Ukrainian parliament approves updated bill reforming Ukraine's Economic Security Bureau: IMF, G7 and businesses' concerns to be addressed

Ukraine’s parliament, the Verkhovna Rada, voted in favour of bill No. 10439 on rebooting Ukraine's Bureau of Economic Security (BES) at the first reading on 11 April.

Source: Yaroslav Zhelezniak, First Deputy Chairman of the Parliament's Tax Committee, on Telegram

Details: A total of 264 lawmakers supported the bill at the first reading.

Zhelezniak stressed that Davyd Arakhamiia, the leader of the parliamentary coalition, has publicly committed to revising the draft law to comply with the requirements of the IMF, G7, and business.

Business associations had issued a joint statement on the draft law, noting that it still needed further work.

The business community noted that the revised government draft law has taken a number of proposals from business associations into account, including:

• election of the head of the BES by a commission in which international experts have a majority vote;
• immediate recertification of all BES staff;
• audits (independent assessments) to be conducted one year and three years after the appointment of the new head.

However, business associations say the draft law omits crucial proposals that jeopardise the reboot of the BES as an essential body. These include:

• a straightforward procedure for recertification of all staff which would contain critical safeguards, particularly to prevent the courts from reinstating employees who do not pass the recertification;
• international experts to be included on the personnel board for the recertification of all current BES staff and the board for recruitment of new BES staff;
• the BES’s analytical function to be enhanced by providing it with free-of-charge access to existing state information systems;
• performance criteria to be set for the rebooted BES and continually monitored;
• the personnel board to be granted the right to be guided by reasonable doubt based on facts, documents, etc., when verifying a candidate's integrity during staff recertification.

The associations believe that failure to incorporate the above proposals carries a significant risk that personnel who do not adhere to the principles of integrity will be retained, potentially leading to another unsuccessful launch of the BES.

Background:

• Earlier, it was reported that the parliamentary committees on law enforcement and tax have approved the government's version of the BES reform bill, to which Ukrainian business associations are opposed.
• The ambassadors of the G7 countries sent a letter to Ruslan Stefanchuk, Speaker of the Ukrainian parliament, insisting that the reform of the BES must include a reboot of its leadership through a transparent recruitment process and integrity checks into other BES staff.
• At its session on 23 February, the Ukrainian parliament did not pass the government's bill No. 10439 on rebooting the BES, which was opposed by G7 ambassadors and Ukrainian business associations, at the first reading.
• Ukraine's Committee on Finance, Taxation and Customs Policy recommended that Parliament adopt a new version of the BES reform bill, but their proposal did not include any comments from businesses or have the approval of Ukraine’s foreign partners.

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