Moratorium on inspections by the National Security and Defense Council: real support for business or another formal decision
From July 21, 2025, a moratorium on groundless business inspections was officially introduced in Ukraine — the relevant decision of the National Security and Defense Council entered into force from the moment the presidential decree was signed. The government quickly approved the plan for its implementation: checks for low-risk enterprises should be suspended, exceptions are provided only for high-risk industries, in particular, the circulation of excise goods. He called it a “victory of common sense” and a “gesture in support of entrepreneurship.” At first glance, the state is trying to enter into a dialogue with business and take a course towards deregulation. However, even the very architecture of the adopted decision does not indicate a change in the logic of interaction with entrepreneurs, but an attempt to reformat the tools of influence without losing the levers of control. What does the new “moratorium” really mean, why and how will it affect entrepreneurs who fight every day for the survival of their business?
What the temporary moratorium on inspections of enterprises provides
On July 21, 2025, the President of Ukraine, Volodymyr Zelenskyy, signed Decree No. 538/2025, which implemented the decision of the National Security and Defense Council on a temporary moratorium on groundless inspections of enterprises by law enforcement, customs, tax, and other regulatory bodies. Its purpose was to create prerequisites for stimulating the economy, supporting entrepreneurship, and combating the bureaucratic and punitive component in the work of state bodies. The key emphasis of the document is the creation of conditions in which the state does not put pressure on legal business, does not conduct unnecessary checks, but at the same time has the opportunity to counteract risky operations, in particular in the areas of smuggling and circulation of excise goods.
According to the decision of the NSDC, the Cabinet of Ministers is obliged to take organizational and practical measures to improve the efficiency of the work of the State Tax Service of Ukraine and the State Customs Service. It is about the introduction of clear restrictions, in particular, inspections should not apply to those enterprises that have the status of authorized economic operators (AEO) or are classified as having an insignificant degree of risk. The only exception is companies that work with excise goods. For them, the state’s right to enhanced control will remain.
An important innovation is also the requirement for the government to improve the method of applying the risk-oriented approach. The point is that checks should not be carried out based on a formal sign — quantity, region, industry, but only if there are signs of real threats: the risk of violations of tax or customs legislation, scheme withdrawal of funds or suspicion of smuggling. Thus, the emphasis should shift from total control to targeted monitoring, where the state spends its resources only where there are confirmed signals of problems. In fact, the decision of the National Security Council should change the culture of interaction between state bodies and business within the limits of martial law. The state recognizes that in conditions of limited resources and a difficult economic background, uncritical interventions and inspections can cause more harm than good. That is why control should be smart, focused and minimally burdensome for entrepreneurs who work transparently.
Three days later, on July 24, the Cabinet of Ministers of Ukraine promptly approved a specific plan for implementing the NSDC decision. Prime Minister Yulia Svyridenko publicly announced that the tax and customs services should henceforth limit inspections for enterprises with a low degree of risk, especially for those with the status of authorized economic operators. In addition, according to the approved plan, the State Regulatory Service, together with relevant ministries, should submit proposals for reducing unnecessary licenses, approvals and permits within the next month. It should be noted that by October 21, the law enforcement agencies were tasked with coordinating work on identifying assets under sanctions and returning them to the budget, with a clear link to defense spending and infrastructure restoration.
The government’s plan also provides for the creation of an electronic control system for state interventions in business operations, a quarterly review of the effectiveness of the decisions made, as well as an important change to the Criminal Procedure Code. Only the Prosecutor General or heads of regional prosecutor’s offices will be able to open new proceedings against entrepreneurs. As the Prime Minister emphasized, it is not just about deregulation, but about establishing the principle of justice instead of selectivity.
Small and medium-sized business: reality and problems
Small and medium-sized businesses (SMEs) in Ukraine are the structural framework of the economy that keeps the country afloat in the face of full-scale war. While large corporations suffer losses, reduce operations or postpone investments, it is SMEs that remain the most flexible and at the same time vital sector. It performs a critical social function — providing jobs, goods, services, and tax revenue for budgets at all levels.
