Financing of Charities (UA0032)
Overview
At-a-Glance
Action Plan: Ukraine Second Action Plan 2014-2015
Action Plan Cycle: 2014
Status: Inactive
Institutions
Lead Institution: Ministry of Finance
Support Institution(s): Ministry of Social Policy, Ministry of Culture, Ministry of Justice, NGO Ukrainian Independent Centre for Political Research, unspecified NGOs and international organisations
Policy Areas
Civic Space, Freedom of Association, Legislation & Regulation, Legislative, Public ParticipationIRM Review
IRM Report: Ukraine End-of-Term Report 2014-2016, Ukraine IRM Report 2014 – 2015
Starred: No
Early Results: Did Not Change
Design i
Verifiable: Yes
Relevant to OGP Values: Civic Participation
Implementation i
Description
Developing and submitting to the Cabinet of Ministers of Ukraine in due course the draft laws on amending the Law of Ukraine on Charitable Activities and Charities and the Budget Code of Ukraine in order to allow charitable organisations to receive financial support for performing state policy tasks and providing social services
IRM End of Term Status Summary
2. Financing of charities
Commitment Text: 2. Developing and submitting to the Cabinet of Ministers of Ukraine in due course of the draft laws on amending the Law of Ukraine on Charitable Activities and Charities and the Budget Code of Ukraine in order to allow charitable organisations to receive financial support for performing state policy tasks and providing social services.
Expected result: relevant draft law endorsed by the Cabinet of Ministers of Ukraine, submitted to the Verkhovna Rada of Ukraine, and followed up until adoption.
Start Date: Not specified End Date: 31 March 2015
3. Obtaining not-for-profit status for CSOs
Commitment Text: 3. Regulating the issue of granting civic associations the non-profit organisation status by means of entering a civic association in the Register of Non-profit Institutions and Organisations on the “one-stop shop” basis, with regulating document processing deadlines, defining grounds for denial of such a status, and envisaging free on-line access to the Register, in particular through the development and submission to the Cabinet of Ministers of Ukraine in due course of a draft Law of Ukraine on Amending the Law of Ukraine on Civic Associations and the Law on State Registration of Legal Entities and Individual Entrepreneurs, and other legislative acts as required.
Expected result: relevant draft laws endorsed by the Cabinet of Ministers of Ukraine, submitted to the Verkhovna Rada of Ukraine, and followed up until adoption.
Editorial Note: The IRM researcher grouped these two commitments together since they are both concerned with creating an enabling environment for civil society organisations.
Responsible institution(s): Ministry of Finance (commitment 2), State Registration Service (commitment 3)
Supporting institution(s): Ministry of Social Policy, Ministry of Culture, Ministry of Justice, NGO Ukrainian Independent Centre for Political Research, unspecified NGOs and international organisations (commitment 2); Ministry of Justice, Ministry of Finance, State Fiscal Service, NGO
"Ukrainian Independent Centre for Political Research", United Nations Development Programme (UNDP), non-specified NGOs and international organisations (commitment 3).
Start Date: Not specified End Date: 30 April 2015
Commitment aim
Both commitments were designed to create an enabling environment for civil society organisations. Commitment 2 focused on improving legislation to provide additional financial support to charities in Ukraine. Commitment 3 aimed to simplify the procedure for granting CSOs non-profit status. If implemented, this would be a step forward in improving conditions for the operation of charities and other non-profit organisations in Ukraine, as they would alleviate some of the administrative barriers faced by CSOs.
Status
2. Financing of charities
Midterm: Not started
After adoption of the OGP action plan, the Ministry of Finance objected to this measure and refused to implement it. The ministry was concerned that the measure, if implemented, would require additional budgetary allocations. In June 2015, the vice prime minister who chairs the OGP Coordination Council issued a formal instruction to the ministry to hold negotiations with civil society representatives, but the ministry did not do so. The issue remained unresolved, hence, the measure’s implementation had not yet started.[Note 6: Independent Reporting Mechanism (IRM) Progress Report 2014-15: Ukraine, 29.]
End of term: Not started
Since the midterm report, implementation of the commitment has still not begun. The Ministry of Finance continued to object to the commitment. According to the Government’s final self-assessment report, the ministry stated that Ukrainian law already extends sufficient support to charities in Ukraine. In particular, they can compete to obtain social services provision and public procurement contracts, and they enjoy certain tax exemptions (charity assistance and property transferred as international aid are exempt from the VAT; charities do not pay income tax).
3. Obtaining not-for-profit status for CSOs
Midterm: Not started
The procedure for obtaining non-profit tax status by NGOs and other civic associations was cumbersome and time-consuming. An NGO first had to register as a legal entity with the Ministry of Justice, then apply to the Fiscal Service for non-profit status. The Fiscal Service often rejected such applications due to problems with NGO statutory documents. These had to go back to the Ministry of Justice for amendment. The commitment aimed to streamline procedures and introduce a one-stop shop principle for obtaining the relevant status. That is, applicant NGOs would apply to the Ministry of Justice, which would then arrange registration with the tax authorities. In its midterm self-assessment report, the government informed about a draft law adopted in the first reading in July 2015, but failed to address the issue that the OGP measure targeted. It did not provide for the one-stop procedure for civic organisations to obtain their registration as legal entities or eligibility for non-profit tax status.[Note 7: Ibid, 29.]
