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April 22, 2020

Business crime and investigations in Ukraine

Corporate manslaughter

Regulatory provisions and authorities

1. What is the main legislation relevant to corporate manslaughter?
Ukrainian criminal law does not contain an offence identical to corporate manslaughter. Moreover, both the Criminal Code of Ukraine (Criminal Code) and the Code of Administrative Offences expressly provides that crimes can only be committed by individuals (rather than by legal entities).
Nevertheless, the offences closest to corporate manslaughter are set out in section X of the Criminal Code (relating to "crimes against production safety").
The following elements are required for a criminal prosecution:
  • An act performed in violation of the relevant requirements or standards.
  • A consequence which resulted in the form of death of people.
  • A causal link between the violation of requirements and the consequence in the form of death of people.
The absence of any of the above elements will be a ground for avoiding criminal liability. We emphasise that liability for similar crimes will extend to officials of enterprises, individual entrepreneurs or normal employees of a company rather than to legal entities.

Offences

2. What is the specific offence that can be used to prosecute corporate manslaughter?
Ukrainian law does not expressly provide for corporate manslaughter but rather enshrines liability for offences of a similar nature committed by individuals (see Question 1).
Therefore, under Articles 271 to 275 of the Criminal Code individuals can be liable for the following actions that caused the death of people:
  • Violations of labour protection legislation (Paragraph 2, Article 271).
  • Violations of safety rules in the course of high-hazard work (Paragraph 2, Article 272).
  • Violations of safety rules at explosive enterprises or in explosive workshops (Paragraph 2, Article 273).
  • Violations of nuclear or radiation safety rules (Paragraph 2, Article 274).
  • Violations of rules concerning the safe use of industrial products or the safe operation of buildings and structures (Paragraph 2, Article 275).

Defences

3. What defences or exemptions are available and who can qualify?
Liability for offences can only be extended to:
  • Officials of a company who are responsible for labour protection in accordance with the constituent documents or job descriptions, individual entrepreneurs.
  • Employees of a company who are obliged to observe safety rules in the course of work.
Relief from criminal liability due to the expiry of the limitation period may be applicable as a defence. In accordance with the periods set by the Criminal Code, a person may be discharged from criminal liability if the following time periods have elapsed from the date of the criminal offence to the entry of judgment into legal force:
  • After five years: where the offence is punishable with imprisonment for up to five years (Paragraph 2 Article 271; Paragraph 2, Article 275).
  • After ten years: where the offence is punishable with imprisonment for up to ten years (Paragraph 2, Article 272; Paragraph 2, Article 273).
  • After 15 years: where the offence punishable with imprisonment more than ten years (Paragraph 2, Article 274).
Other persons are not subject to the relevant obligation and, therefore, may not be prosecuted.

Enforcement

4. Which authorities have the powers of prosecution, investigation, and enforcement in cases of corporate manslaughter? What are the authorities' powers of prosecution, investigation, and enforcement, and what are the consequences of non-compliance?

Prosecution authorities

Pre-trial investigation of crimes equivalent to corporate manslaughter is carried out by investigating departments of the National Police of Ukraine (National Police).
Accordingly, the public prosecution in courts is maintained by the prosecutor's office. Depending on the severity of consequences of a crime, the prosecution may be represented throughout the criminal proceedings (both at the pre-trial and judicial stages) by a local, regional or the General Prosecutor's Office of Ukraine.

Prosecution powers

National Police investigators conduct investigative and search actions aimed at establishing the circumstances of a criminal offence, collecting evidence, and searching for suspects.
The relevant prosecutor's office may:
  • Instruct investigators.
  • Cancel their illegal decisions.
  • Independently carry out investigative and search actions.
  • Notify a person of suspicion.
  • Agree or refuse to refer a case to court.
If the actions of the prosecution require restricting the constitutional rights and freedoms of other participants in the process (house search, detention, arrest of property and so on), the investigating judge or the court during a trial will decide on whether to apply such measures.

Powers of interview

During the pre-trial investigation, witnesses, victims, suspects and the accused can be questioned by an investigator or a prosecutor on any grounds relating to the committed crime. However, according to the principle of immediacy, only evidence investigated directly by the court will have probative value. Therefore, the court will only be able to refer to witness statements if they are obtained during the interrogation in court.

