aaus-list @ ukrainianstudies.org -- [aaus-list] Fwd: Ukraine Today -- 11.03.2002

[Robert De Lossa <radelo@earthlink.net>]

[from "Yaroslav Davydovsky  {20122}" <sda@ukrainet.lviv.ua>]

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   UKRAINE TODAY
   Main weekly events from Infobank News Agency


   11 March 2002



   * GOLDEN TELECOM COMPANY ACCUSED OF WALKING AWAY WITH MILLIONS OF HRYVNIAS
     IN TRUNK CALLS FARES
   * OVER 600 CANDIDATES FOR PARLIAMENT AND LOCAL COUNCILS MISREPORTED THEIR
     INCOMES IN INCOME DECLARATIONS
   * PRESIDENT VETOES A NUMBER OF SOCIAL LAWS
   * PRESIDENT VETOES CUSTOMS CODE
   * PRESIDENT SIGNS LAW ON UKRAINE'S JUDICIAL SYSTEM
   * DISCOUNT RATE TO DROP FROM 12.5% TO 11.5%
   * UKRSPETSEXPORT DIRECTOR GENERAL KILLED IN CAR CRASH
   * POLICE DETAIN NATIONAL BANK DIRECTOR OF PAYMENT SYSTEMS DEPARTMENT AND
     FORMER GOVERNOR OF BANK UKRAYINA
   * VERKHOVNA RADA PASSES LAW ON INTERNATIONAL TREATIES OF UKRAINE






   GOLDEN TELECOM COMPANY ACCUSED OF WALKING AWAY WITH MILLIONS OF HRYVNIAS
   IN TRUNK CALLS FARES

   KYIV. On the results of its investigation, the Kyiv's prosecutor's office
   has enough evidence to accuse the Golden Telecom company of gross
   embezzlement of public money to the tune of hundreds of millions of
   hryvnias, Kyiv's acting chief prosecutor Ivan Derevianko told journalists
   on March 4.

   According to the official, Golden Telecom, a trunk telephone
   communications operator, used Ukrtelecom's networks to service
   international trunk calls, paying to Ukrtelecom by local calls tariffs for
   such international calls. As a result, Golden Telecom was paying
   Ukrtelecom UAH 0.02 instead of US$ 0.1 per minute of telephone
   communications.

   As stressed by Ivan Derevianko, Ukrtelecom did not receive UAH 30,000 in
   payments from Golden Telecom for two days alone. Golden Telecom has been
   using Ukrtelecom's networks for six years. Facts exposed by prosecutors
   are sufficient ground to file criminal charges against Golden Telecom,
   Kyiv's chief prosecutor continued. They also stress the need to check the
   performance of Ukraine's other communications companies, he added.

   As Infobank has reported earlier, Kyiv's prosecutors filed criminal
   charges against Golden Telecom management accusing it of grand theft of
   state property, the Intern TV channel reports, citing Kyiv's Office of
   Prosecution press service.

   According to the press service, on March 4 police department for
   compatting organized crime officers went on checking the company which
   operates in its usual mode. Prosecutors are looking for violations in
   rendering by Golden Telecom of fixed telephone services in Kyiv.

   On March 1 the office of the Golden Telecom company on Khreshchatyk in
   Kyiv was sealed by members of the Kyiv department for combating organized
   crime, Golden Telecom's press service report said. Simultaneously, the
   company's store on Sofievska St., switchboard on Lebedev-Kumach St, and
   call center were closed.

   At the urgently called press conference, GT general director Yury
   Bezborodov said that the surprise check of the office by police on March
   can be explained by a 1.5 year-long conflict between GT and the Ukrtelecom
   open JSC that holds a monopoly for telephone communications in Ukraine.

   According to him, searched the office and technical premises of GT and
   seized the documents. As stressed by Mr. Bezborodov, the police had a
   search warrant and referred to some criminal case investigation which
   necessitated the search of GT office.

   The general director of GT reiterated that on February 28 he sent letters
   to Verkhovna Rada, government, presidential administration, and the
   National Defense and Security Council requesting their assistance in
   solving the artificially orchestrated conflict with Ukrtelecom. He also
   stressed that in 2001 Golden Telecom was the target of 53 official checks
   by various law enforcement agencies, with the number of unofficial checks
   much larger.

   GT chief administrator Jeff Howley said, addressing the press conference,
   that Yury Bezborodov cannot represent the company and can speak only for
   himself. He added that the GT board of directors does not share the views
   expressed by Yury Bezborodov to journalists. Following his brief
   appearance at the press conference, Jeff Howley left it refusing to take
   questions from journalists. Taking the floor again, Yu. Bezborodov said
   that there was an agreement with GT foreign partners not to make public
   comments on the situation until January 1, 2002, but the incident that
   happened on March 1 made him ignore the recommendations of his foreign
   partners who still believe in the peaceful solution of the conflict.

