For many Ukrainian companies (and not only those affected by the FCPA/UKBA) the year of 2014 will be marked as a point of no return in their compliance efforts undertaken so far. On 14 October 2014, the Ukrainian parliament enacted a set of the following new anticorruption laws that will significantly reshape the Ukrainian legal regulation and enforcement in the anticorruption area:
- Law No. 1700-VII on Preventing Corruption;
- Law No. 1699-VII on the State Anticorruption Policy Framework of Ukraine (Anticorruption Strategy) for 2014 – 2017;
- Law No. 1698-VII on the National Anticorruption Bureau of Ukraine.
Unlike previous attempts of the Ukrainian legislator to reform this widely spoken area, this time companies operating in Ukraine will have to take the new legislation seriously. Section X of the Law on Preventing Corruption, dealing with preventing corruption in legal entities, requires special attention of the companies. This Section X provided, in particular, for the following:
- Obligation of the legal entities to ensure developing and implementing adequate measures for preventing and fighting corruption in their activities;
- Responsibility of the companies CEOs for ensuring regular evaluation of the companies' corruption risks and taking appropriate anticorruption measures;
- Possibility to engage independent experts to assist a company in detecting and eliminating corruption risks in its activities, as well as to conduct anticorruption due diligence;
- Definition and duties of the anticorruption compliance officer; and
- Requirements to the anticorruption compliance programs.
In addition to the above important legal novelties, the Law on Preventing Corruption:
- defines a gift;
- distinguishes between a corruption offence and a corruption related offence;
- introduces changes in the groups of subjects of liability for corruption offences;
- provides for an algorithm for preventing acceptance of unjustified benefits and gifts, and for dealing with them when provided;
- regulates protection of whistleblowers;
- sets up certain notable requirements regarding transparency and information access; and
- introduces certain changes related to liability for corruption and corruption related offences to the Criminal Code and the Administrative Offences Code.
Importantly, the new anticorruption legislation preserved the earlier established serious criminal liability (up to approximately EUR 77,000) of the companies for the actions of their authorized persons performed on their behalf and in their interests.
Based on the above, it is highly recommended for all companies operating in Ukraine to adopt a compliance program (approve a written internal anticorruption policy) to adequately address at least the most serious corruption risks it may face in its activities.
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