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ZELENSKYY SUBMITS LONG-ANTICIPATED DE-OLIGARCHIZATION BILL, LEAVES CRITICS WANTING MORE

The Kyiv Post reported, “President Volodymyr Zelenskyy submitted a de-oligarchization bill to the Verkhovna Rada on June 2. Figures who are officially recognized as oligarchs will be banned from donating directly or indirectly to political parties and taking part in the privatization of state assets, according to the bill. Zelenskyy launched what he calls a ‘de-oligarchization campaign’ in early 2021. The bill seeks to create an official legal definition for oligarchs. Oligarchs are defined as persons meeting at least three of four criteria: involvement in political activities, considerable influence on…

June 4, 2021

 

The Kyiv Post reported, “President Volodymyr Zelenskyy submitted a de-oligarchization bill to the Verkhovna Rada on June 2. Figures who are officially recognized as oligarchs will be banned from donating directly or indirectly to political parties and taking part in the privatization of state assets, according to the bill. Zelenskyy launched what he calls a ‘de-oligarchization campaign’ in early 2021.

 

The bill seeks to create an official legal definition for oligarchs. Oligarchs are defined as persons meeting at least three of four criteria: involvement in political activities, considerable influence on mass media, being a beneficiary of monopolies recognized by anti-trust authorities and ownership of assets exceeding Hr 2.2 billion ($81 million), excluding media assets.

 

Involvement in political activities implies being a president, a member of parliament, a minister or deputy minister, the head of a state agency or a presidential advisory body, the head of the Security Service of Ukraine, the prosecutor general or the head of the National Bank of Ukraine, according to the bill. A person affiliated with people in these positions can also be classified as an oligarch.

 

Moreover, a person who has financed political parties, political advertising or protests with political demands can also be defined as an oligarch, according to the legislation.

All top government officials will be required to declare any contacts or meetings with oligarchs, except for public official meetings.

 

A person can be recognized as an oligarch by the National Defense and Security Council based on requests by members of the council, the Cabinet of Ministers, the National Bank of Ukraine, the Security Service of Ukraine or the Anti-Monopoly Committee.

 

The National Security and Defense Council will also keep a public register of officially recognized oligarchs.

 

If signed into law, the bill will formally come into effect on the following day and will be implemented within six months. The legislation will be in force for 10 years.

Zelenskyy’s critics have dismissed the bill as a publicity stunt that aims to compensate for the absence of genuine rule of law reforms.

 

‘It’s impossible to defeat oligarchs with a law on oligarchs,’ columnist and investment banker Serhiy Fursa wrote on Facebook. ‘It’s impossible to defeat oligarchs without the rule of law and functioning institutions.’

 

Kira Rudyk, head of the opposition party Voice, agreed with this assessment. ‘The president’s initiative was submitted to parliament only as a PR stunt,’ Rudyk said in a statement. ‘Instead of reforming the judiciary and creating fair courts in the country, the president is submitting a populist bill that will not change anything fundamentally.’

 

She also argued that the anti-oligarch bill increased the powers of the presidentially controlled National Security and Defense Council and was part of efforts to replace the law enforcement system with the council’s decisions. The legislation gives the National Security and Defense Council arbitrary authority to decide whether someone is an oligarch, she added.

 

Critics were also skeptical about the prospects of de-oligarchization after a bill targeting oligarch Rinat Akhmetov’s interests was amended in his favor.”

 

Initially, the bill was supposed to increase taxes on iron ore extraction, the bulk of which is controlled by Akhmetov’s DTEK group. The initial plan that the government presented would see Akhmetov’s enterprises pay an additional $1 billion per year in taxes.

 

However, Prime Minister Denys Shmyhal and members of Zelenskyy’s Servant of the People party on Feb. 2 submitted a bill that raises the tax by just $500 million per year.”