Ukraine has one foot in the old Soviet system of regulation 



“The main problem of our regulatory system is that Ukraine has one foot in the Soviet system. As a result, we have burdensome rules and artificial barriers for business, and the gas production industry is no exception,” the head of the Better Regulation Delivery Office Oleksiy Honcharuk said during his speech at the panel discussion “The strategy of gas production development in the context of energy security of Ukraine”, which was held today as part of the II Ukrainian Gas Investment Forum.

According to Oleksiy Honcharuk, BRDO experts see a lot of potential in the reform of the regulatory framework of the gas production industry and have specific achievements in this regard. He mentioned 5 main problems and possible solutions, including:

– geological information should become a valuable product, it shouldn’t be bought in a mandatory manner and sold on the basis of additional approvals;

– obtaining a special permit should cease to be a fiscal transaction;

– auctions should not be an instrument to fund the budget, they are an instrument of competitive access to shared limited resources;

– businesses should have the right to define the standards to assess their resources, the StateGeoCadastre should be demonopolized while creating a market of accredited entities;

– special permit for subsoils should not be an administrative document, it should be a legal transaction and the right of subsoil use – an asset that can be sold or give it as a pledge to a bank;

– it is necessary to finally define the role of local government bodies in the process of approval. The existing model when entities should contact collegial bodies and persuade them to sign a piece of paper encourages corruption.

According to the expert, the above mentioned problems can be resolved at the level of secondary documents. “However, some things require to amend the laws and the Subsoil Code. We together with the professional association and colleagues from gas producing companies are currently working on this issue,” Oleksiy Honcharuk said.