KYIV – A new official body designed to improve Ukraine's investment image and resolve disputes between foreign companies and government authorities started work Thursday Sept. 11, to the cautious approval of some aggrieved investors.
The Chamber of Independent Experts on Foreign Investment, created in accordance with a presidential decree issued in March, is a 24-strong group of foreign and Ukrainian legal and financial experts. As well as adjudicating in disputes between investors and government authorities, the chamber will act as a consultative body, advising the president and government how best to attract much-needed investment into Ukraine.
“The chamber will try to persuade foreign investors that Ukraine is a place where one can invest safely,” said Marietee Bernot, president of the U.S. Corporation of Trade Services and one of the new consultative group's 14 foreign members.
Roman Shpek, head of the National Agency for Reconstruction and Development, chairs the group of experts, all of whom are specialists in law or the foreign investment sphere. Some chamber members also have experience working in similar organizations in other countries, according to Shpek.
If called on to arbitrate in disputes between foreign investors and central or local government authorities, the chamber will appoint three experts to issue a ruling on the case. The two parties in the dispute will nominate one expert each, and jointly nominate the third. If the two parties cannot agree on a nomination, the third expert will be selected by the chamber chairman.
According to Shpek, the new body has already received unofficial requests from several foreign companies for the chamber to arbitrate their disputes with government agencies. However, he declined to name these companies or reveal how many requests for arbitration have been received. Companies will be able to pursue their cases in earnest from next week, once the official procedure for filing arbitration requests is published.
Igor Gorkoun, who runs the British-Ukrainian owned Regina business center in Kyiv, said his Britsh partner would definitely ask the chamber to rule on a long-running dispute with Kyiv City Administration over the ownership of the Regina center.
“This arbitrary rule of [government officials] is going to be stopped sooner or later, and we hope the chamber will help,” he said.
Greg Perkatsch, who heads the Kyiv office of the U.S. electronics giant Motorola, said he hoped that the newly-created body “would promote the creation of a healthy investment climate in Ukraine.” In spring, Motorola withdrew from a $500 million mobile telephone investment, complaining that the terms of government licenses were both unfair and constantly shifting.
The chamber's experts hope their work will help reduce the risk of similar pullouts in the future.
“The [chamber's] strategic aim is to make the country's investment climate safe and profitable,” said one of the chamber's ten Ukrainian experts Oleh Klitochenko, who heads the legal department at the Kyiv office of international auditing firm Arthur Andersen.
To achieve its goal, the chamber has also been granted the right to draft legislation to promote private enterprise in Ukraine, added Shpek.
