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Lawmakers greatly simplified the relationship of entrepreneurs with the state

The Verkhovna Rada of Ukraine at an extraordinary meeting on 02.03.2015 adopted the Law of Ukraine “On licensing of types of economic activity” (hereinafter – the Law). The adoption of the Law was a condition of the International Monetary Fund to provide Ukraine with financial assistance.

The law regulates public relations in the field of licensing of types of economic activity, defines an exclusive list of types of economic activity subject to licensing, establishes a unified procedure for their licensing, supervision and control in the field of licensing, responsibility for violation of legislation in the field of licensing of types of economic activity, as well as the procedure for liquidation of LLC , for the activities of which relevant permits and licenses have been obtained.

The Law is distinguished from the previous edition by its novelty. It changes the basic approaches to regulating relations in the field of licensing of types of economic activity.

In accordance with the Law, the main tasks in the formation and implementation of state policy in the field of licensing are carried out by the Cabinet of Ministers of Ukraine, a specially authorized body for licensing and licensing bodies.

The new law provides for types of economic activities that are subject to licensing and the establishment of transparent relations between the state and business. Such measures by the state are caused by the need to create favorable conditions for the development of entrepreneurship and improve the investment attractiveness of Ukraine.

With the adoption of the Law, the number of types of economic activities subject to licensing decreased from 56 to 29, the procedure for obtaining licenses was significantly simplified, which was caused by the introduction of modern electronic technologies. Among the types of economic activities that are now not subject to licensing: trade in pesticides and agrochemicals, customs and brokerage, procurement and processing of scrap metal, trade in liquid fuel from biomass and biogas, security activities and 9 other other types of activities.

The new requirement is that the license is not issued as a paper document (in particular, duplicates and copies thereof) – the business entity determines whether or not to obtain a license on the form, it is sufficient to have information in the Unified State Register of Legal Entities and Individuals of Entrepreneurs about the license issued to him.

The law establishes the perpetuity of the license for all types of economic activity, in addition, the size of the state duty remains at the same level and will be the equivalent of one minimum wage (today – 1218 UAH.).

Legislators have greatly simplified the relationship of entrepreneurs with the state. A business entity that is going to obtain a license can submit documents to the licensing authority and receive documents from it electronically. Such innovations will make it possible to overcome corruption in the field of local licensing by limiting the contacts of entrepreneurs with state bodies.

The ideology of close interaction between state bodies and public organizations or business associations is introduced, which can serve as a means of ensuring transparency of the licensing sphere. Such funds will strengthen control over the activities of state bodies in the field of licensing.

Prior to the adoption of the Law, licensing authorities quite often abused their position, denying entrepreneurs access to licenses. The arguments, as a rule, were links to errors in the submitted package of documents, or the need to provide additional documents, the provision of which is not provided at all. The new law excludes rules that allow officials of the licensing bodies to abuse their position, respectively, will significantly eliminate the corruption component.

Licensing legislation has long required modernization. However, it would be inappropriate for the authorities to limit themselves to the adoption of one law. Now, legislators should unify by-laws and regulations in this area in order to establish standards that are understandable and transparent for business entities and to avoid the possibility of their subjective application by government officials. Such changes require time to implement them, but the course has already been taken to ease the pressure on entrepreneurs.

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