Lex Mundi Global Anti-Corruption Compliance Guide |
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Ukraine |
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| (Europe) Firm Asters Updated 01 Feb 2022 | |
| What is the key anti-bribery and corruption legislation in your jurisdiction? | The key anti-bribery and corruption legislation includes (i) the Law on the Prevention of Corruption, establishing the general anti-corruption framework and system of public service integrity and prevention of corruption (rules on conflicts of interests, gifts, asset reporting, protection of whistle-blowers, requirements for compliance policies of the legal entities, etc.); and (ii) the Criminal Code of Ukraine and the Code of Ukraine on Administrative Offences, setting forth criminal and administrative liability (respectively) for violations of the anti-bribery and anti-corruption requirements. Further, Ukraine is a party to a number of international conventions addressing the above issues such as Civil Law Convention on Corruption (ratified on 09.09.2005), the Criminal Law Convention on Corruption (ratified on 27.11.2009), and the United Nations Convention against Corruption (ratified on 02.12.2009). Other relevant legislation includes the Law on Public Procurement and the Law on Prevention and Counteraction to Legalization (Laundering) of the Proceeds from Crimes or Terrorism Financing and Financing Proliferation of Weapons of Mass Destruction. |
| Has there been a specific anti-bribery and corruption law enacted in your jurisdiction in the last ten years? | Yes, the Law on the Prevention of Corruption entered into effect on April 26, 2015 (replacing the previous law from 2011). Additionally, the new law has led to the establishment of the National Agency on Corruption Prevention, which became fully operational in August 2016. In the past several years the Criminal Code of Ukraine had been amended to (i) introduce criminal liability for certain acts (e.g. undue influence, illegal enrichment) and establish punishment on legal entities for bribery and related actions by their officials; (ii) introduce the concept of special confiscation into the legislation and further develop it; and (iii) increase penalties for certain corruption offenses. Certain measures to strengthen the institutional framework of combating corruption were undertaken, including the establishment of the National Anticorruption Bureau of Ukraine (“NABU”) and the Specialized Anti-Corruption Prosecutor’s Office ("SAPO"). On June 14, 2018, the Law on the Higher Anticorruption Court entered into force. This has led to the launch of the work of the respective court on September 5, 2020. The Higher Anticorruption Court focuses on consideration of the corruption-related and money laundering criminal offenses, including those investigated by NABU under the procedural guidance of SAPO. On January 1, 2020, the new law aimed at the protection and reward of whistleblowers in Ukraine entered into force. The law defines the concept of a whistleblower, sets forth the relevant guarantees for such individuals. Further, the law introduces an obligation of public and certain private sector entities to establish protected anonymous channels for reporting and envisages conditions to provide remuneration for a whistleblower. Further, in June 2021 the Parliament adopted the new law on the establishment of the Unified Portal of Whistleblowers` Reports in Ukraine ("Portal"). The Portal will include summaries of reports of whistleblowers, information on their standing, results of consideration of their reports. As of January 2021, the Portal has not been launched yet. From a practical standpoint, the anti-corruption regime and enforcement thereof have changed dramatically since the Revolution of Dignity in 2014 and it further develops. |
| Is a bribe payment to domestic government officials prohibited by the legislation? | Yes, such payment is prohibited. Ukrainian law provides for the notion of “improper advantage” defined as "money or other property, preferences, advantages, services, non-monetary assets, and any other advantage that is being illicitly promised, offered, delivered, or received by the person, who is authorized to perform public or local self-government functions". This replaced the definition of a bribe. |
| Is a bribe payment to foreign government officials prohibited by the legislation? | Yes, provisions for such payment to a foreign official (as defined in the Criminal Code of Ukraine) is punished under the same article as bribing domestic government officials. The Criminal Code of Ukraine defines a foreign official as (i) any person in a legislative, administrative or judicial office of a foreign country; (ii) any person exercising a public function for a foreign country, including for a public agency or public enterprise; (iii) an official or agent of a public international organization; (iv) members of international parliamentary assemblies; and (v) an official of the international courts and alternative dispute resolution institutions. |
| Is requesting or accepting a bribe prohibited by the legislation? | Yes, an acceptance (receipt) of a bribe (as well as acceptance of promise or proposal) is criminally punished. Requesting a bribe both in the form of solicitation and extortion, are also punishable under the Criminal Code of Ukraine (certain differences apply with regards to potential subjects of solicitation and extortion). Extortion is viewed as an aggravating circumstance and as such results in more severe punishment. |
| Who is subject to the legislation? | Ukrainian law prohibits corruption in various forms, including bribery of (i) domestic government officials (also include officials of state and municipal enterprises); (ii) foreign government officials; (iii) officials of private legal entities; (iv) employees of state and municipal enterprises, institutions or organizations (that are not officials); (v) and providers of public services (e.g. auditors, notaries, evaluators, court experts, court receivers). Both bribe giver and bribe taker can be subject to the punishment (subject to case by case analysis). Legal entities may also be subject to criminal law measures in certain circumstances. |
