On 16 August 2020, the Law of Ukraine "On Amendments to Certain Legislative Acts of Ukraine Concerning the Simplification of Attraction of Investments and the Introduction of New Financial Instruments" No. 738-IX dated 19 June 2020 (the "Law") came into force, which provides for the introduction of green bonds in Ukraine and establishing rules for these market participants. For the first time, the "green" bonds are introduced into circulation as a separate class of securities and the rules of the game are established for participants in this market.

In particular, Article 18 of the Law establishes:

- the concept of green bonds and environmental projects (with the definition of specific areas to which funds raised from the issue of such bonds can be directed);

- the circle of issuers of green bonds (with the definition of a legal regime for those who implement and finance environmental projects); and

- the principles of information disclosure by issuers, reporting requirements and the use of proceeds that will be attracted from investors to finance and / or refinance the costs of environmental projects.

On 14 August 2020, the State Agency on Energy Efficiency and Energy Saving of Ukraine ("SAEE") developed a draft Concept for the implementation of a green bond market in Ukraine ("Draft Concept"). SAEE called on municipalities to prepare pilot projects for their issues.

This Draft Concept defines the goals, main directions and tasks for the introduction of a green bond market in Ukraine, which is of strategic importance for financing environmentally friendly projects, improving the environmental friendliness of the environment, developing the domestic stock market and the Ukrainian economy as a whole.

The draft Concept is aimed at implementing the provisions of the Association Agreement between Ukraine and the European Union, the European Atomic Energy Community and their member states.

The draft Concept defines the following:

• Problems to be solved;
• Goals and terms of implementation of the draft Concept;
• Ways of solving the problem;
• Expected results; and
• The volume of financial, material and technical, labor resources.

Additionally, the Draft Concept contains an Action Plan for the implementation of the Concept for the implementation of the green bond market in Ukraine for 2020-2022.

SAEE informs that, together with partners, work has begun on the development of secondary legislation, in particular, guidelines for the selection and evaluation of projects in the environmental direction, which will be financed from the state and local budgets.

For further information, please contact Asters' partner Yaroslav Petrov and associate Olena Sichkovska.