Types of Investments
The Law of Ukraine “On the foreign investment regime” as of March 19, 1996 (hereinafter - the Law) recognises that foreign investment can take place in a variety of forms, which amongst others, are:
· formation of a joint-venture company;
· acquisition of stock (shares) in existing enterprises;
· buying movable or immovable property;
· creation of a company, wholly-owned by foreign investors;
· acquisition of property rights by purchasing securities;
· buying the right to use land and concessions to exploit natural resources.
· · Foreign investors have the right to invest by using the following forms:
· · hard currency;
· Ukrainian currency as a re-investment into the existing or a newly established enterprise;
· any movable or immovable property and property rights connected with it;
· shares, bonds, other securities and other corporate rights;
· monetary claims and claims under contracts, valued in hard currency and guaranteed by first class banks;
· any intellectual property rights with a confirmed estimation of value in hard currency according to the laws of the investor's country of residence, including copyrights, trademarks, firm names, know-how, and others;
· rights in respect of economic activities, including exploration and utilisation of natural resources valued in hard currency and conferred and valued under the laws of the investor's resident country.
Foreign investment can be executed in the form of a contribution of fixed assets in return for a share in the equity capital of a Ukrainian company. These assets should be valued in both foreign convertible and Ukrainian currency by agreement between the parties, based on International or Ukrainian market prices and using the applicable exchange rate of the National Bank of Ukraine. Currency transfer can be easily executed whilst a contribution in kind require that some special procedures be undertaken by the foreign investor. Please note that under current Ukrainian legislation foreign investment in kind is exempted from VAT and import duties. If the investment is disposed of within three years from the time of registering the foreign investment in the books of the Ukrainian entity, all the relevant import duties will be due.