| Is there criminal liability for corporate entities who have either paid or accepted a bribe payment? | The Criminal Code of Ukraine establishes punishment for companies for bribery and related offenses committed by their officials, other authorized representatives in their name and in the interests of the company, including the bribing of a governmental official, official of a private legal entity or persons providing public services. Additionally, the legal entity may be responsible for non-fulfillment of duties by its officials or shareholders to take corruption-preventive measures if this has led to a commission of the above offenses by its employees (but there were no such cases in practice so far). The imposition of punishment to the legal entity is linked to the commission of the criminal offenses by the above-mentioned individuals and holding them liable for such actions. |
| What is the penalty for individuals violating the law? | Generally, penalties for bribery and related offenses depend on the nature of such offense, the type of official who committed the offense or to whom improper advantage was offered, the amount of the subject matter and certain other circumstances including conspiracy, repetition of the offense etc. By way of example, bribing an official occupying a certain position of responsibility (such as a member of parliament or a judge of the Supreme Court) involves imprisonment from five to ten years and possible forfeiture of property. Bribing an official occupying a less responsible position (such as other judges or prosecutors) is punishable by imprisonment from four to eight years and possible forfeiture of property. Bribery of other officials (without aggravating circumstances) is punished by a fine (from UAH 17,000 (circa USD 629) to UAH 68,000 (circa USD 2,500), restraint of liberty from two to four years or imprisonment for the same period. Lighter punishment is also established for bribing officials of commercial entities or persons providing public services. Receipt of a bribe by an official occupying a certain position of responsibility is punished with eight to 12 years of imprisonment. Receipt of a bribe by an official occupying a less responsible position is punished from five to 10 years of imprisonment. In both instances, forfeiture of property and prohibition to occupy certain positions up to three years is applied. Acceptance of a promise or proposal to receive a bribe or solicitation to provide it is punished in the same way. Receipt of a bribe by other public officials is punished by a fine (from UAH 17,000 (circa USD 629) to UAH 68,000 (circa USD 2,500) or by arrest from three to six months or by imprisonment from two to four years with the prohibition to occupy certain positions up to three years (without forfeiture of property). Acceptance of a promise or proposal to receive a bribe or solicitation to provide it is punished in the same way. Lighter punishment is envisaged for receipt of a bribe by a person providing public services (e.g. notary, private executor, court expert) and by officials of commercial legal entities. Penalties for corruption-related administrative offenses (lighter than criminal), imposed on individuals, are set in the Code of Administrative Offences of Ukraine and depending on the nature and type of the offense include a fine from UAH 850 (circa USD 31) to UAH 42,500 (circa USD 1,575) with forfeiture of the received income or a gift (where applicable) and deprivation of the right to occupy certain positions or engage in certain activities for one year. Also, in certain instances, along with the above punishment special confiscation (e.g. to proceeds of criminal offense, subject matter of criminal offense) can be applied. |
| Assuming corporate entities are liable for violating the legislation, what is the penalty for corporate entities violating the law? | As stated above, the Criminal Code of Ukraine provides for punishment to be applied to legal entities in certain circumstances. For bribery and related offenses, the legal entities may be subject, inter alia, to a fine calculated on the amount of undue advantage received by them as a result of the criminal offense and doubled. If the undue advantage was not received or its amount could not be calculated, the courts (depending on the gravity of criminal offense for which the above individuals are convicted) have a right to apply a fine within a range from approximately UAH 85,000 (circa USD 3,150) to UAH 1,275,000 (circa USD 47,220). In practice, the imposition of criminal punishment on legal entities for bribery and related offenses committed by their officials, other authorized representatives is rare. In decisions publicly available, the issues were rather minor, and fines imposed on the companies did not exceed UAH 33,000 (circa USD 1,220). |
| Assuming corporate entities are liable for violating the legislation, does having a compliance program designed to prevent bribery constitute a defense? | The Criminal Code of Ukraine does not provide for statutory defenses for bribery or related offenses (such as the exemption for facilitation payment or the availability of a compliance program). The availability of a compliance program as well as other steps taken (e.g. risks evaluation) means that if bribing (or other offenses mentioned above) is committed by an employee, the respective legal entity should not be punished for non-fulfillment of duties to take measures to prevent corruption. If committed by officials or other authorized representative of a legal entity, measures are taken by a legal entity to prevent the criminal offense (e.g. compliance program, risks evaluation) serve as circumstance that courts shall consider when imposing the criminal punishment on the legal entity, where applicable. |
| Assuming corporate entities are liable for violating the anticorruption law, is it possible for a corporate entity to reach a deferred prosecution agreement or leniency agreement with the enforcement authorities? | No, the Criminal Procedure Code of Ukraine does not provide for such an option. However, if the court applies a fine to the legal entity, it can allow deferred payment of such fine (in installments and up to three years) considering the financial situation of the company. |
Lex Mundi Global Anti-Corruption Compliance Guide
The key anti-bribery and corruption legislation includes (i) the Law on the Prevention of Corruption, establishing the general anti-corruption framework and system of public service integrity and prevention of corruption (rules on conflicts of interests, gifts, asset reporting, protection of whistle-blowers, requirements for compliance policies of the legal entities, etc.); and (ii) the Criminal Code of Ukraine and the Code of Ukraine on Administrative Offences, setting forth criminal and administrative liability (respectively) for violations of the anti-bribery and anti-corruption requirements.
