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Business sets priorities for the Parliament

06/ 10/ 2020
  The Verkhovna Rada of Ukraine has begun its fourth session in September. For the business community, effective dialogue with the Ukrainian Parliament is extremely important for resolving problematic issues that complicate the activities of companies in Ukraine and for creating a favorable regulatory environment for the development of the business climate. Svitlana Mykhailovska. EBA Deputy Director for Advocacy. It should be noted that this parliamentary session is marked by greater efficiency in work. The community has the opportunity to take part in working groups and jointly develop legislative initiatives, although there are still transparency issues. Sometimes a business submits its proposals but does not understand whether they will be included in the document. Sometimes a quality draft law is leveled by a few strange rules, or business can wait for years to make the necessary changes. Many documents submitted for the first reading are quite raw and are finalized between the first and second readings. Therefore, we thank the business for the cooperation, in my opinion, but a little more systematic and speedy approach in decision-making will not hurt. Thus, the EBA experts made an analysis of the list of draft laws registered in the Verkhovna Rada and identified those legislative initiatives, the adoption of which will have a positive impact on business in the short term. At the same time, many of these draft laws need to be finalized and supported by the Association only if comments and amendments from the business are made. And while the Verkhovna Rada is on a forced break, we urge MPs to use this time to consider and finalize priority business draft laws, considering the proposals of the Association. 1) Draft Law №2289 on unblocking access to innovative crop protection products  Adoption of the draft law will increase crop yields and significantly increase the level of the greening of agriculture, namely reducing the amount of applied CPPs by 30-40%, reducing the amount of working solution by half, significantly increasing the safety profile. 2) Draft Law №2207-1-d on implementation of a waste management system according to European practices This framework draft law establishes a waste management system in Ukraine in line with EU best practices by implementing measures to prevent or reduce waste generation, facilitating its preparation for reuse and recovery as secondary raw materials and energy resources. At the same time, the EBA experts consider it necessary to remove from the draft law the possibility to pay environmental tax as an alternative to the fulfillment of extended producer responsibility regarding waste management. 3) Draft Law №3656 on the reduction of the VAT rate for some categories of agricultural products  Reducing the VAT rate for the agricultural sector will contribute to the de-shadowing of agricultural production. Adoption of the draft law may reduce budget expenditures and the risk of losses associated with VAT fraud and unfair practices of minimizing tax liabilities, as the effectiveness of such schemes is sharply reduced. At the same time, representatives of the dairy industry of the Association see in the document the risks of rising prices for finished dairy products and reducing their consumption by Ukrainians and ask to exclude whole milk from the text of the draft law in preparation for the second reading. 4) Draft Law №3848 on abolishing excise stamps for still wines and the possibility of importing samples of alcoholic beverages If this draft law is adopted, test samples and wine products with a strength of up to 15% will be added to the list of goods that are not subject to excise tax stamps. Such tax changes are expected to create tax conditions for business development and economic stimulation, as well as simplify administration to stimulate business legalization. 5) Draft Law №3906 on strengthened alcohol production requirements for distilleries  The draft law establishes increased requirements for the production and sale of alcohol, as well as strengthening the responsibility for crimes in this area. The document specifies the requirements for the licensing of alcohol and creates conditions for combating its illegal production and circulation. 6) Draft Law №1182-1-d on launching the inland water transport market The inland waterway market has long needed a sectoral draft law. The European Business Association supports the draft law №1182-1-d, provided that the principles developed with the participation of business before the second reading are preserved. Key developments that the deputies took into account during the finalization of the draft law, and which are important for the development of inland waterways, in particular regarding the preservation of functions of the State Service of Maritime and River Transport to register lines of foreign navigation; licensing of activities solely for the carriage of passengers, dangerous goods and hazardous waste by inland waterways (rather than licensing of freight in general); exclusion of the provision on the financing of inland waterways at the expense of port dues. 7) Draft Law №2740 on Stop Masks-show Stop – 3 The draft law is designed to protect the rights of individuals and businesses from illegal actions of investigators during the pre-trial investigation of criminal offenses. We hope that its adoption will improve the methodology of investigative actions and resolve the issue of seizure of equipment for investigation. 8) The package of draft laws for IT industry: Draft Laws №3933 and №3933-1 and draft law №3979 on stimulating the development of the IT industry in Ukraine The European Business Association also emphasizes the need to continue and strengthen the development of the IT industry. We are ready to support this package of draft laws if the amendments made by the IT Committee of the Association, as well as remarks concerning the peculiarities of taxation, legal regulation, labor relations, rules of employment of foreign specialists, IT education, are considered. 9) Draft Laws №3543-1, №3631 and №3632 on reforming environmental finances In recent years, eco-tax rates have increased tenfold, but the funds received are used inefficiently and dissolved in the budget. These draft laws are aimed at reforming three main components - ensuring the targeted use of funds, phasing in rates, and promoting further harmonization of Ukrainian legislation with European standards. 10) Draft Laws №3318 on the introduction of new rules on the market of veterinary medicines The draft law strengthens the control over the market of veterinary medicines by introducing mechanisms for licensing and post-registration supervision of veterinary medicines. At the same time, the experts of the Association consider it necessary to remove from the draft law the requirement to conduct research on the quality of drugs exclusively in Ukraine and to regulate the functioning of official representations of international companies in Ukraine. Also, this draft law is an opportunity to maintain a simplified registration of feed additives. 11) Draft Law №3672 on unblocking the feed market Adoption of the draft law will allow unblocking on a temporary basis the deadlock in the market of animal feed, which occurred due to the fact that Ukraine has not yet moved from the previous regulations on registration of feed to the one compatible with the EU practices. 12) Draft Law №3091 on reforming the state environmental control The draft law proposes to concentrate all functions of environmental supervision and control in one authority. Besides controlling functions, this authority will also be able to engage in environmental monitoring and awareness-raising activities. At the same time, to balance the interests of all stakeholders, the document should remove conflicting provisions regarding inspections and the law enforcement status of the authority. Instead, the law should clearly prescribe the algorithm, timing of inspections and re-inspections, taking into account European experience, preserve the right of companies to appeal the decision of the supervisory authority, provide inspectors with training and motivation for them to properly conduct the obligations. At the same time, the business thanks Parliament for some initiatives already adopted for the benefit of the business and the population. The European Business Association hopes for effective cooperation with the Verkhovna Rada on the above initiatives to improve the business environment in Ukraine!   Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.

