A bill with provisions for Ukrainian Internet providers to obtain a government license is making the rounds in a parliamentary committee. Passed on July 1 in the first of two readings, the measures were inserted after the vote with the vague terminology of “international international traffic,” which isn’t defined and doesn’t stipulate which government agency or body would handle licensing.
It was introduced by the Committee on Entrepreneurship, Regulatory and Antimonopoly Policy, headed by Oleksandra Kuzhel of Yulia Tymoshenko’s Batkivshchyna party, in April.
If passed, it would further convolute the nation’s bureaucracy, which is filled with red tape and contradictory or overlapping regulations that stifle the business climate.
“While the European Union wants Ukraine to decrease the number of licensed activities, the deputies want to add more,” Ivan Petukhov, chief executive officer of Adamant, a web access provider, who saw the bill on Sept. 24, told the Kyiv Post.
Another issue is that the draft law would enforce licensing where it’s not needed.
In an earlier interview with the Kyiv Post, the owner of Internet provider Mirohost Oleksandr Olshanskiy, who runs for parliament, said Ukraine’s light Internet regulation is the driving force of the sector’s development.
“Why did the Internet (in Ukraine) develop rapidly? Because initially it wasn’t regulated by the government, and we had crazy competition,” he said. “Recently I was asked what event was the most significant for the information technology sector in Ukraine in the last 20 years. I answered that it was the fact that in 1999 data transfer wasn’t included in the list of activities, providers of which had to receive licenses from the government.”
Petukhov went further in an open letter, which the parliamentary committee claims to have never received, by comparing the bill in its current version to the Viktor Yanukovych-era “dictatorship laws” of January 16 that severely restricted protest activity and which were later reversed.
Opinions vary
According to Petukhov, Sergiy Tretyakov, Kuzhel’s assistant who served as her deputy within State Regulatory Committee in 2009-2010, is the bill’s key advocate in the public. Behind the scenes, however, the bill is likely to be the brainchild of Kuzhel, said the Internet businessperson.
Kuzhel wasn’t reachable through the committee’s press service, and numerous calls placed to her mobile telephone number went unanswered. She addressed the controversy surrounding the bill on her Facebook account on Oct. 1, claiming that the amendment regarding the licensing of Internet providers “does not exist in the bill.”
Her account appears to contradict the contents of the current bill. The Kyiv Post obtained a document file of the bill that Petukhov and Asters law firm senior associate Anna Vyborna, who received the bill from another lawmaker, confirm is genuine. It clearly stipulates that companies enjoined with “international Internet traffic,” such as providers, must obtain a license.
Volodymyr Zagorodniy, head of the secretariat of the parliament’s committee on entrepreneurship, did not deny that the amendment in question was added to the edition of the bill that was sent to workgroup members before the last meeting on Sept. 26. However, he wasn’t able to identify the person or entity behind it, saying only that it might have been the state regulator of communications and information. He also said that the bill is still a work in process and shouldn’t have been shown to the wider public.
“In that version, [we included] all suggestions, good and bad, we didn’t even sort them,” he said, adding that “[the list of licensable activities] is more or less a technical question, and it could’ve taken too much time to discuss (it during the Sept. 26 meeting). We wanted to talk about theoretical issues.”
Zagorodniy further explained that the main goal of the Committee and himself personally is to decrease the number of licensable activities as much as possible. The final version of the bill may include as few as 20 activities (the current version consists of 35), or even fewer, and there won’t be anything about licensing Internet providers, he added.
The next meeting of the Committee’s workgroup where the list of licensable activities will be discussed is “theoretically” supposed to happen before the middle of December. However, Zagorodniy says the bill might go to back to the session hall earlier.
Vyborna, of Asters law firm, who received the bill from a source other than Petukhov, told the Kyiv Post that the point regarding Internet traffic “looks puzzling,” as the authors of the bill have repeatedly emphasized that their goal is to deregulate the economy.
“The (passing of this norm) would mean that all Internet providers will have to receive a license for an activity, which currently is not licensable according to Ukrainian law ‘On telecommunications’. (…) I want to believe that the amendment in question appeared as a result of a misunderstanding, because the project is still being worked on,” she added.
Andrii Degeler is the Kyiv Post’s information technology reporting fellow. Degeler has been covering the IT business in Ukraine and internationally since 2009. His fellowship is sponsored by AVentures Capital, Ciklum, FISON and SoftServe. He can be reached on Twitter (@shlema) or [email protected].
