Ukrainian business does not support the Cabinet's draft law on BES
The members of the Ukrainian Business Council coalition, which includes 113 business associations from various sectors of the economy, have analyzed the draft law No. 10439 on the Bureau of Economic Security and note the following:
"More than two years have passed since the establishment of the BES, and the Bureau has not yet begun to work effectively.
The key problems of the Bureau's work, which indicate that the BES does not currently meet the concept and needs of business, are competitive selection with violations; unpredictability of the body due to high rotation and lack of responsible persons; predominance of law enforcement over analytical function; pressure on business of other law enforcement agencies due to the inefficiency of the BES.
According to a recent study by economists assessing the largest tax evasion schemes, the largest schemes are associated with weak institutions. According to experts, the state loses UAH 200-240 billion annually due to the ineffective work of just three agencies - the State Customs Service, the State Tax Service, and the Bureau of Economic Security.
The budget loses UAH 100-150 billion from customs rules violations and gray imports, UAH 40-45 billion annually from counterfeiting and illegal trade, and UAH 20-30 billion from VAT schemes. In other words, the poor performance of the BES accounts for about UAH 100 billion of budget losses annually.
Given the relevance and importance of the BES reboot issue, the BES experts have worked on a number of draft laws, in particular, No. 10439 (initiated by the CMU), No. 10088 and No. 10088-1 (initiated by the MPs of Ukraine).
The comparative table and the texts of the draft laws show that the draft law No. 10439 contradicts Ukraine's commitments and does not meet the G7 priorities recently published.
Experts of the Ukrainian Business Council compared the two drafts by their key provisions, and the results are presented in the table below:
|
Key provisions of the drafts |
№ 10439 |
№ 10088-1 |
|
Reboot of the agency |
no |
yes |
|
The competition commission for the selection of the head of the Bureau of Economic Security has a predominant vote of international experts |
no |
yes |
|
The Selection Board submits the best candidate for the position to the Government |
no
(submits three candidates) |
yes |
|
Recertification of employees of the Bureau of Economic Security |
one year after the end of martial law |
immediately after the election of the director |
|
Mechanism for dismissal of dishonest employees |
no |
yes |
|
Personnel commission for re-certification of employees includes international experts |
no |
yes |
|
Strengthening the analytical direction of the BES - granting the Bureau the right to obtain free access to existing state information systems containing data on the financial activities of business entities, state registers of authorities |
no |
no |
|
Establishment of qualitative criteria for the BES's performance |
no |
no |
|
Establishing regulatory safeguards against pressure on business by law enforcement agencies |
no |
no |
As it becomes obvious from the comparative table, draft law No. 10088-1 gives hope for a reboot and the creation of a high-quality Bureau of Economic Security, while draft law No. 10439 leaves no chance for the creation of a high-quality BES.
Based on the above, the Ukrainian Business Council calls on MPs to adopt Draft Law #10088-1 in the first reading as soon as possible and finalize it for the 2nd reading, taking into account business proposals, providing a basis for the quality work of the body fighting economic crimes. Draft law No. 10439 does not solve any of the existing problems, so it should be returned to the authors without consideration.
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