The Verkhovna Rada of Ukraine has begun its fourth session in September. For the business community, effective dialogue with the Ukrainian Parliament is extremely important for resolving problematic issues that complicate the activities of companies in Ukraine and for creating a favorable regulatory environment for the development of the business climate.

Svitlana Mykhailovska EBA Deputy Director for Advocacy
It should be noted that this parliamentary session is marked by greater efficiency in work. The community has the opportunity to take part in working groups and jointly develop legislative initiatives, although there are still transparency issues. Sometimes a business submits its proposals but does not understand whether they will be included in the document. Sometimes a quality draft law is leveled by a few strange rules, or business can wait for years to make the necessary changes. Many documents submitted for the first reading are quite "raw" and are finalized between the first and second readings. Therefore, we thank the business for the cooperation, in my opinion, but a little more systematic and speedy approach in decision-making will not hurt.

Thus, the EBA experts made an analysis of the list of draft laws registered in the Verkhovna Rada and identified those legislative initiatives, the adoption of which will have a positive impact on business in the short term. At the same time, many of these draft laws need to be finalized and supported by the Association only if comments and amendments from the business are made. And while the Verkhovna Rada is on a forced break, we urge MPs to use this time to consider and finalize priority business draft laws, considering the proposals of the Association.

1) Draft Law №2289 on unblocking access to innovative crop protection products 

Adoption of the draft law will increase crop yields and significantly increase the level of the greening of agriculture, namely reducing the amount of applied CPPs by 30-40%, reducing the amount of working solution by half, significantly increasing the safety profile.

2) Draft Law №2207-1-d on implementation of a waste management system according to European practices

This framework draft law establishes a waste management system in Ukraine in line with EU best practices by implementing measures to prevent or reduce waste generation, facilitating its preparation for reuse and recovery as secondary raw materials and energy resources. At the same time, the EBA experts consider it necessary to remove from the draft law the possibility to pay environmental tax as an alternative to the fulfillment of extended producer responsibility regarding waste management.

