The key reasons of hostile takeover of businesses in Ukraine are corruption and problems with the system of public registration of property, Anticorruption Entrepreneurial Front President Igor Egorov has said.
“The existence of hostile takeovers comes from a corrupt government, complete impunity for committing crimes of this kind and low-skilled law enforcement officers. According to official data of the Prosecutor General’s Office for 2017, 315 criminal proceedings were registered under the article on obstruction of lawful economic activity, 99 crimes under the article on unlawful seizure of property, of which two and four, respectively, reached the court,” he said at a press conference at Interfax-Ukraine on Wednesday.
He also said that foreign companies for these reasons do not want to invest in a business in Ukraine, and each case of hostile takeover is a blow to the country.
An example of this problem was the hostile takeover of a business center located at 21G, Dehtiarivska Street in Kyiv on December 11, among whose tenants are foreign companies and the 112 Ukraine TV channel.
Representatives of the co-owners of the business center, Office Line and Patron Invest, said that the police could not take control of the situation, since the persons who had seized the building announced that the Avangard Invest LLC had acquired ownership rights to the business center. At the same time, the owners claim that the building was re-registered using illegal schemes and forged documents.
According to lawyer of Patron Invest Iryna Belytska, one of the reasons that made this new registration possible is the weakness of the public registration system and a fairly wide access to public registers.
“10 years ago it was impossible to accomplish this. Now it can be done in three days, having access to the register. Unfortunately, over the years of the register’s existence, the pain points have not been eliminated,” she said.
Belytska said that Office Line and Patron Invest will defend their rights in courts, as well as initiate investigations by law enforcement agencies. However, the negative consequences of the incident cannot be avoided.
“We have applied to law enforcement agencies, human rights organizations and we will use all available mechanisms,” she said.
According to the lawyer, the investment value of the office building is $10.5 million.
