The Legal 500

On 13 March 2012 the Ukrainian National Commission on Securities and Stock Market (the "Commission") adopted the Regulation (the "Regulation") on granting a permit (the "Permit") for equity acquisition in a professional securities market participant, such as a security broker, asset management company, custodian, depositary, etc., resulting in direct or indirect holding or control over 10, 25, 50 or 75 percent of equity (the "Significant Shareholding"). The Regulation will be effective upon its approval by the Ministry of Justice.

Oleksandr Aleksyeyenko, partner - oleksandr.aleksyeyenko@integrites.com

Artur Yalovyy, head of London office – artur.yalovyy@integrites.com

Generally, a loan, credit or other similar agreements governed by the law other than the law of the borrower’s jurisdiction, is affected by the “local” law in a limited way. Usually, such “local” law sets the procedure of execution of the agreement by the borrower and the validity of the agreement as well as of the respectful corporate authorization.

with Foreign Lenders Submitted for Registration

On 31 October 2011, the Main Department of the NBU in the city of Kyiv and Kyiv region (the "NBU Kyiv Department") issued a letter (the "Letter") clarifying requirements that apply to loan agreements with foreign lenders and the set of documents submitted with the NBU Kyiv Department for registration. 

On 16 October 2011 the Law of Ukraine "On Making Amendments to Certain Laws of Ukraine Regarding Regulation of Relations between Creditors and Consumers of Financial Services" dated 22 September 2011 (the "Law") entered into force.

On 13 October 2011, the President of Ukraine signed into law a number of amendments to the Civil Code, the Bankruptcy Law, the Law on Securing Creditors’ Claims, the Criminal Code and some other laws (the “Amendments”) aimed at increasing protection of creditors’ rights and consumers of financial services, decreasing the share of delinquent assets in the loan portfolio of banks. Amendments became effective on 16 October 2011. The most important changes are outlined below:

Cross-border foreign currency payments by Ukrainian surety providers (guarantors) to a foreign lender under a surety agreement (guarantee), which secures obligations of a Ukrainian borrower under a foreign currency loan agreement with such foreign lender, will be exempt from the individual licensing requirement.

On August 19, 2011 a Memorandum of Cooperation was signed between the consulting company ICC Ukraine Consulting that operates on the basis of the Ukrainian Committee of the International Chamber of Commerce and Arzinger Law Office, which is an independent national law firm, one of the leading legal experts in Ukraine focused on inbound investment.

On the 06th of July 2011 the High Specialized Court of Ukraine on civil and criminal cases finally put an end to a long and fascinating story named "the legitimacy of concluding loan agreements in foreign currency."

Recently Ukrainian corporate law underwent numerous amendments, in particular:

• introduction of International Financial Reporting Standards (“IFRS”) in Ukraine

•  increase of the maximum number of participants in a limited liability company

•  abolition of the incorporation certificate

Government to provide support for Public-Private Partnership   

On 22 December 2010, the National Bank of Ukraine (the "NBU") adopted Resolution No. 572 "On Regulation of Certain Issues Relating to Currency Operations" (the "Regulation"), which will come into effect on 22 March 2011 

On 11 March 2011 the President of Ukraine signed Law of Ukraine No. 3024-VI "On Amendments to Certain Laws of Ukraine Regarding Regulation of Banking Activity" (the "Amendments") adopted by Verkhovna Rada on 15 February 2011.  The Amendments come into effect three months after their official publication, i.e., on 17 June 2011.

Amendments to Joint Stock Companies Law

With the global financial crisis approaching its end, the mergers and acquisitions (M&A) activity is picking up in Ukraine. Foreign buyers are again looking at the Ukrainian market as sellers have adjusted their pricing expectations to reasonable levels. With this trend in mind, it could be useful to reiterate a few basic aspects of investing in Ukraine.

Please give a brief overview of the equity market(s) in your jurisdiction and initial public offering (IPO) activity generally. What were the large deals over the past year? Have there been many listings of overseas companies on your market(s)?

Starting from 21 December 2009, the rules for the reorganization of commercial banks have been simplified by Resolution No. 683 of the Board of the National Bank of Ukraine (the “NBU”), adopted on 18 November 2009, which introduced amendments (the “Amendments”) to NBU Regulation No. 189 “On the Reorganization of a Bank Pursuant to the Decision of Its Owner”, dated 27 June 2008 (the “Regulation”). The Amendments are aimed at bringing the Regulation into conformity with the latest legislative changes relating to financial recovery of commercial banks and with the requirements of the Law of Ukraine “On Joint Stock Companies” (the “JSC Law”).

Law of Ukraine No. 1533-VI, dated 23 June 2009, "On the Introduction of Amendments to Certain Laws of Ukraine for Overcoming the Negative Consequences of the Financial Crisis" (the "Law") became effective on 24 November 2009. The Law introduced a number of important changes into the Ukrainian currency control regime in respect of cross-border foreign currency loans from foreign lenders to Ukrainian borrowers; the procedure for foreign investments in Ukraine; and the procedure for settlements under export-import transactions.

On 24 July 2009 the Verkhovna Rada (Ukrainian parliament) passed the Law of Ukraine No.1617-VI “On Introduction of Amendments to Certain Legislative Acts of Ukraine Regarding Peculiarities of Carrying out Measures Aimed at the Financial Recovery of Banks” (the “Law”).