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News & Knowledge

Doing agricultural business in Ukraine

8th August 2022
Igor Dykunskyy & Iurii Dynys - DLF Attorneys-at-Law

Ukraine is one of the world’s leading exporters of agricultural products. The geographical location, climatic conditions, and soil properties create very favourable conditions for crop production. MSI's Ukraine law member DLF Attorneys-at-Law have put together this comprehensive guide on doing agricultural business in Ukraine, which also discusses wartime legal regulation as a result of the current situation in the country.

In addition, lasting tradition of farming, qualified personnel, and agronomic schools allow the agricultural business in Ukraine to grow rapidly and increase its investment potential.

At the same time, Ukrainian agribusiness has some peculiarities due primarily to the initial conditions of its development. Being one of the post-Soviet countries, Ukraine at the very beginning of the formation of its independent economy faced the incompatibility of the legal system in particular, and the architecture of the agricultural economy as a whole with market relations.

For almost thirty years, the state remained the principal owner of agricultural land. Land was divided up into millions of parcels and handed over to the former participants of the Soviet agricultural enterprises (kolkhozes). Agricultural infrastructure and production assets were also parcelled out.

Historically, this situation has greatly hindered the formation of an efficient agricultural industry. But over time, and through reforms, Ukraine has developed a competitive agribusiness that has been able to leverage land resources and production assets, as well as to attract investment and enhance its own production and technological capacity.

In 2021, the process of transferring agricultural land to private ownership started. Despite significant restrictions, this process has established additional instruments of control over land assets and created new investment opportunities in Ukraine. Today, Ukraine’s agricultural business is a unique ecosystem that is one of the most profitable sectors of the economy. However, it has a number of peculiarities that need to be considered in order to do business effectively in Ukraine. This brochure reflects such peculiarities in the context of building and running an agribusiness in Ukraine.

On 24 February 2022, the Russian federation invaded Ukraine, opening one of the most difficult and tragic pages of our country’s history. Martial law was introduced in Ukraine. Nevertheless, Ukraine’s agricultural sector continued to function under such difficult conditions. Considering the current situation, this brochure has been supplemented with peculiarities of wartime legal regulation.

View the guide on Doing agricultural business in Ukraine

 

About DLF Attorneys-at-Law - Kyiv

DLF is a full-service legal firm, advising mostly foreign companies and entrepreneurs regarding any issue of Ukrainian commercial law, including corporate law, M&A, labour law, contract law, tax law, IP law, real estate law, renewable energy law, litigation and dispute resolution, antitrust and competition law, insolvency and company restructuring.

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