According to Forbes Ukraine, more than 70% of Ukrainians currently work in small and medium-sized businesses. These are approximately 3.7 million people employed at SME enterprises, and another 1.6 million citizens who are registered as individual entrepreneurs. In terms of economic indicators, this sector forms almost two-thirds of the gross domestic product. For comparison: a similar share of SMEs in GDP is characteristic of France, Italy, and Poland — countries with a developed market economy.
In addition, for every 1,000 inhabitants in Ukraine, there are 60 small and medium-sized business entities (including FOP). This is somewhat less than in the neighboring countries of Central and Eastern Europe, where the average figure is 73. For example, in the Czech Republic there are 102 per thousand people, in Germany – 31. However, even these figures, which are more modest than the European ones, in the Ukrainian context mean a stable trend: SMEs play a system-forming role. It does not just fill gaps in the market, but actively shapes the face of the post-war economy.
In recent years, it is SMEs that have taken responsibility for the basic needs of local communities: logistics, food, repairs, medical services, security, education, IT infrastructure — all these areas are partially or fully supported by entrepreneurs. They adapt to the new reality faster than state bodies, generate employment in critical regions and continue their work in conditions of complete uncertainty. At a time when international aid is gradually decreasing and big players are investing cautiously, it is small and medium-sized businesses that remain the force that can not only hold the country together, but also move it forward.
In Ukraine, the term “white business” is being heard more and more often – as a kind of mark of quality, transparency and integrity of business activity. After the beginning of the full-scale invasion, the status of a responsible taxpayer, a reliable employer and distant from any ties with the Russian Federation became not only a legal, but also a moral marker. Today, such companies form the basis of the so-called White Business Club — a special register of enterprises maintained by the State Tax Service of Ukraine.
On July 24, 2024, President Volodymyr Zelenskyi signed a law that defines the specifics of tax administration under martial law and introduces a new concept — the “White Business Club.” The law provides for the creation of a special list of taxpayers who voluntarily undertake to faithfully comply with tax legislation and in return receive a number of tax advantages. Both legal entities and individual entrepreneurs, including Diya.City residents, may be included in such a list, provided they meet the established criteria for tax payment and salary level.
Club members are provided with a number of benefits: they are subject to a moratorium on documentary checks (with the exception of certain situations), expedited camera checks, prompt VAT refunds, quick access to tax consultations, as well as a personal compliance manager for remote interaction with tax authorities, in particular in the format of video communication.
As of mid-July 2025, there are 8,882 legal entities in this list. This is less than 1% of the total number of companies in Ukraine, but they are the ones that demonstrate maximum transparency, report honestly, have no debt, are not connected to Russia and work in the white — without shadow salaries, schemes or envelopes. At the same time, from the beginning of 2025, more than 4,100 new companies joined the list, while 3,200 left.
It should be noted that the largest number of Club members are concentrated in the capital — 25% of all companies, i.e. one in four. Next – Dnipropetrovsk region (9%), Kyiv and Lviv regions (7% each), Kharkiv region (5%). These are the regions with the most active economic activity and developed entrepreneurship. If we talk about the industry structure of the Club, then the most represented areas are those that serve the basic needs of citizens. More than 22% of companies are engaged in trade or repair of motor vehicles. Processing industry — 16%, agriculture, forestry and fisheries — 14%. Another 8% are companies related to real estate, and 7% are related to administrative services. Construction, professional services, IT, transport and postal sector are nearby. Among the big players who got into the Club and declared the highest revenues for 2024 are the energy company “Ukrhydroenergo” (54.2 billion UAH), the gas station network “Petrol Partner” (WOG brand) with an income of 49.1 billion UAH, and the corporation “Roshen” – 37.4 billion UAH.
Despite the fact that small and medium-sized businesses became one of the biggest bearers of the economic burden in wartime, despite shelling, blockade of logistics, legal instability and financial shortages, they continue to keep the country afloat. Almost 75% of the working population are employees of these enterprises, which have lost more than a third of their number over the past three years, especially in the southern and eastern regions.
Due to the war, the structure of the economy was distorted: many companies stopped production, others hurriedly evacuated equipment and personnel to safer regions. Those who managed to reorganize faced a breakdown in logistics, loss of clients, and broken contracts. All this caused a sharp decline in the volume of production and sales, which significantly affected the general economic background of the country. Small and medium-sized businesses, which traditionally supported the labor market, lost momentum and resilience, which affected the level of employment and became a catalyst for rising unemployment.
