Anzhela Makhi­nova: There’s no such thing as sim­ple le­gal work in in­ter­na­tional trade

Kyiv Post Legal Quarterly - - CONTENTS - By Vy­ach­eslav Hnatyuk [email protected]­

Want some free le­gal ad­vice?

Anzhela Makhi­nova will give it to you – as long as you’re ask­ing about the fun­da­men­tals of in­ter­na­tional trade.

“Ukraini­ans of all walks of life need to un­der­stand the con­se­quences of Ukraine’s in­ter­na­tional obli­ga­tions, when the coun­try signs in­ter­na­tional treaties,” she says.

Large do­mes­tic and for­eign cor­po­ra­tions, as well as in­dus­trial unions and the state rely on her ad­vice while trad­ing all over the globe – and they do have to pay.

Makhi­nova, a lead­ing Ukrainian lawyer spe­cial­iz­ing in in­ter­na­tional trade, and a part­ner at law firm Sayenko Kharenko, thinks that Ukraini­ans of var­i­ous pro­fes­sions should adopt more in­ter­na­tion­al­ist at­ti­tudes. Busi­nesses and au­thor­i­ties should rid them­selves of parochial de­ci­sion-mak­ing tac­tics, known in Ukraine as “mis­tetchko­vist,” or “provin­cial­ism” in English.

“We have to look at our prob­lems from var­i­ous stand­points, and do our best to fore­see the fu­ture of these prob­lems,” Makhi­nova says. “And there shouldn’t be any rush de­ci­sions, like the one’s we’re so fond of.”


In­stead, Makhi­nova ad­vo­cates bal­anced and strate­gic de­ci­sion-mak­ing. Her cer­tainty and can­dor are per­sua­sive. She has been work­ing in in­ter­na­tional trade law for more than 10years, and knows Ukraine’s trade with the world in­side out. Ask Makhi­nova what Ukraine’s big­gest trade is­sues are, and her an­swer is in­stant.

“Ukrainian ex­porters are mostly suf­fer­ing from the trade wars that the world is cur­rently en­gaged in. Ukraine’s met­al­lur­gi­cal sec­tor in par­tic­u­lar is be­ing hit hard by the trade wars.”

A new wave of pro­tec­tion­ism is cur­rently ris­ing over the globe. Dubbed “neo-pro­tec­tion­ism,” it is when coun­tries limit im­ports us­ing the ex­cuses of na­tion­al­ist or pop­ulist poli­cies. Re­cent ex­am­ples in­clude the in­tro­duc­tion of new cus­tom du­ties by the ad­min­is­tra­tion of U.S. Pres­i­dent Don­ald Trump, and the in­creased use of pro­tec­tion­ist mea­sures within the World Trade Or­ga­ni­za­tion by its mem­ber-states.

Strict quo­tas

On top of that, since Rus­sia started its war on Ukraine in the Don­bas in 2014, Ukraine’s for­eign trade pol­icy has made a U-turn away from Rus­sia and to­wards the West.

Many ex­porters are hav­ing a hard time adapt­ing, and the process is far from over, Makhi­nova says.

“A re-ori­en­ta­tion to other mar­kets is tak­ing place. My feel­ing is that trade cur­rents with Rus­sia are still flow­ing, but that the Euro­pean vec­tor is grow­ing, too. How­ever, Europe has not opened it­self up fully.”

Even though Ukraine now has a Deep and Com­pre­hen­sive Free Trade Agree­ment with the Euro­pean Union, strict Euro­pean Union quo­tas on low-duty im­ports are still in place. Ukraine’s quota for poul­try is a mere 16,000 tons per year, whereas one lo­cal pro­ducer My­ronivsky Hli­bo­prod­uct, owned by ty­coon Yuriy Kosyuk, alone churned out 566,242 tons last year. There are honey quo­tas in the EU, too, and Ukraine ex­hausts them within the first 10 days of each year.

Al­though a pro­moter of free trade, Makhi­nova con­fesses that “ex­ports are not al­ways a to­tally pos­i­tive thing.” Nowhere can that be more plainly seen than in Ukraine’s Carpathian Moun­tains, where il­le­gal log­ging, fueled by high prices for tim­ber in the EU, has caused en­vi­ron­men­tal prob­lems as­so­ci­ated with de­for­esta­tion, such as floods and land­slides.

The em­bargo Ukraine in­tro­duced for ex­port of wood is not ef­fec­tive. It can be cir­cum­vented by smug­gling, and Ukraine has faced a back­lash by Euro­pean coun­tries in the WTO over its tim­ber ex­port lim­i­ta­tions.

