DMITRO ROMANOVICH: THE MAIN GOAL – DEVELOPMENT OF BETTER REGULATION

DMITRO ROMANOVICH: THE MAIN GOAL – DEVELOPMENT OF BETTER REGULATION

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Reformators project
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We have realized that in all ministries there is a lack of resources for high quality development of reform initiatives. Besides, ministries a priori can not reform themselves - an external impulse is needed

- What are the basic principles underlying the deregulation?

There are three principles: replacement of obsolete overlapping each other norms; removing unnecessary pressure on business; compliance with the requirements of the Association and Free Trade Zone Agreement with the EU.

I would divide the deregulation process into two stages.

First phase - an "emergency surgery". In other words, rapid removal and correction processes that hinder business and provoke corruption. Ukrainian businessmen showed us the biggest issues.

From a "common pot" there were selected two hundred priority issues. From the beginning of the year, over 80 such issues were solved - I would call this stage a Quick Win. For example, managed to abolish several dozens of licenses, shorten the time for issuance of phytosanitary and quarantine certificates, to reduce number in the list of objects of quarantine regulation for domestic transportation, abolish the monopoly of "Ukrecoresources" and much more.

The first phase is ongoing now - CMU resolution №357, consisting of 131 sections, is fulfilled by state authorities. And we hope that by the end of the year, the most of this plan will be implemented.

Now we are at the edge of the second stage. It can be called intensive therapy. In the nearest future will created a so-called Better regulation delivery office - non-government entity in which will be involved professional lawyers and analysts. Their work will be funded not from state budget, but by donors.

Main tasks of the office include:

- Analysis of the regulatory environment in areas which are the most important for small and medium business (retail, food industry, controlling authorities, construction and etc.).

- Construction of "regulatory tree" (a list of legal act that regulate the sphere);

- Evaluation of the effectiveness and usefulness of acts;

As a result of this work the team will recommend to modify or abolish some regulations.

- What can guarantee the process of deregulation and to improve regulation in the future?

Initiators of Better regulation delivery office are Ministry of Economic Development and State Regulatory Service. We have realized that in all ministries (deregulation is common task for all executive authorities) there is a lack of resources for high quality development of reform initiatives. Besides, ministries a priori can’t reform themselves - an external impulse is needed.

Therefore, in addition to ministries expert and business community will be actively involved in the process for a more qualitative assessment of decisions taken. Plus - this will make the process as transparent and public as possible. The founders will ensure the initiation and promotion of finalized documents at all stages of their adoption. By the way to achieve this goal we have already worked out the amendments to the regulations of the CMU that will speed up the process of documents adjustment.

Besides, we form the Reform Task Team, which consists of representatives of all branches of power, experts and civil society. In business language, it will be  analogue of the "board", which, in addition to monitoring the reform process, will help with the promotion of deregulation initiatives at all levels of decision-making - from ministries to Parliament.

Unfortunately, we had to refuse from immediate deregulation and move to a model "better regulation". One of the main reasons is that Ukraine has serious obligations on harmonization of its legislation with European one as well as obligations under international agreements: the WTO and Association Agreement, Free Trade Agreement and others.

Unfortunately, it is impossible to separate very precisely the areas, to which we can or can not be apply the principle of the guillotine. Besides, the approach "absence of regulation" contradicts European approach to regulation. This was the position of our European partners, so we decided to go through deliberated evaluation of each process.

We have a challenging goal of huge number of regulation acts that should be revised shortly. Nobody in the country knows their number, but, according to various estimates, it varies from 3 to 15 thousand!

Besides the regulatory impact of each document we will also compare if it complies with DCFTA (Free Trade Agreement).

- What is the purpose of deregulation?

The end result - the simplification of the regulatory environment and the normalization of relations between government and business, construction of a "better regulation".

I will explain it on the example of food market regulation. Today, control of the end product, in fact, is limited to verifying the documents for the product. The inspector comes to the company and checks and presence of papers. But this has nothing in common with safety and quality of the products, which are on the shelves in stores.

In European countries inspector comes to the store, takes a product and checks its safety and compliance with the stated quality. In this process there is no contact between inspector and manufacturer/seller. This significantly narrows the opportunities for corruption, and this is our aim.

 - According to a report on the implementation of deregulation plan in the second quarter out of 62 planned initiatives only 10 fulfilled. Why?

First, after consultations with the business community there were selected 202 priority initiatives. By the beginning of the second quarter 80 initiatives were completed - the so-called quick wins.

The mentioned above plan was adopted in the beginning of second quarter. Implementation of more than 130 initiatives requires negotiations, consultations with business, search of compensators, adoption of amendments to the laws and even codes by Government and Parliament. The work on all these things is in process.

In fact, if we look closer, we will get about 140 initiatives (some of them combine different documents). Out of this number, for the moment we have 18 initiatives fully adopted by CMU and Parliament, 53 processed and they are at different stages of approvals (Parliament, CMU, central authorities), 67 are in the process of development.

The main risk is that all initiatives have to be adopted in 3-4 quarters of this year. Let’s hope that despite the difficult political season (elections, amendments to the Constitution, tax reform, etc.), the Parliament and Government will take decisions on reforms as main priority.

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Маркович Галина Богданівна - координатор напрямку місцеві бюджети Проектного офісу секторальної децентралізації
19 December 2016
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