Powers of search/to compel disclosure

A request for a search is filed by the investigator upon the prosecutor's approval or by the prosecutor only and is considered in court on the day of its receipt, with the participation of the investigator or prosecutor. During investigations for matters under Articles 271 to 275 of the Criminal Code, searches can be conducted at the premises of the company where the crime occurred, or at the offices and/or at home of officials responsible for the observance of the safety rules, with mandatory audio and video fixation.

Powers to obtain evidence

According to Article 93 of the Criminal Procedure Code of Ukraine (Procedure Code), an investigator, prosecutor, defence side (suspect, accused, attorney) and a victim are entitled to collect evidence in criminal proceedings.
The investigator and the prosecutor have more powers in collecting evidence, since they carry it out mostly on their own, through investigative and search actions (such as interrogation, covert surveillance, monitoring, and searches), while the defence side or the victim may only seek such actions from the investigator and prosecutor. Other means of collecting evidence (attorneys' requests, appeals to authorities) by the defence are less efficient.

Power of arrest

Detention in custody applies to the suspect or accused as an exceptional measure if the prosecutor proves that other, milder precautions (personal commitment, house arrest and so on) could not prevent the risk of a person's hiding or loss of evidence, undue influence on witnesses and so on. The decision on detention is made only by the court (or by the investigating judge at the pre-trial investigation stage) and the detention cannot exceed 60 days. However, if necessary, this term may be extended.
When detention in custody is applied to a person, the court can, as an alternative, determine the amount of the bail upon which the person could be released. However, if the offence was committed with the use of violence which caused the death of people, or when a person had already violated the bail rules before, such procedure is not applicable.

Court orders or injunctions

The most common orders are as follows:
  • Temporary access to objects and documents. This measure is not applicable to correspondence or other forms of information exchange between an attorney and the client. In the case of failure to fulfil a court order on temporary access to objects and documents, the court, at the request of the prosecution/defence, may decide on a search.
  • Temporary seizure of property. This extends to property used as a tool for committing an offence or intended to finance it, or property towards which the offence is directed or was obtained as a result of the offence.
  • Arrest of property. This can be imposed on any type of property, valuables or rights in relation to such property or valuables, which the investigating judge or the court has determined are needed for an arrest. It is prohibited to arrest property owned by a purchaser in good faith, unless this is necessary to ensure the preservation of material evidence. When the need for arrest disappears or the person involved in the criminal proceedings proves that the arrest was imposed unreasonably, such measure may be terminated.
5. Which authority makes the decision to charge and on what basis is that decision made? Are there any alternative methods of disposal and what are the conditions of such disposal?
Once sufficient evidence has been collected to prove the guilt of the accused, the investigator or prosecutor will draw up an indictment indicating the completion of the pre-trial investigation. This must be provided to the suspect and the latter's attorney for review and sent to the court for consideration on the merits and sentencing.
As an alternative to indictment, a settlement agreement with the victim or prosecution may also be reached. However, such agreements do not apply to all offences in the category in question. Settlement agreements can only be concluded in proceedings regarding crimes punishable by imprisonment for a term that does not exceed five years.

Conviction and sanctions

6. What are the penalties for corporate manslaughter?
The crimes closest to corporate manslaughter under Articles 271 to 275 of the Criminal Code, which lead to the death of people, are punishable with the following sanctions (with the most severe types of punishment listed):
  • Violation of requirements of the labour protection legislation: imprisonment for up to seven years.
  • Violation of safety rules in the course of high-hazard work: imprisonment for up to eight years.
  • Violation of safety rules at explosive enterprises or in explosive workshops: imprisonment for up to ten years.
  • Violation of nuclear or radiation safety rules: imprisonment for up to 12 years.
  • Violation of rules concerning the safe use of industrial products or the safe operation of buildings and structures: imprisonment for up to five years.
As an additional penalty, the court may deprive the accused of the right to occupy certain positions or engage in certain activities for a term up to three years.

