of key rules: Where funding for the construction of an object is expected during several years, the commissioner should organize the procurement process based on the overall expected cost of the entire works and sign a long-term procurement contract with the successful bidder that establishes that the works will be ongoing for several years.In planning procurements, it should be kept in mind that the commissioner has no right to break up the procurement subject into smaller parts to avoid holding open tenders or applying Sec. 5 of Art. 2 of the Law of Ukraine “On public procurements.”To estimate the cost of procuring works, Ukraine’s normative construction documents should be used as a guide, as they set the rules for determining the value of construction, design and survey works, and feasibility analyses of the actual plans according to the domestic standards. The one mandatory document that should be used in estimating costs is the National Standard “Rules for determining the value of construction”. This standard is mandatory when estimating costs for construction covered by budget funds, the funds of state and communal enterprises, institutions and organizations, as well as by loans guaranteed by the government. Its application has to be stipulated by contract. This means that the conditions for calculating the value of a proposition and the draft procurement contract should include the use of this standard, that is, in the conditions that establish the agreed price of the awarded contract. Where participants plan to engage subcontractors to carry out works, tender bid prices should include the cost of all proposed works contained in the tender documentation, including works that will be executed by subcontractors.To prepare procurement and tender documents, the commissioner should use a finalized working design with all necessary approvals and land issues confirmed and resolved, if required. The working phases of the project should be preceded by an explanation of any repair work in compliance with the quality control system for the relevant types of infrastructure, a feasibility study, and public discussions to identify all possible risks. Where there is no finalized working design with the necessary approvals, the recommended approach is to include a tender interview procedure to negotiate with participants and clarify any issues about the project directly during the tender process.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: Pursuant to paragraph 7, part 1 of Article 8 of the Law of Ukraine "On Public Procurement", on the MEDT's website an information resource of the Authorized Agency was created aimed at disseminating information on the application of public procurement legislation, which allows for on-line advisory advice on procurement issues, as well as get acquainted with the generalized answers prepared on the basis of common problem issues to all entities in the field of public procurement.

Draft amendments to the Law of Ukraine “On Public Procurements””:

 

- by adding to the basic terms in the law, in Art. 1, the concept of a consortium to ensure broader opportunities for companies to jointly submit a bid without having to establish a separate legal entity

 

- by reducing the mandatory minimum weight of the criterion “low price” from 70% to 50% for the procurement of works. When “low price” dominates the criteria while the terms of a contract are poorly defined and requirements for the subject of the purchase, this could lead to the bidder with the lowest price failing to complete the works or to complete them inadequately.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented

To take into account the necessity to amend Law of Ukraine "On public procurements" regarding publication of information on concessional tenders at the unified procurements portal in preparing the Draft Law of Ukraine "On concessions".

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented

To add to its work plans of further adaptation of public procurement legislation to the EU legislation the Directives 2014/24 on public procurements and 2014/25 on procurements by enterprises that operate in the area of water supply, power, transport and postal services. Of particular importance are the provisions of EU legislation related to public procurements of construction works, including such criteria as life-cycle cost, the influence of a company's reputation on its potential participation in procurements, the concept of abnormally low price, etc.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented

Systemic report "problems with cross-border trading in Ukraine"

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: Part one of Article 9 of the Law of Ukraine “On the Scrap Metal” regarding obligatory registration of contracts (agreements, treaties) for the export of scrap metal was excluded based on the Law No.1455-VIII dated 12 July 2016. The resolution of the issue is foreseen by the Draft Law of Ukraine No.7497 "On Unshadowing of the Market of Metallurgical Raw Materials (on amendments to certain legislative acts concerning operations with scrap metal)" which was registered with the VRU on 17.01.2018. The Draft Law is supported by the MEDT and the representatives of the metallurgical industry. Current status - pending review.

To bring legislation on quota allocation of the scrap metal in line with Ukraine's WTO commitments and obligations connected to the implementation of the DCFTA schedule.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: According to the Resolution of the Cabinet of Ministers of Ukraine "On approval of the lists of goods, the export and import of which is subject to licensing and quotas for 2019" of 27.12.2018, No.1136, no quotation and licensing of export (import) of scrap metal is foreseen.

To change the collegial approach to quota allocation currently used by the MEDT, using auctions as an alternative. Auctions can ensure minimal intervention by the regulator in the quota distribution process. Should the quota system be further used for scrap metal exports, reconsider the approach to forming the responsible Commission in the Ministry. Amend the current regulatory framework and establish public, clear and competitive procedures and rules for the allocation of export quotas for scrap metal.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: According to the Resolution of the Cabinet of Ministers of Ukraine "On approval of the lists of goods, the export and import of which is subject to licensing and quotas for 2019" of 27.12.2018, No.1136, no quotation and licensing of export (import) of scrap metal is foreseen.

To amend Cabinet Resolution No.155 dated 15 February 2002: To draw up an exhaustive list of grounds for refusal to register export contracts to avoid any abuse of powers by MEDT officials and misinterpretations of regulatory norms; To set a time limit for the Ministry to decide on the registration of export contracts; To introduce a procedure to appeal a negative decision; To establish clear deadlines for re-registering export contracts in case of fluctuations in the world market, as provided in Para. 11 of the Cabinet Resolution.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: The Government abolished the registration of contracts for the export of scrap metal by the CMU Resolution No.1035 dated 28 December 2012 (the CMU Resolution No.155 dated 15 February 2002 has lost its effect).