   As Infobank has reported earlier, in April 2001 the Kyiv Court of
   Arbitration has ruled that the open joint stock company UkrTeleCom must
   pay Golden Telecom nearly UAH 18 million and give it full access to Kyiv
   city telephone set for its 100,000 subscribers. UkrTeleCom has also been
   obliged to meet the terms of HiproZvyazok Institute's design and provide
   Golden Telecom with 495 trunks.

   On July 19, the board of the Supreme Arbitration Court of Ukraine has
   abrogated the ruling by the Kyiv Arbitration Court binding Ukrtelecom to
   provide free access to Kyiv's city telephone networks to Golden Telecom's
   100,000 subscribers, korrespondent.net report says. According to the
   Supreme Arbitration Court decision, Kyiv Arbitration Court's ruling runs
   counter to the laws of Ukraine and to the materials of the case. SAC
   obliged Golden Telecom to repay to Ukrtelecom UAH 17.8 million received
   earlier as sanctions.

   Few days later, President Kuchma dismissed Oleh Shevchuk from the post of
   head of the State Committee for Communications and Information, replacing
   him with Stanislav Dovhy, Ukrtelecom's board chairman.

   Golden Telecom, Ukrayina Ltd. is one of Ukrainian providers of integrated
   telecommunications services for corporate clients and communications
   operators. GT is part of the Golden Telecom Inc. holding company. GT
   provides services of stationery and mobile telephone(GSM-1800 standard)
   services in Kyiv and Odesa, as well as international telephone and
   Internet services in Ukraine's large cities.

   69% of Golden Telecom stock is owned by investors from Russia and United
   States and 31% by Ukrainian companies Agat-telecom and Brig-telecom. In
   1996 GT opened its communications network in Ukraine by investing US$ 42
   million under no government guarantees of repayment. In 2001, GT received
   US$ 37 million in profits, with after-tax profits of US$ 10.5 million. The
   company employs 400 Ukrainian residents.


   OVER 600 CANDIDATES FOR PARLIAMENT AND LOCAL COUNCILS MISREPORTED THEIR
   INCOMES IN INCOME DECLARATIONS

   KYIV. The Central Election Commission has completed screening the income
   declarations submitted by candidates running for parliament in single-seat
   constituencies. According to CEC head, Mykhailo Riabets, 647 candidates
   submitted false information about their incomes, differing by several
   hundred to several thousand hryvnias from their true ones.

   According to a For-ua.com report, the top five political parties and blocs
   whose members cheated on their income declarations are the Green Party of
   Ukraine (63 candidates), the For A United Ukraine bloc (46), the Communist
   Party (45), The Justice Party (38), and the Our Ukraine bloc (38). In
   some constituencies, Mykhailo Riabets confirmed, more than a half of
   candidates misreported their incomes.

   According to the official, the Central Election Commission has not made a
   decision how to deal with the delinquent candidates and their parties and
   blocs, but will study the situation more closely and take the decision
   soon. Meanwhile, three candidates in the Lviv Oblast have been dropped by
   the regional election commission for submitting untrue income
   declarations.


   PRESIDENT VETOES A NUMBER OF SOCIAL LAWS

   KYIV. The Ukrainian President has vetoed a number of social laws passed
   by parliament.

   Among the laws vetoed by Leonid Kuchma are those obligating employers to
   pay salaries to employees in the first place - without waiting until taxes
   have been paid, and to pay off all wage arrears by July 1; changes to the
   law on vacations, under which days off and public holidays are not counted
   as vacation; law on compensation for people's depreciated deposits for a
   period until 2015; law prioritizing repayment of natural entities'
   deposits in Ukrayina bank; law on restructuring, for 5 years, of debts for
   utilities run up by people with low incomes.


   PRESIDENT VETOES CUSTOMS CODE

   KYIV. The Ukrainian President has vetoes the Customs Code, which was
   passed by parliament on December 20 last year.

   The Customs Code was meant to incorporate numerous existing legislative
   acts, including the law on the single tax. The main concept of the new
   code envisages uniform customs procedures with respect to all goods
   regardless of the country of origin, the owner, and the kind of shipment.

   The Code, for the first time, specifies such elements of the customs
   procedure as the deadlines for submission and filing of customs
   declarations during a simplified customs clearance; the mechanism for
   submitting a preliminary declaration and customs clearance on the basis of
   a continuous customs declaration.

   The Code includes customs operations involving all possible kinds of
   shipments, by sea and river vessels, planes, railway and automobiles, by
   international postal channel, pipe transport, electricity transmission
   lines. Hitherto, there was no legislation in Ukraine on the latter two
   kinds of shipments of goods.

   The vetoed Customs Code provides for a more flexible approach to
   establishing customs tariffs, which is in line with the guidelines by the
   General Agreement on Tariffs and Trade and the World Trade Organization.
   The new rules provide for the declaration of the customs value of goods
   which will allow to fully calculate and collect taxes during customs
   clearance.

