Ukraine is on the Threshold of Significant Transformations, including in the Transport Sector – Tatyana Titarenko

Some consider the period of an economic crisis as a time to pause while others consider it as an opportunity for development. It is our firm conviction that transportation lawyers have a unique opportunity to prove themselves at a crucial moment for the country. The old rules of the game are gradually becoming obsolete, but the new rules have not yet been fully established. The drafting of these new rules requires the help of qualified lawyers. The same applies to businesses adapting to changing market conditions.

This is what dictated the creation of LeGran.TT, a new law firm. In an interview with the YurLiga portal, we share our plans for the future and analyze the current problems of the maritime and port industries.

We continue to monitor the development of the legal services business in Ukraine, investigate recent trends, and acquaint our readers with promising newcomers to the market of legal services. This time, our attention focuses on the Odessa region, which is traditionally rich in high-profile experts in the fields of transportation law and maritime law. In an interview with the YurLiga portal, the LeGran.TT law firm’s Director Tatiana Titarenko explains why no investment project is being implemented in Ukrainian ports, the changes that are needed in the industry, and how to get ahead of the competition during a crisis.

Tatyana, tell us more about the LeGran.TT law firm, which you head

The LeGran.TT law firm was founded in autumn 2015. It so happened that I worked in the legal department of the Ministry of Infrastructure for a long time. This determined the future direction of my work because all our cases were directly related to transportation. After that, I became the deputy general director for legal affairs at the Federation of Transport Employers, where I continued to deal with the problems of the industry and work actively with enterprises in the maritime industry. Then I decided to apply my experience and knowledge in private practice. As a result, a partner and I registered a new law firm, which became known as Legal Gran.TT. The name refers to legal grants for protection of business interests.

Which legal practices and business areas form the focus of your work and which types of customers are you targeting?

As I said, since my previous work was closely linked to transportation, we decided to focus on this area. Therefore, our specializations include maritime law, legislation in the port industry, investment, and international trade. In addition, no infrastructure project in seaports is complete without land and property, so our practice also covers this area. We are also ready to represent the interests of our clients in courts and arbitration. One of our company’s areas of operation is registration of companies abroad and performance of international audit. To this end, our partner based in Cyprus has all the necessary resources and contacts.

Because of our considerable experience of working with government agencies, we are well aware of their specificity and are ready to assist our customers in their interactions with the authorities. We also perform legal due diligence of companies ahead of deals or internal reorganizations. Moreover, our specialists have a good understanding of legislative techniques, which allows us to work effectively on legislative initiatives.

Our clients are public and private stevedoring companies, ship owners, shipping agents, freight forwarders, large industrial holding companies with their own logistics, cargo owners, government agencies, banks that lend to the transport sector, investment and insurance companies, suppliers of marine fuels and spare parts, shipbuilding and ship-repair enterprises.

Why did you decide to open a new company during a crisis?

Ukraine is on the threshold of serious transformations, including transformations in the transport sector. Port reform finally got off the ground in 2013. The authorities have concluded that development of transshipment capacities is possible only through public-private partnership. Therefore, we will soon see the first investment projects in Ukrainian ports. It is a long and rather complex process, which requires careful legal preparation. This is why the demand for specialists with our profile will increase.

In addition, the Association Agreement between the European Union and Ukraine will enter into effect this year, which will lead to changes to the trading rules between Ukraine and European countries. Adaptation to these changes will also increase the demand for legal services.

How difficult is it for a law firm in your region to find its niche in the market? What obstacles need to be overcome to achieve this?

I think that the biggest obstacle that must be overcome by any startup is winning the confidence of customers. Our experience gave us the opportunity to meet many of our clients before the establishment of LeGran.TT. At the same time, there are still many companies on the market to which we will be able to bring benefit.

What can you offer a customer and how are you trying to outdo your competitors on the market?

Firstly, we offer high-quality services. Our lawyers have extensive experience both in government and in private practice. They have won many cases in the industry. Unlike our main competitors, we have a clearly defined specialization while the existing players on the market spread themselves to many other areas.

Another advantage is the cost of our services because our competitors operate in the higher price category. LeGran.TT charges fees only effective working hours.

