In a further step towards deregulation and making it easier to do business in Ukraine, the Ukrainian government just launched an online service for state registration of limited liability companies (LLCs).
This e-service, which is designed to set up a new LLC on the basis of a model charter or change the charter of an existing LLC to a model charter, works in the following way:
- an applicant wishing to set up an LLC fills in a questionnaire on the e-service portal;
- based on the applicant's answers, the portal instantly generates all necessary registration documents; and
- the documents signed with the applicant’s electronic signature are submitted to the state registrar and should be processed within 24 hours (except on weekends and public holidays).
The main features of the e-service include:
- automatic generation of all necessary documents for LLC registration, making it unnecessary to draft any documents in advance;
- guidance on filling in the questionnaire;
- electronic submission of all documents to the state registrar; and
- ability to register an LLC as a VAT payer and apply for use of the simplified taxation system online simultaneously with LLC registration.
Despite the optimistic expectations for the new e-service, practical concerns around its use include:
- online registration requires an applicant to use an electronic signature, which should be obtained in advance through special agencies in Ukraine;
- foreign entities will not be able to benefit from this e-service, as currently they cannot obtain electronic signatures for technical reasons; and
- because the current use of the e-service is limited to state registration on the basis of a model charter or changing an existing charter to a model charter, other changes to the activities of an LLC, such as changing participants, directors, address, etc., need to be done using the regular non-electronic procedure.
In addition, since the service has been in place only for a month, it will require further tuning to improve its efficiency and iron out bugs.
Despite these shortcomings, the e-service – available on the Online House of Justice portal – is expected to simplify the procedure for setting up an LLC in Ukraine, increase business activity, and improve the overall business environment in Ukraine.
For more information on this e-service and doing business in Ukraine, call or email your usual CMS contact or one of our local CMS experts: Tetyana Dovgan, Maria Orlyk.
Legislation: Resolution of the Cabinet of Ministers "On Deregulation of Business Activities" No. 367 dated 27 March 2019