Doing Business in Ukraine

The Kyiv Post has another great interview today:

"In September, the State Customs Administration accused the plant of being a coal smuggler, as it claimed that ArcelorMittal failed to pay Hr 200 million ($25 million) worth of customs duties on its imported coal, arresting nearly 67,000 tons of coal in question at ports. This case was dropped last December, only to give way to headaches.

Recently, tax authorities accused ArcelorMittal’s plant in Ukraine of more than $50 million in tax violations. But Russian-native Rinat Starkov, appointed ArcelorMittal’s generaldDirector in Ukraine, says his biggest headache is the state tax administration’s inability to refund value added tax on time and in full.

Government debts to the plant as of Jan. 1, he said, totaled Hr 2.3 billion, the biggest amount owed to any business in Ukraine. Starkov is also not happy that ArcelorMittal has had to make more than Hr 1 billion in advance tax payments to help Ukraine cover a budget shortfall. In addition, dealing with inspections from various controlling bodies, which the company faces on a daily basis, has become a daily routine."

And a rather embarrassing comparison with Russia:

"Things like that are impossible in Russia, and in the West, where I worked for the last four years. It’s really difficult for [ArcelorMittal’s management in London] to understand what is really going on here. Russia had similar problems, but that was 10 years ago."