Ukrainian President Volodymyr Zelenskiy has backtracked and approved new draft legislation aimed at restoring the independence of the country’s anti-corruption agencies, after a controversial law was passed on July 22 that gutted Ukraine’s anti-corruption reforms sparking the first mass anti-government protests since the war with Russia started.

Law 21414 also drew sharp criticism from the EU with several European leaders saying it endangered Ukraine’s EU accession bid, which stalled last week, and could possibly lead to sanctions on the war-torn country similar to those imposed on Georgia that is also an EU candidate and has also passed a similar Russian-style ““foreign agents” law undoing democratic norms.

In full damage control, Zelenskiy announced the new law on July 24. The previous bill granted sweeping new powers to the prosecutor general—an appointee of the president—over the National Anti-Corruption Bureau of Ukraine (NABU) and the Specialised Anti-Corruption Prosecutor’s Office (SAPO), that brought civil society activists to the streets in swelling numbers.

"It is important that we are maintaining unity. It is important that we are preserving independence. It is important that we respect the position of all Ukrainians," Zelenskiy said on social media. He added that the new bill, submitted to parliament the same day, was a “well-balanced” text that “guarantees real strengthening of Ukraine’s law enforcement system, independence of anti-corruption agencies, and reliable protection... against any Russian influence.”

The bill has caused huge damage to Ukraine's effort to seek more money and weapons from its western partners and has badly dented Zelenskiy’s personal reputation as a war hero.

“But those times are gone. Zelenskiy is no longer part of the solution to
Ukraine – he is part of the problem,” Telegraph columnist Owen Matthews wrote, under the headline “For Ukraine’s sake, Zelenskiy must now step aside.”

Protesters rallied in central Kyiv holding placards that read “We chose Europe, not autocracy.” Critics accused the government of overreach and warned of political interference in anti-graft probes at a critical time for Ukraine’s efforts to meet EU accession criteria.

Zelenskiy’s ruling style has come in for increasingly critical scrutiny in just the last few weeks. The Financial Times ran a damning feature saying Zelenskiy has been losing the trust of his people as he adopts increasingly authoritarian methods. Law 21414 is more of the same as it effectively brings all law enforcement powers directly under the president's control. NABU and SAPO were set up at the EU’s insistence pre-war and are completely independent of government control until this week’s law, and have been actively investigating corruption in the government and Zelenskiy’s administration, although few politicians have been charged with any crimes.

The president’s executive has also been accused of launching an intimidation and smear campaign against the anti-corruption bodies and leading NGOs that are critical of the regime.

The Ukrainian Security Service (SBU), which are also directly under the president’s control, have carried out a string of raids and arrests of anti-corruption officers in the last month, as well as prominent anti-corruption activists from Ukraine’s vibrant civil society.

Ukrainian security forces arrested two Nabu officials on suspicion of spying for Russia earlier this week, intensifying scrutiny of the Zelenskiy administration’s approach. NABU complained in a statement that the raids were carried out without court orders and several officers were questioned over non-related incidents, some as trivial as traffic accidents. One prominent anti-corruption official suffered a SBU raid, accused of simply using a government car for personal use while he had been doing his national service pre-war.

The crackdown, coupled with the fast-tracking of Law 21414 that was rammed through the Rada with the support from Zelenskiy’s Servant of People Party, raised alarm among international partners.

Brussels has welcomed Zelenskiy’s climb down. At an emergency meeting on July 24, the president tasked the government to come up with a new bill in the next two weeks. Ukraine’s partners and civil society are now waiting to see the text of the new law that Zelenskiy promises will restore the independence of the anti-corruption organs. It remains unclear when parliament—technically on summer recess—will debate the revised draft or competing proposals already introduced by opposition lawmakers seeking to annul the earlier law.

“This is a crucial step for Ukraine’s democratic resilience,” one EU diplomat said, noting that the episode had highlighted both the strength of public oversight and the fragility of reform progress under wartime conditions.

Eminence grise Yermak

While most of the opprobrium has fallen on Zelenskiy’s head, other long-term Kyiv-watchers have blamed the head of Ukraine’s presidential office, Andriy Yermak for being behind Law 21414.

If anything, the all-powerful but unelected head of Ukraine’s presidential office, has come in for more criticism of Machiavellian authoritarianism, and for much longer than Zelenskiy.

Christopher Miller, the FT’s long serving Kyiv correspondent, wrote another damning profile this week of Yermak under the strapline “Unelected. Uncompromising. Unapologetic.” Yermak has been long-accused of running his own empire and acting as the éminence grise as the second most powerful person in the country. The FT profile follows on from a similar profile in Politico.

Yermak is reported to have his own team of a dozen advisors and enforcers that are given access to meetings with foreign leader meetings, something that is highly unusual and raised eyebrows in Brussels. He also has an ego of “galactic” proportions, according to one EU politician that has raised hackles in Washington that now refuses to deal with him, according to Politico.

Yermak has clearly been gathering power into his own hands and is thought to be the architect of the recent government reshuffle that was seen by some as a coup d'état by Yermak. The long-serving Prime Minister Denys Shmyhal was ousted and demoted to Defence Minister, replaced by Yuliia Svyrydenko. While Shmyhal and Yermak worked closely together, he was largely seen as a competent, but technocratic, administrator. Svyrydenko, on the other hand, is known as a close Yermak ally under his control, although she is also seen as a hugely capable politician and recently brokered the difficult minerals deal with the Trump administration.

Ukraine’s defenders are downplaying Zelenskiy’s decision to sign off on the controversial law and calling it a “mistake” by Zelenskiy, who they hail as an outstanding wartime leader – with much justification. However, these supporters are also blaming Yermak as the culprit for the scandal.

“Zelenskiy has made a mistake on the anti-corruption agenda - reining in the independence of NABU and SAPO - but I think this is more case of bad advice from a support structure increasingly now dominated by his chief of staff, Yermak,” Timothy Ash, the senior sovereign strategist at BlueBay Asset Management in London and long time Ukraine-watcher, said in a blog post.

“If anything, Yermak should fall on his sword, not Zelenskiy, albeit the president's figure head style of government suggests he is overly reliant on Yermak to do the dirty work of government so who should/can replace him?” he added in reaction to the Telegraph’s Matthews’ call for Zelenskiy to step down.

Part of Yermak’s motivation, who reportedly pulled Rada deputies back from their summer holidays to rush Law 21414 through a vote, is accusations claiming that his businessman brother, Denys, has been in receipt of classified government military procurement contracts, and may have been under investigation for corruption.

“I don't think anyone thinks that Zelensky is personally corrupt - but Ukraine has a serious problem with corruption. I speak to people in the military industrial complex and they say it is rampant, increasing and undermining the war effort,” says Ash.