Wednesday05 February 2025
ps-ua.com

The State Duma has passed a law regulating business activities, effectively abolishing the Commercial Code.

The Verkhovna Rada has approved, in its second reading and overall, Bill No. 6013, which outlines the specific regulations for the entrepreneurial activities of certain types of legal entities and their associations during the transitional period. This bill will terminate the application of the Commercial Code of Ukraine and introduce amendments to the Civil Code of Ukraine and other laws, as reported on the website of the Servant of the People party on Thursday.
Рада одобрила закон, регулирующий бизнес-деятельность, который отменяет Хозяйственный кодекс.

The Verkhovna Rada supported in the second reading and in general the draft law No. 6013 concerning the regulation of entrepreneurial activities of certain types of legal entities and their associations during the transitional period, which terminates the action of the Commercial Code of Ukraine and introduces amendments to the Civil Code of Ukraine and other laws, as reported on the website of the "Servant of the People" party on Thursday.

According to Pavel Frolov, a member of parliament from the "Servant of the People" faction, a 3-year transitional period is introduced for the enforcement of the law, during which the charters and internal regulations of enterprises must be aligned with this law, and those that do not contradict it will be applicable.

"State and municipal non-profit enterprises will change their names to 'state non-profit society' or 'municipal non-profit society' during the transitional period, which will not be considered a transformation," he clarified.

Earlier, one of the initiators of the draft law, Chairman of the Verkhovna Rada Ruslan Stefanchuk, stated that the document underwent a series of public discussions, particularly on the platform of the Congress of Local and Regional Authorities under the President, with the participation of over 400 representatives from all regions. According to him, the draft law aims to align Ukrainian legislation with the requirements and standards existing in EU countries during the transitional period. This is also one of the indicators of Ukraine's compliance with the Ukraine Facility program.

As reported, the Verkhovna Rada adopted the draft law No. 6013 in the first reading on January 12, 2023.

The draft law proposes to declare the Commercial Code of Ukraine void. The goal of the document is also to introduce a seven-year transitional period for the gradual cessation of "enterprises" and their transformation into business entities while adhering to the principle of proportional and expected intervention in the rights of founders of such legal entities without imposing an excessive burden of compliance with the provisions of the law.

The draft law replaces the quasi-property rights of "economic management" and "operational management" with clear and presumed private law constructs of use (lease) and management of other people's property. It also provides for the implementation of best practices in corporate governance into current legislation, particularly concerning the definition of the responsibilities of officials of legal entities, as well as the introduction of effective and market-based mechanisms for controlling the ownership and management of state and municipal property by the newly created societies and institutions.

The Association of Cities of Ukraine appealed to parliamentarians to reject the draft law, asserting that it would halt the operations of hospitals, schools, and municipal heating and water supply enterprises, and directly violates Articles 142 and 143 of the Constitution of Ukraine, as it prohibits territorial communities from creating municipal enterprises, pooling budget funds, and establishing necessary services. The association insists on the need to preserve municipal enterprises.

The All-Ukrainian Association of Communities stated that the draft law is unprepared and could have negative consequences for the functioning of municipal enterprises, hence they will advocate for the preservation of all existing opportunities for current municipal enterprises.

Within the "European Solidarity" faction, it was stated that they are preparing blocking resolutions regarding the draft law, as it provides for the cancellation of penalties for poor-quality arms supply and denied that the draft law is part of the Ukraine Facility.