Competitions for Commission on Gambling positions, changes in Ukroboronprom management, and memorandum with EBRD: decisions by Cabinet and President

Today in our digest: the President makes personnel changes in a strategic state company; the Government announces “lockdown” competitions for positions in a newly-created body and negotiates about the strategic reforms.

Decision-maker: the Cabinet.

Who is affected: Ukrainian citizens, gambling industry, gamblers, and the Cabinet.

What does it change: the Government has announced “lockdown” competitions for positions of the Head and the six members (1, 2, 3, 4, 5, 6) of the Commission for Regulating Gambling and Lotteries.

Why this is important: the Law on Gambling is in force since August of this year. According to the law, the state regulatory authority in the area of gambling activities is the Commission for Regulating Gambling and Lotteries.

What is right:

• the newly-created body is launching
• the government budget-2020 includes ₴4.4 bln of expected revenue from licenses for gambling activities.

What is wrong:

• “lockdown” competitions reduced to mere job interviews do not facilitate the development of high-quality civil service. Such competitions do not guarantee the impartial and unbiased selection, the winners are selected by subjective criteria
• presidential amendments to the Law on Civil Service (3491) will allow persons appointed under the simplified “lockdown” procedure to retain their positions, including the Head and members of the Commission on Gambling
• the Commission on Gambling is a newly-created body, so the procedure of its formation must be as impartial as possible. New employees should be professionals with an untarnished reputation. Manipulations during the competitions will undermine the legitimacy of the new government body’s decisions.

Decision-maker: the President.

Who is affected: Ukrainian citizens, servicemen of the Armed Forces of Ukraine and other military units, employees of the SC Ukroboronprom.

What does it change:

• Aivaras Abromavicius is dismissed as the Director General of the SC Ukroboronprom
• Ihor Fomenko is appointed as the acting Director General of the SC Urkoboronprom
• Ihor Smilianskyi is dismissed as a member of the Supervisory Board of the SC Ukroboronprom.

What is wrong:

• even though the President is the Supreme Commander in Chief of the Armed Forces of Ukraine and the SC Ukroboronprom is an important defense enterprise, the President, according to the Constitution, should not have the authority to appoint its management
• according to the Law on Management of State-owned Property, the President does not manage the state-owned property. The authority to do that have the Cabinet, ministries, other central executive bodies, the State Property Fund, etc.

Decision-maker: the Cabinet.

Who is affected: Ukrainian citizens, employees of the State Agency of Automobile Roads of Ukraine, several state enterprises, the Government, and the President.

What does it change:

• the Cabinet approved the cooperation between Ukraine and the European Bank of Reconstruction and Development (EBRD) on preventing corruption and facilitating transparent and efficient governance in the state sector. The aim of the agreement is to strengthen corporate governance of state-owned enterprises
• the Agreement provisions the implementation of a pilot anti-corruption program in the State Agency of Automobile Roads
• the corporate governance reform continues. A high-profile Steering Committee will be created that will include representatives of the Office of the President, the Cabinet, the EBRD, and the state enterprise. The Committee will control the progress of the Agreement’s implementation.

What is right: the cooperation on strengthening corporate governance of state enterprises continues.

Correction: in the previous digest we have stated that the State Customs Service and the State Tax Service are going to be merged. In truth, under the Memorandum of Economic and Financial Policies Ukraine does not have an obligation of such a merger. Moreover, the Agreement provisions that the State Customs Service and the State Tax Service should remain two separate legal entities.