Property Rights and Ease of Business

More enforceable obligations and proper debt collection – new private enforcement service

According to the World Bank estimates, more than UAH 400 billion (some EUR 13 billion) are locked up in large unenforced civil cases. As recently as 2016, only some 5% of civil court decisions in Ukraine were properly and timely enforced in favour of claimants, while the relevant figure was at least 30% in European countries with private enforcement services. In 2016 Ukraine decided to shift from the state enforcement service to create a mixed system including Private Enforcement Officers (PEOs), who benefit from entrepreneurial spirit of an individual to improve effectiveness and in enforcement of court decisions.

The Predecessor Project to "Pravo-Justice" was a leading donor in helping launch operations of some 100 active PEOs, working in parallel with some 4,500 state enforcement officers (SEOs). PEOs have already fully enforced almost 3 times more court judgments per case closed, to compare with SEOs. "Pravo-Justice" is building on these achievements to maintain the high level of PEO efficiency through building PEO professional self-governance system, raising awareness of the reform and its benefits, smoothening and simplifying procedures, streamlining the MOJ oversight role of PEOs.

Cleaner property titles – improved notary service

The protection of property rights is an important pre-condition for investment, economic and social stability. A variety of transactions related to various proprietary interests and titles are conducted through notaries, who bear the responsibility clean transactions and foreseeable rights. MOJ has recently undertaken to fully privatise the notary services, following a gradual privatisation process that was launched almost 20 years ago. Pravo-Justice is supporting the Ukrainian counterparts in these endeavours, helping develop the professional standards, admission and evaluation procedures, ethical and disciplinary oversight mechanisms, development of fully electronic services, encouraging cooperation of 2 key players – the Ministry of Justice and the Notary Chamber of Ukraine.

Protection of property title is important condition for investment, economic and social stability.

Ease of economic activity while protecting creditors and business partners - new bankruptcy rules

The Financial Stability Board considers sound insolvency and creditor/debtor regimes fundamental to robust and diverse modes of financial intermediation, responsible access to finance, and financial stability. Protection of creditors’ rights in bankruptcy proceeding remains a challenging issue in Ukraine. The bankruptcy procedures existing for the last 17 years are very lengthy, unclear and ineffective. According to various expert assessments, on average creditors in insolvent companies recover only nine cents for every euro. Pravo-Justice is assisting Ukraine in development and implementation of the new Bankruptcy Code which was intended to simplifiy insolvency procedures, increase protection of creditors’ rights while introducing individual bankruptcy.

Execution of ECHR judgments

Ukraine has had a high count of applications before the European Court of Human Rights (ECHR). One of the main reasons for the problem is non-enforcement of court judgments, making up more than 50% of total violations found by ECHR against Ukraine. The Project contributes to resolving this problem through the reform of the enforcement system, while also helping the Government Agent at MOJ to be more effective in implementing general measures in the aftermath of ECHR judgments, improving the regulatory framework and practices in Ukraine for the benefit of all individuals in a similar position to that of the successful ECHR applicant.

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