Ukraine law enforcement conduct search of Japanese firm

The Security Service of Ukraine (SBU) and the Interior Ministry conducted on June 10 searches of the Kyiv offices of the Japanese pharmaceutical company Takeda, former general director Yevhen Zayika told the epravda.com.ua news site. Several dozen officers forced their way into the offices to conduct the search and remove servers,Zayika said. They have accused the company of violating registration procedures with the goal of evading taxes and customs duties.

Takeda has work in Ukraine for more than 20 years, selling its pharmaceutical Aktovehin, which is injected to treat the after effects of strokes, Zayika said. He acknowledged “not paying anything” to authorities who had been hounding the company “for many years,” yet insisted that it acted legally. Takeda Pharmaceutical Company sells its products in at least 70 countries throughout the world.

Zenon Zawada: Regardless of whether the Takeda company is playing taxes and customs duties properly or not, this is not the best way to deal with a legitimate, multinational pharmaceutical company with a decades-long presence on the Ukrainian market. This conflict could have been resolved without the need to dispatch law enforcement officers to conduct searches that draw unneeded media attention and cast a negative pall on Ukraine’s business environment on an international level.

With such tactics employed against business, the Ukrainian government risks killing the geese that lay the eggs for the economy. It lacks the understanding that the need for foreign investment is greater than whatever immediate, short-term need to collect tax revenue. With more foreign investment, tax revenue will swell in the mid- to long-term.

The company official suggested the search could have been intentionally hatched to taint the president’s June 28 visit to Japan. Yet Petro Poroshenko controls the SBU, which its employees are well aware of. Takeda had submitted appeals to top state officials ahead of the search, including the president, all of which failed to intervene.