Safeguards

7. Are there any measures in place to safeguard the conduct of investigations? Is there a process of appeal? Is there a process of judicial review?
In criminal proceedings, the following rights are guaranteed:
  • The presumption of innocence as enshrined by law.
  • The right of the suspect to know what criminal offence he/she is suspected or accused of, the right to refuse to provide any testimony or explanation.
  • The right of the suspect to have an attorney upon the first request.
  • The right to inviolability of home, ownership, non-interference in private communication unless through a decision of the court.
  • The right to avoid self-incrimination, family and close relatives' privilege.
  • The right of participants in the proceedings to file evidence, to provide explanations.
  • The right of participants in the proceedings to demand recusation (that is, the act of disqualifying the judge on the grounds of possible partiality or prejudice).
  • The right of participants in the process to familiarise themselves with procedural documents, receive copies of them and appeal to the court or the court of higher instance.
(Articles 271 to 275, Criminal Code.)

Health and safety offences

Regulatory provisions and authorities

8. What are the main regulatory provisions and legislation relevant to health and safety offences?
Under Ukrainian law, safety and health of employees in the workplace is covered by the term "labour protection". The main law establishing the basis for labour protection is the Law of Ukraine on Protection of Labour (Protection of Labour Law). Article 13 of the Protection of Labour Law imposes an obligation on the employer to:
  • Establish working conditions in each structural subdivision of the workplace that are in accordance with the necessary laws and regulations.
  • Ensure compliance with the requirements of the law relating to employees' rights in the field of occupational safety.
Responsibilities regarding the organisation of the labour protection system and implementation of appropriate measures by the employer are set out under the relevant articles of section XI of the Labour Code of Ukraine (Labour Code).
The safety requirements for employees in various industries are governed by various bye-laws, in particular, by resolutions of the Cabinet of Ministers of Ukraine, orders of the relevant ministries and departments and so on.
Criminal liability for violations of employee health and safety is set out in section X of the Criminal Code (relating to "crimes against production safety"). Administrative liability is regulated under Paragraph 5, Article 41 of the Code of Administrative Offences.

Offences

9. What are the specific offences relating to health and safety?
Unlike in many civil law countries, where criminal liability for violating the rules for labour protection or the safety of production arises under provisions relating to negligent death or bodily harm, in Ukraine such crimes are set out separately in section X of the Criminal Code relating to "crimes against production safety".
Similar crimes are addressed already in Question 1 to Question 7. However, offences relating to breaches of health and safety relate to an act envisaged in Paragraph 1 of the relevant articles of the Criminal Code:
  • Violation of the requirements of the labour protection legislation (Paragraph 1, Article 271).
  • Violation of safety rules when performing high-hazard work (Paragraph 1 Article 272).
  • Violation of safety rules at explosive enterprises or in explosive workshops (Paragraph 1, Article 273).
  • Violation of nuclear or radiation safety rules (Paragraph 1, Article 274).
  • Violation of rules regarding the safe use of industrial products or safe operation of buildings and structures (Paragraph 1, Article 275).
Administrative liability of an employer's officials or other employees is stipulated in Part 5 of Article 41 of the Code of Administrative Offences.
Financial liability rests with employers where there has been a failure to comply with an order from a labour inspector of the State Service of Ukraine on Labour to eliminate violations of labour legislation, including labour protection requirements, which led to a threat to the safety of life and health of the employees (Article 265, Labour Code).

Defences

10. What defences or exemptions are available and who can qualify?
An obligatory condition for criminal liability is harm to the victim, namely moderate or slight bodily harm that caused a short-term health disorder or a slight disability. In some cases, for an act to be classified as a criminal offence, it must entail a threat of death to people (in violation of safety rules when performing high-hazard work or other grave consequences (causing severe bodily damage)). In the absence of these, an act cannot be recognised as a criminal offence. Therefore, the aim of the defence, depending on the situation, may be to prove that either:
  • No harm was caused to the victim's health.
  • There is no causal link between an official's act and the consequence in the form of such damage.
Financial sanctions can be imposed on an employer in accordance with Paragraph 9 of Part 2 of Article 265 of the Labour Code, unless the employer can show that, following an inspection from a labour inspector of the State Service of Ukraine on Labour, it had eliminated the violation for the period identified. Where it is revealed that the same violation has been committed repeatedly within one year after the initial violation, the financial sanctions prescribed by Paragraph 10 of Part 2 of Article 265 of the Labour Code will be imposed on the employer even if employer eliminated the violation following the inspector's order.

