Policy Win: The Verkhovna Rada of Ukraine Decreased Possibilities for Unlawful Pressure on Business

On September 17, the Verkhovna Rada of Ukraine adopted Draft Law #1080 amending Criminal Code of Ukraine and Code of Criminal Procedure of Ukraine aimed at decreasing the prerequisites for unlawful pressure on business.

In particular, Draft Law in question abolishes Article 205 (“Fictitious Entrepreneurship”) and amends Article 212 (“Tax Evasion”). These amendments will potentially decrease the number of criminal proceedings involving business entities.

The Chamber welcomes adoption of the Draft Law since judgments under Article 205 against certain entities were used as a proof in cases against bona fide taxpayers and created possibilities for unlawful pressure on business. Chamber Legal, Tax and Agricultural Committees advocated for removing the possibility to use judgments under this article as a universal proof, and held a number of meetings with law enforcement bodies, tax authorities and judges. At the same time, the Chamber believes that issues related to existence of fictitious enterprises should be addressed in the future.