Law on Criminalization of Smuggling of Goods, EU AI Law

Law on Criminalization of Smuggling of Goods and Excisable Goods has been Adopted: What is Provided?

On 09.12.2023, the Verkhovna Rada adopted as a whole Draft Law No. 5420, which criminalizes smuggling of non-excisable, excisable goods and false declaration of goods.

Thus, starting from 01.07.2024, the Law provides criminal liability for smuggling of non-excisable goods in amount of:

from 7,5 to 15 million UAH – in form of a fine from 170 to 425 thousand UAH;
over 15 million UAH – from a fine in 850 thousand UAH to imprisonment for 11 years with confiscation of property.

For excisable goods in amount of:

from 1.1 to 2.3 million UAH – from a fine in 340 thousand UAH to 6 years of imprisonment;
Over 2.3 million UAH – from a fine in 1.3 million UAH to 12 years of imprisonment with confiscation of property.

Let us pleas remind you that after its adoption in the first reading, the Law was criticized by the public and business as leading to corruption risks and preconditions for abuse by regulatory and law enforcement agencies, as well as unlawful pressure on legitimate business.

Afterwards, the draft law for the second reading took into account the changes insisted on by the business, including, in particular, raising thresholds for criminalization of committed acts (the threshold for non-excisable goods smuggling was raised 5 times, for excisable – 2 times), intent was added as a mandatory element of the committed offence etc.

On 13.12.2023, the Law was submitted to the President for signature.

Administrative Liability for Curfew Violation: Draft Law Passes First Reading

On 09.12.2023, the Verkhovna Rada adopted in the first reading Draft Law No. 10195, which provides administrative liability for curfew violation in the form of fines.

In particular, violation of the curfew regime during martial law by a business entity entails a fine of 51 thousand to 102 thousand UAH for a director of a company or an individual entrepreneur.

If such violation is committed repeatedly within a year, the fine for it will range from 170 to 340 thousand UAH.

The EU Adopted the Law on AI

On 08.12.2023, the European Parliament adopted the world’s first law that will regulate the functioning and use of the Artificial Intelligence (AI) in the EU.

It is currently known that the law will classify AI systems by risk level. Strict control will be exercised over those technologies that pose a threat to health, security and human rights (unmanned vehicles, medical equipment etc.).

Some restrictions will also apply to the use of AI by law enforcement agencies.

Companies that want to operate and sell their AI-based products within the EU will be required to cooperate with regulators, share data and take special measures to minimize risks.

Businesses are liable for violations of the relevant legislation, including fines of up to 7% of the company’s global revenue.

The law is expected to enter into force no earlier than 2025.

European Commission Approves Plan to Use Russian Frozen Assets

On 12.12.2003, the European Commission approves a legislative proposal to use the income of frozen russian assets to rebuild Ukraine.

It is expected that the text of the proposal will be submitted to the European Council for consideration and decision in the near future. The decision to enact this proposal must be taken unanimously by all EU member states.

The use of income from the assets of the Central Bank of russia on separate accounts in central depositories for Ukraine’s recovery is a long-term goal of the European Commission.

Reportedly, since the immobilization of all such investments, they have begun to generate income, which was decided to keep as net income within the central depositories.

Now, the European Commission is focusing on the short-term goal of this plan, namely:

management of this income;
a complete ban on the distribution of income between shareholders and third parties.

However, specific figures or procedures of the approved plan remain unknown.

Let us please remind you, earlier the Financial Times reported that the European Commission plans to raise 15 billion euros for Ukraine in the period from 2023 to 2027.

President Imposed Sanctions on Individuals and Legal Entities

On 07.12.2023, by Decree No. 813/2023 the President of Ukraine imposed sanctions for 5 and 10 years against 185 individuals and 181 companies.

The sanctions are imposed mainly on russian citizens, but there are also persons with dual or multiple citizenships, as well as German and Uzbekistan citizens.