On 3 August 2016, the President of Ukraine signed the Law of Ukraine No. 1475-VIII On Amendments to Certain Legal Acts of Ukraine with respect to Enabling the International Cooperation of the Aircraft Industry Entities and Development of the Domestic Aircraft Industry (the “Law”).  The Law will become effective the day after its official publication.

Under the Law, Ukrainian companies doing business in the aviation sector will now be allowed to set up joint ventures with foreign partners.  The only restriction applies to potential foreign partners originating from a country designated as an aggressor or occupant by the Ukrainian Parliament and to which respective sanctions apply.

The introduced amendments apply to Ukrainian aviation companies working under the terms of international contracts of Ukraine on the development, supply, production and repair of aviation goods and engines.

The Law is aimed at creating conditions for development of the domestic aviation industry and ensuring opportunities for aircraft builders to participate in international aviation projects. This shall in turn attract foreign investments and create competitive conditions for development, serial production, sale and aftersales services of aircrafts.

It is anticipated that as a result of the amendments introduced by the Law, foreign investment into the aviation industry shall constitute around UAH 5-10 billion and sales of aviation goods shall increase 20-25% by the year 2020.

Law: Law of Ukraine No. 1475-VIII On Amendments to Certain Legal Acts of Ukraine with respect to Enabling the International Cooperation of the Aircraft Industry Entities and Development of the Domestic Aircraft Industry.