It was yours, now it’s ours
As a rule, folk wisdom is superior to the minds of sluggish government officials. The same day that Prime Minister Yanukovych answered The Day’s question by saying that his government is aware of the raiding problem and is planning legislative measures to overcome it, a young man from his entourage, as though confirming the boss’s statement, told a risque joke about the wolf meeting Little Red Riding Hood and telling her, “You have a choice: be merged or eaten up.” So, the government does not seem to be asleep at the helm: it’s telling jokes and drafting laws. Yet almost every day we hear about criminal takeovers of businesses.
There are many aspects to the losses being incurred by raiding. It is destabilizing the legal foundation of the state, which proclaimed private ownership inviolable; fostering the corruption of judges (who are being made offers they cannot refuse, if there is nowhere else to go in this question); proliferating manifestations of corruption among law enforcement organs; breaking the working rhythm of businesses; and, finally, curtailing foreign investments in a country that traditionally has no respect for private ownership.
When a state spots a threat, it starts taking steps to neutralize it. We all know how the Soviet state tried to combat alcoholism. But we are repeating the same mistakes. The Ministry of Justice is planning a mechanism to combat raiding. Reiterating practically every word of the prime minister’s response to The Day, justice minister Oleksandr Lavrynovych said during his meeting with German Ambassador Reinhard Schaefers that “we know the components of raiding, we know how raiders operate, and we are working to make raiding impossible from the legislative point of view. It is an antisocial act that is not legitimate but which is taking place in an absolutely lawful manner,” the minister said, introducing this correct idea to law-abiding citizens, who are alarmed by this dangerous phenomenon. The Prosecutor General’s Office has also drafted proposals to combat raiding. Its head, Oleksandr Medvedko, noted that they include measures to strengthen procedures aimed at resolving disputes in economic courts at a given business’s place of registration. The chief prosecutor also proposes to ensure the owner’s right to restore his property appropriated by a raider. Analyzing the existing situation, Medvedko reminded those present that raiding initially takes place in the legal field through the purchase of shares and court decisions. After this a business is seized. He likened such seizures to acts of violence against people, which sometimes involve the use of firearms, as happened in Poltava and Dnipropetrovsk oblasts.
Parliamentarians have also joined the anti-raiding campaign. Our Ukraine’s Mykola Yakovyna announced that a message would be forwarded to President Yushchenko and Prime Minister Yanukovych, urging them to take measures to stop raider attacks on businesses. He believes that such cases require prompt responses from law enforcement and the drafting of measures to prevent encroachments on citizens’ ownership rights.
A discordant note against the background of the public’s general repugnance to raiding was struck at the press conference “The Problem of Raiding: a Myth,” held on Dec. 5. During the conference reports were submitted by the analytical division of a raiders’ brigade that had targeted concrete businesses.
The theme of poor Little Red Riding Hood crops up here again. Ihor Tunik, the leading partner of the consulting company BPT Group (Kyiv), told journalists that in order to counteract raider attacks, the government must provide conditions for the legalization of the process of mergers and absorptions, which must be fitted within a civilized framework. The lawyer believes that “raiding is largely a part of these processes, and the state has to control it.”
In particular, raiding must be made subject to criminal prosecution. It must have a clear legal definition, laws on joint stock and holding companies must be quickly enacted, judicial reform must be carried out, and a register of court decisions generated. Tunik also believes that companies must combat raider attacks on the level of corporate rights and corporate security, and that they must conduct their affairs in such a way that there will be neither motives nor opportunities for attempts at raiding. The government should heed what practicing lawyers have to say. Often both sides in such conflicts accuse each other of raiding. How will the authorities combat this phenomenon? How will they tell the wolf from Little Red Riding Hood?
