Ukraine, April 5, 2005 — Participants
of the round table “Ways of Reforming the Permit System in Ukraine”,
organized by the International Finance Corporation (IFC) with the financial
support of the European Commission, agreed on 3 key principles for successful
reform of business permits in Ukraine.
Government representatives, members of the
Ukrainian Parliament, experts from international organizations, and business
associations recognize that the current system of issuing business permits
in Ukraine is outdated and requires urgent reform. The system is
a significant administrative barrier for opening a business as well as
for the further development of already functioning enterprises. In
Ukraine there are over 1,200 different types of permits, which are regulated
by 167 laws, 150 decrees of the Cabinet of Ministers, and about 1,500 normative
acts issued by local authorities.
The participants of the round table determined
3 key principles of reform of the permit system:
1. Adopt the Framework Law “On the Permit
System of Ukraine”. The Law will set forth the principles of state
policy governing permit issuance procedures, set limits to the authority
exercised by permit issuing agencies and municipalities, and standardize
requirements for the content of legislation governing permits. According
to the draft of the new Law, only permits which are directly stipulated
in the Law will remain obligatory, and the issuing order will be within
exclusive competence of the central government authorities.
2. Standardize regulations governing permit
issuance procedures. Special attention should be paid to review, clarification
and dissemination of state agencies’ internal instructions and procedural
requirements for issuing permits. As a result, the permit issuance process
should become simpler and more transparent to businesses.
3. Actively inform entrepreneurs
of their rights and responsibilities as market participants. This includes
disseminating regulations for employee and consumer safety and for protection
of the environment, as well as disseminating information on agency requirements
and on exact procedures for obtaining permits.
Mr. Andriy Dashkevych, Head of the State Committee
on Regulatory Policy and Entrepreneurship of Ukraine, is confident, that
adoption of the new law will harmonize relations between entrepreneurs
and state authorities, and will help to adapt Ukrainian legislation to
The manager of IFC’s SME Policy Development
Project, Mr. Andrey Gurevich, believes that introduction of the application
principle for obtaining permits for activities not related to use of hazardous
technologies and mechanisms will be an important part of the new Permits
Law. Successfully implemented by many EU countries, the application principle
allows an entrepreneur to complete a simple form confirming that he/she
understands and meets the requirements of state agencies regulating his
sphere of business, in lieu of obtaining a permit. Importantly, the entrepreneur
need not wait to receive explicit approval from the state to launch or
expand operations. Oversight of compliance to regulations is conducted
through inspections of the enterprise.
The participants of the round table “Ways
of Reforming the Permit System in Ukraine” agreed to continue co-operation
to support the adopted concept of the reform and to conduct regular round
Amongst key-speakers of the round table were
the Director of IFC’s Private Enterprise Partnership, Mr. Christian Grossmann,
the Head of the State Committee of Ukraine on Regulatory Policy and Entrepreneurship,
Mr. Andriy Dashkevych, Íead
of the State Committee of Health and Safety at Work – Mr. Olexander Storchak,
Deputy Head of the State Fire Safety Department – Mr. Ivan Krisa, Deputy
Minister of Health – Mr. Serhiy Berezhnov. Members of the Ukrainian
Parliament, representatives of the European Commission, non-governmental
organizations, and business associations also took part in the discussion.
The International Finance Corporate (IFC)
is the private sector lending arm of the World Bank Group. IFC (www.ifc.org)
finances private sector investments in its member countries, mobilizes
capital in international financial markets, helps clients improve social
and environmental sustainability, and provides technical assistance and
advice to governments and businesses. From its founding in 1956 through
FY04, IFC has committed more than $44 billion of its own funds and arranged
$23 billion in syndications for 3,143 companies in 140 developing countries.
In Ukraine, IFC has been active since 1993, carrying out investment activities
and implementing technical assistance projects. IFC’s direct investments
in Ukrainian companies have reached 200 million US dollars.
European Union numbers 15 Members States: 15 different nations
determined to shape their future closely together. Over a period of enlargement
of 40 years, they have, together built a zone of peace, stability, progress
and solidarity. The European Union is a model for overcoming conflicts
and promoting reconciliation through close co-operation to achieve common
goals, while respecting national sovereignty and territorial integrity.
But the EU is not focused on itself: its ambition is to share its
achievements and values with countries and people beyond its borders. The
European Commission is the EU’s executive body.