3) Draft Law №3656 on the reduction of the VAT rate for some categories of agricultural products 

Reducing the VAT rate for the agricultural sector will contribute to the de-shadowing of agricultural production. Adoption of the draft law may reduce budget expenditures and the risk of losses associated with VAT fraud and unfair practices of minimizing tax liabilities, as the effectiveness of such schemes is sharply reduced. At the same time, representatives of the dairy industry of the Association see in the document the risks of rising prices for finished dairy products and reducing their consumption by Ukrainians and ask to exclude whole milk from the text of the draft law in preparation for the second reading.

4) Draft Law №3848 on abolishing excise stamps for still wines and the possibility of importing samples of alcoholic beverages

If this draft law is adopted, test samples and wine products with a strength of up to 15% will be added to the list of goods that are not subject to excise tax stamps. Such tax changes are expected to create tax conditions for business development and economic stimulation, as well as simplify administration to stimulate business legalization.

5) Draft Law №3906 on strengthened alcohol production requirements for distilleries 

The draft law establishes increased requirements for the production and sale of alcohol, as well as strengthening the responsibility for crimes in this area. The document specifies the requirements for the licensing of alcohol and creates conditions for combating its illegal production and circulation.

6) Draft Law №1182-1-d on launching the inland water transport market

The inland waterway market has long needed a sectoral draft law. The European Business Association supports the draft law №1182-1-d, provided that the principles developed with the participation of business before the second reading are preserved. Key developments that the deputies took into account during the finalization of the draft law, and which are important for the development of inland waterways, in particular regarding the preservation of functions of the State Service of Maritime and River Transport to register lines of foreign navigation; licensing of activities solely for the carriage of passengers, dangerous goods and hazardous waste by inland waterways (rather than licensing of freight in general); exclusion of the provision on the financing of inland waterways at the expense of port dues.

7) Draft Law №2740 on Stop Masks-show Stop – 3

The draft law is designed to protect the rights of individuals and businesses from illegal actions of investigators during the pre-trial investigation of criminal offenses. We hope that its adoption will improve the methodology of investigative actions and resolve the issue of seizure of equipment for investigation.

8) The package of draft laws for IT industry: Draft Laws №3933 and №3933-1 and draft law №3979 on stimulating the development of the IT industry in Ukraine

The European Business Association also emphasizes the need to continue and strengthen the development of the IT industry. We are ready to support this package of draft laws if the amendments made by the IT Committee of the Association, as well as remarks concerning the peculiarities of taxation, legal regulation, labor relations, rules of employment of foreign specialists, IT education, are considered.

9) Draft Laws №3543-1№3631 and №3632 on reforming environmental finances

In recent years, eco-tax rates have increased tenfold, but the funds received are used inefficiently and dissolved in the budget. These draft laws are aimed at reforming three main components – ensuring the targeted use of funds, phasing in rates, and promoting further harmonization of Ukrainian legislation with European standards.

10) Draft Laws №3318 on the introduction of new rules on the market of veterinary medicines

The draft law strengthens the control over the market of veterinary medicines by introducing mechanisms for licensing and post-registration supervision of veterinary medicines. At the same time, the experts of the Association consider it necessary to remove from the draft law the requirement to conduct research on the quality of drugs exclusively in Ukraine and to regulate the functioning of official representations of international companies in Ukraine. Also, this draft law is an opportunity to maintain a simplified registration of feed additives.

11) Draft Law №3672 on unblocking the feed market

Adoption of the draft law will allow unblocking on a temporary basis the deadlock in the market of animal feed, which occurred due to the fact that Ukraine has not yet moved from the previous regulations on registration of feed to the one compatible with the EU practices.

12) Draft Law №3091 on reforming the state environmental control

The draft law proposes to concentrate all functions of environmental supervision and control in one authority. Besides controlling functions, this authority will also be able to engage in environmental monitoring and awareness-raising activities. At the same time, to balance the interests of all stakeholders, the document should remove conflicting provisions regarding inspections and the law enforcement status of the authority. Instead, the law should clearly prescribe the algorithm, timing of inspections and re-inspections, taking into account European experience, preserve the right of companies to appeal the decision of the supervisory authority, provide inspectors with training and motivation for them to properly conduct the obligations.

At the same time, the business thanks Parliament for some initiatives already adopted for the benefit of the business and the population. The European Business Association hopes for effective cooperation with the Verkhovna Rada on the above initiatives to improve the business environment in Ukraine!

 

Be the first to learn about the latest EBA news with our Telegram-channel EBAUkraine.

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