Following the Russian full-scale invasion in 2022, Ukraine remains a vital forum for international legal work. Foreign companies continue to invest across a broad range of sectors in Ukraine, driven by evolving economic conditions, state priorities, and global trends in infrastructure, defence, finance, and IT.

Foreign clients are increasingly engaging with Ukrainian counterparties, and as a result, the volume of cross-border disputes has grown rapidly. Most disputes stem from disrupted supply chains, force majeure claims, or investment losses.

As Ukraine continues legal reforms and strengthens its judiciary, it is vital to understand the procedural and strategic landscape of arising disputes.

For international law firms engaged in assisting clients in Ukraine, navigating disputes with Ukrainian counterparties or in Ukraine requires a nuanced understanding of three critical aspects: jurisdiction, dispute resolution strategy, and enforcement mechanisms. A well-calibrated approach to these factors is crucial for effectively protecting clients’ interests in an evolving legal and geopolitical environment.

Jurisdictional Considerations

Ukrainian law allows parties to select dispute resolution forums: the parties are free to refer disputes arising out of their contracts to local courts, foreign courts, or international arbitration, if such a dispute is not attributed to the exclusive jurisdiction of Ukrainian courts.

As a rule, in the absence of an arbitration clause in a contract, Ukrainian courts have jurisdiction over disputes where the debtor is domiciled or has a place of business or assets in Ukraine. This principle ensures access to justice for both domestic and foreign claimants when the opposing party has a tangible presence within the country.

In addition to general jurisdiction, Ukrainian law provides for the exclusive jurisdiction in certain categories of disputes. These include claims related to real estate located in Ukraine, corporate disputes involving Ukrainian legal entities, bankruptcy and insolvency proceedings, public procurement disputes, cases involving Ukrainian public authorities. In these cases, only Ukrainian courts are competent to hear the case, regardless of any alternative dispute resolution clauses agreed in contracts.

If the subject of a contract is not attributed to the exclusive jurisdiction of Ukrainian courts, parties are free to include an arbitration agreement referring resolution of disputes arising from the contract to arbitration. In this case, if either party attempts to resort to the national court, the latter will most definitely refuse to consider the dispute given the valid arbitration agreement.

Another tricky issue may be a hybrid dispute resolution clause offering the parties flexibility in choosing an authority to consider disputes arising out of or in connection with the contract. Such ambiguity may result in duplication of arbitration and litigation proceedings, multiple challenges of jurisdiction, and further challenges of an arbitral award or a court decision.

Practical Tip: “Specify exclusive jurisdiction clearly; hybrid clauses may create procedural risks in Ukraine.”

Litigation in Ukrainian Courts

Since the onset of the full-scale Russian invasion in 2022, Ukraine’s judiciary has faced unprecedented challenges. Nonetheless, the court system has demonstrated remarkable resilience and adaptability in the face of new reality. During the announced martial law and active hostilities in several regions, Ukrainian courts continue to function, even in territories that have been recently de-occupied and are close to the front-line. The courts offer handling court hearings via video-conferences for the security of the parties.

Ukraine’s judicial system operates on a three-tier structure, comprising local courts, courts of appeal, and courts of cassation. Business-related disputes fall under the jurisdiction of commercial courts, which possess specialized competence in matters of corporate, contractual, and trade law. In parallel, administrative courts serve as a venue to challenge actions or decisions by Ukrainian public authorities, such as tax, customs, or licensing bodies.

For foreign companies and international law firms, litigation in Ukraine offers significant advantages, especially when Ukrainian counterparties or assets in Ukraine are involved. Our law firm provides tailored litigation strategies for foreign clients navigating Ukrainian courts. Ukraine’s courts recognize the principle of international cooperation, and Ukraine’s court decisions can be enforced in other jurisdictions under applicable international treaties or reciprocity principles.

In litigation proceedings brought before the Ukrainian courts, foreign companies benefit from equal procedural rights with Ukrainian entities, as guaranteed under domestic legislation. This parity fosters an environment conducive to fair judicial treatment:

Despite the growing reliability of Ukrainian litigation, foreign businesses should remain aware of several practical and systemic challenges:

While litigation in Ukrainian courts offers a viable and increasingly modernized forum for dispute resolution, foreign companies should assess the specific context of the dispute, including the location of assets, governing law, and urgency of interim relief, before proceeding. In many cases, Ukrainian litigation remains an effective mechanism, particularly when paired with proactive enforcement strategies and sound legal representation.

Case Snapshot

Ilyashev & Partners successfully represented a foreign bank in a series of high-profile legal proceedings, including litigation and arbitration proceedings in Ukraine. The firm played a key role in complex multi-jurisdictional asset recovery efforts related to the embezzlement case against former chairman. The team provided full legal support in arbitration proceedings and Ukrainian commercial and civil courts, including obtaining interim measures, enforcement of foreign judgements, arbitral awards and coordination with international legal proceedings.

International Arbitration in Ukraine

As was mentioned above, Ukrainian courts have a pro-arbitration approach and respect the parties’ choice of a dispute resolution clause if validly included in the main contract.

The arbitration legislation in Ukraine is represented by the Law of Ukraine “On International Commercial Arbitration”, the Civil Procedure Code of Ukraine, and the Commercial Procedural Code of Ukraine.

