On Wednesday, 18 September 2013, the Ukrainian Government approved the draft EU Association Agreement (EUAA) - a hugely important agreement for Ukraine, and an agreement which, if signed, will open up trade with the EU, potentially also serving as Ukraine's road map to EU membership.

Whilst the Government’s approval of the draft EUAA is a major milestone, signing of the agreement nevertheless remains subject to Ukraine proving that it abides by EU principles. Consequently, the agreement will likely only be signed by the EU if Ukraine can demonstrate that it is committed to implementing deep structural reforms in such areas as the rule of law, the economy, and in politics more generally.

If signed, then the EUAA will be the most extensive international agreement to be signed by Ukraine in recent times, and will significantly raise the country's investment attractiveness. It covers a number of areas, in particular with respect to EU common values, enhancing the political dialogue between Ukraine and the EU, supporting peace in the region and worldwide, improving economic relations, opening up free trade with the EU, strengthening the rule of law, and harmonising EU and Ukrainian legislation. As such, the agreement will impact all sectors, including energy, taxation, transportation, environment, industrial policy, tourism, healthcare, education, culture and many others. As the President of Ukraine stated, this will be the most significant event in Ukraine since independence in 1991.

All eyes are accordingly focused on whether the Government will implement the necessary structural reforms in the coming months, with a view to the EUAA hopefully being signed in Vilnius in November of this year. We are monitoring further developments.