UKRAINE'S ANTI-MONOPOLY REGULATIONS CHANGED
18 JANUARY 2000
SOURCE: US EMBASSY KIEV
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INTERNATIONAL COPYRIGHT, U.S. AND FOREIGN COMMERCIAL
SERVICE AND U.S. DEPARTMENT OF STATE, 1999. ALL
RIGHTS RESERVED OUTSIDE OF THE UNITED STATES.
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1. SUMMARY: AMENDMENTS TO UKRAINE'S NEW ANTI-MONOPOLY
LAW CHANGED THE CRITERIA UNDER WHICH THE ESTABLISHMENT
OF A LEGAL ENTITY, MERGERS, AND ACQUISITIONS MUST BE
APPROVED BY THE ANTI-MONOPOLY COMMITTEE. IN MOST
CASES, THE REVENUE AMOUNT TRIGGERING COMMITTEE
OVERSIGHT WAS RAISED FROM USD 600,000 TO USD ONE
MILLION. END SUMMARY. .
2. UKRAINE'S OLD ANTI-MONOPOLY LAW REQUIRED THAT THE
ESTABLISHMENT OF A LEGAL ENTITY, MERGERS, AND
ACQUISITIONS BE APPROVED BY THE ANTI-MONOPOLY
COMMITTEE IF THE INVESTMENT FULFILLED CERTAIN CRITERIA
(E.G. ACQUIRING A CERTAIN PERCENTAGE OF THE VOTING
RIGHTS IN AN ENTERPRISE, OR WHEN COMBINED ASSETS
EXCEEDED A FIXED AMOUNT). HOWEVER, THE THRESHOLD WAS
SET SO LOW THAT NEARLY ALL EQUITY INVESTMENTS, JOINT
VENTURES WITH MULTIPLE PARTICIPANTS, AND SHARE
ACQUISITIONS REQUIRED ANTI-MONOPOLY COMMITTEE
APPROVAL. CABINET OF MINISTERS RESOLUTION NUMBER 2121
OF NOVEMBER 22, 1999 ATTEMPTED TO IMPROVE THE
SITUATION BY RAISING THE BAR (SOMEWHAT). UNDER THE
PREVIOUS RESOLUTION, WHICH WAS ADOPTED ON NOVEMBER 11,
1994, AND AMENDED ON MAY 26, 1997, THE ANTI-MONOPOLY
COMMITTEE WAS RESPONSIBLE FOR MONITORING THE
RESTRUCTURING OF ALL ENTERPRISES WITH SALES IN EXCESS
OF USD 600,000. THE NEW RESOLUTION REQUIRES THE ANTI-
MONOPOLY COMMITTEE TO APPROVE THE CREATION OF FIRMS BY
TWO OR MORE FOUNDERS ONLY IF THE COMBINED ASSETS OF
THE FOUNDERS OR COMBINED SALES VOLUMES EXCEED USD 12
MILLION, OR IF TWO OF THE FOUNDERS HAVE ASSETS OR
SALES OVER USD ONE MILLION (PREVIOUSLY USD 600,000).
3. THE ANTI-MONOPOLY COMMITTEE MUST ALSO APPROVE THE
SALE OF COMPANIES WITH COMBINED ASSETS THAT EXCEED USD
ONE MILLION (PREVIOUSLY USD 600,000).
4. THE ANTI-MONOPOLY COMMITTEE MUST NOW APPROVE THE
SALE OF COMPANIES IN WHICH THE GOVERNMENT HOLDS OVER
50 PERCENT OF THE SHARES, IF THE ASSETS OF SUCH A
COMPANY WERE VALUED AT OVER USD ONE MILLION
(PREVIOUSLY USD 600,000) AT THE END OF THE ACCOUNTING
YEAR. THE EXCEPTION IS WHEN A CIVIL OR ARBITRATION
COURT ORDERS LIQUIDATION.
5. THE ANTI-MONOPOLY COMMITTEE MUST APPROVE THE LEASE
OF PROPERTY IF THE COMBINED VALUE OF THE ASSETS OF THE
ENTERPRISES OR THE COMBINED SALES VOLUME OF THE
FACILITIES BEING LEASED EXCEED USD ONE MILLION
(PREVIOUSLY USD 600,000).
6. THE COMMITTEE'S APPROVAL IS ALSO REQUIRED TO MERGE
FIRMS OF WHICH THE COMBINED VALUE OR COMBINED SALES
VOLUMES EXCEED USD 12 MILLION, (PREVIOUSLY USD SIX
MILLION), OR, IF THE ENTERPRISES BEING MERGED HAVE
ASSETS OR SALES VOLUMES THAT EXCEED USD ONE MILLION
(PREVIOUSLY USD 600 MILLION).
7. THE CABINET OF MINISTER'S RESOLUTION ALSO LIMITED
THE CONDITIONS BY WHICH THE ANTI-MONOPOLY COMMITTEE
WOULD REGULATE THE PURCHASE OF MORE THAN 25 PERCENT OF
THE VOTING RIGHTS IN AN ENTERPRISE. THE RESOLUTION
REQUIRES THE ANTI-MONOPOLY COMMITTEE'S CONSENT FOR THE
PURCHASE OR TRANSFER OF SHARES ONLY IF THE VALUE OF
THE ASSETS OF THE BUYER OR ITS SALES VOLUME EXCEED USD
12 MILLION. THIS LAW ALSO COMES INTO PLAY WHEN THE
VALUE OF THE ASSETS OR SALES VOLUMES OF THE BUYER OR
THE FIRM OF WHICH THE SHARES ARE BEING ACQUIRED EXCEED
USD ONE MILLION (PREVIOUSLY USD 100,000).
8. ESTABLISHING A SELF-REGULATING ORGANIZATION FOR
THE SECURITIES MARKET OR RESTRICTING COMPETITION
BETWEEN THE FOUNDERS IS NOT SUBJECT TO ANTI-MONOPOLY
COMMITTEE PERMISSION.
9. FOR DETAILED INFORMATION ON THE GOVERNMENT OF
UKRAINE'S ANTI-MONOPOLY REGULATIONS, PLEASE CONTACT
YOUR NEAREST USDOC EXPORT ASSISTANCE CENTER, WITH A
COPY TO: DAVID HUNTER, CS KIEV SENIOR COMMERCIAL
OFFICER; OR OLENA STEPHANSKA, CS COMMERCIAL
SPECIALIST:
THECOMMERCIAL SERVICE, U.S. EMBASSY KIEV
7 KUDRIAVSY UZVIZ, KIEV 04053, UKRAINE
TEL: (380-44) 417-143, 417-2669
FAX: (380-44) 417-1419
E-MAIL: OLENA.STEPHANSKA@MAIL.DOC.GOV