Ukraine – “land of lobbyists’ dreams”

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A full-scale war for almost two years has caused massive destruction that will have to be rebuilt, involving all possible resources, investments and connections. Already now the World Bank evaluates reconstruction needs of more than 400 billion dollars. And international organizations and businesses are ready to join the recovery process.

In a positive development scenario, we expect that only the European Union and the International Finance Corporation (IFC) involvedmore than 500 million euros of private sector investments for the recovery of Ukraine. About the readiness of American business invest a number of sectors of the Ukrainian economy are discussed not only in numerous meetings, but also in clear statements of the US special representative for the economic recovery of Ukraine, Penny Pritzker. We also understand that there will be competition for investments within the EU. There are already many Polish businesses served projects for the post-war reconstruction of our state.

On the one hand, international companies are well aware of the opportunities and prospects that are open to them in a country that is on the way to joining the EU. At the same time, the previous stages of economic development cannot boast of numerous successful cases with a share of foreign capital, and our time of European integration also coincided with the tough selection of borders in a full-scale war. However, the civilizational choice we have made for ourselves and the Ukraine of the future, to which we aspire, is a state with an attractive investment climate and a dynamic economy.

Therefore, Kyiv can become a place of active activity of lobbying companies, including foreign ones, which will be an instrument of interaction between the state and businesses. This means that the state has come very close to the need to create legislative regulation of lobbying, and with it the market of legal influence, transparent mechanisms and standardization of tools.

A step towards joining the EU

Two months ago, the European Council agreed to start the procedure for Ukraine’s accession to the EU, which involves the harmonization of national legislation with Union standards. Among the list of mandatory requirements for implementation is the need to adopt a law on lobbying activities. This is stated in conclusion European Commission. The main international standards in the field of lobbying are also in the recommendations The Organization for Economic Cooperation and Development (OECD), whose member countries account for most of the world’s GDP.

Professional protection, promotion of certain interests for remuneration and influence on decision-making, which is lobbying in its essence, has been legalized in the USA and European countries for a long time and is considered as a component of the democratic process. With experience in legal lobbying, interests and resources for investment, European and American companies will be able to open up more prospects for themselves in various fields – from defense and infrastructure to energy and education and health care, and are already making connections today. And the American media, describing the interest of business, called To some extent, Kyiv is a “land of lobbyists’ dreams”.

In Ukraine, despite all attempts to regulate such activity, this process has always remained unsystematic and changed its color in the palette between fairly gray and frankly black in various spheres. Today, this is both a requirement for joining the EU and the need to create working rules and procedures within the state for the development and attraction of business and improving the quality of legislative decisions. The adoption of the relevant law is provided for in the implementation measures State anti-corruption program.

The new one, developed by the National Agency for the Prevention of Corruption (NACP), bill “On honest lobbying and advocacy in Ukraine” appeared last year in mid-December, and on January 10, 2024, it was voted by the Verkhovna Rada in the first reading.

What does the bill provide

The main step towards creating a legislative field for the work of lobbyists and fulfilling the requirements for joining the EU is the above-mentioned draft law. The document voted as a basis aims to introduce honest lobbying procedures. He proposes to define the principles of such activity, who and what can lobby, as well as the rights and obligations of lobbyists and methods of their influence.

The draft law issued by NAKC provides for the creation and launch of a public Transparency Register, which will contain information on lobbyists and reporting on their activities. Registers of lobbyists exist in various countries and allow tracking who is lobbying, for what remuneration and whose interests.

In the EU, there is such a tool – EU Transparency register – launched European Parliament and European Commission in June 2021. It is open Database about groups and organizations that influence the formation or implementation of EU policy and legislation. And as of February 2024, it has almost 12,500 registered businesses, public organizations, law firms, lobbying companies, private individuals, scientific institutions, associations and personal consultants.

The document proposed by the government has become one of the most discussed draft laws in the public sector in recent times. NGOs criticized the first edition of the document and saw in it prerequisites for limiting their activities. Among the shortcomings mentioned by NGOs is the vagueness of the distinction between the concepts of lobbying and advocacy. The latter is an integral part of the sector’s work to achieve social change, which is why organizations advocate decriminalizing advocacy.

Legalization of lobbying: what the new law offers

About the need to clearly write out the concept says and business. The draft law supported in the first reading, according to entrepreneurs, does not give an answer as to who to consider business communities that represent the interests of the industry, and not individual players – they are lobbyists or engaged in advocacy.

At their own conclusions before the first reading, the Main Scientific and Expert Department of the Apparatus of the Verkhovna Rada (GNEU) also had comments regarding the definition of concepts and the separation of lobbying from other activities, which do not fully take into account the recommendations of the Council of Europe and the OECD. In addition, the GNEU calls the lack of a definition of what constitutes honest lobbying as a drawback of the draft law “On Virtuous Lobbying and Advocacy”.

The public sector is now active offers in the draft law, expand the code of ethics not only for lobbyists, but also for officials, ensure the publicity of the latter’s meetings and full openness of information about the activities and sources of funding of full-time and freelance advisors of state bodies and their officials.

Now the draft law is being prepared for the second reading, and this is the time to make the document and the legislative regulation of lobbying such that it will bring the state closer to fulfilling the requirements for joining the EU: according to European standards, as a result of an open and inclusive discussion with the involvement of stakeholders, without limiting the activities of civil society society.

Interact effectively

Today, commercial organizations and entire sectors of the economy still feel the lack of an effective mechanism of interaction with state authorities. When my team and I were creating Educational and Analytical at KSE in April 2021 Center interaction with the authorities, we started out of necessity, which I see even now – through quality education, to help state institutions, companies, public and professional associations master the skills of building effective relationships.

In a state that is already moving towards recovery and guided by the “Build Back Better” principle, the interaction between government and business should be based on civilized practices. Legislation that would define and establish clear working lobbying rules is needed. Regulated lobbying and transparent and clear procedures for such activities lead to the creation of a market professional specialists equal to each other.

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Legal lobbying opens doors for all, not for individuals. When lobbyists of one business see the work of others, it will have a qualitative impact on the field, and players will compete with each other with ideas, arguments, and creative approaches. The arrival of foreign companies will also increase the requirements for the industry’s work standards.

The state also benefits from this. First of all, from improving the quality of decisions approved by officials. Secondly, the regulation of lobbying is also the creation of jobs, and therefore additional revenues to the budget from taxes.

To this day, there is no institute of civilized lobbying in Ukraine. At the same time, our state is now at a moment when, on the one hand, the legalization of lobbying is a requirement for joining the EU, and on the other, Ukrainian and foreign businesses expect regulated rules of the game and transparency of influence on legislative decisions. This is an opportunity for Ukraine to finally have a legal field in the state where it is possible to build bridges between business, the public and authorities.

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