A new law pledges to take down Ukraine's oligarchy, but does it go too far or not far enough?
The Ukrainian President Volodymyr Zelenskyy made headlines in Ukraine recently when he submitted a new bill to parliament that he claims will target oligarchs.
It takes aim at Ukrainian oligarchs who built 'political, economic, and media influence'. The president wants to create an official list of the country’s oligarchs and, among other things, ban them from donating either directly or indirectly to political parties. But it doesn’t stop there.
"We are building a country without oligarchs... A country for forty million citizens, not for a hundred of Forbes. A country where the state really helps business and big business doesn’t live at the expense of the state budget," Zelenskyy stressed in a recent speech.
He added that he is “building a country that is not waiting only for the sanctions policy of other states” and said that he is ready to act. It is unclear who will be on the list.
But the move could help Ukraine in its effort to join NATO, with President Joe Biden commenting last week that corruption was a specific "stumbling block" to Kyiv joining the alliance.
What are the criteria?
Any person fitting three of the four following criteria will be on the list if the bill passes:
• involvement in political activities
• ownership of assets exceeding 2.2 billion hryvnias ($81 million)
• considerable media influence
• being a beneficiary of monopolies
Too much or too little?
Ukraine's oligarchs have built vast business empires and networks of power since the fall of the Soviet Union and the independence of Ukraine. They have been accused of controlling large sections of the country's economy and having a huge influence on politics, economics, and society.
But the bill has been criticised for going too far by some and for being too weak by others. Aleksey Jakubin, an associate professor at Kyiv Polytechnic Institute, told Euronews that some criticise the bill for not being concrete about what media and political influence means.
“Some people see the current actions by the President as purely PR, but others are concerned that Zelenskys is going too far and not respecting the constitution,” said Aleksey Jakubin, an associate professor at Kyiv Polytechnic Institute, told Euronews.
“There are hundreds and hundreds of Ukrainians who could fit the criteria in the new bill, and it makes people nervous that Zelenskyy might only target some oligarchs and not others.”
The Medvedchuk case
The new bill comes after a high-profile case in Ukraine, showing the government’s willingness to act.
In May, Prosecutor General Iryna Venediktova charged an allegedly pro-Russian member of the Ukrainian parliament, Viktor Medvedchuk, with "high treason for providing information to Russia and attempting to steal national resources in Crimea", which Russia annexed in 2014.
Medvedchuk is one of the most powerful men in Ukraine, and he is often labeled an oligarch by Ukrainian media.
Medvedchuk himself followed his lawyer’s advice not to comment to Euronews, but Oleg Voloshyn, a member of the Ukrainian parliament for the same party as Medvedchuk - Opposition Platform - For Life - expressed his concern.
He said that the case against Medvedchuk is an attempt by Zelenskyy to remove a political opponent through a populist move and that the recent de-oligarchisation bill if passed in parliament, will give Zelenskyy the tools to go after his political opponents, which will be dangerous.
“What Zelenskyy is doing now is not to get rid of oligarchs and to make fair competition, but to subordinate them or substitute them for others,” said Voloshyn to Euronews.
“To fight oligarchs, you need to change the rules, not the people. The oligarchs are a symbol (of problems), and you need to fight them by creating equal rules and competition.”
The problem with making a list of oligarchs, according to Voloshyn, is that there will always be skepticism about why specific names are included, and others are not. He is afraid that Zelenskyy will only go after political opponents and protect his own people.
“The list of oligarchs is made in a way to show that there is a fight. But the oligarchs of tomorrow could maybe be Zelenskyy himself or one from his team,” said Voloshyn.
Several steps to come
Euronews has reached out to Zelenskyy’s press person Iuliia Mendel for comment, but she had not responded before publication.
However, in a statement to Kyiv Post, Mykhailo Podolyak, an aide to Zelenskyy’s chief of staff Andriy Yermak, recently said that Zelenskyys new bill is significant because “before Volodymyr Zelenskyy, nobody in Ukrainian politics tried to take such steps aimed at legally defining the (oligarch) phenomenon and later dismantling the oligarchic system.”
Podolyak argues that the bill is needed because “oligarchs and people affiliated with them have long held a special position in our politics and economics” and could “blackmail the state through their mechanisms and seize public resources.”
Zelenskyy was elected president in 2019, promising large-scale market reforms and fighting corruption, including oligarchy.
In 2020, Zelensky received criticism from international organisations such as the International Monetary Fund, IMF for not doing enough to stop corruption and reform. The de-oligarchisation bill can be a renewed attempt to make reforms.