Further, Ukraine is a party to a number of international conventions addressing the above issues such as Civil Law Convention on Corruption (ratified on 09.09.2005), the Criminal Law Convention on Corruption (ratified on 27.11.2009), and the United Nations Convention against Corruption (ratified on 02.12.2009).
Other relevant legislation includes the Law on Public Procurement and the Law on Prevention and Counteraction to Legalization (Laundering) of the Proceeds from Crimes or Terrorism Financing and Financing Proliferation of Weapons of Mass Destruction.
Yes, the Law on the Prevention of Corruption entered into effect on April 26, 2015 (replacing the previous law from 2011).
Additionally, the new law has led to the establishment of the National Agency on Corruption Prevention, which became fully operational in August 2016.
In the past several years the Criminal Code of Ukraine had been amended to (i) introduce criminal liability for certain acts (e.g. undue influence, illegal enrichment) and establish punishment on legal entities for bribery and related actions by their officials; (ii) introduce the concept of special confiscation into the legislation and further develop it; and (iii) increase penalties for certain corruption offenses.
Certain measures to strengthen the institutional framework of combating corruption were undertaken, including the establishment of the National Anticorruption Bureau of Ukraine (“NABU”) and the Specialized Anti-Corruption Prosecutor’s Office ("SAPO").
On June 14, 2018, the Law on the Higher Anticorruption Court entered into force. This has led to the launch of the work of the respective court on September 5, 2020. The Higher Anticorruption Court focuses on consideration of the corruption-related and money laundering criminal offenses, including those investigated by NABU under the procedural guidance of SAPO.
On January 1, 2020, the new law aimed at the protection and reward of whistleblowers in Ukraine entered into force. The law defines the concept of a whistleblower, sets forth the relevant guarantees for such individuals. Further, the law introduces an obligation of public and certain private sector entities to establish protected anonymous channels for reporting and envisages conditions to provide remuneration for a whistleblower. Further, in June 2021 the Parliament adopted the new law on the establishment of the Unified Portal of Whistleblowers` Reports in Ukraine ("Portal"). The Portal will include summaries of reports of whistleblowers, information on their standing, results of consideration of their reports. As of January 2021, the Portal has not been launched yet.
From a practical standpoint, the anti-corruption regime and enforcement thereof have changed dramatically since the Revolution of Dignity in 2014 and it further develops.
Yes, such payment is prohibited.
Ukrainian law provides for the notion of “improper advantage” defined as "money or other property, preferences, advantages, services, non-monetary assets, and any other advantage that is being illicitly promised, offered, delivered, or received by the person, who is authorized to perform public or local self-government functions". This replaced the definition of a bribe.
Yes, provisions for such payment to a foreign official (as defined in the Criminal Code of Ukraine) is punished under the same article as bribing domestic government officials.
The Criminal Code of Ukraine defines a foreign official as (i) any person in a legislative, administrative or judicial office of a foreign country; (ii) any person exercising a public function for a foreign country, including for a public agency or public enterprise; (iii) an official or agent of a public international organization; (iv) members of international parliamentary assemblies; and (v) an official of the international courts and alternative dispute resolution institutions.
Yes, an acceptance (receipt) of a bribe (as well as acceptance of promise or proposal) is criminally punished.
Requesting a bribe both in the form of solicitation and extortion, are also punishable under the Criminal Code of Ukraine (certain differences apply with regards to potential subjects of solicitation and extortion). Extortion is viewed as an aggravating circumstance and as such results in more severe punishment.