End of term: Complete
The final wording of the new law on state registration of legal entities, private entrepreneurs, and civic formations, as adopted in November 2015 (enacted in December 2015), included provisions on the one-stop procedure for obtaining non-profit status by CSOs. An applicant entity was allowed to submit, at the same time, a request for registration as a legal entity and non-profit organisation. Later, in July 2016, the government approved regulations on the Procedure for maintaining a Register of Non-Profit Organisations to reflect the new changes in the law. According to the government’s self-assessment report, NGOs took part in the development of the final version of the law and government regulations. However, a CSO representative noted that the new provisions had not been implemented. State registrars refused to transfer applications to tax authorities, referring to the lack of electronic data exchange.[Note 8: Written interview with Maksym Latsyba, NGO Ukrainian Centre for Independent Political Research.] This indicates that the one-stop procedure is not yet fully functioning. However, as the commitment sought only to adopt new changes in the law, which has been done, the commitment is considered complete. In addition, other parts of the commitment carried out include regulating deadlines for processing applications for obtaining non-profit status, defining grounds for denial of such status, and envisaging free online access to the Register.[Note 9: Ibid.]
Did it open government?
2. Financing of charities
Civic participation: Did not change
The commitment aimed to improve the operational environment for charity organisations by broadening their funding sources. The commitment did not lead to any changes since it was not implemented, due to the position of the Ministry of Finance. It showed that the government did not really “own” and accept this OGP commitment, and was reluctant to implement it.
3. Obtaining not-for-profit status for CSOs
Access to information: Marginal
Civic participation: Marginal
The commitment sought to streamline the procedure for obtaining non-profit status by CSOs. The new law on state registration of legal entities introduced provisions for the one-stop method for registering new entities as non-profit organisations. The government adopted the necessary bylaws. However, the new legal provisions have not been fully enforced in practice. If implemented, it could have significantly simplified CSO registration, and limited their contacts with public authorities (by excluding direct interaction with tax authorities). This would have reduced the possibilities for corruption and red tape. The parts of the commitment that were implemented (regulating deadlines for processing applications for obtaining non-profit status, defining grounds for denial of such status, envisaging free online access to the Register) did improve the operational environment for CSOs, by streamlining relevant procedures and enabling better civic participation, but only marginally. They also improved access to information, as the Register of Non-profit Institutions and Organisations became available online.
Carried forward?
2. Financing of charities
The commitment was not carried over to the new action plan. It appears that, as worded, it goes against the policy priorities of the government, hence, will no longer be pursued. The government should evaluate the operational environment for CSOs regarding taxation and sources of funding in a comprehensive way, and include clear commitments on improving the environment in future action plans.
3. Obtaining not-for-profit status for CSOs
The commitment was not included in the new action plan. The government has to ensure that the adopted legal framework be enforced by taking all necessary organisational and technical measures.
Commitments
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Infrastructure Data Portal
UA0070, 2018, Anti-Corruption
-
Open Standard for e-System
UA0071, 2018, E-Government
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Ensuring Openness and Transparency of Selling Public Assets and Property
UA0072, 2018, E-Government
-
Transparency in Public Procurement (Prozorro)
UA0073, 2018, Access to Information
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Awarenss Raising About Social and Economic Development
UA0074, 2018, Aid
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e-Calls for Proposals to Support CSOs
UA0075, 2018, Civic Space
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Beneficial Ownership Registry
UA0076, 2018, Anti-Corruption
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Anti-Corruption Training
UA0077, 2018, Anti-Corruption
-
Publishing Environmental Information
UA0078, 2018, E-Government
-
Database of Natural Resources
UA0079, 2018, Access to Information
-
Interactive Map of Mines
UA0080, 2018, E-Government
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Priority Electronic Services
UA0081, 2018, Citizenship & Immigration
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Online Platform for Executive Bodies and CSOs
UA0082, 2018, Civic Space
-
EITI Online Data
UA0083, 2018, Access to Information
-
Electronic Resources for Education
UA0084, 2018, Access to Information
-
Online Verification of Education Certificates
UA0085, 2018, E-Government
-
Free Access to National Repository for Academic Texts
UA0086, 2018, E-Government
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Administrative Service Decentrilisation and Improvement
UA0057, 2016, Capacity Building
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United State Portal Extension; Electronic Government Information Services Unification; Modern Tools for Electronic Identification
UA0058, 2016, Capacity Building
-
System for Entities Performing Government Functions
UA0059, 2016, Anti-Corruption
-
Free Urban Planning Documentation
UA0060, 2016, E-Government
-
Beneficial Ownership Verification System
UA0061, 2016, Anti-Corruption
-
CoST Beneficial Ownership Standards
UA0062, 2016, Anti-Corruption
-
Transpartent Budget System
UA0063, 2016,
-
Open Public Procurement
UA0064, 2016, Access to Information
-
Extractive Industries Transparency Initiative
UA0065, 2016, Anti-Corruption
-
Environmental Public Monitoring
UA0066, 2016, Access to Information
-
Community Policing System
UA0067, 2016, Education
-
Draft Law on Public Consultations
UA0068, 2016, Legislation & Regulation
-
Development of E-Democracy.
