EBA thanks for considering the proposals to criminalize smuggling and looks forward to reading the full version of the adopted document soon

12/ 12/ 2023

Last week, the Verkhovna Rada of Ukraine adopted in general the draft law No. 5420 on the criminalization of smuggling. The document provides for criminal liability for smuggling of goods in significant and large amounts. The introduction of criminal liability will come into force in stages. For example, smuggling of excisable goods will be criminalized starting from January 1, 2024, and smuggling of all other goods will be criminalized starting from July 1, 2024. According to the information available in the public space from the lawmakers, the Law was adopted in the version that included the amendments insisted on by the business: the threshold for criminal liability for smuggling was increased fivefold to UAH 6 million; the thresholds for criminal liability for smuggling of excisable goods were raised by 2 times - up to UAH 1.3 million; the intent to commit a crime will have to be proved. The control function in the context of smuggling criminalization will be assigned to 2 services - the Customs and the ESВ. We sincerely hope that parliamentarians will have the political will to adopt the relevant changes early next year to fully launch the reboot of the ESВ as a law enforcement agency that should carry out pre-trial investigations of offenses related to commodity smuggling. Before the large-scale introduction of criminal liability for smuggling of all types of goods on July 1, business and civil society in Ukraine must be confident in the high professionalism of the controlling body and the prevention of undue pressure on business by the tax police. At the same time, it is worth noting that the business still has several questions: who can be held criminally liable for such crimes - the head of the company, the declarant, the customs broker, the carrier, etc. what will be the liability of officials (Customs Services, ESВ) of the authorities for abuse of power. Therefore, on behalf of business, the European Business Association thanks the lawmakers for taking into account business proposals in such an odious draft law. At the same time, the community is looking forward to the publication of the Law in order to personally familiarize itself with the wording in the document, as the full version of the adopted Law is not yet available for business to review.

Last week, the Verkhovna Rada of Ukraine adopted in general the draft law No. 5420 on the criminalization of smuggling.

The document provides for criminal liability for smuggling of goods in significant and large amounts. The introduction of criminal liability will come into force in stages. For example, smuggling of excisable goods will be criminalized starting from January 1, 2024, and smuggling of all other goods will be criminalized starting from July 1, 2024.

According to the information available in the public space from the lawmakers, the Law was adopted in the version that included the amendments insisted on by the business:

the threshold for criminal liability for smuggling was increased fivefold to UAH 6 million;
the thresholds for criminal liability for smuggling of excisable goods were raised by 2 times – up to UAH 1.3 million;
the intent to commit a crime will have to be proved.

The control function in the context of smuggling criminalization will be assigned to 2 services – the Customs and the ESВ. We sincerely hope that parliamentarians will have the political will to adopt the relevant changes early next year to fully launch the reboot of the ESВ as a law enforcement agency that should carry out pre-trial investigations of offenses related to commodity smuggling. Before the large-scale introduction of criminal liability for smuggling of all types of goods on July 1, business and civil society in Ukraine must be confident in the high professionalism of the controlling body and the prevention of undue pressure on business by the tax police.

At the same time, it is worth noting that the business still has several questions:

who can be held criminally liable for such crimes – the head of the company, the declarant, the customs broker, the carrier, etc.
what will be the liability of officials (Customs Services, ESВ) of the authorities for abuse of power.

Therefore, on behalf of business, the European Business Association thanks the lawmakers for taking into account business proposals in such an odious draft law. At the same time, the community is looking forward to the publication of the Law in order to personally familiarize itself with the wording in the document, as the full version of the adopted Law is not yet available for business to review.