Russian-Ukrainian Legal Group, P.A.
Kiev, Ukraine; Washington, D.C., USA
Chronicle
of Recent Developments in Ukrainian Legislation
February 2006
Corporate Registration
Customs
Licensing
Subsoil, Oil and Gas
Taxes
Specific Sectors of Economy/Miscellaneous
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The “Chronicle of Recent Developments in Ukrainian
Legislation” is a monthly summary of the most important legislative
developments in Ukraine in the area
of business and corporate law, and is prepared, published and distributed by
the Russian-Ukrainian Legal Group as a free service to our clients. The
Chronicle will be distributed only via e-mail, in English and Russian, by the
middle of each month, and will summarize the legislative developments of the
previous month. The Chronicle is prepared in an effort to capture news of
greatest interest to the widest cross-section of our firm’s clientele, without
restating all legislation published and drowning our readers in too much
information. Due to the winnowing process necessary when preparing the Chronicle,
we cannot and do not guarantee that it contains a comprehensive list of all
Ukrainian legislation relevant to your business.
Finally, please bear in mind that this summary does not constitute legal
advice; it is an informational service only.
Should you wish to receive further information or actual legal advice,
please do not hesitate email us at chronicle@rulg.com
Corporate Registration
1) Law of Ukraine No. 3422-IV "On Introducing
Amendments to Certain Laws of Ukraine” dated 9 February 2006. The Law
amends the Law “On State Registration of Legal Entities and Individual
Entrepreneurs” and the Law “On Accounting and Financial Reporting in Ukraine”. The amendments require businesses to submit (via
registered letter) to the state registrar a financial report on their economic
activities, including the balance sheet and annual report on financial
performance not later than 1 June of the year following the reference period.
Such financial data will be recorded in the Uniform State Register of Legal
Entities and Individual Entrepreneurs. The Law will take effect on 1 January 2007.
2) Letter from the State Committee of
Ukraine for Regulatory Policy and Entrepreneurship (the “Entrepreneurship
Committee”) and the Ministry of Emergencies of Ukraine No. 1343/01-2183/211
“On Amendments to the Procedure for State Fire Supervision Bodies Issuing
Permits to Begin Operations and Permits to Lease Premises ” dated 21 February
2006. Pursuant to the amendments introduced by Cabinet of Ministers of
Ukraine (“Cabinet of Ministers”) Resolution No. 17 dated 11 January
2006, new companies may begin operations without permits issued by the state
fire supervision bodies if they obtain Third Party Liability Insurance (see the
January 2006 edition of this Chronicle). The Entrepreneurship Committee's
Letter makes it clear that the companies need only to declare that they have
obtained insurance, and that this fact need not be independently verified. It
also clarifies that companies may contract with any insurance company they
wish.
Customs
3) State Customs Service (the “Customs
Service”) Order No. 1227 “On Approving the Procedure for Executing and
Using the Refusal Card to Accept the Customs Declaration, Customs Clearance and
Passage of Goods and Vehicles Across the Customs Border of Ukraine” dated 12
December 2005. The Order establishes the procedure for customs bodies to
issue a written Refusal Cards to accept the customs declarations,
customs clearance and passage of goods and vehicles across the border of Ukraine. Pursuant to the Procedure, written notification on
a Refusal Card to accept the customs declarations, customs clearance and
passage of goods and vehicles across the border of Ukraine should be immediate when appropriate, but must state
the reasons for refusal and cite specific Ukrainian laws. The Order took effect
on 1 February 2006.
4) Customs Service Order No. 30 “On
Approving the Procedure for Collecting Import/Export and Special Duties by
Customs Bodies in the Course of Customs Clearance of Goods that are Crossing
the Customs Border of Ukraine” dated 23 January 2006. The approved
Procedure replaces the Instruction on the Procedure for collecting
import/export duties that was issued in 1997. Pursuant to the new Procedure,
import/export duties are collected in the course of customs clearance of goods
that are imported into or exported from the customs territory of Ukraine. Special duties (antidumping, special and compensatory) may be imposed
pursuant to decisions of the Intergovernmental Commission on International
Trade. Duties must be paid prior to the
execution of cargo customs declarations, temporary or incomplete
declarations. Overpaid duties can be
refunded in accordance with the statutory procedure not later than the 1095th
day (up to three years) from the moment of
customs clearance at the request of the goods' owners. The
Order will take effect on 8 April 2006.
Licensing
5) Law
of Ukraine No. 3370-IV "On Amending Certain Legislative Acts of Ukraine to
Bring Them in Line with Legislative Acts of Ukraine in the Field of Licensing”
dated 19 January 2006. The Law brings current legislation in the field of
licensing in line with the norms of the Law “On Licensing Certain Types of
Commercial Activity”. The Law amends 32 laws, four codes and two decrees, among
them: Subsoil Code of Ukraine, the Laws “On Audit”, “On Investment Activity”,
“On Fire Security”, “On Securing the Sanitary and Epidemiological Well-being of
the Population” and “On Medicines”. The Law also gives an exhaustive list of
the types of economic activity that are subject to licensing, and adds a
refinement pursuant to which the production of and trade (wholesale and retail)
in agrochemicals and pesticides that relate to the regulators of plant’s growth
are subject to licensing. The Law took
effect on 17 February 2006.
