Business start-up

Ownership and Property

Property Legislation
Applicable Ukrainian legislation provides for three forms of ownership:
Foreign legal entities: joint ventures, international organizations, foreign citizens
and persons without citizenship may own property in Ukraine
Foreign individuals are specifically allowed to own residential buildings, apartments,
summer cottages and other objects of "personal use"
Ukrainian citizens may own land in Ukraine for a limited number of purposes
(including agricultural needs and the construction of a private house or other dwelling)
Ukrainian legal entities may own land (in the form of "collective ownership") for agricultural
purposes only
Foreign individuals and foreign legal entities are permitted only to lease land

Intellectual property
Even through Ukraine is a party to the main international conventions in the areas of intellectual
property and has legislation it place, protection of intellectual property rights can be problematic, in
part because of a lack of coordination between various legal codes and special laws that regulate
intellectual property rights
The law on copyrights and related rights provides a legal basis for the protection of authors' rights
related to the creation and use of works of science, literature and art, and rights of these works' users,
including video and record producers and broadcasting organizations
Ukraine has also a system for industrial property protection (including protection of trademarks) that
is generally consistent with internationally recognized norms and practices
The trademark law guarantees ownership rights with regard to trademarks and service marks through
the assurance by a respective state body of certificates on marks for goods and services

Dealing with Business

Registration and licensing
A license of permit may be required to perform certain business activities in Ukraine (e.g. mineral
exploration, operations with gas, medicine production and sale etc.)
Licenses and permits are issued after registration of the company but before the entity commences
with operations.
Licensing procedures generally are time-consuming and require the presentation of a significant number
of documents.
Price control
As in the on the other countries of the former Soviet Union, prices in Ukraine were generally liberalized
after independence, although some restrictions remain.
Ukrainian authorities have traditionally regulated tariffs charged by the utility companies (gas, electricity
and telecoms), the railways, local transport and communal services.
Monopolies and restraint of trade
According to Ukrainian legislation, a business entity is deemed to have a dominant position in a particular
market if it has no competitors in the market and/or faces no significant competition
An entity whose share of the goods market exceeds 35% is considered to have a monopoly position
if it fails to prove significant competition in this market
Mergers and acquisitions (M&A)
M&A are regulated under the Anti-Monopoly Commission (AMC) is charged with preventing monopolies
from abusing their dominant position and/or restricting market competition
Permission from the AMC is required for mergers of business entities with a total book value exceeding
an equivalent of EUR 12 million, if the value of assets held in Ukraine and abroad by at least 2 concentration
participants exceeds EUR 1 million

Business Entities

Ukraine offers various types of legal entities for business incorporation under the Civil Code and
Commercial Code
In addition, some issues are still regulated by the law on business associations

Limited Liability Companies (LLC)
LLC does not have shares: participants in a LLC own a percentage in the company's capital, as specified
in its governing document - Charter.
LLC is liquidated if its participants agree to liquidate it, by the court or its corporate term expires.

Joint Stock Companies (JSC)
JSC is a legal entity whose share capital is divided into a specified number of shares of equal nominal
value; JSC may be established as an "open" or "closed"
The issued shares must be registered with the State Securities and Stock Market Commission

Partnerships and Joint Ventures (JV)
The Civil Code allows for the establishment of general partnerships and limited partnerships as legal
The law recognizes also a concept of JV without the need to establish a separate legal entity. Internal
relations will generally be governed by partnership agreement

Branches and Representative Offices
It is not currently possible to register a branch of a foreign legal entity in Ukraine
A representative office is not a separate legal entity and operates in Ukraine on behalf of the foreign
company it represents, which should be registered with the Ministry of Economics of Ukraine, the Statistics
Department, the tax authorities, pension and social funds