To the Members of Parliament of Ukraine

 

Business associations have analyzed the updated government draft law on rebooting the Bureau of Economic Security (registration number 10439 and note the following.

Almost three years have passed since the establishment of the Bureau of Economic Security (BES), but this body has not yet begun its effective work. As a result, the state budget of Ukraine loses significant amounts of revenue, and legal Ukrainian businesses that did not go into hiding even during the worst of the military and economic crisis are subjected to pressure from law enforcement agencies. Instead of focusing on shadow trade schemes, counterfeiting, smuggling, and tax evasion, which annually cost the state budget more than UAH 100 billion, law enforcement agencies and the BES in particular are busy with formal violations that allow them to hinder the activities of legal businesses and put unreasonable and disproportionate pressure on them.

The key reason for the actual loss of these years of work of the Bureau of Economic Security for the state is the violations in the selection of the heads of this body, who failed to ensure the implementation of the concept of creating an analytical and law enforcement body that would put things in order with economic crime and reduce pressure on business from other law enforcement agencies, in particular, the Security Service of Ukraine and the National Police.

It should be noted that the updated Government draft law No. 10439 took into account a number of proposals from the business community, in particular

1. election of candidates for the position of the head of the Bureau of Economic Security by a commission with a predominant vote of international experts;
2. immediate re-certification of all employees of the Bureau of Economic Security;
3. audit (independent assessment) in one year and three years after the appointment of a new head.

However, important proposals that jeopardize the reboot of the BES as an important body have not been taken into account, in particular, the Government’s draft law lacks

1. a clear procedure for re-certification of all personnel, which would contain key safeguards, in particular, to prevent courts from reinstating employees who have not passed such re-certification;
2. inclusion of international experts in the personnel commission for re-certification of all current BES employees and the commission for selection of new BES employees;
3. Strengthening the analytical function of the Bureau by providing the BES with free access to existing state information systems;
4. establishing performance criteria for the renewed Bureau of Economic Security and their constant monitoring;
5. granting the personnel commission the right to be guided by reasonable doubt based on facts, documents, etc. when checking the integrity of a candidate during the re-certification of personnel.

According to the business associations, failure to take into account the above proposals on the mechanism of re-certification of current employees and strengthening the analytical function of the law enforcement agency carries a significant risk of retaining personnel who do not meet the principles of integrity and repeated failure to launch the work of the Bureau of Economic Security.

The most critical of the unaccounted-for proposals is the composition of the competition commissions for re-certification of personnel and the mechanism for conducting re-certifications. According to business representatives, a detailed mechanism for conducting reassessments should be set out in the draft law, and the commissions themselves should be dominated by international experts with an impeccable reputation and a good understanding of the work of law enforcement agencies. In addition, it is important to restrict access to positions in the BES to persons with dubious reputations based on the principle of reasonable doubt, given the small number of corruption cases that have resulted in guilty verdicts. These important procedures and composition cannot be created and formed solely by the decision of the new director; safeguards are needed against possible erroneous sole or biased decisions.

It is also extremely important to preserve in the final version of the draft law the right of the international experts to have a decisive vote when electing the BES chairman.

In addition, in order to establish safeguards against unlawful pressure on business by law enforcement agencies, along with the reboot of the Bureau of Economic Security, the business demands amendments to the Criminal Procedure Code of Ukraine to

1. introduction of standards of prosecutorial activity;
2. limiting the powers of the National Police and the BES in terms of giving instructions to operatives of the Security Service of Ukraine;
3. ensuring the possibility of appealing to the investigating judge against any actions or omissions, including decisions of the investigator, coroner, prosecutor, taken in any procedural action;
4. prohibiting the reopening of proceedings on the same grounds after a positive decision for the business as a result of appealing against previous actions of law enforcement agencies;
5. responsible storage and immediate return of seized property to the owners after a court decision;
6. setting a reasonable and proportionate level of bail and preventive measures;
7. Prohibiting the seizure of material assets that are not specified in the investigating judge’s ruling;
8. permitting the seizure of “critical property” (means of labor that are part of economic activity) only on exceptional grounds;
9. imposing on investigating judges the obligation to verify that the pre-trial investigation body complies with the requirements of jurisdiction;
10. returning the pre-trial investigation terms and the procedure for their extension in factual criminal proceedings, except for grave and especially grave crimes within the jurisdiction of the NABU.

Taking into account the above, business associations call on MPs to take into account the proposals of business and immediately finalize the draft law on rebooting the Bureau of Economic Security, as well as to adopt the necessary amendments to the Criminal Procedure Code of Ukraine.<a104

 

Sincerely yours

Business associations:

Association of Taxpayers of Ukraine

International business community Board

All-Ukrainian professional association of entrepreneurs

Association of private employers

Ukrainian Federation of Security Industry

Ukrainian Agrarian Council

Kharkiv IT Cluster

U-Food Association

Association Ukrconsulting

Association of Software Ukraine

All-Ukrainian Association of Passenger Carriers

National organization of retail trade

Kreminna Business Association

Association Ukrkondprom

Association “Insurance Business”

Association of Ukrainian importers of fish and seafood