Recommendations on investment in ukraine

“All's well that ends well”

No one worries about their deposit in an investment project or not having alawyer when everything is all right. But when problems, disputes or conflictsappear everyone starts to regret they didn’t take the time and effort to protecttheir investments in advance.

Having a considerable experience in the field of litigation and legal services,I have formed a list of simple but effective and efficient advices for foreigninvestors, which minimizes risks and gives a confidence in the correctnessof an investment approach. Looking forward, these will help the investor'slawyers to have a better position in court in the case of a dispute or conflict.

Correct business structuring decisions

After reaching an agreement with partners or making a decision the investorcreates a legal shell for the business – a corporate structure. It should provideeach of the partners with a sufficient level of control over the project, guaranteethe achievement of project objectives, and create a system of checks and balances.

A charter, a corporate contract, an irrevocable power of attorney to managecorporate rights, a trust management agreement of shares in the company – allthese are tools that should be used with proper and safe structuring.

Having built the correct structure, you shouldn’t forget that it is necessary tocontrol its use and implementation. This function can be entrusted to a corporatesecretary, who will monitor compliance with the system of checks and balances.

Corporate contract

The application of the corporate contract will increase the protection of theparticipants and the reliability of the partnership (project). Such a contract isrecommended if you:

• are a minority shareholder;
• are a majority shareholder, but it is important for you to keep minorityshareholders (including management with minority stake) in the company;
• have signed a concept document, but there is an intent to legalize it, to giveit legal significance;
• would like to determine the fate of the company (your share) in case ofunforeseen events;

The contract is obligatory if you:

• are not a majority shareholder in a project with a complicated shareholder;
• are a minority shareholder and expect to profitably sell your share to themain participant;
• would like to prevent a competition between the company and itsshareholders;
• are a member of a company with a 50/50 share distribution;

Engage local technical experts

Participation of surveyors, technical consultants in the project will allow toassess the quality of the implementation of the investment project related toreal estate, construction and more.

One of the main goals is to minimize the risks of the customer associatedwith the implementation of a concept (project) in the field of real estate. Thiswill allow to control the customer, general contractor, developers and otherparticipants of the investment project.

Regime of Foreign Investments

Foreign investment is particularly protected. If the guarantees stipulated bythe Law of Ukraine “On the Regime of Foreign Investments” change afteran investment then within ten years from the date of such legislation, atthe request of a foreign investor, state guarantees of protection of foreigninvestments will be applied.

In addition, in some cases, there is a preferential treatment of investment andother economic activities.

I follow these recommendations. We are sure that investing in Ukraine willbe more protected. At the same time, each case is special and requires anindividual approach. Trust is a good foundation for any investment.

By materials "KyivPost"

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