Enforcement

11. Which authorities have the powers of prosecution, investigation, and enforcement in cases of health and safety offences? What are the authorities powers of prosecution, investigation, and enforcement, and what are the consequences of non-compliance?
The state authorities are similar to those indicated in Question 4.
12. Which authority makes the decision to charge and on what basis is that decision made? Are there any alternative methods of disposal and what are the conditions of such disposal?

Conviction and sanctions

13. What are the sanctions for health and safety offences?

Criminal liability

Articles 271 to 275 of the Criminal Code stipulate the following criminal sanctions for individuals:
  • Violation of requirements of the labour protection legislation (Paragraph 1, Article 271). This is punishable with:
    • a fine of about EUR65 to EUR128;
    • correctional labour for up to two years; or
    • restraint of liberty (which generally involves a custodial sentence) for up to two years.
  • Violation of safety rules in performing high-hazard work (Paragraph 1, Article 272). This is punishable with:
    • a fine of about EUR65 to EUR128;
    • correctional labour for up to two years; or
    • restraint of liberty for up to three years.
  • Violation of safety rules at explosive enterprises or in explosive workshops (Paragraph 1, Article 273). This is punishable with:
    • correctional labour for up to two years;
    • restraint of liberty for up to three years; or
    • imprisonment for up to three years.
  • Violation of nuclear or radiation safety rules (Paragraph 1, Article 274). This is punishable with:
    • restraint of liberty for up to four years; or
    • imprisonment for up to four years.
  • Violation of rules regarding the safe use of industrial products or the safe operation of buildings and structures (Paragraph 1, Article 275). This is punishable with:
    • a fine of about EUR65 to EUR128;
    • correctional labour for up to two years; or
    • restraint of liberty for up to three years.
As an additional punishment, the court may apply deprivation of the right to hold certain positions or engage in certain activities for a term of up to three years.

Administrative liability

Part 5 of Article 41 of the Code of Administrative Offences stipulates that a violation of the labour protection requirements will entail a fine of:
  • For employees or officials of enterprises, institutions, organisations regardless of their ownership form: four to ten tax-free minimum incomes (about EUR2 to EUR6).
  • For private entrepreneurs: 20 to 40 non-taxable minimum incomes of citizens (about EUR12 to EUR25).

Financial liability

An employer will be liable to pay a fine equivalent to about EUR175 for violations of other labour legislation requirements, including those on occupational safety, which have caused threats to employees' safety of life and health. Where it is revealed that the same violation was committed repeatedly within one year after the initial violation, the fine will amount to about EUR350.
Pursuant to Part 5 of Article 265 of the Labour Code, the employer will be liable to pay only 50% of the amount of the fine if it manages to provide payment within ten banking days from the moment of receipt of the decision that imposed the fine.

Safeguards

14. Are there any measures in place to safeguard the conduct of investigations? Is there a process of appeal? Is there a process of judicial review?

Environmental offences

Regulatory provisions and authorities

15. What are the main regulatory provisions and authorities responsible for investigating environmental offences?
The main regulatory provisions are found in the Law of Ukraine on the Protection of the Environment (Environment Law). Environmental offences are also set out in section VIII of the Criminal Code and a number of separate articles within the Code of Administrative Offences.
Currently, seven central executive agencies are concerned with exercising control over compliance with environmental standards. On 31 May 2017, the Cabinet of Ministers of Ukraine presented its Concept of the Reform in the Field of Environmental Protection. The general idea is to establish a single entity responsible for environmental monitoring and oversight. Implementation of the Concept will be carried out in three stages during 2017 to 2020.
With respect to the guidelines for prosecution of environment-related offences, the Resolution of the Plenum of the Supreme Court of 10 December 2004 should be mentioned. This provides a selection of legal positions on how the prosecution for environment-related offences should be considered in the courts.

