Introduction of bail against economic crime shall not cancel possibility of the subsequent arrest

A business breakfast dedicated to the protection of business against possible threats and consequences of inspections and investigative actions by law-enforcement bodies was held by the Pavlenko & Poberezhnyuk Law Group.

According to Tatiana Ignatenko, counsel, the amendments made to the legislation on humanization of responsibility for economic crimes - mitigation of punishment for crimes committed or substitution of them with punishment not entailing imprisonment - along with administering the measure of restraint in the form of a bail with possible additional obligations, do not preclude from the detention of persons who have been made criminally liable in case of such bail non-payment. The mentioned novelties specify that this category of persons is subject to bail plus additional obligations or detention. “There is a positive point from the viewpoint of budget revenues, but in case of failure to pay bail the only way for such person is detention”, she noted.

“As to humanization of particular economic crimes, it should be noted that legislators have not provided for the amount of a maximum fine, which may eventually lead to ‘fine inflation’ depending on the level of company the perpetrator of the crime committed works for; some other ‘factors’ will also be taken into account”, Ms Ignatenko said. It follows from the amendments to the Criminal Code of Ukraine that legislators have removed criminal sanctions (i.e. imprisonment) for committing economic crime but increased the amount of a fine. Moreover, the legislator has only provided that the amount of fine must not be less than the value of property damage caused by the crime.

“We should also bear in mind that in case of failure to pay a fine, the court may substitute the fine as punishment with imprisonment”, the attorney resumed.

Valeriya Tarasenko, counsel, turned to the issue of inspecting authorities of tax bodies being exhaustive and strictly regulated by the Tax Code of Ukraine (TCU). Thus, being aware of such authorities and developing a clearly defined taxpayer strategy, will enable a business to avoid unfounded actions by the State Tax Administration and reduce risk of the unfounded decisions being made.

“It happens rather frequently that staff feel panic when an unplanned inspection occurs, and fail to properly verify the grounds for such an inspection and the documents submitted by the inspectors. This approach is absolutely wrong and may be risky for the taxpayer”, she explained.

According to the expert, in most cases, as established in practice, tax bodies arrange unplanned inspection documents not in the proper manner, which may raise absolutely lawful grounds for the taxpayer not to allow the inspection to take place.