To draft and adopt the new edition of the Law “On Foreign Economic Activities” to reflect modern trade regulation trends and WTO commitments, and to cover all necessary provisions of EU acquis communautaire, in particular: To bring the law fully in line with WTO agreements and EU requirements, which should increase access to global markets: (a) simplifying formalities and procedures; (b) harmonizing applicable laws and regulations; (c) applying international agreements; and, (d) making a commitment to regulatory cooperation. To change the regulations for foreign trade, export/import licenses and protection measures in accordance with WTO rules and regulations. For instance, licenses should be required only for the import or export of goods that effect public security, the life and health of individuals, animals and plants and so on, in accordance with the definitions used by the EU. Based on stakeholder consultations, to reduce (a) the number of cross-border trade operations subject to licensing and (b) the number of commodity groups subject to restrictions or limitations as to export or import. To implement methods for export-import quota administration according to best practices and WTO recommendations: First-Come, First-Served; Auction Quota Rights; Give Away Quota Rights.

Cabinet of Ministers of Ukraine
Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented
— comments: The licensing of export, import of goods, which is carried out in accordance with Article 16 of the Law of Ukraine "On Foreign Economic Activity", complies with the WTO norms, in particular, the Agreement on Import Licensing (WTO), is regulated by Articles 8, 11-14, 20-21 GATT 1994.

To publish a consolidated Official List of Goods Subject to State Export Control Service on the official website of the State Export Control Service. The Service must ensure that the List is updated regularly.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Export Control Service

Implemented
— comments: In 2017, the Export Control Service has harmonized all changes to the Single List of Dual-Use Goods subject to Export Control, which in its structure corresponds to the List of Dual-Use Items of the European Union, given in Annex I to the Council Regulation (EC) No.428/2009 dated 5 May 2009, setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items.

To ensure that the State Export Control Service complies with timeframes for state reviews and consideration of documents. To achieve this goal, complex measures can be recommended, together with the MEDT, including: introducing an integrated e-system of document flow to streamline the review process. The MEDT, as the supervisory body, can control timeframes; implementing the practice of having the causes of each delay in a state review justified before the supervisory body; applying fines to responsible managers based on monitoring by the Ministry.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Export Control Service

Implemented

To organize the system of state evaluations of goods subject to export control in a way to optimize costs, resources and time for businesses. Businesses should have access to licensed expert organizations on the territory of Ukraine. The State Export Control Service should ensure the optimal infrastructure for dual-use goods evaluations, which includes (a) licensed expert organizations in export control for all types of dual-use goods, (b) information on the official web-page, (c) awareness-raising events for the business community that engage in foreign economic activity involving dual-use goods.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Export Control Service

Implemented
— comments: The list of expert organizations that have the authority to carry out activities related to the preliminary identification of goods in the field of state export control is posted on the official website of the State Export Control Service.Awareness-raising events for the business community that engage in foreign economic activity involving dual-use goods is carried out during seminars and conferences, as well as within the framework of the “hotline”.

To draft comprehensive User Guide on Strategic Goods and Services and have it adopted by the State Export Control Service. The guide should include: (i) a description of special international regimes; (ii) an outline of the regulatory base; (iii) a list of authorized agencies; (iv) a description and categories of special goods; (v) the policy and regulations on the export, import and transit of special goods; (vi) a detailed description of licensing procedures, and so on.

Ministry for Development of Economy, Trade and Agriculture of Ukraine
State Export Control Service

Implemented
— comments: The specified issues were regulated by the Law of Ukraine "On state control over international transfers of military and dual use goods" and the normative and legal acts adopted for its implementation. At the same time, the State Export Control Service conducts work on amendments to the current legislation in order to shorten the timing and optimize procedures for the provision of administrative services in the field of state export control, the approximation of procedures for national export control to the EU standards.

To develop a special section in the new edition of the Law “On Foreign Economic Activity” that follows WTO rules, EU legislation, and best EU practice at the national level: To publish information on penalties and sanctions. This information should include the penalties and sanctions that apply, the reason for such penalties and sanctions, the responsible authority, and when and how payment is to be made; To shorten the grounds for applying sanctions and review the variety of such sanctions, where practicable; To limit specific penalties and sanctions in connection with foreign trade to the approximate cost of the services rendered in connection with a specific import or export operation; To the penalty imposed should depend on the facts and circumstances of the case and should be commensurate with the degree and severity of the breach.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented

As a short-term solution: To develop working mechanisms to immediately notify companies about special sanctions imposed against them. The mechanism of mediation should be foreseen prior to the application of special sanctions, which can include any explanations and/or objections regarding the alleged violations. To approve a clear minimum materiality threshold for failure to comply with Laws and Regulations on foreign trade activities and formalize this through an executive Order. To reduce the maximum timeframe for reviews of individual licensing applications to any rationale number of working days, reflecting the types of foreign trade activity. To delegate individual licensing responsibilities from the Ministry to its regional offices.

Ministry for Development of Economy, Trade and Agriculture of Ukraine

Implemented