6) Order of Entrepreneurship Committee
and the Ministry of Industrial Policy of Ukraine No. 8/29 “On Approving Licensing Conditions for
Implementation of Economic Activity in the Field of Production of Pesticides
and Agrochemicals (Only the Regulators of Plants’ Growth)” dated 31 January
2006. The Order approves the licensing conditions for work
in the field of production of pesticides and agrochemicals that are classified
as regulators of plants’ growth, as well as related requirements aimed at
securing environmental protection and the sanitary and epidemiological
well-being of the population. The
Ministry of Industrial Policy will carry out the licensing. To receive a
license, a business must apply to the specified body and submit the documents
required by law. The Order took effect on 28 February 2006.
7)
Order of the Entrepreneurship Committee and the Ministry of Agrarian Policy
of Ukraine No. 9/30 “On Approving Licensing Conditions for Carrying Out
Economic Activity in the Field of Wholesale and Retail Trade in Pesticides and
Agrochemicals (Only the Regulators of Plants’ Growth)” dated 1 February 2006.
Businesses that intend to conduct wholesale and retail trade in agrochemicals
and pesticides classified as regulators of plants' growth must obtain licenses
from the Ministry of Agrarian Policy to carry out these activities, and must
meet the requirements established by the new licensing conditions. To receive a license, a business must apply
to the specified body and submit the documents required by law. The Order took
effect on 28 February 2006.
Subsoil,
Oil and Gas
8) Cabinet of Ministers Resolution No.
167 “On Approving the Procedure for Carrying out Auctions to Sell Special
Permits to Use Subsoil in 2006” dated 20 February 2006. Unlike the similar
procedure that was effective in 2005 (see the May 2004 edition of this
Chronicle), the new Procedure: (1) does not require that applicants be paid up
on their taxes; (2) states that when a permit to use subsoil for the purpose of
developing a field is put up for auction, and the geological study of the field
was carried out at the expense of a subsoil user who identified the mineral
deposits but did not apply for a permit to commercially exploit them, the
winner of the tender must reimburse the previous subsoil user for its
geological study costs; (3) determines that the money paid by the tender
participants for the tender documentation expert examination of documents,
press announcements, and communication services will cover the auction
expenses of the Ministry for
Environmental Protection of Ukraine (Environmental Ministry). The Resolution took effect on 20 February 2006.
9) Cabinet of Ministers Resolution No.
168 “On Approving the Procedure for Issuing Special Permits for Subsoil Use in
2006” dated 20 February 2006. The
Procedure stipulates that special permits for subsoil use in Ukraine, on its continental shelf and in its exclusive
(maritime) economic zone in 2006 are to be issued by the Environmental Ministry
to the winners of auctions for these permits, as well as to subsoil users in
cases envisaged by the Procedure. The Resolution took effect on 20 February 2006.
10) Cabinet of Ministers Resolution No. 194
“On Amending the List of Licensing Bodies” dated 22 February
2006. The State Geological Service is now responsible for
licensing mineral exploration and uranium ore mining. The Resolution took
effect on 22 February 2006.
Taxation
11) State Tax Administration of Ukraine Order No. 62 “On Approving the Regulations for
Administration of Taxes, Duties (Compulsory Payments)” dated 9 February
2006. The Regulations generalize the regulatory and legal
framework for administering taxes, duties, rights, obligations and responsibilities
of both taxpayers and state tax officials. The Regulations contain general
information related to: registration and keeping records of taxpayers; use of a
simplified system of taxation by taxpayers; patenting certain types of economic
activities, as well as the procedure for executing settlement operations in the
field of trade and services; processing tax returns; assessing and paying
taxes; services for taxpayers; implementing tax control; the procedure for
submitting and considering taxpayers' claims; and liquidating tax debts. The
Order took effect on 9 February 2006.
Specific Sectors of
Economy/Miscellaneous
12) Law of Ukraine No. 3369-IV
"On Amending the Law of Ukraine "On Quarantine of Plants” dated 19
January 2006. The Law of Ukraine “On Quarantine of Plants” is set forth in a
new wording. The amendments relate to: (1) the procedure for working up,
amending and approving phytosanitary measures and making them public; (2)
regulating international trade in plants; and (3) identifying, monitoring and
controlling regulated hazardous organisms. The Law requires the registration of
persons who carry out economic activities related to the production of and
trade in "regulated objects". "Regulated objects" are
defined as plants, products derived from plants or other organisms, and objects
or materials able to transmit and spread regulated hazardous organisms. The Law
establishes the procedure for implementing and terminating quarantines in Ukraine, exercising control over the movement of
regulated objects, and related matters. The Law took effect on 21
February 2006.
13) Ministry of Justice Order No. 12/5 “On
Approving the Regulations for the State Registration of Mass Media in Ukraine
and the Regulations for the State Registration of Information Agencies as
Subjects of Information Activity” dated 21 February 2006. Pursuant to the
approved Regulations, all printed mass media published in Ukraine, as well as all information agencies and their
representative offices that are in the process of establishment or that are
already operating in Ukraine, must register with the State. The Ministry of
Justice registers mass media (except for local mass media) and information
agencies and their representative offices. Correspondents with foreign
information agencies’ representative offices shall be accredited with the
Ministry of Foreign Affairs. The Order
took effect on 7 March 2006.