Advantage Ukraine investment initiative. Is it really an advantage for IT industry in Ukraine and beyond?

The Advantage Ukraine initiative has been launched with much fanfare. On 6 September 2022, President Volodymyr Zelenskyy virtually rang the Opening Bell of the New York Stock Exchange (NYSE), inviting businesses around the world to invest in the future of Ukraine. Advantage Ukraine is a new investment initiative of the Government of Ukraine, heavily supported by the President of Ukraine. The idea of this initiative was first expressed and generally presented at the Ukraine Recovery conference in Lugano, Switzerland, in July 2022. The Ukrainian Government is in search for investors and declares to support businesses understanding that the recovery of Ukraine should start now.

The initiative is focused on attracting future investment into the country by showcasing the breadth of opportunities across the key sectors, which will be especially important for the post-war Ukraine. In addition to innovation technologies, the initiative covers defence industry, metallurgy and metalworking, agriculture, power industry, pharmaceutical, natural resources, logistics and infrastructure, furniture and woodworking industries.

An interested business can register at the dedicated website to receive detailed information about specific projects (e.g., privatisation opportunities) and, as the Government calls it, the investment menu. The interested business is also welcomed to propose its own projects.

The Advantage Ukraine initiative is intended to be a G2B umbrella for other initiatives and opportunities, promoting them, facilitating the entry to Ukraine, and supporting the launch of business in Ukraine. In addition to promoting opportunities in the field of development of PPP and industrial parks projects, the Advantage Ukraine initiative also promotes Diia City legal framework for IT/tech companies.

Diia City is a special tax and legal framework for IT/tech companies making it easier, more flexible, more Western-style and less expensive to manage and operate IT business in Ukraine. For more information on the Diia City legal framework, please read our overview and see some statistic about those IT businesses, which already benefit from the Diia City residency.

Although the Advantage Ukraine initiative does not promise some extra-special in terms of regulation, this G2B initiative can be a good opportunity to consider for businesses to facilitate the launch of their IT business in Ukraine or explore new opportunities for growth. Reportedly, the Ukrainian Ministry of Economy appointed a USAID-supported project team of investment bankers and researchers that will also work with businesses interested in investing.

Sayenko Kharenko’s multidisciplinary team is constantly involved in advising on various Diia City projects and is available to discuss Diia City opportunities for your IT business. Please contact Oleg Klymchuk or your usual contact at Sayenko Kharenko to learn more about Diia City regime. Our GR team is also ready to support working more closely with the Ukrainian Government concerning the Advantage Ukraine initiative.

Information contained in this newsletter is for general information purposes only, does not constitute legal or other professional advice, and should not be relied upon as a substitute for specific professional advice tailored to particular circumstances.

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