BIZNEWS:

Crimea

Crimea and Sevastopol: Further EU sanctions approved

The EU Council has imposed substantial additional sanctions on investment, services and trade with Crimea and Sevastopol. From 20 December 2014, investment in Crimea or Sevastopol is outlawed. Europeans and EU-based companies may no longer buy real estate or entities in Crimea, finance Crimean companies or supply related services. In addition, EU operators will no longer be permitted to offer tourism services in Crimea or Sevastopol. In particular, European cruise ships may not make calls at ports in the Crimean peninsula, except in case of emergency. This applies to all ships owned or controlled by a European or flying the flag of a member state. Existing cruise contracts may be still be honoured until
20 March 2015. It has also been prohibited to export certain goods and technology to Crimean companies or for use in Crimea. These concern the transport, telecommunications and energy sectors and the prospecting, exploration and production of oil, gas and mineral resources. Technical assistance, brokering, construction or engineering services related to infrastructure in the same sectors must not be provided. These measures are a supplement to an import ban on goods from Crimea and Sevastopol imposed in June 2014, as well as restrictions introduced in July 2014 on trade and investment related to certain economic sectors and infrastructure projects.

European Integration

Belgium introduces fee for residence permits

Migrants wishing to settle in the Kingdom of Belgium are supposed to pay a fee. In cases of family reunification, each person coming to Belgium will have to pay EUR 160. The same amount will be paid by foreign students that study in Belgium. Migrants that come to Belgium to work will pay a fee of EUR 215. Minors, persons applying for the status of refugees and foreigners requesting residence permits because of the need of urgent medical treatment will not have to pay the fee.

Antimonopoly Committee of Ukraine

Unnecessary services

The Antimonopoly Committee of Ukraine (AMCU) has issued its mandatory recommendations for the Ministry of Health of Ukraine. The joint order of the Ministry of Health of Ukraine and the Ministry of Internal Affairs of Ukraine of 31 January 2013, No.65/80 approved the Regulation on the Medical Examination of Vehicle Drivers, which sets the frequency of examinations, the order of examinations, the list of medical services provided during medical examinations, etc. The Committee is of the opinion that the list of medical services for drivers during medical examinations is not reasonable as the frequency of examinations is deemed unjustified. In particular, this relates to the annual payment to determine the drivers’ blood group and Rh factor during medical examinations. So as to excuse drivers from paying for unnecessary services, the AMCU recommended that Ministries make changes in the mentioned Regulation.

Similar labels “Spring” and “Natural Spring”

The AMCU has imposed a fine on Avis-Aqua LLC in the amount of UAH 300,000
for violating legislation on protection against unfair competition. In Summer 2012 drinking water called “Spring” (carbonated and non-carbonated) landed on store shelves in Rivne. Its label design disturbed the producer of the drinkable water “Natural Spring” — Napoi-Plus LLC, which has produced and sold its drinking water since 2010, and invested significant funds into advertising.
The AMCU has analyzed the labels’ design, its general composition, colors, and placement of elements. The AMCU’s poll of consumers showed that 87% of respondents believed the labels were similar and 77% of respondents said that they were not able to distinguish between the products. Avis-Aqua LLC did not admit it was guilty but it did change the label’s design.

Procurement by Kievoblenergo canceled

Following the consideration of a complaint by Benichou GP EC UKRAINE LLC claiming that JSC Kievenergo violated legislation when procuring transportation monitoring equipment, the AMCU obliged the customer to cancel the procurement procedure as the participants’ offers did not comply with tender documentation.

Banking & Finance

National Bank received the right to impose a moratorium on repayment of deposits

The National Bank of Ukraine has the right to impose a moratorium on repayment of deposits to businesses and individuals, including returning money from current accounts, and foreign exchange transactions. This norm has been introduced pursuant to the new On Measures to Promote Banks' Capitalization and Restructuring Act of Ukraine. The NBU can impose all of these bans or partial bans on certain types of activity. The NBU may impose a moratorium on repayment of deposits or currency restrictions only after the Financial Stability Board decides that there is instability in the financial condition of the banking system or other circumstances that threaten the banking or financial system of Ukraine. The Financial Stability Board should be established in accordance with the decree of the President of Ukraine and it should regulate not only the NBU but also the State Commission on Securities and Financial Services Market.

 

EIB supports early recovery on Donbas and SME sector

The European Investment Bank (EIB) has agreed to provide two loans under the bank’s 2014-2016 EUR 3 billion lending plan to Ukraine: EUR 200 million to finance early recovery of small-scale damaged infrastructure in parts of Donetsk and Lugansk Regions in order to cope with the consequences of the conflict ravaging parts of East Ukraine; EUR 400 million in support of projects promoted by SMEs and midcaps. The Ukraine Early Recovery loan focuses on investments in the Ukrainian Government-controlled Donetsk and Lugansk Regions and the surrounding areas of Kharkov, Dnepropetrovsk and Zaporozhye. It will support undertakings to reestablish and improve public service delivery of water and sanitation, electricity, and heating. It also covers repairs to roads and railways and the reconstruction of destroyed bridges and the refurbishment of damaged public buildings, including administrative buildings, schools, health centers and hospitals, postal services, and other social infrastructure. EIB funds will also help municipalities in areas that are currently accommodating a significant influx of internally displaced persons to better cope with the increased pressure on social infrastructure and shelter capacity.

Regulatory Policy

Government established State Regulatory Service

The Cabinet of Ministers of Ukraine has reestablished the State Regulatory Service (SRS) after it reorganized the State Service of Ukraine for Regulatory Policy and Entrepreneurship Development. According to the approved regulation, the SRS is a national executive agency, whose operation is guided and coordinated by the Cabinet of Ministers. It implements the state’s regulatory policy, supervision policy (control) in the sphere of business activity, licensing, the system of permits for business activities, and deregulation of business activities. The SRS is headed by its chairman, who is appointed and dismissed by the Cabinet upon the recommendation of the Prime Minister. According to the document, the Chairman of the SRS has two deputies, who are appointed and dismissed by the Cabinet of Ministers upon recommendation of the Prime Minister in coordination with the Chairman of the SRS.