Mikhail Nos­alyk: Work­ing in law­less ser­vice sec­tor

Kyiv Post Legal Quarterly - - Contents - By Josh Koven­sky Koven­sky@kyiv­post.com

Abar­tender who doesn't wash glasses, caus­ing hep­ati­tis to spread among cus­tomers. waiter who spills a scorch­ing dish on a cus­tomer, caus­ing se­vere burns.

An ex­tor­tion­ist who poi­sons a res­tau­rant's soup, caus­ing pa­trons to fall ill.

In Ukraine, per­haps more than other na­tions, peo­ple need to be care­ful about the restau­rants, night­clubs and bars they fre­quent.

Not many peo­ple know more about the prob­lems, per­haps, than Mikhail Nos­alyk, a part­ner at Global Law. Nos­alyk has en­coun­tered a lot of dis­turb­ing in­ci­dents in his prac­tice, which in­volves con­stant work with gov­ern­men­tal fire, food and con­sumer safety reg­u­la­tors.

Many of th­ese prob­lems take place in a loosely reg­u­lated en­vi­ron­ment.

New reg­u­la­tor

Ukraine has been try­ing to con­sol­i­date all of the agen­cies that run checks into one sin­gle reg­u­la­tor: the State Ser­vice of Ukraine for Food Safety and Con­sumer Reg­u­la­tion.

Al­though the body legally came into ex­is­tence in Fe­bru­ary 2016, Nos­alyk said that it’s still be­ing formed. “They will be the main reg­u­la­tor,” Nos­alyk said.

The new con­sumer pro­tec­tion agency, es­tab­lished by for­mer Agri­cul­ture Min­is­ter Olek­siy Pavlenko, united the state in­spec­tion ser­vices for agri­cul­tural prod­ucts, live­stock, plants and quar­an­tine is­sues.

But Nos­alyk said that many “il­le­gal ver­i­fi­ca­tions” con­tinue. “There’s a list of state or­gans that have the right to con­duct checks, but some will come who don’t have the right to come, or who have the right, but it’s the wrong ad­min­is­tra­tion to be con­duct­ing it.”

Many of the laws that gov­ern­ment en­forces date to the Soviet era.

Ukraine still uses the 1970s Soviet la­bor code, while other re­quire­ments reg­u­lat­ing the “ad­ja­cency of food prod­ucts” mean

that “stor­ing prod­ucts within our Soviet norms is im­pos­si­ble, be­cause you need 40 re­frig­er­a­tors to keep ev­ery­thing.” Part of the so­lu­tion is to en­act mod­ern leg­is­la­tion. One idea is re­plac­ing Ukraine’s 1970s la­bor code. Leg­is­la­tion has been kick­ing around the Verkhovna Rada, Ukraine's par­lia­ment, since 2015. La­bor lawyers ex­pected ac­tion in the 2016 ses­sion, but that has not yet hap­pened.

Club­bing

The cut­throat res­tau­rant in­dus­try lends it­self to at­tacks rang­ing from le­gal com­plaints to "ti­tushki," or hired thugs, com­ing over and break­ing the win­dows of a com­peti­tor’s eat­ing es­tab­lish­ment.

Nos­alyk told the story of a res­tau­rant in Kyiv's Pech­ersk dis­trict that was ac­cused of play­ing mu­sic too loudly. But the peo­ple who filed the com­plaint were in Obolon, many kilo­me­ters away. “The po­lice still tried to ver­ify it,” Nos­alyk said.

In an­other case that Nos­alyk de­scribed as ex­tor­tion, a man who was threat­en­ing a res­tau­rant poi­soned the es­tab­lish­ment’s soup in a bid to ex­ert pres­sure. “Ev­ery­one got poi­soned,” he said.

Rep­re­sent­ing Kyiv’s night­clubs comes with its own set of le­gal chal­lenges. Fights oc­ca­sion­ally break out among pa­trons. So part of Nos­alyk’s job is to re­view video footage to send to the po­lice.

“We had a case where they just stole the cam­era,” Nos­alyk said, adding that many club man­agers train video sur­veil­lance on their em­ploy­ees to pre­vent theft and not on rev­el­ers.

The lack of ef­fec­tive fi­nan­cial crime in­ves­ti­ga­tors makes it dif­fi­cult to press theft charges against em­ploy­ees. “It’s dif­fi­cult to prove,” Nos­alyk said, adding that in one case, an em­ployee was rou­tinely say­ing he had given 10 per­cent dis­counts on items, but was ac­tu­ally pock­et­ing the dif­fer­ence. Com­ply or for­feit But in gen­eral, gov­ern­ment reg­u­la­tors still wield a heavy ba­ton of civil for­fei­ture in cases where restau­rants and clubs do not com­ply with the law.

En­trepreneurs in Ukraine have per­sonal li­a­bil­ity for their op­er­a­tions. A big fine could lead to the re­pos­ses­sion of homes.

Nos­alyk re­counted the case of one bar­tender who was fined Hr 350,000 ($13,400) for rip­ping the ex­cise la­bel on a liquor bot­tle. “The bar­tender came, saw the fine, and said, ‘I don’t have the money, my salary is Hr 10,000 ($384),” Nos­alyk re­called. “And then he left.”

Nos­alyk's ad­vice: “It’s bet­ter to just do ev­ery­thing as it should be done, then you’ll sleep soundly.”

Though Ukrainian food and health reg­u­la­tions are of­ten quite strict, en­force­ment is piece­meal and the rules of­ten self­con­tra­dic­tory, says Mikhail Nos­alyk, a part­ner at Global Law who spe­cial­izes in con­sumer pro­tec­tion is­sues. (Cour­tesy)

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