In “Dualism of Ukrainian Commercial Courts: Exploratory Study,” Tatiana Kyselova reports her findings from a five-year case study designed to explore the characteristics of what she calls the “dual commercial justice system” in Ukraine. Kyselova concludes that Ukraine has a two-track commercial court system which has been intentionally designed by the ruling elite. Kyselova also finds that in most cases which proceed through this system, justice is served with remarkable efficiency, while in only a minority of cases is justice thwarted by bribes and political pressure. Kyselova chooses three businesses to capture a variety of sizes and the predominant industries in Ukraine. From 2007 to 2011, Kyselova monitored the three businesses’ experiences with the commercial court system in Ukraine.
Kyselova finds that in Ukraine the commercial courts contain two separate tracks that a case may follow: a “white” track and a “black” track. Cases processed according to law follow the white track, and cases where justice is subverted follow the black track. The two main ways that cases are diverted to the black track are through monetary bribes of judges and bailiffs, as well as pressure exerted through connections with state officials. Kyselova notes that the white track is surprisingly efficient due to several factors such as relatively low court fees, short court proceedings and a high chance of the judgments being enforced. The black track cases in the study were comparable in efficiency to the white track. However, the effectiveness of justice was problematic due to much lower enforcement rates.
Overall, Kyselova finds that most cases proceeded through the efficient white track, while only seven of nineteen in the study went through the black track. While litigants such as state agencies were most likely to use the black track, many individuals with ties to power holders also utilized the black track. Due to pressures from the international community, the cost of monetary bribes has risen substantially, resulting in a decline in their use. Instead, Kyselova notes an increase in the use of “telephone law” — “a practice by which outcomes of cases allegedly come from orders issued over the phone by those with political power rather than through the application of law.” Another source of the subversion of justice was the legislature, which has passed laws banning mandatory disposal of assets of state-owned enterprises, preventing the enforcement of any judgments against state-owned enterprises that may have taken advantage of private businesses.
Finally, Kyselova concludes that the dual court system of Ukraine is intentionally designed and maintained by the ruling elite despite international pressure for judicial independence. The system of bribery is used as an incentive system to promote compliance and obedience to the state from judges. While pressure from the international community is taken more seriously in Ukraine than in Russia, in the past Ukraine has been able to complete shallow reforms of the white track while simultaneously institutionalizing the black track. Political division and competition have created internal pressure on the Ukrainian courts as well. These multiple pressures ensure neither the parties nor the subject matter of the cases can determine which track it will follow, resulting in great uncertainty in the Ukrainian commercial courts.
NOTE: This summary is produced by the Rule of Law Collaborative, not by the original author(s).