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As the country entered the 21st century, Ukraine’s Soviet-era judicial system was widely condemned as corrupt, incompetent, and inefficient. Committed to rectifying the situation, in 2015 the Ukrainian government introduced plans to reform the entire system. That transformation, which was the focus of an August 2017 CEE Legal Matters Round Table, continues today. We reached out to several of the Ukrainian dispute resolution specialists we spoke to several years ago for an update.

In February 2019 CEE Legal Matters reported that Integrites and K&L Gates had advised Norwegian utility-scale wind power developer NBT and Paris-based renewable energy independent power producer Total Eren on their entrance into a framework agreement with a syndicate of foreign lenders, including the EBRD and the Nordic Environment Finance Corporation, for the construction of the Syvash wind farm – one of the largest in Europe. Redcliffe Partners and Clifford Chance advised the lenders and J.P. Morgan Securities Plc as debt coordinator.

Redcliffe Partners and Clifford Chance Amsterdam have advised the Netherlands Development Finance Company, the Green for Growth Fund, and the Norwegian Guarantee Institute for Export Credits on EUR 37.8 million financing to Scatec Solar for the construction of a 54 MWp solar PV plant in the community of Bohuslav, in the Kyiv region of Ukraine. Integrites and Triniti advised Scatec Solar on the transaction, which closed in July 2019.

Redcliffe Partners and Linklaters have advised the EBRD on a USD 56 million term-secured loan, including a USD 8 million tranche funded by the Clean Technology Fund, made to four Ukrainian members of the Kernel Group, the producer and exporter of sunflower oil in Ukraine and a supplier of agricultural products from the Black Sea region to world markets. Allen & Overy and Lenz & Staehlin reportedly advised the Kernel Group on the deal.

This time, our law firm marketing friends across CEE considered the following question: “What one part of your job would you most appreciate having more help with – not in terms of training or capability, but simply in terms of time?”

Last year Ukraine took several significant steps to encourage investments into the energy market. The Government announced a strategic goal of making Ukraine self-sufficient in energy and abandoning its dependence on imported gas.

K&L Gates and Integrites have advised NBT on the financing documents for Segment 2 of Ukraine’s Syvash Wind Power Project, with commitments of an additional EUR 107.6 million of further senior debt coming from the Black Sea Trade and Development Bank (EUR 30 million), Proparco (approximately EUR 42 million), Finnfund and IFU (EUR 15 million each), and the Nordic Environment Finance Corporation (EUR 5 million). The lenders were advised on Ukrainian law by Redcliffe Partners and on English law by Clifford Chance.

“Ukraine is a very vibrant place to be in, both for life and business,” says Redcliffe Partners Managing Partner Olexiy Soshenko. “In particular, after the Revolution of Dignity in 2014, there have been many changes and reforms.” He cites Ukraine’s policies on energy self-sustainability, currency control, upcoming elections, and extension of the land sale moratorium as particularly deserving of attention.

Integrites and K&L Gates have advised Norwegian utility-scale wind power developer NBT and Paris-based renewable energy independent power producer Total Eren on their entrance into a framework agreement with a syndicate of foreign lenders, including EBRD and the Nordic Environment Finance Corporation, for the construction of one of the largest wind farms in Europe. Redcliffe Partners and Clifford Chance advised the lenders and J.P. Morgan Securities Plc as debt coordinator.

Sayenko Kharenko, working with global counsel Allen & Overy, has provided Ukrainian advice to Greenyard N.V. on the EUR 120 million sale of 100% shares of its horticulture business to independent investment group Straco BVBA. Clifford Chance, working with Redcliffe Partners in Ukraine and TGS Baltic in Latvia, advised the buyers.

On 2 August 2017 the state aid regime, based on the requirements of the EU-Ukraine Association Agreement (the "Association Agreement"), fully entered into force in Ukraine. Before this there were no state aid rules in place, and state support was distributed by the Ukrainian authorities as was deemed appropriate according to fast-changing industrial and regional policy objectives. The Ukrainian government has, traditionally, heavily supported producers in a number of so-called "priority" industries such as steel, fuel and energy, coal mining, aircraft manufacturing and shipbuilding. In the energy sector alone, total budget revenue relinquished under special tax benefits allowed to undertakings accounted for up to 3.5% of GDP annually. The introduction of state aid control is expected to bring more transparency and higher standards in the management of public spending. In particular, all existing state aid programmes implemented before 2 August 2017 should be notified to the Antimonopoly Committee of Ukraine (the "AMC") until 2 August 2018, and all new state aid may be granted only following the prior approval of the AMC.

On 30 September 2017, the UK Criminal Finances Act 2017 (the “Act”) came into force.1 The Act outlines the liability for companies which fail to prevent the facilitation of tax evasion actions. The new Act also has an extraterritorial effect, meaning that it is not limited to activities in the UK, and can also apply to activities in foreign jurisdictions such as Ukraine.

In 2017, Ukraine implemented several anti-corruption steps based on its contractual obligations per loan arrangements with the EU and the IMF1. However, the speed of implementation is slow, which is frustrating for international financial organisations, as well as the broader business community. 

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Redcliffe Partners at a Glance

Redcliffe Partners is a leading Ukrainian law firm that provides a full range of legal services to large national enterprises, international companies, financial institutions and private investors who are conducting business or investment activities in Ukraine.

We are involved in the majority of the largest and most complicated transactions and litigation cases in Ukraine.

Redcliffe is a top-tier law firm in Ukraine, being Tier 1 in all of our key practices: Banking, Energy and M&A according to Legal 500 2019.

The basis of our work and dynamic development is a powerful international team, practical experience in the most active business sectors, and impeccable professional ethics and business transparency.

Firm's website: www.redcliffe-partners.com