Offences

16. What are the specific offences relating to the environment?
Section VIII of the Criminal Code includes 21 offences related to violation of environmental rules. The most common (according to the statistical information provided by the Prosecutor General Office of Ukraine's official website):
  • Violation of the established rules for the protection or use of subsoil, if it contributed to a danger of life, health of people or the condition of the environment.
  • Illegal extraction of minerals resources of national importance.
  • Illegal felling of trees or shrubs in forests, protective and other forest plantings that caused significant damage, as well as the commitment of such actions in the natural reserves, or in the other specially protected areas.
  • Illegal engaging in the trade of fish, or other water-living species, which caused significant damage.
  • Illegal extraction, sale, acquisition, storage, transfer, transportation or processing of amber (this is a new criminal offence in sphere of environmental protection).
The Code of Administrative Offences also establishes specific offences related to the violation of environmental protection rules.
It should be noted that liability for offences will apply to officials of enterprises, individual entrepreneurs or to the employees of a company rather than to legal entities.

Defences

17. What defences or exemptions are available and who can qualify?
There are no specific defences for environmental-related offences except for claiming the absence of the elements essential to the offence in question.

Enforcement

18. Which authorities have the powers of prosecution, investigation, and enforcement in cases of environmental offences? What are the authorities powers of prosecution, investigation, and enforcement, and what are the consequences of non-compliance?
One of the main bodies responsible for environmental monitoring is State Ecological Inspection of Ukraine (SEI). According to its internal rules, the SEI is authorised to engage the representatives of law enforcement agencies in conducting environmental control, as well as share any information with those representatives during environmental investigations.
For general information on the law enforcement agencies, see Question 4.
19. Which authority makes the decision to charge and on what basis is that decision made? Are there any alternative methods of disposal and what are the conditions of such disposal?

Conviction and sanctions

20. What are the penalties for environmental offences?
For the most common environmental offences under the Criminal Code (see Question 16), the penalties are:
  • Violation of established rules for the protection or use of subsoil, if it contributed to a danger of life, health of people or the condition of the environment. This is punishable with:
    • a fine of about EUR192 to EUR400 (according to the exchange rate);
    • restriction of liberty for up to five years; or
    • imprisonment for up to eight years.
  • Illegal felling of trees or shrubs in forests, protective and other forest plantings. This is punishable with:
    • a fine of about EUR641 to EUR960;
    • arrest for up to six months; or
    • restriction of liberty/imprisonment for up to three years.
  • Illegal engaging in the trade of fish, or other water-living species. This is punishable with:
    • a fine of about EUR65 to EUR250; or
    • restriction of liberty/imprisonment for up to three years.
    • Illegal extraction, sale, acquisition, storage, transfer, transportation or processing of amber. This is punishable with:
    • a fine about EUR1,920 to EUR6400;
    • restriction of liberty for up to five years; or
    • imprisonment for up to five years.
In relation to administrative liability, the penalties are:
  • Unauthorised use of subsoil, conclusion of transactions that, directly or indirectly, violate the right of ownership to the subsoil. This is punishable with a fine of about EUR6 to EUR65.
  • Use of land belonging to state forest fund for uprooting, construction of buildings, processing of wood, warehouse arrangement and so on without proper permission. This is punishable with a fine of about EUR3 to EUR11.
  • Pollution and littering of water, violation of the water protection regime in the catchment areas, which causes their pollution, water erosion of soils and other related harmful phenomena. This is punishable with a fine of about EUR2 to EUR5.
In addition, it should be noted that under the Environment Law, any damage caused from a violation of environmental protection rules must be compensated in full. For determining the amount of damage caused, the courts refer to the rates approved by Cabinet of Ministers of Ukraine on approval of rates for calculating the amount of damage caused by violation of environmental legislation, Regulation No. 1209 dated 21 November 2011 on the calculation of damage for illegal harvest or killing of water bioresources (see https://zakon.rada.gov.ua/laws/show/1209-2011-%D0%BF ).
Moreover, administrative liability may also incur:
  • Special confiscation of money, valuables and other objects employed.
  • Fine of more than EUR1,600.
  • Imprisonment.

Safeguards

21. Are there any measures in place to safeguard the conduct of investigations? Is there a process of appeal? Is there a process of judicial review?
See Question 7.
 
First published in Thomson Reuters.

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