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“The team was recently visible advising on a number of pharmaceutical cases. Sources agree that the team is “moving in the right direction” and are particularly impressed by its work in the pharmaceutical sector”.

 

Mighty Dnipro: Decommunization or a Mere Economic Waste

03.06.2016

Mykola Aleksiuk, Attorney at Law at Ilyashev & Partners Law Firm
Source: Forbes.ua

On May 19, 2016 Verkhovna Rada of Ukraine upheld two decrees in order to bring the names of geographical objects in compliance with requirements of the Law of Ukraine “On the condemnation of the communist and national socialist (Nazi) regimes and prohibition of propaganda of their symbols”. According to the said Decrees the town of Dnipropetrovsk was renamed into the town of Dnipro, and Dniprodzerzhynsk – into Kamianske.

Certain people treated the news about renaming of a million city with a critical eye. Resentment towards changing the names of population centers is substantiated by three major points:
• humanitarian: renaming the population center is ill-timed as soon as it may provoke further escalation of the conflict between supporters and opponents of the communist past;
• macroeconomic: change of the geographical names puts burden on local budgets as soon as it requires allocation of additional resources (production of new signs at the buildings, new traffic signs etc.) which could be directed at vital social needs;
• microeconomic: decommunization process will prove costly to business because of the necessity to receive new certificates and licenses, re-register title rights, produce new seals and letterheads etc.

Let’s try to analyze if the change of geographical names requires spending considerable material resources from the entrepreneurs while bringing their activities in compliance with legislative norms.

Change of the names of the toponymic objects of the population centers by no means influences the validity of a documents establishing title to the immovable property. That is why there is no necessity to re-register such documents. “Decommunized” address of an object of immovable property will be mentioned in the new document of title after further alienation of such object. Besides, it will not be necessary to bear any additional expenses in this respect.

But the amendments about a legal entity contained in the Unified State Register will need to be registered. Moreover, for registration of such amendments an administrative fee shall apparently be charged. It may be explained by the fact that in final and transitional provisions of the law of Ukraine “On the condemnation of the communist and national socialist (Nazi) regimes and prohibition of propaganda of their symbols” (which was passed on March 09, 2015) the legislator stipulated introduction of amendments to the Law of Ukraine “On the state registration of legal entities and private entrepreneurs” concerning exemption of legal entities from making payment of administrative fee for state registration of amendments introduced to their constituent documents in connection with passing the law on decommunization.

However, from January 01, 2016 new version of the said law came into force under the new name: the Law of Ukraine “On the state registration of legal entities, individual entrepreneurs and civil organizations”. Provisions of this law do not stipulate exemption from settlement of the administrative fee under the mentioned principles. Thus, for the state registration of changes about a legal entity introduced into the Unified State Register an administrative fee in the amount of 435 hryvnias is currently charged (the amount of 0.3 amount of minimum official wage). The legislatively established term of consideration of documents submitted for the state registration of corresponding amendments is 24 hours from the moment of receipt of such documents.

If we talk about re-registration of permission documentation (in particular represented by veterinary, ecological, land surveying, and sanitation-and-epidemiological documents, permits for subsoil use etc.) by its information letter No. 1036/0/20-16 as of February 22, 2016 the State regulatory service of Ukraine stated its clear position. According to the said position in case of the change of names of population centers, districts and regions, but the company does not change its actual place of activities or location of its office (from which it performs day-to-day management of the company’s activities – mainly the place where the head officials work -, or the place of performance of accounting and administration activities), there will be no grounds for re-registration of permission documents. Suchwise, the process of decommunization does not require introduction of amendments into the permission documents (full list of which may be found in the Law “On list of permission documents in the sphere of economic activities”).

The Law “On licensing of types of economic activities” also does not stipulate change of location of a legal entity as grounds for re-registration of a license. At the same time Article 15(2) of the said Law stipulates for the licensee’s obligation to inform licensing authorities about the change of all the information, which was indicated in its documents attached to the license application, within the period not exceeding one month after the moment when such changes came into force.

According to clarifications of the State Fiscal Service of Ukraine, provided in the letter No. 2375/10/28-10-06-11 as of February 03, 2016 in case of introduction of amendments into the license for the right to engage into retail trade of alcoholic drinks and tobacco products the issuing body, based on the application filed by a business entity, must issue a new license on the official letterhead within three business days with consideration for the necessary amendments. Payment for such re-registration shall not be charged.

Within five days following the change of the geographical name it will be required to re-register payment transactions recorders used for registration of settlement operations (payments for goods or services). In addition it will be needed to re-program cash-register machines so that new addresses will be indicated in the settlement documents.

The subjects of entrepreneurial activities will need to produce new seals, stamps, official letterheads and marketing products which are going to contain new address. Though, it will not be a great burden for the business. The term of production (for example) of seals does not exceed several business days and the price of production ranges from UAH 150 to UAH 350.

 
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