The eco­nom­ics of this ex­port trade are not in Ukraine’s fa­vor ei­ther: “We ex­port raw ma­te­rial, but im­port high value Ital­ian fur­ni­ture,” says Makhi­nova.

En­ter­ing the WTO has had mi­nuses for Ukraine as well as pluses, she says – while ex­port con­di­tions are more fa­vor­able un­der the or­ga­ni­za­tion’s rules, mem­ber­ship also means open­ing the econ­omy up to im­ports.

“When Ukraine en­tered (the WTO), we dras­ti­cally de­creased pro­tec­tion of do­mes­tic pro­duc­tion,” Makhi­nova says. “Thus, im­ports of al­most all types of steel prod­ucts are per­formed with a zero-per­cent im­port duty rate.”

‘We ex­port raw ma­te­rial, but im­port high value Ital­ian fur­ni­ture,’ says Makhi­nova.

Le­gal in­stru­ments

WTO leg­is­la­tion is hard to un­der­stand and nav­i­gate, Makhi­nova ad­mits. But Ukraine has to do a bet­ter job of us­ing it to pro­tect its do­mes­tic mar­ket, and its raw ma­te­rial mar­kets. Much could be achieved if Ukraine just played its WTO cards cor­rectly, Makhi­nova be­lieves.

For in­stance, in the case of pro­hibit­ing tim­ber ex­ports, Ukraine’s ban has been in­ef­fec­tive be­cause WTO leg­is­la­tion wasn’t un­der­stood or fol­lowed prop­erly. Un­der WTO rules, Ukraine in fact has cer­tain le­gal in­stru­ments that it could use to pro­tect its do­mes­tic mar­ket, and ex­cep­tions to free trade rules that can be called to pro­tect ex­haustible nat­u­ral re­sources – they sim­ply haven’t been used, Makhi­nova says.

Asked what in­dus­tries she would sup­port were she Ukraine’s Min­is­ter of Trade, Makhi­nova praises Ukraine’s Ex­port strat­egy for 2017-2021. The strat­egy sets Ukraine’s ex­port pri­or­ity as High Tech Ser­vices.

But “this is a task for an in­no­va­tive, glit­ter­ing fu­ture,” she adds. Mean­while, Ukraine mustn’t ne­glect its es­tab­lished and well-func­tion­ing in­dus­tries – met­al­lurgy, chem­i­cals, and en­gi­neer­ing, she says.

“We can’t throw over­board the in­dus­tries that are putting food on the ta­ble in Ukraine now. Of course the fu­ture be­longs to IT, but we’ve got to de­velop it wisely.”

Fos­ter­ing de­vel­op­ment

For her pay­ing clients, Makhi­nova of­fers two ma­jor types of ser­vices: trade in­ves­ti­ga­tions on the one hand, and ad­vis­ing on WTO leg­is­la­tion and dis­pute res­o­lu­tion on the other. Al­though she says she has no lack of clients and han­dles about five to seven projects per year, Makhi­nova de­clines to dis­close her prac­tice’s turnover. She says her work­load is enough to achieve the fi­nan­cial tar­gets set by her firm’s man­age­ment. The work is in­ten­sive and well re­mu­ner­ated, she adds.

The unique char­ac­ter of her work means that it never be­comes rou­tine.

“My sphere of pro­fes­sional ac­tiv­ity re­quires a lot of cre­ativ­ity and out-of-the box think­ing” as the tasks re­quire knowl­edge of WTO reg­u­la­tions and un­der­stand­ing of eco­nomic pro­cesses, Makhi­nova says.

If a bright law stu­dent were to want to join her team, the can­di­date would have to go through a rig­or­ous se­lec­tion process. First­class aca­demic cre­den­tials from a top Ukrainian law school are a must. Ap­pli­cants are also ex­pected to have a spe­cial­ized Mas­ter of Laws de­gree from a Wto-ap­proved train­ing course in Bern or Barcelona. More ex­pe­ri­enced lawyers would be ex­pected to have passed the bar exam in Ukraine.

Makhi­nova’s po­si­tion is highly com­pet­i­tive. Her pre­de­ces­sor Nataliya Mykol­ska un­til re­cently was the deputy Econ­omy Min­is­ter and was the coun­try’s trade rep­re­sen­ta­tive.

Tal­ent and ex­pe­ri­ence are defini­tively a re­quire­ment for this line of le­gal work.

“In this sphere there’s no longer any such thing as sim­ple work,” Makhi­nova says.

“What we’re do­ing fosters (self-) de­vel­op­ment. Plus, I en­joy talk­ing to peo­ple from dif­fer­ent spheres of hu­man ac­tiv­ity.”

Newspapers in English

Newspapers from Ukraine

© PressReader. All rights reserved.