The first proposal in the bill related to the regulation of lobbying activities in Ukraine was registered in the Verkhovna Rada in 2020.
Lobbying is usually called any influence on the legislative or executive power of the state in order to defend the interests of a certain commercial structure or group of persons with business interests.
Currently, lobbying in the world is a business with a multi-billion dollar turnover, regulated at the legislative level. The pioneers in lobbying activities were representatives of American business at the beginning of the 20th century. Subsequently, lobbying became commonplace in all other developed countries of the world.
In Ukraine, the concept of lobbying appeared with independence in 1991, but this phenomenon is still not properly regulated at the legislative level. For about 20 years, attempts have been made to normalize the promotion of the interests of big business in the Ukrainian parliament.
Back in 2009, the Verkhovna Rada adopted the Concept of the draft Law of Ukraine “On the influence of the public on the adoption of normative legal acts.” The Ukrainian Parliament also adopted the Law of Ukraine “On the fundamentals of state anti-corruption policy in Ukraine (Anti-Corruption Strategy) for 2014-2017.” These legislative initiatives were intended to regulate the legal principles of lobbying.
Will another attempt to legitimize lobbying be successful?
The first bill concerning lobbying activities in Ukraine, which could change the rules of the game in the field of representing business interests in government bodies - Yu. Tymoshenko and S. Vlasenko “On state registration of lobbying entities and the implementation of lobbying in Ukraine” was registered in 2020. Currently, deputies from the ruling coalition, together with the National Agency for the Prevention of Corruption, have prepared their bill “On Fair Lobbying in Ukraine,” which corresponds to the Anti-Corruption Strategy until 2025 and the State Anti-Corruption Program for 2023-2025.
The NAPC bill defines the basic concepts of lobbying, introduces a national register of lobbyists and obliges persons representing business interests to prepare reports on their activities. It also proposes the introduction of a Code of Ethical Conduct for lobbyists, directly regulating the rules for their cooperation with legislators and other representatives of government and business.
The goal of the legislative initiative is to create a transparent lobbying market and overcome corruption schemes widespread in the highest echelons of power.
The proposed lobbying model is more reminiscent of the European one than the American one, which is over-regulated after almost a century of its existence.
Other advantages of the bill include the following: ·
transparency, allowing you to find information about a lobbyist from open sources thanks to the register and contact him for services; ·
the document gives lobbyists the right to officially meet with representatives of the legislative and executive branches; ·
Lobbyists can become official co-authors of bills and attend meetings of Verkhovna Rada committees.
Lobbying and public organizations in Ukraine
One of the features of the introduction of the Ukrainian version of lobbying is the impact of legislative changes on the activities of public organizations.
Thanks to the legalization of lobbying, public organizations will be strengthened and will receive legal mechanisms to advocate for their initiatives. Such influential public associations include the Anti-Corruption Center (ACC), the Automaidan NGO and others. Unlike private companies, registration in the new register of lobbyists for public organizations will be free.
The bill spells out several more preferences for civil society organizations, namely the absence of administrative liability for violation of lobbying activities and exemption from the preparation of separate reports.
How can a business use the services of lobbyists?
According to the presented bill, any company has the right to enter into an agreement with a lobbyist listed in the register. Otherwise, a lobbyist can register after signing a contract with a business representative. Such cooperation is mutually beneficial for any business, as it helps shape the company’s economic policy and plan its development.
The bill prohibits the use of lobbyist services by business representatives associated with the aggressor country: Russia and Belarus.
For violators of the law on lobbying, administrative liability is provided - 5,400 UAH. The violator is included in the register of persons who have committed corruption or corruption-related offenses. The law provides for liability for the violator one year after its entry into force.
How businesses lobby their interests in the Ukrainian Parliament
A striking example of lobbying in Ukraine is the representation of the tobacco business at the legislative level.
Tobacco companies' tactics are to delay and block tobacco control initiatives, with many alternative bills being filed. For example, in the anti-tobacco bill No. 2813 on reducing the attractiveness of tobacco products for children and youth, 5 alternative draft laws were presented. As a result, the law was never passed.
The tobacco lobby is represented by deputies in relevant committees of the Verkhovna Rada and its representatives in ministries. Ratification of the Protocol to Eliminate Illicit Trade in Tobacco Products has been stalled for a year now, although Ukraine is one of the world leaders in the smuggling of tobacco products.
Another striking example of lobbying in the Ukrainian parliament is the representation of the interests of the gambling business. Until 2021, the gambling business in our state was completely in the shadows, not bringing a penny to the treasury. It was not possible to stop the existence of gambling using directive methods, so it was decided to take it under state control.
In July 2020, the Verkhovna Rada adopted Law No. 2285-d “On state regulation of activities for organizing and conducting gambling,” which regulated the activities of the gambling business. The law provided for the creation of a gambling regulator; it spelled out requirements and restrictions on the market, the cost of licenses and taxation rules.
This is where a powerful lobby emerged, thanks to which almost ideal conditions were created for the functioning of the legal gambling market with low taxes and a simplified system for obtaining a license. Already in March 2021, people's deputies again returned to the issue of regulating gambling activities; 9 new bills were registered in parliament that softened the functioning of gambling establishments, reduced the cost of obtaining licenses and taxing income.
Only in August 2023, almost 1.5 years after the start of a full-scale war, tax breaks for the gambling business were canceled, and on August 30, the president signed a law on the return of sales tax for online casinos.
Despite the fact that lobbying for the interests of Ukrainian business has been in the shadows for a long time, in the last few years the state has taken huge steps to legislatively regulate this activity, taking into account international experience and the positions of interested parties. The adoption of legislation on lobbying should become a driving force for positive changes and prevent the creation of corruption, and not another act of populism by the current government.
