BUSINESS-GOVERNMENT RELATIONS

LEGAL SERVICES: Government Relations emerges as new niche for Ukrainian law firms

Ukrainians are learning to lobby legally as attention focuses on the benefits of better business-government dialogue

LEGAL SERVICES: Government Relations emerges as new niche for Ukrainian law firms
About the author: Andriy Dovbenko is the Managing Partner at EVRIS law firm
Andriy Dovbenko
Tuesday, 15 May 2018 18:59

Ukrainian law firms are increasingly introducing the practice of GR, or Government Relations, the process of seeking to influence public and government policy at all levels. Broadly speaking, the concepts underpinning GR are nothing new in Ukraine. Indeed, the lobbying of public officials is as old as government itself. However, such activities used to be very much out of public sight in Ukraine. This is now changing, with the current trend suggesting an industry-wide shift towards a more civilized, standardized and transparent approach.

 

Why GR is in fashion

GR and lobbying are not currently subject to any kind of specific regulation under existing Ukrainian legislation. At the same time, there is a wealth of available international experience available demonstrating that a more regulated and communicative relationship between business and the authorities can be mutually beneficial for the country as well as for individual private enterprises. In the US, for example, lobbyists and GR specialists have official status and their activities are subject to detailed regulation. These specialists promote business interests in state institutions and other agencies, while also sometimes representing third sector or public initiatives.

All large US law firms have a separate GR practice. The main goal of these practices is to build bridges between business and the state. At the same time, much of the work of the GR specialist also has an educational component. After all, it is often possible to mitigate some contradictions between business and the state by simple enlightenment.

An experienced lawyer understands the application of legislative norms in practice, while also knowing what the real powers of state regulators are. He can analyse a company’s activities and make optimisation recommendations in the legal field without significant losses. A lawyer specialising in GR needs to possess a comprehensive understanding of the work of state structures and have the ability to find a common language in a legal way.

GR services are particularly relevant when legislative norms go against the actual situation in the market while also contradicting common sense (it is worth acknowledging that this is often the case in the Ukrainian context). In such circumstances, a GR specialist is often engaged both to defend specific interests and to offer the necessary amendments for the benefit of the entire industry. This is in everybody’s best interests. Updating existing legislation and promoting the economic wellbeing of growth-generating companies are two critically important issues for the development of any country’s economy.

 

Learning the art of lobbying

Lobbying is an important and prominent tool in the complex communications strategy of Government Relations. It is commonplace to hire lobbyists for specific tasks or to seek out the support of lobbyists when it is necessary to solve certain complex issues. The term itself dates from nineteenth century America, when representatives of business interests would typically wait in Washington DC hotel lobbies hoping for an opportunity to speak with government officials.

Naturally, representatives of the lobbying profession tend to tread a fine line between the development of business in general and promoting the quite specific interests of a certain company or group of companies. Nevertheless, a Western-style lobbyist sticks to persuasion and avoids anything that might appear as bribery. Bribery of an official is corruption, not lobbyism. A GR specialist’s task is to convince the government that his client is important and necessary for the country’s economy, and that the changes he advocates will positively affect not only a single business but will have a beneficial long-term economic impact.

Adhering to lawful methods when lobbying for one’s interests brings benefits to the business itself. After all, the task of Government Relations is not to solve specific problems of individual clients at any cost. Instead, building a healthy relationship with the state is a necessary part of creating an effective ecosystem with a large number of participants. In this context, sometimes even competitor companies will unite for the sake of sectoral Government Relations.

 

GR gaining ground in Ukraine

Many of the ethical aspects governing GR are already subject to unofficial regulation in Ukraine, if not by law, then at least by a generally accepted code of conduct. For example, the Ukrainian Association of GR Professionals and Lobbyists has established an openly available ethical code. Among other things, this code states that for the lobbyist, “it is forbidden to act to the detriment of democratic state processes or to commit actions that show disrespect to the government of the country.” In the legal business, the same rules apply. If a lawyer tries to persuade you to act in the GR sphere through bribery or corruption, this should be an occasion to reflect on whether you have chosen the right specialist.

Not only is it possible to establish mutually beneficial relations between the state and business, it is necessary. This will provide the business community with transparent conditions while creating additional opportunities for growth. As this sector of the legal services industry develops in Ukraine, the country as a whole also stands to benefit from the dynamically developing markets and companies that it produces.

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