   Besides, the Customs Code significantly widens the powers of the State
   Customs Service. It grants its staff the right to free access to the
   premises of companies of all types of ownership where commodities subject
   to customs clearing are stored. Customs Service staff can also check
   foreign trade companies' financial and economic performance, according to
   the vetoed Code, which also provides for the creation of a special armed
   unit to accompany goods of high value.


   PRESIDENT SIGNS LAW ON UKRAINE'S JUDICIAL SYSTEM

   KYIV. The President of Ukraine has signed a new version of the law on
   judicial system, which envisages the cancellation of the division of
   general jurisdiction courts into criminal and civil ones, leaves unchanged
   the current composition and functions of the Supreme Court and provides
   the possibility to create additional judicial institutions - the appellate
   and cassation courts.

   Under the law, which was passed on February 7, the judicial system
   includes local courts or courts of general jurisdiction. Above them are
   the appellate courts that have been created already on the basis of oblast
   courts, as well as cassation courts and courts of appeal. The draft also
   envisages the creation of a system of specialized courts within general
   jurisdiction courts and empower the country's Supreme Court to perform the
   function of repeated cassation.

   The law also proposes to create a system of specialized administrative
   courts that correspond to the existing system of economic (arbitration)
   courts, maintain the system of martial courts, create qualification
   judicial commissions in the country's regions and specialized courts as
   well as the Supreme Qualification Commission. It also provides for the
   creation of the state judicial administration as a separate body of state
   power.


   DISCOUNT RATE TO DROP FROM 12.5% TO 11.5%

   KYIV. On March 11, 2002 the National Bank of Ukraine will lower its
   discount rate from 12.5% to 11.5%. The NBU Board took this decision
   on March 5 having analyzed the situation on the money-credit market,
   NBU press service reports.

   Last year the NBU has lowered its discount rate 6 times. On March 10,
   the rate was reduced from 27% to 25%, on April 7 - to 21%, on June
   11 - to 19%, on August 9 - to 17%, on September 10 - to 15% and on
   December 10 -- to 12.5% annual.

   In year 2000 NBU reduced its discount rate four times - to 35% on
   February 1, to 32% on March 24, to 29% on April 10, and to 27% on
   August 15, 2000.


   UKRSPETSEXPORT DIRECTOR GENERAL KILLED IN CAR CRASH

   POLTAVA. A car accident in Hlobyn rayon, Poltava oblast, has killed
   Valeriy Malev, Director General of UkrSpetsExport company.

   As the Poltava oblast Interior Ministry department's unit on duty has told
   for-ua.com, Mr. Malev had fallen asleep while driving his Audi-8 and drove
   onto the opposite direction lane, where his car collided with a KAMAZ tank
   truck. The passenger riding in the Audi-8 with Mr. Malev and the truck
   driver were unhurt.

   Valeriy Malev, who was 63 years old, was appointed Director General of
   UkrSpetsExport, a state monopoly engaged in exporting and importing
   military and special equipment and services, in April 1998. In 1995-1997,
   he served as Ukraine's Minister of the Engineering Industry,
   Military-Industrial Complex and Conversion and in 1997-1998 as Ukrainian
   President's adviser. From 1996 until his death he was a member of the
   National Security and Defense Council.


   POLICE DETAIN NATIONAL BANK DIRECTOR OF PAYMENT SYSTEMS DEPARTMENT AND
   FORMER GOVERNOR OF BANK UKRAYINA

   KYIV. On March 5 the Prosecutor General's Office of Ukraine detained
   director of National Bank's payment systems department Viktor Kravets,
   accusing him of having abused his former office of Bank Ukrayina governor,
   For-ua.com reports says, citing the Ministry of Internal Affairs.

   Earlier, prosecutors also detained Ukrayina's former governor Petro
   Mikheyev who headed the bank prior to the introduction of interim
   administration.

   As Infobank has reported earlier, NBU board of governors has taken a
   decision to revoke Ukrayina's license to perform all banking operations as
   of July 16, 2001 and initiated liquidation procedure. NBU appointed the
   state-run Agency for the Issues of Bankruptcies as Ukrayina's liquidator.

   Ukrayina is one of Ukraine's top eight banks. Its currency balance as of
   April 1 was UAH 4.5 billion, its credit portfolio was UAH 1.37 billion,
   with over 70% of credits for agricultural producers. Losses in 2000
   amounted to UAH 96 million.


   VERKHOVNA RADA PASSES LAW ON INTERNATIONAL TREATIES OF UKRAINE

   KYIV. At its March 7 session, the Ukrainian parliament passed the law "On
   International Treaties of Ukraine" which sets forth the procedure for
   signing, implementing, and suspending international treaties. The bill was
   supported by 248 deputies.

   Under the new law, political and economic international treaties,
   agreements on citizenship, on participation in interstate unions and
   associations, and military alliances are subject to the approval by
   Verkhovna Rada. All other international treaties must be ratified by
   president or government.




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