In addition, as a socially responsible company, we are ready to support projects of national importance voluntarily and without payment, for example, in the case of construction of a strategic infrastructure. It could be a project involving construction or reconstruction of a road to a seaport through a public-private partnership, but the parties involved are unable to determine the optimum mechanism from a legal point of view.

How is the legal services business different in Odessa, compared with the capital?

Odessa is the maritime capital and a port city, so our activities are connected with the sea in one way or another. Lawyers here have to deal not only with the usual issues of land, real estate, and corporate law, but also with international maritime law, legal acts in the port industry, the customs legislation, and the powers of regulatory bodies, such as the environmental inspectorate.

In your opinion, what legislative changes are required in the maritime sector today?

Our main task is to increase the competitiveness of Ukrainian ports compared with other seaports on the Black Sea. This requires a package of measures that would simplify regulatory procedures and create a more flexible tariff policy and favorable conditions for investment.

In particular, it is necessary to continue the work on deregulation of seaports and to amend the “Law on Seaports” to introduce a port community information system that will allow market participants to fully switch to electronic document management.

We also need a new approach to tariff policy. Today, port charges and flat rates for state stevedoring companies are regulated by orders of the Ministry of Infrastructure and changes require a long and complicated bureaucratic process that deprives port operators of the ability to respond flexibly to market changes.

Which legislative changes have been dictated by your commercial law practice?

Our legislative changes have involved transportation, although, of course, they also influenced trade. An example of the result of my work – first in the Ministry of Infrastructure and then in the Federation of Transport Employers – was the abolition of compulsory inspection of segregated ballast in ports, a procedure that involved a huge level of corruption.

Why are no investment projects being implemented in ports?

Despite the difficult situation in which the country finds itself today, there is interest in seaports among investors. However, a number of legal barriers prevent implementation of projects.

In particular, state stevedoring companies are still on the list of assets that are not subject to privatization. Although, in accordance with the “Law on Seaports,” all strategic assets have been transferred onto the books of the state-owned Ukrainian Port Authority while transshipment facilities are expected to pass into private hands, as is customary in international practice.

Another barrier is harmonization of seaports’ financial plans. As you know, this is a long process and the financial plan for the current year is sometimes adopted retroactively in December. Legislative amendments that would allow investment of funds without mandatory approval of financial plans are necessary.

How will the introduction of the Association Agreement affect trade with the EU?

The rules of the game are changing gradually, and Ukraine is beginning to operate based on the European legislation. The period of adaptation will inevitably be accompanied by situations in which it will no longer be possible to operate as before while, at the same time, it will not yet be possible to operate as necessary. A striking example is the recent situation involving the EUR.1 certificate in the agro-industrial complex. The Chamber of Commerce issued this document until January 1 this year, but this function has now been transferred to the State Fiscal Service, which is now setting its own requirements for farmers.

What prevents revival of shipping on River Dnieper from a legal point of view?

Further development of the market requires adoption of the “Law on Transportation on Inland Waterways,” which the market is already tired of waiting for, to put it mildly. Among other changes, it is necessary to allow vessels flying foreign flags to enter internal waters. The situation currently looks like this: a motor vessel arrives at the Kherson river port, which is located near a seaport, and undergoes customs, border, and other controls. Then, all the cargoes on the vessel must be transferred onto another vessel flying the Ukrainian flag, and this vessel then transports the cargoes to Zaporozhe and Dnepropetrovsk. This significantly increases the delivery period and the cost of logistics. As you can understand, this does not stimulate development of navigation on River Dnieper.

What are the company’s development plans for the future?

We plan to become one of the leaders on the Ukrainian market of legal services in the areas of maritime law and port legislation. Our aim is to ensure that LeGran.TT becomes the first name that comes to the minds of customers when legal issues arise in the industry (smiles). In the future, we do not intend to limit our work to the borders of our country: we will enter international markets and gradually open offices and affiliates in other countries. Expanding our presence in Europe will be very handy in light of the introduction of the Association Agreement between Ukraine and the European Union because trade relations between Ukraine and the European Union will change as a result. In addition, the authorities are currently working on alternative routes for transportation of transit goods between the West and the East. A recent example is the launch of an experimental train on the “New Silk Road.” Therefore, I think we will have enough work.