UA0069, 2016, E-petitions
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Improve Government Rules on CSO Involvement
UA0031, 2014, E-Government
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Financing of Charities
UA0032, 2014, Civic Space
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Not-For-Profit Status for CSOs
UA0033, 2014, Civic Space
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Public Participation Law
UA0034, 2014, E-Government
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Establishing Rules on Processing Official Information
UA0035, 2014, Access to Information
-
Access to Urban Planning Documents
UA0036, 2014, E-Government
-
Access to Communist-Era Archives
UA0037, 2014, Legislation & Regulation
-
Draft Law on Open Data
UA0038, 2014, Access to Information
-
Supervisory Mechanism for the Right to Information
UA0039, 2014, Access to Information
-
Compliance with EITI
UA0040, 2014, Anti-Corruption
-
Monitoring of Infrastructure Projects
UA0041, 2014, Anti-Corruption
-
Adopt Regional Anti-Corruption Programmes
UA0042, 2014, Anti-Corruption
-
Corruption Risk Assessment Methodology
UA0043, 2014, Anti-Corruption
-
Asset Disclosure on a Single Web Portal
UA0044, 2014, Anti-Corruption
-
Law on Administrative Procedure
UA0045, 2014, Legislation & Regulation
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Law on Streamlining Payment of Administrative Fees
UA0046, 2014, E-Government
-
Administrative Services Portal
UA0047, 2014, Access to Information
-
Draft Law on Decentralisation of Administrative Services
UA0048, 2014, Legislation & Regulation
-
Draft Law on Social Services
UA0049, 2014, E-Government
-
e-Government Laws
UA0050, 2014, E-Government
-
Electronic Readiness Assessment
UA0051, 2014, E-Government
-
Government Regulations on Open Data
UA0052, 2014, Access to Information
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Electronic Democracy Development Roadmap
UA0053, 2014, E-Government
-
Open Budget Initiatives
UA0054, 2014, Access to Information
-
e-Petitions
UA0055, 2014, Dispute Resolution & Legal Assistance
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e-Governance Training for Local Government
UA0056, 2014, Capacity Building
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Laws on Public Participation
UA0001, 2012, Civic Space
-
Amendments to the Law on Community Associations
UA0002, 2012, Civic Space
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Amendments to Resolutions on Collaboration with Civil Society
UA0003, 2012, E-Government
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Training for Public Servants on Consultations
UA0004, 2012, Capacity Building
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Harmonisation of Access to Information Laws
UA0005, 2012, Access to Information
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By-Laws on Access to Information
UA0006, 2012, Access to Information
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Guidelines for Classifying Data
UA0007, 2012, Public Participation
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Public Information Recording Systems
UA0008, 2012,
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Law on Public Broadcasting
UA0009, 2012, Civic Space
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Public Access to Information in State Registers
UA0010, 2012, E-Government
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Extractive Industries Transparency Initiative
UA0011, 2012, Anti-Corruption
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Law for Controlling Declarations of Public Servants
UA0012, 2012, Anti-Corruption
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Public Declarations of Officials’ Assets
UA0013, 2012, Anti-Corruption
-
Guidelines on Conflicts of Interest
UA0014, 2012, Anti-Corruption
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Updated Anti-Corruption Laws
UA0015, 2012, E-Government
-
Regional Anti-Corruption Programmes
UA0016, 2012, E-Government
-
Law on Competitive e-Government Procurement
UA0017, 2012, Anti-Corruption
-
Administrative Services Reforms
UA0018, 2012, E-Government
-
Electronic Access to Administrative Services
UA0019, 2012, E-Government
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Governmental Web Portal of Administrative Services
UA0020, 2012, E-Government
-
Administrative Services in a Digital Format
UA0021, 2012,
-
Regional Administrative Service Centres
UA0022, 2012,
-
Programme for Promotion of e-Government
UA0023, 2012, E-Government
-
Electronic Collaboration Between Executive Agencies
UA0024, 2012,
-
Web-Based Petitions System
UA0025, 2012, E-petitions
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One Stop Shop for e-Reporting
UA0026, 2012, E-Government
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e-Region Pilot Project
UA0027, 2012, E-Government
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Network of e-Government Practitioners
UA0028, 2012, Public Participation
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Public Libraries as Bridges Towards e-Governance
UA0029, 2012, E-Government
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e-Government Knowledge Management Portal
UA0030, 2012,