Draft law on natural monopolies to increase housing prices by 10-20%, constructors will protest, says CCU

Kyiv, April 4 (Interfax-Ukraine) – The Confederation of Constructors of Ukraine (CCU) has said that draft law No. 9011 on fees for connections to networks of natural monopolies, which will result in an increase in housing prices by 10-20%, cannot be passed at second reading, and the confederation is ready to allow constructors to strike.

"If the law were passed in the present form, it would increase housing prices by 10-20%, and it is lobbying for the interests only of private monopoly organizations," CCU Head Lev Partskhaladze said at a press conference at Interfax-Ukraine on Tuesday.

He said that the bill foresees the transfer of utilities networks to the ownership of monopolists, who will determine a list of work for their development, their cost and connection of consumers to them by themselves, without the participation of town authorities. The connection mechanism is not transparent, he said.

"The customer will have to pay and build all networks of a monopolist without having a chance to determine the justifiability of the price… No mechanism for price compensation is foreseen," Partskhaladze said, commenting on the draft law.

He said that CCU proposes to peg the draft law in terms of connections of networks to the general plan and zoning, and city and town authorities are to be a third party in determining the cost of the work.

Clauses on beneficial conditions to connect to networks for social housing projects are not present in the document, reads a letter of CCU released at the press conference.

"We, the constructors, have many regions – 25. [People from] every region will come here if the draft law [in the present form] is passed. We'll gather a lot of people, and we won't allow the passing of the law in this form," he said.

He said that on Tuesday a meeting with representatives of the presidential administration, the state committee for regulatory policy and entrepreneurship and the National Commission for Energy Regulations (NCER) was held to discuss the draft law, where the CCU studied its latest wording. The confederation is preparing its proposals to the draft. The proposals can be submitted by April 3, 2012.

An open letter of the CCU was sent to Ukrainian Premier Mykola Azarov, Speaker Volodymyr Lytvyn, Secretary of the National Security and Defense Council Andriy Kliuyev, Regional Development, construction, Housing and Utilities Minister Anatoliy Blyzniuk, Energy and Coal Industry Minister Yuriy Boiko, head of the parliamentary committee for construction, town-planning, utilities and regional policy, Volodymyr Rybak, and head of the parliamentary committee for the fuel complex, nuclear policy and safety, Mykola Martynenko.

Draft law No. 9011 on amendments to some Ukrainian laws regarding fees for connection to the networks of natural monopolies was registered in parliament on July 18, 2011. The revised bill was submitted to the parliament on February 20, 2012. The initiator of the bill is MP and head of the parliamentary committee for the fuel complex, nuclear policy and safety, Mykola Martynenko.