Ukrainian law prohibits corruption in various forms, including bribery of (i) domestic government officials (also include officials of state and municipal enterprises); (ii) foreign government officials; (iii) officials of private legal entities; (iv) employees of state and municipal enterprises, institutions or organizations (that are not officials); (v) and providers of public services (e.g. auditors, notaries, evaluators, court experts, court receivers). Both bribe giver and bribe taker can be subject to the punishment (subject to case by case analysis).
Legal entities may also be subject to criminal law measures in certain circumstances.
The Criminal Code of Ukraine establishes punishment for companies for bribery and related offenses committed by their officials, other authorized representatives in their name and in the interests of the company, including the bribing of a governmental official, official of a private legal entity or persons providing public services.
Additionally, the legal entity may be responsible for non-fulfillment of duties by its officials or shareholders to take corruption-preventive measures if this has led to a commission of the above offenses by its employees (but there were no such cases in practice so far).
The imposition of punishment to the legal entity is linked to the commission of the criminal offenses by the above-mentioned individuals and holding them liable for such actions.
Generally, penalties for bribery and related offenses depend on the nature of such offense, the type of official who committed the offense or to whom improper advantage was offered, the amount of the subject matter and certain other circumstances including conspiracy, repetition of the offense etc.
By way of example, bribing an official occupying a certain position of responsibility (such as a member of parliament or a judge of the Supreme Court) involves imprisonment from five to ten years and possible forfeiture of property. Bribing an official occupying a less responsible position (such as other judges or prosecutors) is punishable by imprisonment from four to eight years and possible forfeiture of property. Bribery of other officials (without aggravating circumstances) is punished by a fine (from UAH 17,000 (circa USD 629) to UAH 68,000 (circa USD 2,500), restraint of liberty from two to four years or imprisonment for the same period.
Lighter punishment is also established for bribing officials of commercial entities or persons providing public services.
Receipt of a bribe by an official occupying a certain position of responsibility is punished with eight to 12 years of imprisonment. Receipt of a bribe by an official occupying a less responsible position is punished from five to 10 years of imprisonment. In both instances, forfeiture of property and prohibition to occupy certain positions up to three years is applied. Acceptance of a promise or proposal to receive a bribe or solicitation to provide it is punished in the same way.
Receipt of a bribe by other public officials is punished by a fine (from UAH 17,000 (circa USD 629) to UAH 68,000 (circa USD 2,500) or by arrest from three to six months or by imprisonment from two to four years with the prohibition to occupy certain positions up to three years (without forfeiture of property). Acceptance of a promise or proposal to receive a bribe or solicitation to provide it is punished in the same way.
Lighter punishment is envisaged for receipt of a bribe by a person providing public services (e.g. notary, private executor, court expert) and by officials of commercial legal entities.
Penalties for corruption-related administrative offenses (lighter than criminal), imposed on individuals, are set in the Code of Administrative Offences of Ukraine and depending on the nature and type of the offense include a fine from UAH 850 (circa USD 31) to UAH 42,500 (circa USD 1,575) with forfeiture of the received income or a gift (where applicable) and deprivation of the right to occupy certain positions or engage in certain activities for one year.
Also, in certain instances, along with the above punishment special confiscation (e.g. to proceeds of criminal offense, subject matter of criminal offense) can be applied.
As stated above, the Criminal Code of Ukraine provides for punishment to be applied to legal entities in certain circumstances. For bribery and related offenses, the legal entities may be subject, inter alia, to a fine calculated on the amount of undue advantage received by them as a result of the criminal offense and doubled.
If the undue advantage was not received or its amount could not be calculated, the courts (depending on the gravity of criminal offense for which the above individuals are convicted) have a right to apply a fine within a range from approximately UAH 85,000 (circa USD 3,150) to UAH 1,275,000 (circa USD 47,220).
In practice, the imposition of criminal punishment on legal entities for bribery and related offenses committed by their officials, other authorized representatives is rare. In decisions publicly available, the issues were rather minor, and fines imposed on the companies did not exceed UAH 33,000 (circa USD 1,220).
The Criminal Code of Ukraine does not provide for statutory defenses for bribery or related offenses (such as the exemption for facilitation payment or the availability of a compliance program).
The availability of a compliance program as well as other steps taken (e.g. risks evaluation) means that if bribing (or other offenses mentioned above) is committed by an employee, the respective legal entity should not be punished for non-fulfillment of duties to take measures to prevent corruption.
If committed by officials or other authorized representative of a legal entity, measures are taken by a legal entity to prevent the criminal offense (e.g. compliance program, risks evaluation) serve as circumstance that courts shall consider when imposing the criminal punishment on the legal entity, where applicable.
No, the Criminal Procedure Code of Ukraine does not provide for such an option. However, if the court applies a fine to the legal entity, it can allow deferred payment of such fine (in installments and up to three years) considering the financial situation of the company.