DSA of Ukraine Update

On November 30, 2018, the Ukrainian DSA in cooperation with the WFDSA held a conference titled “Entrepreneurship and Consumer Rights: Direct Selling on the Wave of Changes” in Kiev, Ukraine.

Topics such as direct selling stays in sync with fast-changing consumer trends and direct sellers possess a certain degree of flexibility to be ready for the technological changes were discussed during the event.
In Ukraine, approximately 50,000 direct sellers build their business regularly and approximately 1 million people have opportunities to get additional income from direct selling from time to time.
Despite the positive dynamics of development, the direct selling industry faces some obstacles. In particular, the Entrepreneurial Spirit Index in Ukraine has shown that in 2017 the desire, willingness and ability to establish a stable individual business have decreased radically in Ukraine.  As sociologists explain, emigration processes influence the desire to start own business in Ukraine. Nevertheless, experts are not inclined to apocalyptic scenarios. “The entrepreneurial spirit in Ukraine is alive, but serious work is needed to improve the business environment” said Tomasz Muras.
The answer to this was the speech by Member of Parliament of Ukraine Tetyana Ostrikova, who supported the legislative initiative of the DSA of Ukraine to reduce social taxes for direct sellers who are not working permanently. Like other post-Soviet countries Ukraine does not have any tax-free individual income (formally – $0.5 per month). Thus, direct sellers have to pay monthly social tax ($30) even if their monthly income is less or they had a break in their activity. A more flexible and stimulating tax policy on small incomes will support small and micro business in Ukraine.
Andriy Sadovy, Mayor of the city of Lviv noted that the priority for the country should be to maximize the SME promotion.
WFDSA Executive Director Tamuna Gabilaia presented on global trends.  She also touched upon the gig economy and generation Y and Z.  
Dmytro Yanin, Chairman of the International Confederation of Consumer Societies stated that the consumers become more informed and more motivated to protect their rights. At the same time, with the development of technology, there are more challenges associated with the violation of consumer rights. In particular, a global IPSOS study shows that 72% of companies do not know what information they collect about them.  Customers are concerned about the inability to control these processes, and the contracts that companies offer are too difficult to understand.
Natalia Prytulska, President of the Puls Consumer Rights NGO, and Olexandr Vasylchuk, Head of the Department of the Ministry of Economy of Ukraine, participated in the panel discussion on a new draft law on consumers’ rights protection. The draft is developing in order to update retail practice regulations. “Direct selling industry in Ukraine is the best example how to protect consumers’ rights using self-regulation and the Code of Ethics. We observe now that other industries and state bodies try to choose the similar way” stressed Nadiya Bedrychuk, Executive Director of the DSA of Ukraine.