Ukrainian courts enforce foreign arbitral awards, uphold valid arbitration clauses, and stay proceedings in favour of arbitration. While enforcing international arbitration awards, Ukrainian courts do not interfere with the merits of the case and consider the enforceability of the award itself and whether there are grounds for refusal under Article V of the New York Convention.

The ICAC at the Ukrainian Chamber of Commerce and Industry and the Ukrainian Maritime Arbitration Commission (the UMAC) are the primary and most reputable arbitral institutions in Ukraine, established under the Law of Ukraine “On International Commercial Arbitration”. The other most preferred forums for arbitration include ICC, SCC, LCIA, VIAC, and ICSID.

Ukrainian court practice is increasingly aligned with global arbitration standards, and the Ukrainian legislation is being regularly amended to meet the practical needs in international arbitration.

Case snapshot

Ilyashev & Partners Law Firm successfully defended the interests of a foreign company that is part of one of the French largest retail chains in a commercial fraud case considered by the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry (ICAC at the UCCI).

Recognition and Enforcement of Foreign Judgments and Awards

Ukraine is a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 and the European Convention on International Commercial Arbitration 1961, and has a supportive arbitration legal framework.

Ukrainian law also permits the recognition and enforcement of foreign court judgments and international arbitral awards, subject to specific legal conditions. These include the principle of reciprocity (in the absence of multilateral and bilateral treaties), proper notification of the parties to the proceedings, and compliance with Ukrainian public policy standards. Applications for recognition are reviewed by Ukrainian courts in separate proceedings, which may involve a detailed assessment of formal criteria.

Ukraine operates a dual enforcement system: once a domestic or recognized foreign judgment or award becomes enforceable, it may be executed either through the State Enforcement Service or licensed private enforcement officers. The emergence of private enforcement since 2017 has added flexibility, competition, and efficiency to the enforcement process, particularly in high-value or time-sensitive matters.

One of the landmark developments in Ukrainian legal practice was achieved by Ilyashev & Partners, as one of the first law firms in Ukraine to successfully secure recognition of English court orders and judgments in Ukraine. These cases helped shape a positive judicial precedent and contributed to the evolving enforcement landscape, particularly in common law-related matters.

However, despite recent amendments to Ukrainian legislation to facilitate the recognition and enforcement of foreign arbitral awards and court judgments, practical enforcement challenges remain. In particular, the enforcement proceedings may be affected by the fraudulent action of debtors attempting to conceal assets, initiate delaying tactics, or use procedural loopholes. Therefore, careful pre-enforcement asset analysis and strategic planning may be a key to effective debt recovery.

Asset Tracing and Interim Measures

Freezing orders and tracing assets in support of arbitration or litigation proceedings in Ukraine are legally feasible and procedurally well-established.

Ukrainian courts may grant interim measures, such as asset seizures or freezing bank accounts, both prior to the filing of a claim, at the stage of the ongoing proceeding or after a final decision is issued. Prompt actions and precision are crucial in this case, especially in high-value disputes at stake. Quite often, however, the allocation of the assets to be seized under the interim measures granted by the court is the responsibility of the creditor’s legal counsel.

Ukrainian legal counsels and state authorities have a wide range of instruments to effectively trace the debtor’s assets and to procure their preservation till the final resolution of the dispute. Normally, state registers, open sources, and independent analytical systems are used to allocate concealed assets. Local counsel coordinate access to property, corporate, and bank registries, and engage enforcement officers to secure assets. Courts require evidence of urgency and risk of dissipation to grant protective orders.

Working with Ukrainian Counsel

In cross-border disputes involving Ukrainian parties or assets, partnering with competent local counsel is not optional; it is essential for a positive outcome of the case. Whether the dispute proceeds before Ukrainian courts or relates to enforcement or interim measures, Ukrainian lawyers ensure compliance with domestic procedural rules, manage court filings, organize translation and legalization of the documents, and appear in person on the client’s behalf.

Foreign law firms benefit from the deep familiarity a local counsel has with current court practice, procedural formalities and nuances, regional enforcement patterns, especially in complex commercial or high-value disputes. Ukrainian legal counsel can also ease and facilitate the preparation and analysis of documentary evidence.

To ensure effective cooperation, a foreign client should prioritize:

While many Ukrainian law firms operate at international standards, differences in document formatting, client onboarding (e.g., KYC/AML compliance), and billing should be harmonized at the outset. Ukrainian lawyers are typically highly responsive and well-adapted to working with multinational clients, particularly those active in arbitration or investment disputes.

Ukraine provides an arbitration-friendly dispute resolution landscape that is procedurally sophisticated and increasingly transparent. With well-drafted contracts, strategic planning, and reliable local legal counsel, foreign law firms can effectively guide their clients through disputes involving Ukrainian elements.

Authors:

Marina Riashchenko, Attorney at Law, Counsel at Ilyashev & Partners Law Firm

Vyacheslav Sytyi, Attorney at Law, Counsel at Ilyashev & Partners Law Firm

Ilyashev & Partners Law Firm provides comprehensive legal support to foreign law firms and international companies involved in disputes in Ukraine. Our expertise covers cross-border litigation, enforcement of foreign judgments, international arbitration, asset tracing, and interim measures in Ukraine.

Find out more at Ilyashev & Partners Law Firm or reach out to the authors for further insights: Marina Riashchenko and Vyacheslav Sytyi.