Customs Update: systematic dialogue between the business community and the State Customs Service
The Ukrainian Business Council, the American Chamber of Commerce and the European Business Association held their first meeting with the new Head of the State Customs Service, Orest Mandziy.
The business community came forward with specific issues and proposals. In response, the Customs Service presented a transformation strategy: staff certification, body cameras, anti-corruption tools and law enforcement status.
The most pressing issue is budget losses from shadow schemes. According to estimates by think tanks, the State Customs Service and the Verkhovna Rada’s Tax Committee, grey schemes at customs cost the state around 100 billion hryvnias annually. Separately, there is the scheme involving forged ‘Euro-1’ certificates for the import of used cars: 93% of such documents are fake, and budget losses amount to over 11 billion hryvnias. The business community proposed setting up an inter-agency commission under the leadership of the Head of the State Customs Service to investigate this scheme.
Odesa Customs has come in for particular criticism – as the worst performer in terms of processing times and the number of value adjustments. Due to pressure from law enforcement agencies at ports, businesses are already redirecting cargo to Romania and the Baltic states. Meanwhile, the illegal import of e-cigarettes costs the budget over 8 billion UAH a year, whilst smuggled meat and cheese are destroying local producers.
In the digital sphere, there is a roadmap comprising 17 key IT systems for synchronisation with the EU, the integration of scanning and weighing without human intervention, a pilot scheme for electronic TIR carnets, and an electronic stamp for excise goods from November 2026. The context of European integration complicates the task: Ukraine is adapting its legislation to the EU Customs Code, which is itself currently undergoing reform.
Following the meeting, the parties agreed on quarterly meetings and a joint position: customs reform is only possible through synergy between the state and ethical businesses. The URB called on the business community to jointly advocate to the Ministry of Finance for adequate funding for the State Customs Service — without money, even the best strategy will remain on paper.
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