The Acting President has signed the Law that reduces a number of licensing documents. The main advantages and disadvantages of the new law

30 April, 2014 Newsletters

Law of Ukraine No 1193-VII «On Amending Certain Legislative Acts of Ukraine Regarding Reducing the Number of Permitting Documents” (adopted on the basis of the draft law No 2436a as of 06.27.2013) was adopted by the Verkhovna Rada of Ukraine on April 9, 2014, and signed by the Acting President of Ukraine on April 25, 2014.

This law is pertained to cancellation of a number of permitting procedures, simplification of conducting business activity, and makes amendments to a large number of normative and legal acts. Most of the amendments have been introduced to the laws which regulate relations in the field of agriculture. Among the main innovations introduced by Law No 1193-VII the following should be distinguished:

  • in the Law of Ukraine “On Grain and Grain Market in Ukraine”: cancellation of certification of services on storage of grain and its derivative products, as well as certification of quality of grain and its derivative products in export-import transactions and their relocation within the territory of Ukraine. It should be noted that specialized agricultural and international business associations have pressed for these amendments for a long time. In particular, the certificates of grain quality contained the same data as in warehouse documents; therefore double check of grain quality was performed;
  • in the Law of Ukraine “On Plants Protection”: cancellation of necessity to obtain approval for importation of crop-protection agents on the territory of Ukraine; certificate of conformity of agricultural products and raw materials of plant origin on the content of remaining pesticides, agrochemicals and heavy metals (was required in trading and circulation of such products within the territory of Ukraine), as well as certificate of compliance with regulations of usage of pesticides and agrochemicals (plant growth regulators only) in agricultural products and raw materials of plant origin (was required for export of such products);
  • in the Law of Ukraine “On Pesticides and Agrochemicals”: cancellation of necessity to obtain a permit for usage of residuals of expired pesticides and agrochemicals within two years, as well as approval of the State Sanitary and Epidemiological Service of Ukraine on import of unregistered pesticides and agrochemicals on the customs territory of Ukraine for state testing and scientific research (previously was required along with the permission of the Ministry of Ecology and Natural Resources of Ukraine);
  • in the Law of Ukraine “On Labour Protection”: cancellation of necessity to obtain a permit to operate (use) extra-hazardous vehicles, machinery, and equipment if such equipment was put into operation with relevant certificate or after filing a declaration on operational readiness, as well as in case of registration of extra-hazardous vehicles, machinery equipment by the State Service of Mining Security and Industrial Safety of Ukraine;
  • in the Law of Ukraine “On Atmospheric Air Protection”: period of validity of permits on emissions of harmful substances into the atmosphere from stationary sources has been extended (for objects of the first group – up to seven years, the second group – up to ten years, the third group – unlimited duration has been established).

Also, Law No 1193-VII somewhat amends the general rules regulating the procedures relating to the permitting documents issuance. In particular, in the Law of Ukraine “On Permitting System in Business Activity” it is proposed to establish that the permitting agency itself shall obtain the intermediate documents, decisions, approvals required to issue a permitting document, not an applicant.

It should be noted that Law No 1193-VII also contains provisions which hold risk for business. Thus, the following provision is introduced to paragraph 41 of the Law of Ukraine “On Permitting System in Business Activity”:

Permitting authority that has issued permitting document may submit a claim to an administrative court on application of the response measures regarding cancellation of   permitting document upon existence of at least one of the following reasons:

  • finding of false information in the application for permitting document issuance and its addendums;
  • when an entity carried its activity (or type of activity which required a permitting document) with violation of the legislation requirements regarding which a permitting authority has issued an order on their elimination providing sufficient amount of time for this.

On the one hand, the positive moment is that the issues related to cancellation of a permitting document on the grounds of submitting false information or violating the law shall be under the jurisdiction of a court and not of the executive authority. However, this provision itself establishes very broad grounds for cancellation of a permitting document, namely that a permitting document may be cancelled by court for any (even insignificant) violation of the law, if such violation has been previously stated in the order. Therefore, from our point of view this rule should be amended in a way that a court may cancel a permitting document for only those violations which are specially indicated in relevant laws.

The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.

Kind regards,

© TOV "KM Partners", 2014

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