News

20-11-2015

Procedure for conducting of M&A transactions on Ukrainian market is being simplified

Procedure for conducting of M&A transactions on Ukrainian market is being simplified

The procedure for obtaining of Antimonopoly committee of Ukraine concentration permit may be simplified shortly. In some cases, the obligation to obtain such a permit would be even withdrawn, eventually leading to more efficient transactions’ closing. 

The respective changes, provided by the Law of Ukraine No 2168a “On the amendments of the Law of Ukraine “On the protection of economic competition (regarding increase of the efficiency of the economic concentration’s control system)”, were approved by the Parliament in the first reading.

One of the positive issues of this Law is that it will significantly simplify the procedure for carrying out of M&A transactions on Ukrainian market. The whole process will be realized through the uplift of the threshold of the amount of total assets or the total volume of sale of goods (turnover) of the participants of concentration for the last financial year, which influenced the necessity to obtain the AMC permit for the concentration of commercial entities.

Should the above Law approved, the participants of concentration will have to apply for the AMC permit only in cases, when the total volume of assets or the amount of turnover of the participants of concentration  will exceed EUR 30 mio. per year; in case if the total volume of assets (turnover of the goods) of the two participants of concentration exceeds EUR 4 mio. per year; or when the turnover of one of the participants of concentration in Ukraine will exceed EUR 8 mio. per year while turnover of the other participant of concentration exceeds the level of EUR 100 mio. per year.

Also there are other numerous changes, which lead to the liberalization of process of the  AMC permit obtaining, in particular, the new Law, if approved, will introduce a simplified application procedure for the certain list of subjects and transaction types.

Based on the above, together with devaluation of hryvnia, the situation appearing on the market, creates a favorable investing climate for the whole range of the western risk investors, who are now able to purchase good quality assets for the reasonable amount and with the aim of its development and subsequent sale. Also, the situation can be interesting for the range of strategic investors, which are looking for the income in the long run.

Nickolas Likhachov, MCIArb, Counsel, Head of Corporate and М&А Practice