Ukraine Boosts Deregulation of the Economy

KYIV, Ukraine, May 31, 2011 /PRNewswire/ --

The first and main stage of work on deregulation of the economy of Ukraine, namely the simplified permitting, licensing and procedural bureaucracy, will be completed before the end of the year, said the first Vice Premier, Minister of Economic Development and Trade of Ukraine, Andriy Klyuev in his interview with Ukrainian weekly Dzerkalo Tyzhnya.

According to Minister Klyuev, Ukraine made significant steps to simplify the permitting system for businesses. First of all, the government introduced the declarative principle for certain types of businesses. The number of permits required for business operation was reduced from more than 200 to 134. In addition, the number of required service licenses decreased by 90 percent (to 222 from 2268) and operation licenses by 30 percent (to 23 out of 78).

Now a business does not need to obtain construction permits for temporary structures and facilities that do not pose risk to human life. This category includes small offices, stores, shops, cafes and restaurants.

Another example of deregulation is the simplified and expedited permitting procedure for construction. Previously the process could last for up to 18 months, now it takes maximum 2 months, and the number of required procedures decreased fourfold - down to 23 from 93.

Experts estimate that all the above measures may save an entrepreneur about 23 days in a year that previously had to be spent on gathering various permits and certificates.

Ukraine has already passed legislation that significantly strengthens the responsibility of civil servants. A government official now will be personally liable for creating administrative barriers to business.

The World Bank Doing Business 2011 Study put Ukraine in 145th place out of 183 countries in terms of ease of doing business. The study also pointed out that in 2009/10 Ukraine simplified the tax compliance process, streamlined the issuance of construction permits, and eased business start-up process.

"I'm sure there are only few countries in the world, which, in such a short time made such a regulatory and legislative effort to simplify business. In just one year, we changed and passed hundreds of laws and regulations," said Minister Klyuev. He also stressed that Ukraine is not going to stop, but will continue working hard to simplify its business environment.