In a study conducted within the framework of the UNDP program “Supporting Ukraine” in 2023-2024, large-scale changes in the well-being of businesses were recorded. If before the start of the full-scale invasion, only about a fifth of enterprises (22.3%) considered their financial situation problematic, then in December 2023 this indicator reached 78.1%. Only 36.5% of representatives of small and medium-sized businesses remained in working mode, another 6% were forced to completely stop their activities for more than a year.
The most painful losses fell on the eastern and southern regions. In the war zone in the east, 18.2% of enterprises did not work for at least 12 months; in the south – 12.7%. Areas that depend on physical presence were especially affected – construction, transport, public catering, tourism. At the same time, IT and the agricultural sector remained relatively stable. The Business Activity Index (UBI) in January 2024 recorded a deep decline — 37.3 points out of a possible 100.
A moratorium that did not become salvation
However, despite the statement regarding the introduction of a moratorium on inspections, entrepreneurs quickly faced reality: less than a day has passed since the government’s action plan was made public, and in the information field there is already a serious reason to doubt the sincerity of the declared course. People’s deputy Yaroslav Zheleznyak published a document that proves that the day after the official start of the moratorium, the State Emergency Service sent an instruction to the regions to conduct business inspections, record violations and apply administrative sanctions. The distributed document of the Emergency Situations of Ukraine mentions the need for “inspection of industrial facilities with further information on compliance with fire and man-made safety standards.” In case of detection of violations, the inspectors are ordered to immediately take measures of administrative influence in accordance with the current legislation.
So, at first glance, the NSDC’s decision gives the impression of an attempt to finally ease the breathing of business: to reduce administrative pressure from the state and create at least minimal conditions for the restoration of economic activity during the war. However, it turns out that the rhetoric of state bodies clearly demonstrates a deep disconnect between public policy and real actions. The formally proclaimed “liberation of business from pressure” turns out to be another declaration without an implementation mechanism: each body acts according to its own scenario, which does not always agree with the general course. In such a system, which is very likely to continue in the future, even the introduction of a moratorium can remain only a loud statement without actual impact on institutional practice.
It is worth emphasizing that the NSDC’s decision, in the form of a “moratorium” on business inspections, is presented as a step towards restoring trust and reducing pressure on entrepreneurs. However, the key provisions of this document raise a number of questions — first of all, regarding the mechanisms of practical implementation, risks of abuse and loopholes for evasive maneuvers. And this is exactly what makes us doubt the real effect of the announced regime of loosening control.
One of the most resonant innovations was the idea of raising the status of the prosecutor, who has the right to demand documents from businesses. Now, according to the plan, only the head of the prosecutor’s office will be able to do this, and not the ordinary procedural head. In words, it looks like an attempt to introduce a fuse. However, on a practical level, this does not change the nature of the pressure, because the mechanism of demanding documents is almost never used in real proceedings. Businesses, as a rule, refuse to provide information without a court order. In response, prosecutors go to court, receive a decision and come back with a decision. Or they bypass all this red tape in general through banal searches, because a search is quick, sudden, with the seizure of servers, document management, e-mail and equipment. That is why most real actions are searches, not inquiries. So, the announced changes look like ritual cosmetics.
Separately, we should dwell on the government’s statement that it, together with the State Regulatory Service, Tax and Customs, will improve the list of risky enterprises. It is deciphered as follows: the system of risk-oriented indicators is not canceled, but on the contrary, it is detailed. This does not mean a decrease in checks, but an increase in spot interventions, where the subject is brought into the zone of increased attention of the state. Therefore, the new risk structure will not become a lifeline, it is just a new list of red flags that the business will automatically fall under. And there is no guarantee that the system will not be used against individual companies selectively — under the “sauce of analytics.”
