On 26 April 2014, the Law of Ukraine “On Amendment of Certain Legislative Acts of Ukraine Regarding Shortening of the Amount of Permissive Documents” (the “Law”) became effective. The Law abolishes the requirement to obtain regulatory approvals in various spheres, including the area of subsurface use.

Implications for subsurface users

The Law re-establishes the procedure to obtain special permits for subsurface use for the purpose of exploration and/or extraction of minerals and the procedure of construction of extraction objects and underground facilities for purposes not connected with the minerals’ extraction.

What the Law says in terms of mining

The Law abolished requirement for the special permit on subsurface use applicants (those made without auction) to seek prior approvals of such applications from the local councils. Under the Law, from now on such approvals shall be directly requested by the licensing authority (i.e., State Geology and Subsurface Service of Ukraine).

Allocation of the extraction objects and underground facilitites for purposes not connected with the minerals’ extraction (e.g., for underground storage of oil, gas, burying of industrial waste, sewage disposal, etc.) shall no longer require approval from: (1) the State Subsurface Supervision and Industrial Safety Service of Ukranie; (2) the State Geology and Subsurface Service; (3) the State Sanitary and Epidemiological Service of Ukraine; (4) Regional, Kyiv and Sevastopol State Administrtaions;(5) local councils and other interested state authorities.

Actions to consider

Under the Law, the application to receive the special permit for subsurface use without auction is no longer required to be supported with the originals or certified copies of approvals issued by local councils.

At the same time, such requirement is not abolished under Resolution of the Cabinet of Ministers of Ukraine No. 615 “On Approval of Procedure of issuance of Special Permits on Subsurfgacde Use” dated 30 May 2011 (the "Resolution") setting forth the procedure of issuance, re-issuance, amendment, suspension and annullment of special permits for subsurface use in Ukraine and establishing an exhaustive list of documents supporting the application. Given superior legal force of the Law as compared to the Resolution, when making the application on issuance of the special permit respective approval from local council shall no longer be considered a must and thus the State Geology and Subsurface Service of Ukraine cannot refuse applications made without such document.

Conclusion

Adoption of the Law generally contributes to simplification of the procedure to obtain special permits for subsurface use. This notwithstanding, relevant amendments of applicable bylaws (e.g. the Resolution) are required to remove any legal discrepancies.