General business proposals in the context of simplifying the conditions for doing business in wartime

23/ 11/ 2023

Listen to online Stop   Ukraine and, in particular, businesses operating in the country have been significantly negatively affected by the full-scale invasion of russia. Especially affected are the territories where hostilities are/were conducted (territories of possible and active hostilities), de-occupied territories, territories contaminated with explosive devices (mined territories), and territories that are periodically subjected to enemy shelling. Therefore, restoring the economy of such territories requires significant efforts to rebuild and develop business. In this aspect, coordination and dialog with the authorities and local governments is crucial for business. In fact, business understands that it is not worth insisting on financial support from the state - the country itself needs significant financial resources to bring us all closer to victory. But still, the willingness to hear and listen to each other and coordinate would help entrepreneurs stay alive and work in such difficult times. What aspects of cooperation are we talking about? According to the EBA member companies, the implementation of such priority steps will help restore economic activity in the territories. In particular, resolving the issue of blocking tax invoices, ensuring timely VAT refunds, and preventing delays in the reimbursement of confirmed VAT amounts. In addition, legislative provisions should prevent initiatives to increase the tax burden on taxpayers (in particular, by indexing tax rates, rents, and any other changes in taxation conditions that lead to a sharp increase in taxes.) In the context of property issues, it is necessary to introduce a transparent procedure for assessing losses of legal entities due to destruction, damage, and occupation of production facilities, as well as a mechanism for monetary compensation for business losses. In addition, the prohibition of bankruptcy of processing enterprises due to destroyed facilities for the period of martial law and the introduction of a moratorium on early foreclosure of property of agricultural enterprises. Since people are a crucial component of business development and the countrys victory, it is essential to ensure transparent and predictable mobilization measures and transparent opportunities for business trips abroad with mandatory control of return and personal responsibility. Several aspects are crucial in the context of financing. On the one hand, it ensures wide and open access to existing recovery programs, grants, and donor programs and a transparent mechanism for the distribution of international financial assistance. On the other hand, the introduction of a wide range of concessional lending opportunities for the restoration of destroyed and damaged property and further development. For example, increasing the amount of funding for the State Credit Program Affordable Loans 5-7-9 in the field of agricultural processing to UAH 1 billion, which, according to business representatives, corresponds to the average cost of modern powerful enterprises, taking the 2020-2021 financial statements as the basic financial indicators for lending. At the same time, Ukraine also needs new investment projects to ensure that the countrys economy not only survives but also develops, given the scale of losses. Therefore, it is necessary to introduce a single permit window with services for domestic and foreign investors of all sizes - because nowadays, investors (especially foreign ones) do not really understand who can become the right hand in Ukraine to guide them through all the processes, procedures, and institutions for starting a business in the country. That is why the European Business Association has become a partner in launching the Global Business for Ukraine initiative - to, among other things, help global companies get to know Ukraine and its business opportunities. And no less important in the context of investments from international partners is the introduction of instruments to ensure investments and reconstruction projects against war risks. Therefore, on behalf of the business community, we ask the Prime Minister of Ukraine, Denys Shmyhal, the First Deputy Prime Minister of Ukraine - the Minister of Economy of Ukraine, Yuliia Svyrydenko, and the Minister of Finance, Sergii Marchenko, to pay attention to these proposals in the context of simplifying the conditions for doing business in Ukraine and, especially, in the territories that have been significantly affected by the armed aggression of the russian federation.

Ukraine and, in particular, businesses operating in the country have been significantly negatively affected by the full-scale invasion of russia. Especially affected are the territories where hostilities are/were conducted (territories of possible and active hostilities), de-occupied territories, territories contaminated with explosive devices (mined territories), and territories that are periodically subjected to enemy shelling.

Therefore, restoring the economy of such territories requires significant efforts to rebuild and develop business. In this aspect, coordination and dialog with the authorities and local governments is crucial for business. In fact, business understands that it is not worth insisting on financial support from the state – the country itself needs significant financial resources to bring us all closer to victory. But still, the willingness to hear and listen to each other and coordinate would help entrepreneurs stay alive and work in such difficult times. What aspects of cooperation are we talking about?

According to the EBA member companies, the implementation of such priority steps will help restore economic activity in the territories.

In particular, resolving the issue of blocking tax invoices, ensuring timely VAT refunds, and preventing delays in the reimbursement of confirmed VAT amounts. In addition, legislative provisions should prevent initiatives to increase the tax burden on taxpayers (in particular, by indexing tax rates, rents, and any other changes in taxation conditions that lead to a sharp increase in taxes.)

In the context of property issues, it is necessary to introduce a transparent procedure for assessing losses of legal entities due to destruction, damage, and occupation of production facilities, as well as a mechanism for monetary compensation for business losses. In addition, the prohibition of bankruptcy of processing enterprises due to destroyed facilities for the period of martial law and the introduction of a moratorium on early foreclosure of property of agricultural enterprises.

Since people are a crucial component of business development and the country’s victory, it is essential to ensure transparent and predictable mobilization measures and transparent opportunities for business trips abroad with mandatory control of return and personal responsibility.

Several aspects are crucial in the context of financing. On the one hand, it ensures wide and open access to existing recovery programs, grants, and donor programs and a transparent mechanism for the distribution of international financial assistance. On the other hand, the introduction of a wide range of concessional lending opportunities for the restoration of destroyed and damaged property and further development. For example, increasing the amount of funding for the State Credit Program “Affordable Loans 5-7-9” in the field of agricultural processing to UAH 1 billion, which, according to business representatives, corresponds to the average cost of modern powerful enterprises, taking the 2020-2021 financial statements as the basic financial indicators for lending.

At the same time, Ukraine also needs new investment projects to ensure that the country’s economy not only survives but also develops, given the scale of losses. Therefore, it is necessary to introduce a single permit window with services for domestic and foreign investors of all sizes – because nowadays, investors (especially foreign ones) do not really understand who can become the right hand in Ukraine to guide them through all the processes, procedures, and institutions for starting a business in the country. That is why the European Business Association has become a partner in launching the Global Business for Ukraine initiative – to, among other things, help global companies get to know Ukraine and its business opportunities. And no less important in the context of investments from international partners is the introduction of instruments to ensure investments and reconstruction projects against war risks.

Therefore, on behalf of the business community, we ask the Prime Minister of Ukraine, Denys Shmyhal, the First Deputy Prime Minister of Ukraine – the Minister of Economy of Ukraine, Yuliia Svyrydenko, and the Minister of Finance, Sergii Marchenko, to pay attention to these proposals in the context of simplifying the conditions for doing business in Ukraine and, especially, in the territories that have been significantly affected by the armed aggression of the russian federation.