Similar in form, but even more dangerous in content, is the point of the government’s decision on the “legalization” of BEB certificates. It is proposed to remove the dubiousness of analytical materials, which are currently not evidence in the procedural sense, but have long been used as a basis for opening criminal cases. What does it look like in practice? An employee of the Bureau of Economic Security enters data into a self-made program on an office computer. At the same time, it is not certified, not independently verified, and tax authorities or courts do not have access to it. She simply prints a document called an “analytical product.” It is enough to start a case, go to court for a decision, conduct a search, seize property. This destroys not only the presumption of innocence, but also the principle of judicial review. Such logic is a direct path to abuses, which are disguised as the fight against tax evasion. However, there is still no movement towards providing an independent head of the BEB. There is no political will for institutional reform.
Another loud thesis from the “moratorium” refers to the protection of foreign investors. It is proposed to instruct the Cabinet of Ministers to provide such protection within one month. This clause looks more like a declaration than a tool. In conditions when domestic companies cannot protect their infrastructure and rights, it is difficult to believe in priority care for external investors. Because the first test should be work with the internal environment. If domestic entrepreneurs daily balance on the edge of searches, arrests, blocking of accounts and tax claims, foreign players find themselves in the same context. No one invests in a jurisdiction where an investigator in uniform has more power than the Minister of Economy.
In parallel, the new government decision contains a direct mandate to find all sanctioned property within three months and immediately seize it. This assignment may make sense in wartime, but it is not accompanied by a clear procedure. What is “sanctioned property”? How is its ownership determined? What are the rights of entrepreneurs who had business relations before the war, and who did not have information about the structures of beneficiaries? No answer. Instead, this point is a great new “option” for the SBU, SBU, BEB, and the tax office. Every transaction in such an environment is a reason for criminal proceedings.
Even more questions are raised by the block with the mandate to “check all business cases in one month, cancel arrests if there are grounds.” These words completely duplicate the repeated statements of the Prosecutor General. On paper, it looks pragmatic, but in reality, prosecutors have been preparing reports for the third week, which describe all criminal proceedings related to business. But, according to the employees on the ground, most of these cases are accusations of embezzlement of budget funds during participation in tenders or non-payment of taxes. And here the prosecutors have a dilemma. They should either inform their management that they are monitoring the proceedings, which have been opened without proper grounds, in which no investigative actions have been carried out for years, or quickly start the process: order forensic examinations, get the necessary conclusions with the accusation and take the case to court.
In the first case, there is a risk of becoming an unwanted employee, in the second, there is a chance to show a “result”, which is evaluated in the system as an effective work in exposing misuse of budget funds. Such a dilemma leaves no room for objective analysis: the system encourages the case to move forward, even if prosecutions are based on formalities. This creates the prerequisites for a new round of searches, so after the moratorium is introduced, their number will not decrease, but on the contrary will increase. Because a search before the declaration of suspicion is a common practice in a situation where such a measure was not carried out at the initial stage of the investigation. It is used to pressure, extract documents and create an additional psychological effect. And the new logic of “cleaning up” cases only encourages this.
In addition, the government plans to amend the Criminal Procedure Code to require the personal participation of the head of the prosecutor’s office before opening proceedings or requesting documents. Such a step by itself does not solve the problem, because the chief prosecutor himself is interested in the number of cases. This is part of his KPI and he will always find a way to file proceedings, not even against the enterprise, but for example against the official who organized the tender. As a result, the company is in liquidation, the property is under arrest, and all this without actually mentioning the name of the company in the plot.
Finally, the idea of improving the risk-based approach to inspections has a serious dual context. On the one hand, this sounds like a promise to reduce the number of unwarranted interventions. On the other hand, there is an increase in the number of criteria that are interpreted as risks. Thus, the number of companies that fall into the inspection zone increases. Moreover, a significant part of the audits is not carried out at the initiative of the tax office, but at the request of the businessmen themselves in order to reimburse VAT or exclude their enterprises from the category of risky, etc.
As we can see, the formal reduction of proactive inspections by the state does not equal a reduction of the general pressure on business. He needs not an illusory, but a real moratorium – the kind that operated at the beginning of the war. Not a “managed risk regime”, “optimization of procedures” or “improvement of regulations”, but a complete stop of pressure. Because today, business does not work for development, but to stay afloat and not disappear. And in this situation, the state either becomes a partner or turns into risk #1.
