President Volodymyr Zelenskyi has signed the Ukrainian Law on Concession, which the parliament adopted on October 3, the CFTS portal reports.

The aim of the law is to improve legal regulation of concession activities, which will make it possible to effectively attract domestic and foreign investment in the Ukrainian economy and facilitate development of infrastructure.

The document provides for amendment of 25 Ukrainian legislative acts with the aim of regulating relations in the area of attracting private businesses to participate in development of infrastructure based on public-private partnerships.

As reported earlier, the drafting of the document lasted more than two years with the participation of consultants from the European Bank for Reconstruction and Development (EBRD) and experts from the American Chamber of Commerce in Ukraine and the European Business Association. The Ministry of Infrastructure and the Ministry of Economic Development also participated in its preparation.

The draft law stipulates that concession projects can be implemented in all sectors of the economy and on the basis of any asset, with the exception of the following: assets for which laws impose concession restrictions/prohibitions (for example, forests); projects not involving investments in facilities; projects in which the private partner receives full reimbursement of its investments from the state partner; projects that do not provide for creation and/or operation of concession facilities and/or provision of socially significant services.

Residents and non-residents can participate in concession tenders. The law provides equal conditions for all entities participating in concession tenders. A resident and non-resident can be the winner of a concession tender, but only a legal entity registered in Ukraine (residents of Ukraine) can be a concessionaire. Therefore, after winning a concession tender, a non-resident is required to create a legal entity in Ukraine with which a concession agreement will be concluded. This legal entity will guarantee that the concessionaire pays taxes in Ukraine.

The law also provides for concessions for construction and operation of roads. In this case, availability of alternative free travel in accordance with Ukraine’s Law on Roads is a prerequisite.