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Ukraine

Extractive Industries Transparency Initiative (UA0065)

Overview

At-a-Glance

Action Plan: Ukraine Third National Action Plan 2016-2018

Action Plan Cycle: 2016

Status: Inactive

Institutions

Lead Institution: Ministry of Coal and Energy, Ministry of Economic Development, Ministry of Finance, Ministry of the Environment, State Geology and Subsoil Resources Service.

Support Institution(s): Renaissance International Fund, German Corporation for International Cooperation(GIZ), American Chamber of Commerce in Ukraine, non-governmental organisations Dixie Group, Analytical Centre for Regional Cooperation, Energy Transparency Association, the international initiative Publish What You Pay, other civil society institutions and international organisations (by consent).

Policy Areas

Extractive Industries, Fiscal Transparency, Legislation & Regulation

IRM Review

IRM Report: Ukraine End-of-Term Report 2016-2018, Ukraine Mid-Term Report 2016-2018

Starred: Yes Starred

Early Results: Outstanding Outstanding

Design i

Verifiable: Yes

Relevant to OGP Values: Access to Information

Potential Impact:

Implementation i

Completion:

Description

Event: Implementation in Ukraine of the Extractive Industries Transparency Initiative; Implementation timeframe: 2016-2018; Entities responsible: Ministry of Coal and Energy, Ministry of Economic Development, Ministry of Finance, Ministry of the Environment, State Geology and Subsoil Resources Service.; Partners: Renaissance International Fund, German Corporation for International Cooperation (GIZ), American Chamber of Commerce in Ukraine, non-governmental organisations Dixie Group, Analytical Centre for Regional Cooperation, Energy Transparency Association, the international initiative Publish What You Pay, other civil society institutions and international organisations (by consent).; Expected results: Ensuring the: Support in the Verkhovna Rada of Ukraine for the draft Law of Ukraine “On the disclosure of information in extractive industries” (until adoption). Publication of reports in Ukrainian and English based on the standards of the Extractive Industries Transparency Initiative (December 2016, December 2017).

IRM End of Term Status Summary

✪9. Implement the Extractive Industries Transparency Initiative

Commitment Text:

Implementation in Ukraine of the Extractive Industries Transparency Initiative

Expected results: Support in the Verkhovna Rada of Ukraine for the draft Law of Ukraine “On the disclosure of information in extractive industries” (until adoption). Publication of reports in Ukrainian and English based on the standards of the Extractive Industries Transparency Initiative (December 2016, December 2017).

Responsible institutions: Ministry of Coal and Energy, Ministry of Economic Development, Ministry of Finance, Ministry of the Environment, State Geology and Subsoil Resources Service.

Supporting institutions: International Renaissance Foundation, German Corporation for International Cooperation (GIZ), American Chamber of Commerce in Ukraine, non-governmental organizations Dixie Group, Analytical Center for Regional Cooperation, Energy Transparency Association, the international initiative Publish What You Pay, other civil society institutions and international organizations (by consent).

Start date: December 2016..                         End date: August 2018

Editorial note: This commitment is clearly relevant to OGP values as written, has transformative potential impact, and is substantially or completely implemented and therefore qualifies as a starred commitment.
Commitment Aim:

This commitment aims to implement the Extractive Industries Transparency Initiative (EITI) in Ukraine as a continuation of commitments in two previous action plans. Ukraine became an EITI candidate country in 2013, published its first EITI report in 2015, and has passed some legislative amendments to introduce EITI standards. However, the government need to put forth additional efforts to pass EITI assessment, publish annual reports, and introduce a new law that would adopt EITI standards to the fullest extent. This commitment aims to win support in the Verkhovna Rada for the law and publish the EITI reports.

Status

Midterm: Substantial

By midterm, the multi-stakeholder group, including Extractive Industries Transparency Initiative (EITI) Ukraine, had helped to prepare the draft law. Parliament first debated it in February 2017, but it did not pass. The second updated draft law, under new registration number #6229, was submitted on 23 March 2017. [160] The parliamentary committee recommended it for voting, but the draft law was not included in the parliamentary agenda. The second EITI report was published in February 2017. This report, written by an independent organization (the so called “administrator”), covered two calendar years (2014 and 2015). The report included additional extractive industries not illuminated in previous reports. Its scope covered 97 extractive companies that together paid more than 99 percent of the extractive industries tax revenues to the state budget. Overall, 51 of 97 companies responded to a request for information during the preparing of the report. After the Russian annexation of the Crimean Peninsula and the eruption of armed conflict in the Donetsk and Luhansk regions, the multi-stakeholder group proposed that the EITI board adapt implementation of EITI standards for the 2014 and 2015 fiscal years. In October 2016, the EITI board approved the group’s request pertaining to the 2014–2015 EITI report. To cover the information gaps and respond to an EITI board request, the State Fiscal Service of Ukraine provided full unilateral disclosure of total income. This disclosure included information from nonreporting companies and data for each material revenue stream. For more information, please see the 2016–2018 IRM midterm report. [161]

