News date: 18 September 2019
Leonid Gilevich, the Counsel at Ilyashev & Partners Law Firm, delivered a speech on “Compliance in Contractual Relations” at the IV International Compliance Forum, held on 18 September 2019 in Kyiv.
According to Leonid Gilevich, the inclusion of compliance provisions into the contract allows controlling the quality of services, works and goods, cooperating with the reliable contractors, avoiding violations of the law, and also preventing the influence of other negative factors.
“It is not enough to be simply limited in the contract to the general obligation of a party to comply with “legislation” or “all applicable norms and provisions”, – Leonid Gilevich emphasized. – To ensure that compliance provisions are not purely declarative, the contract must contain carefully elaborated compliance obligations, as well as an effective controlling mechanism and sanctions for the failure to fulfill such obligations”.
Leonid Gilevich noted that the contract can oblige the counterparty to comply with both legislative norms and other provisions, provide for the possibility to audit the counterparty, as well as provide for a penalty and a right to terminate the contract (with compensation for damage) in case of violation of the compliance provisions. In this case, only legally verified provisions can be effective and enforced, therefore it is recommended to involve qualified lawyers to draw up such provisions.
IV International Compliance Forum is a specialized event attracting the heads of legal and compliance departments of Ukrainian companies. The forum is organized by Yurydychna Praktyka Publishing House.