On 24 May 2017, the Cabinet of Ministers of Ukraine have approved a number of regulations on deregulation of state supervision of business. Such regulations were approved in response to the amendments introduced on 01 January 2017 to the Law of Ukraine “On Fundamentals of Public Supervision (Control) of Business Activity” (the “Law”).

Such regulations among others include:

  • introduction of the integrated public database on audits (audits) of business entities (the “Database”);
  • execution of the scheduled audits simultaneously by all supervising authorities;
  • opportunity for business entities to initiate participation of Ministry of Economic Development and/or State Regulatory Service during audits (audits) by the supervising authorities; and
  • filing of electronic documents to the licensing authorities.

Public Database of Audits

The Database is introduced by the Cabinet of Ministers of Ukraine Order No. 384 dated 24 May 2017 “On the procedure of functioning of integrated automated system of state supervision, upload of the information and the terms for publishing such information” (the “Procedure”). The Database will make the activity of state supervising authorities more transparent, predictable and accountable.

The purpose of the Database is:

  • to save and systemize the information on state supervision measures;
  • automatic detection of business entities which are included into the schedules of state supervision measures of more than one supervising authority; and
  • preparation of the draft schedule for unified state supervision based on such information.

According to the Procedure, the state supervising authorities should upload the information on the planned state supervision measures for the next year to the Database until 15 October.

The uploaded information from the Database will be used by the state authorities to prepare a draft plan (schedule) for unified measures of state supervision of business entities. Such draft plan (schedule) should be prepared no later than by 17 October and will be published on the web-site of the Database to be accessible to the general public, business entities, government bodies, local authorities.

Simultaneous Conduct of Scheduled Audits of Business Entities

The Cabinet of Ministers of Ukraine Order No. 350 dated 24 May 2017 “On the Procedure of conduct of unified state supervision measures” (the “Order No. 350”) provides for the conduct of the scheduled audits simultaneously by all supervising authorities, in case when several authorities have scheduled audits of the same business entity. This should reduce the number of contacts between business and supervising authorities by 15-30%.

According to the Order No. 350, the unified state supervision measures are conducted according to the schedule approved by the order of the State Regulatory Service and published on its official web-site no later than by 15 November for the year, for which the unified state supervision measures are scheduled.

Additional Control Over State Supervising Authorities

In addition, the Government by its Order No. 361 dated 24 May 2017 “On some issues of control over the state supervising authorities” has granted the Ministry of Economic Development and the State Regulatory Service the rights to monitor the observance by the state supervising authorities of the provisions of the Law of Ukraine “On Principles of State Supervision (Control) of Economic Activity” (the “Order No. 361”). The Order No. 361 allows business entities to initiate unscheduled audits of the state supervising authorities by the State Regulatory Service based on violations of the Law during audits of business entities by the state supervising authorities.

Submission of Electronic Document to Licensing Authorities

By adoption of the Order No. 363 dated 24 May 2017 “On the Approval of the Order of Provision of the Licensing Authorities with the Documents in Electronic Form” (the “Order No. 363”) the Government has regulated the procedure for submitting documents in electronic form to the licensing authority.

According to the Order No. 363, electronic documents are submitted to the licensing authorities using Unified State Portal of Administrative Services, or through information systems of the licensing authorities. Documents that exist only in electronic form are attached to the application in pdf format and signed by digital signature. Documents submitted in electronic form do not require submission of a paper duplicate.

The adopted deregulation measures are aimed at further liberalization of state supervision, and should consequently reduce the number of contacts between business and state supervising authorities and significantly reduce the risks of corruption and pressure on businesses.