End of term: Complete

The draft law #6229, On Ensuring Transparency in Extractive Industries, [162] underwent intensive debate. After several failed attempts of a coalition of civil society organizations and members of Parliament to include it in the parliamentary agenda in 2017, on 1 March 2018 the number of supportive Parliament votes was sufficient for Parliament to approve the law in general in the first hearing. On 5 June 2018 the parliamentary committee sent Parliament the list of suggested edits. However, on 3 July 2018 the draft law did not receive the required number of votes for a final adoption. Parliament sent it back to the parliamentary committee for review. A civil society activist conducting the advocacy of the Extractive Industries Transparency Initiative (EITI) believed that previous votes failed because members of Parliament affiliated with certain companies avoided extra transparency for those companies. This activist predicted that other members of Parliament without a conflict of interest would contribute to successful voting. [163] Indeed, on 18 September 2018 Parliament adopted the law. The law was passed due to joint efforts of a wide coalition of civil society organizations, business associations, multilateral organizations, the EITI Secretariat, the Cabinet of Ministers, members of Parliament, and the speaker of Parliament. [164] Civil society organizations in the coalition included DiXi Group and International Renaissance Foundation. Business coalitions involved included the Association of Gas Extracting Companies and the American Chamber of Commerce. Government and multilateral organizations that helped the process included the European Commission, the European Bank for Reconstructions and Development, and the US Agency of International Development. Also, the coalition managed to reach an effective compromise with stakeholders (business, civil society, and the government agencies) [165] about the provisions of the law. [166] The law requires private and state companies conducting activities in extracting industries, recipients of revenues, and related ministries to disclose information on payments and revenues in reports and on websites in a publicly accessible, open data format. It also established the procedures for the multi-stakeholder group and for writing and publishing EITI reports by a specially selected, independent administrator. The law introduced consequences for violations of the law (mostly fines). On 6 June 2018 the third EITI report (on 2016) was published. [167], [168] It covered legal, corporate, and financial information on the coal, oil, natural gas, iron ore, titanium ore, manganese ore, fireclays, high-melting clays, and quartz sand industries.

Did It Open Government?

Access to Information: Outstanding

The government intended for this commitment to introduce a comprehensive framework for transparency in the sector. The three Extractive Industries Transparency Initiative (EITI) reports provide an immense amount of financial information about extractive industries in a detailed format. [169] According to the civil society actor promoting transparency policies on behalf of the DiXi Group, the reports constitute the only source of aggregated and verified information about the sector. Diverse stakeholders submit information, and an independent auditor verifies it. [170] The representative of the EITI Secretariat confirmed this assessment of the special standing of EITI reports. The representative admitted that the reports constitute the most extensive multidimensional source of data in the field. [171]

Compared to the first report, the second one expanded the scope of information disclosed by opening up previously closed information on iron ore, titanium ore, and manganese ore. The third report disclosed information on fireclays, high-melting clays, and quartz sand. In addition to the EITI Ukraine reports, the Ministry of Coal and Energy published EITI reports and source datasets in an open data format [172] in the government open data portal. [173] Moreover, the Ministry of Coal and Energy, the State Geology and Subsoil Resources Service, and State Fiscal Service voluntarily disclosed additional information. [174] The government has made datasets for all three reports available in .xls and .csv formats. One serious limitation involves the temporarily occupied territories, for which around 95 percent of the information required for disclosure is available. [175] On 29 June 2018 global EITI completed Ukraine's validation against the standard, which commenced on 1 July 2017. EITI acknowledged that EITI Ukraine made meaningful progress in meeting the EITI Standard. [176] In particular, the EITI praised the transparency of beneficial ownership and civil society engagement, noting that it went beyond expectations. Finally, law #6229, On Ensuring Transparency in Extractive Industries, [177] made the disclosure of information according to EITI standards mandatory and introduced accountability mechanisms. This progress can be acknowledged as an outstanding advance in access to information on extractive industries in Ukraine.

Carried Forward?

The IRM researcher recommends developing and launching a digital online platform for reporting and publishing information according to EITI standards and information about payments to local budgets.

[160] “The Draft Law on Ensuring Transparency in Extracting Industries,” #6229, the Verkhovna Rada of Ukraine, http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=61409.

