Investment company Dragon Capital denounces unfair control by the Ukrainian Economic Security Agency - UBJ

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The investment group Dragon Capital claims to have suffered inappropriate pressure from the BEB regarding one of its main assets, according to its press release dated May 24.

However, the BEB response dismissed Dragon Capital’s claims as mere “manipulations.”

Many in Ukraine’s business community have expressed concerns over increasing pressure from government entities, including the BEB. The administration has vowed to act improve relations between businesses and public authorities.

With Dragon Capital as the largest investment establishment in Ukraine, its holdings span various sectors and include the prominent Ukrainian newspaper Ukrainska Pravda.

Their statement mentions: “For several months, we have seen increased surveillance by the Economic Security Bureau of Ukraine over the activities of Victoria Gardens, a major shopping center in Lviv,” they detailed.

The shopping center in question is owned by Europolis Property Holding, a subsidiary of Dragon Capital acquired in 2018.

In 2017, before this acquisition, the BEB launched a tax evasion case associated with Victoria Gardens.

According to Dragon Capital, employees of Europolis Property Holding were questioned in the Lviv region and it appears that these questions were previously resolved.

In May 2024, BEB detectives asked Europolis to provide documents for another case from 2017 for which information had already been provided.

Despite providing the requested documents and indicating previous investigations, the BEB subsequently sent new requests and informed the company of possible searches and confiscations.

“We consider such duplicative actions and dragging our company into old procedures to be a form of commercial harassment,” Dragon Capital said.

The company urges an end to such actions and hopes to foster a lucrative business climate in Ukraine.

They look forward to government support to establish a fair and transparent business environment.

The agency denies the allegations, saying its detectives are entitled to the collection of information as part of their criminal investigations.

The agency also indicated that the procedure for tax fraud was closed in February of the current year and that the investigation in May resulted from a referral to the National Police and the Prosecutor’s Office.

“Detectives have requested details from the company mentioned as part of their data validation,” BEB commented.

The office is reportedly in the process of organizing the necessary formalities to close this criminal procedure.

Additionally, earlier this month, CEO Club Ukraine reported a search conducted by BEB detectives on their premises, linking the operation to an alleged smear campaign against them.

This business The forum has been a strong advocate of desk reforms to prevent it from turning into an oppressive or corrupt institution.

The BEB was created in 2021 with the intention of leading the fight against economic crimes, but several media sources and civil groups have since reported that it appears to be under the umbrella of the BEB. indirect influence by Oleh Tatarov, a senior figure in the presidency.

To address these concerns, on April 11, Parliament presented a bill aimed at reform the office at first reading, aligning with the expectations of local stakeholders and international allies.

Dragon Capital claims that the Economic Security Bureau (BEB) placed undue pressure on its company, including repeatedly requesting documents regarding a previous tax evasion case related to Victoria Gardens, which the company believed was already resolved.

BEB has refuted the harassment allegations outlined by Dragon Capital, saying its detectives lawfully carry out their duties of gathering information for criminal proceedings. The BEB also clarified that it is working to finalize the closure of the mentioned criminal case.

Dragon Capital calls for an end to practices it considers to be pressure and also seeks government support to create a favorable, transparent and fair business environment.

Yes, the Ukrainian parliament adopted, in first reading, a bill focused on BEB reform. The move aims to respond to national and international calls for reforms of the office to meet specified standards and requirements.

The BEB was established in 2021 to serve as the main authority for combating economic crime in Ukraine. However, concerns have been raised about the impartiality and integrity of the agency’s operations.

The situation involving Dragon Capital and the Economic Security Bureau (BEB) highlights tensions between Ukrainian authorities and the business community. While Dragon Capital calls for an end to the alleged intimidation tactics and hopes for government support to foster a conducive business environment, BEB maintains its actions are within the legitimate framework of criminal investigations. The steps taken by the Ukrainian parliament to reform the BEB indicate a recognition of broader concerns about the agency’s methods and potentially signal a shift toward a more balanced and equitable relationship between business and economic security apparatuses in Ukraine. As these events unfold, all eyes will be on the Ukrainian government to see how it handles these complex issues as part of its broader economic reform agenda.

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