Josep Borrell is on a three-day visit to Ukraine that will take him to the line of contact with pro-Russian separatists. AP
Josep Borrell is on a three-day visit to Ukraine that will take him to the line of contact with pro-Russian separatists. AP
Josep Borrell is on a three-day visit to Ukraine that will take him to the line of contact with pro-Russian separatists. AP
Josep Borrell is on a three-day visit to Ukraine that will take him to the line of contact with pro-Russian separatists. AP

Josep Borrell's trip to Ukraine demonstrates EU support for Kiev in security crisis


Tim Stickings
  • English
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Europe cannot be a “neutral spectator” in talks between great powers about the security crisis enveloping Ukraine, the EU’s foreign policy chief Josep Borrell said.

Mr Borrell, who travelled to Ukraine on Tuesday in a show of solidarity with Kiev during the Russian military build-up on its eastern flank, said the tense situation could not be discussed “without all the relevant actors around the table”.

His three-day trip will take him to the “line of contact” between government forces and pro-Russian separatists, before he travels to Kiev to meet Ukrainian officials in the capital.

His visit comes as the US and Russia gear up for high-stakes talks in Geneva in the coming days, which are leading to concerns about the EU being sidelined in discussions on the future of European security.

“The EU cannot be a neutral spectator in these negotiations if Russia really wants to discuss Europe’s security architecture,” Mr Borrell told Polish news agency PAP.

“We are building a common foreign and security policy and a common security and defence policy precisely for that purpose.”

Mr Borrell said there was no question of anybody “deciding about things related to Ukraine without Ukraine”.

Brussels described his three-day trip as a mission to underscore the EU’s support for Ukraine’s sovereignty and territorial integrity.

Russian soldiers take part in drills at the Kadamovskiy firing range. AP
Russian soldiers take part in drills at the Kadamovskiy firing range. AP

Russia has been under sanctions since annexing Crimea from Ukraine in 2014. Some EU members also suspect a Russian role in the ongoing tensions in Belarus.

Mr Borrell repeated warnings from the West that Russia would face “serious consequences” if it breached Ukraine’s territory.

He said the EU was willing to help Kiev respond to cyber attacks and strengthen its military capacity as it faces up to the Russian threat.

The Russian troop movements have sparked fears that Moscow is planning a full-scale invasion of its former Soviet neighbour, although the Kremlin denies such intentions.

Ukraine’s ambassador in the UK said people in his country feared that “big dealers” would strike a deal behind Kiev’s back.

“We are trying to be very frank with our friends as well,” he told BBC Radio 4’s Today programme. “The leaders of the West, who are trying to help us, should understand that Ukrainians have their own agenda.

“If Putin wants something and the compromise is too high, Ukrainians won’t just budge.”

Washington is preparing for talks with Moscow after Russia published drafts of a proposed treaty that would ban Nato from expanding further into Eastern Europe.

The US said some of the Kremlin’s demands were unacceptable, while affected countries such as Ukraine, Sweden and Finland said Nato membership was a matter for them.

Meanwhile, German Chancellor Olaf Scholz is hoping for a separate meeting with Russian President Vladimir Putin, German newspaper Bild reported on Monday.

The two leaders recently spoke by phone, but Mr Scholz, who took office last month, is said to want to go further with a “qualified reset” of relations with Moscow.

Any move towards conciliation with Mr Putin would risk angering Russia critics in his three-party coalition.

Mr Scholz’s predecessor Angela Merkel annoyed some European allies by talking directly to Russia’s ally Belarus, whose leader Alexander Lukashenko is under separate EU sanctions.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Updated: January 04, 2022, 3:50 PM