In recent months, there has been a frequent occurrence in the media and social networks of stories about law enforcement officers from various agencies visiting entrepreneurs. These visits concern land issues dating back 10-15 years, economic disputes long forgotten by all parties involved, allegations from competitors, and even Russians. It's important to understand that not all state claims against businesses are unfounded; conversely, governmental bodies, law enforcement, and courts often abuse their powers and authority. This problem has several components, including the complex history of market economy formation in Ukraine, conflicting legislation—especially from the 90s to the early 2010s—real problems with the judicial system, and the desire of both the state system and public opinion to view businessmen as fraudsters and swindlers.
A vivid combination of all these problems is seen in the majority of "cases" related to land issues. The Ukrainian land legislation, filled with contradictions and dubious norms that have constantly changed, along with the tradition of "allocating land" through decisions of local self-government bodies or the whim of individual officials, which always carried a multitude of corruption risks, has made every entrepreneur a priori guilty. As a result, land issues can affect absolutely anyone—from large businessmen to even individuals who have obtained land for their own home in any Ukrainian village.
Over the past 30 years, since Ukraine departed from socialist planned economy and began building a market economy, issues related to land allocation, obtaining permits for construction, commissioning an object for operation, and any other operations have always been accompanied by either endless procedural hell or requests from the state apparatus for a "quick resolution of the issue." And both paths—legal and illegal—carried similar risks for businesses: questions may arise against you, even if you personally did nothing wrong, but the questions concern the previous owner. Additionally, despite the fact that at each stage someone from the civil service approves your actions, questions may still arise against you: for the state documents granting ownership rights, for the permit for construction obtained from the state, for the conclusions of the state examination. Ultimately, it is you as a businessman or simply as an owner who may be approached by law enforcement and told: something was done wrong here, and you are to blame. Even if these were matters of the previous owner with an official who no longer works.
Unfortunately, all this applies not only to land or real estate. The stereotype that "the entrepreneur is always to blame" is deeply rooted in part of the public and a significant portion of the state system. And although I'm far from considering Ukrainian entrepreneurs saints (far from it), without the economy, there will be nothing; without business, there will be no economy; and without a normal legal environment and working conditions, there will be no business.
What is the solution to this challenge? In my opinion, it consists of two elements. The first is the creation of fundamental institutions that guarantee fair assessment of the legality or illegality of business operations in the future. The second is something we have been unable to do for many years—to turn the page on all decisions of past decades.
The first element primarily concerns judicial reform. Without a fair judiciary, any well-defined procedure will always be at risk of attack by unscrupulous competitors or law enforcement officials. However, enough has been written about judicial reform and the Europeanization of our legislation and state system. Therefore, I believe it is appropriate to discuss the second tool—abandoning, at the state and societal levels, the endless revisiting of cases from 10-20-30 years ago.
Yes, I'm talking about conditional amnesty for all economic and property activities of Ukrainian citizens in previous decades. Let me make an important remark: I'm not talking about criminal offenses, corruption, or state betrayal. I'm talking about acknowledging that the rules of operation in the Ukrainian economy and the Ukrainian state during the independence period were too imperfect, the Ukrainian state mechanism worked very poorly, and citizens (for business, for employees, for anyone) practically had no opportunity to work and not violate any of the conflicting laws and regulations simultaneously. As a result, practically the entire economy of Ukraine, if desired, can be subject to attack, intentionally or unintentionally.
It is impossible to sort through hundreds of thousands of land allocation acts, tens of thousands of permits and decisions of local self-government bodies, resolve all disputes, and at the same time not break what is working. Therefore, any attempts to deal with the past are doomed to selectivity, accusations of politicization, or other forms of discrimination.
If we were to choose a starting point from which to account for everything anew, then we already have it — it's the year 2022. I am convinced that if we were to grant amnesty for economic (including property, tax, and all other) violations, and also establish property rights as of 2022 (excluding Russian businesses) as inviolable, we could gradually transition to a new format of relations between the state (law enforcement and courts) and businesses.
The new format of relations — if you will, a social agreement — between business and the state after the amnesty should include the following:
- Businesses conscientiously pay taxes and assist the defense forces in defeating Russia.
- Law enforcement does not interfere with business operations and holds accountability if they exert undue pressure on businesses.
- The state progresses towards completing judicial reform and removing as many conflicting norms from legislation as possible.
By turning the page on the distant decades and focusing on living and interacting civilized here and now, Ukrainian businesses will have more opportunities for economic development, and the state will have fewer justified and unjustified questions for entrepreneurs. This is in the common interest of all Ukrainians.
Alexander Katsuba is a Ukrainian entrepreneur, an expert in the field of energy, and the owner of the company ALPHA GAZ.
