The Ukraine’s Parliament Adopted the Law ‘On Industrial Parks’

On September 7, 2021, the Ukraine's Parliament adopted in the second reading and as a whole the draft law ‘On Industrial Parks’ No. 4416-1. The draft law aims to simplify the establishment of industrial parks and stimulate their activity.

According to the draft law, management companies, initiators of creation of industrial parks and residents will be entitled to a number of benefits, in particular:

• full or partial compensation of interest payments on loans (borrowings) for development and/or carrying out economic activities in industrial parks;
• financing on non-refundable basis for development of industrial parks and/or ensuring construction of adjacent infrastructure facilities required for establishment and operation of industrial parks;
• compensation of costs for connection to engineering and transport networks.

The procedure for compensating and financing for the development of industrial parks will be established by the Cabinet of Ministers of Ukraine. To implement these projects, the Cabinet of Ministers shall allocate at least UAH 2 billion (annually) in the state budget.

The draft law also develops procedures for creation of industrial parks and their inclusion into the state register, reduces the minimum area of industrial park to 10 ha and sets the maximum area at 1000 ha, clarifies the list of objects that can be located on the territory of industrial parks and provides the possibility of settle disputes at international commercial arbitration or arbitral tribunal.

The law is aimed at creating real incentives to attract investments to the industrial sector by introducing effective incentives for industrial parks.

To enter into force, the draft law is pending signature of the President and official publication.

For more information, please, contact Counsel Nadiia Dmytrenko and Managing Partner Dmytro Vidsota.