[161] “Ukraine Mid-Term Report 2016–2018,” Open Government Partnership, https://www.opengovpartnership.org/sites/default/files/Ukraine_Mid-Term_Report_2016-2018_EN.pdf.

[162] “The Draft Law on Ensuring Transparency in Extracting Industries,” #6229.

[163] Olena Pavlenko (DiXi Group), interview with IRM researcher, 29 August 2018.

[164] Olena Pavlenko (DiXi Group), email exchange with IRM researcher, 18 October 2018.

[165] Dina Narezhneva (EITI Ukraine), email exchange with IRM researcher, 18 October 2018.

[166] Oleksii Orlovskyi (International Renaissance Foundation), email exchange with IRM researcher, 18 October 2018.

[167] “Third UAEITI Report Published,” UAEITI, http://eiti.org.ua/en/2018/06/third-uaeiti-report-published/.

[168] “Library,” UAEITI, http://eiti.org.ua/en/library/.

[169] “Library,” UAEITI, http://eiti.org.ua/en/library/.

[170] Olena Pavlenko (DiXi Group), interview with IRM researcher, 29 August 2018.

[171] Dina Narezhneva (EITI Ukraine), email exchange with IRM researcher, 18 October 2018.

[172] “Information Contained in ЕІТІ Reports is Available in the Format of Open Data,” DiXi Group, http://dixigroup.org/news/dani-zvitiv-ipvg-dostupni-u-formati-open-data/.

[173] “National Ukraine EITI Report,” Open Data Portal, https://data.gov.ua/dataset/da1849bf-140f-4161-a71f-2f6a904fffb5.

[174] Dina Narezhneva (EITI Ukraine), interview with IRM researcher, 9 August 2018.

[175] Oleksii Orlovskyi (International Renaissance Foundation), interview with IRM researcher, 4 August 2018.

[176] “EITI Ukraine,” EITI, https://eiti.org/ukraine.

[177] “The Draft Law on Ensuring Transparency in Extracting Industries,” #6229.


Ukraine's Commitments

  1. Infrastructure Data Portal

    UA0070, 2018, E-Government

  2. Open Standard for e-System

    UA0071, 2018, E-Government

  3. Ensuring Openness and Transparency of Selling Public Assets and Property

    UA0072, 2018, E-Government

  4. Transparency in Public Procurement (Prozorro)

    UA0073, 2018, E-Government

  5. Awarenss Raising About Social and Economic Development

    UA0074, 2018, Aid

  6. e-Calls for Proposals to Support CSOs

    UA0075, 2018, Civic Space

  7. Beneficial Ownership Registry

    UA0076, 2018, Beneficial Ownership

  8. Anti-Corruption Training

    UA0077, 2018, Anti-Corruption Institutions

  9. Publishing Environmental Information

    UA0078, 2018, E-Government

  10. Database of Natural Resources

    UA0079, 2018, E-Government

  11. Interactive Map of Mines

    UA0080, 2018, E-Government

  12. Priority Electronic Services

    UA0081, 2018, Citizenship and Immigration

  13. Online Platform for Executive Bodies and CSOs

    UA0082, 2018, Civic Space

  14. EITI Online Data

    UA0083, 2018, E-Government

  15. Electronic Resources for Education

    UA0084, 2018, E-Government

  16. Online Verification of Education Certificates

    UA0085, 2018, E-Government

  17. Free Access to National Repository for Academic Texts

    UA0086, 2018, E-Government

  18. Administrative Service Decentrilisation and Improvement

    UA0057, 2016, Capacity Building

  19. United State Portal Extension; Electronic Government Information Services Unification; Modern Tools for Electronic Identification