Petro Poroshenko is the European Solidarity Party leader and was the Ukrainian President before Zelenskyy.
In an email to Euronews, the European Solidarity Party wrote that they support the government’s vision of a future without corruption. Still, the focus should be on reforms and not on specific people.
“He (Zelenskyy) wants to impose in Ukraine supremacy of the rule of the president instead of the rule of law. It all leads to ruining the trust of the international partners, and that’s very dangerous,” writes the European Solidarity Party in the email.
The party is worried that Zelenskyy is going too far with his fight against certain oligarchs, where some voices say that Poroshenko, who was charged in an abuse of power case last year, could be next in line.
Poroshenko owns TV channels and is the third richest person in Ukraine. His party argues that Zelensky should focus more on reforms such as the judiciary and strengthening anti-corruption bodies instead of targeting individuals.
“The fight should not be a smokescreen for undemocratic aspirations: persecuting political opponents, cut the freedom of speech and media, launch a witch-hunt,” the party wrote and arguing that any attempt to target Poroshenko under the new bill would be an “attempt to follow the Russia or Belarus example to install a dictatorship, aiming at political opponents.”
The fight in the Constitutional Court
Jakubin told Euronews that the criticism from the opposition isn’t ungrounded because Zelenskyy has taken far-reaching steps in recent months to change the system. An example came in March, when Zelenskyy removed two judges from the Constitutional Court of Ukraine after the court had ruled against some anti-corruption laws in Ukraine.
The governmental decree signed by Zelenskyy said that the judges “threaten Ukraine’s independence and national security, which violates the constitution, human and civil rights, and freedoms” and threaten Ukraine’s anti-corruption reforms and the trust in Ukraine.
The Ukrainian judiciary has long been accused of corruption and inefficiency. The Venice Commission, an advisory body of the Council of Europe has also criticised the Constitutional Court in Ukraine, but the Commission, however, also pointed out that the court's independence or role must be respected. The question for many is whether Zelenskyy has respected the constitution. He removed the two judges Oleksandr Tupytskiy, then Constitutional Court Chairman, and Oleksandr Kasminin by a decree, cancelling their appointment by former President Viktor Yanukovych, who was ousted in 2014.
Ukraine’s constitution says that Constitutional Court judges are appointed by the sitting President, but then can only be removed by the Constitutional Court itself. It can happen if two-thirds of the court’s judges vote for it.
Euronews spoke to Tupytskiy, the former chairman, who denied being corrupt. He called his dismissal unconstitutional and said that the Constitutional Court only examined laws and reforms in accordance with the country’s constitution.
“As a judge, I think that the activity of the President signals that he is trying to control the Constitutional Court of Ukraine,” Tupytskiy said to Euronews, adding that it sends a solid signal to judges in the country that the President can remove you if you act against him.
Jakubin told Euronews that the case with the Constitutional Court isn’t the only place where people are concerned about the President’s use of power. He also points to how Zelenskyy seems to be trying to control anti-corruption organs and institutions.
“Maybe Zelenskyy just wants change. Maybe his wishes or dreams are good, but the tools that he uses are another thing. There are real concerns here,” says Jakubin, who is an expert in Ukrainian politics, “... In my opinion, Zelenskyy wants to have his own influence on the whole system; maybe he does not want systems to be completely independent.”
Zelenskyy has achieved, says MP
Halyna Yanchenko is a member of parliament for Zelensky’s party, Servant of the People, and deputy head of the Committee on Anti-Corruption Policy. She did not agree with the critics and told Euronews that Zelenskyy had done several good things to reform the country. He lifted parliamentary immunity so that politicians can be prosecuted for crimes and was responsible for passing the so-called ‘bank law,’ which avoided that oligarch Ihor Kolomoisky could regain control of the now nationalised PrivatBank. The bank was nationalized in 2016 when an investigation found a capital shortfall of about $5.65bn.
“The President cannot wait for ten years for results, and society will not let the president wait for ten years…,” said Yanchenko, “The team (Zelenskyy’s) is working in a couple of parallel directions, legislation changes to make overall favorable systematic changes. The filtering of law enforcement and prosecution bodies, but also searching for tools to give quick results and the feeling that there is justice in this country.”
She said that “the President has little tolerance to oligarchs” and that the government also has decided to increase taxes on natural resources such as iron ore (which is used to make steel) to remove competitive advantages for certain business people or oligarchs.
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