    UA0058, 2016, Capacity Building

  20. System for Entities Performing Government Functions

    UA0059, 2016, Capacity Building

  21. Free Urban Planning Documentation

    UA0060, 2016, E-Government

  22. Beneficial Ownership Verification System

    UA0061, 2016, Beneficial Ownership

  23. CoST Beneficial Ownership Standards

    UA0062, 2016, E-Government

  24. Transpartent Budget System

    UA0063, 2016,

  25. Starred commitment Open Public Procurement

    UA0064, 2016, Capacity Building

  26. Starred commitment Extractive Industries Transparency Initiative

    UA0065, 2016, Extractive Industries

  27. Environmental Public Monitoring

    UA0066, 2016, Environment and Climate

  28. Community Policing System

    UA0067, 2016, Education

  29. Draft Law on Public Consultations

    UA0068, 2016, Legislation & Regulation

  30. Development of E-Democracy.

    UA0069, 2016,

  31. Improve Government Rules on CSO Involvement

    UA0031, 2014, E-Government

  32. Financing of Charities

    UA0032, 2014, Civic Space

  33. Not-For-Profit Status for CSOs

    UA0033, 2014, Civic Space

  34. Public Participation Law

    UA0034, 2014, E-Government

  35. Establishing Rules on Processing Official Information

    UA0035, 2014, E-Government

  36. Access to Urban Planning Documents

    UA0036, 2014, E-Government

  37. Starred commitment Access to Communist-Era Archives

    UA0037, 2014, Legislation & Regulation

  38. Starred commitment Draft Law on Open Data

    UA0038, 2014, Legislation & Regulation

  39. Starred commitment Supervisory Mechanism for the Right to Information

    UA0039, 2014, Legislation & Regulation

  40. Compliance with EITI

    UA0040, 2014, Extractive Industries

  41. Monitoring of Infrastructure Projects

    UA0041, 2014, Anti-Corruption Institutions

  42. Adopt Regional Anti-Corruption Programmes

    UA0042, 2014, Anti-Corruption Institutions

  43. Corruption Risk Assessment Methodology

    UA0043, 2014, Anti-Corruption Institutions

  44. Starred commitment Asset Disclosure on a Single Web Portal

    UA0044, 2014, Asset Disclosure

  45. Law on Administrative Procedure

    UA0045, 2014, Legislation & Regulation

  46. Law on Streamlining Payment of Administrative Fees

    UA0046, 2014, E-Government

  47. Administrative Services Portal

    UA0047, 2014, E-Government

  48. Draft Law on Decentralisation of Administrative Services

    UA0048, 2014, Legislation & Regulation

  49. Draft Law on Social Services

    UA0049, 2014, E-Government

  50. e-Government Laws

    UA0050, 2014, E-Government

  51. Electronic Readiness Assessment

    UA0051, 2014, E-Government

  52. Government Regulations on Open Data

    UA0052, 2014, E-Government

  53. Electronic Democracy Development Roadmap

    UA0053, 2014, E-Government

  54. Open Budget Initiatives

    UA0054, 2014, E-Government

  55. e-Petitions

    UA0055, 2014, E-Government

  56. e-Governance Training for Local Government

    UA0056, 2014, Capacity Building

  57. Laws on Public Participation

    UA0001, 2012, Civic Space

  58. Amendments to the Law on Community Associations

    UA0002, 2012, Civic Space

  59. Amendments to Resolutions on Collaboration with Civil Society

    UA0003, 2012, E-Government

  60. Training for Public Servants on Consultations

    UA0004, 2012, Capacity Building

  61. Harmonisation of Access to Information Laws

    UA0005, 2012, E-Government

  62. By-Laws on Access to Information

    UA0006, 2012, Legislation & Regulation

  63. Guidelines for Classifying Data

    UA0007, 2012, Public Participation

  64. Public Information Recording Systems

    UA0008, 2012, Records Management

  65. Law on Public Broadcasting

    UA0009, 2012, Civic Space

  66. Public Access to Information in State Registers

    UA0010, 2012, E-Government

  67. Starred commitment Extractive Industries Transparency Initiative

    UA0011, 2012, E-Government

  68. Law for Controlling Declarations of Public Servants

    UA0012, 2012, Asset Disclosure

  69. Public Declarations of Officials’ Assets

    UA0013, 2012, Asset Disclosure

  70. Guidelines on Conflicts of Interest

    UA0014, 2012, Conflicts of Interest

  71. Updated Anti-Corruption Laws

    UA0015, 2012, E-Government

  72. Regional Anti-Corruption Programmes

    UA0016, 2012, E-Government

  73. Law on Competitive e-Government Procurement

    UA0017, 2012, E-Government

  74. Starred commitment Administrative Services Reforms

    UA0018, 2012, E-Government

  75. Electronic Access to Administrative Services

    UA0019, 2012, E-Government

  76. Governmental Web Portal of Administrative Services

    UA0020, 2012, E-Government

  77. Administrative Services in a Digital Format

    UA0021, 2012,

  78. Starred commitment Regional Administrative Service Centres

    UA0022, 2012, Public Service Delivery

  79. Programme for Promotion of e-Government

    UA0023, 2012, E-Government

  80. Electronic Collaboration Between Executive Agencies

    UA0024, 2012,

  81. Web-Based Petitions System

    UA0025, 2012,

  82. One Stop Shop for e-Reporting

    UA0026, 2012, E-Government

  83. e-Region Pilot Project

    UA0027, 2012, E-Government

  84. Network of e-Government Practitioners

    UA0028, 2012, Public Participation

  85. Public Libraries as Bridges Towards e-Governance

    UA0029, 2012, E-Government

  86. e-Government Knowledge Management Portal

    UA0030, 2012,