INDEX OF ARTICLES ——
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1. INVESTMENTS & INNOVATION IN UNCONVENTIONAL HYDROCARBONS
CIS oil and gas producers still show little interest in unconventional hydrocarbons
Ernst & Young, Kyiv, Ukraine, Tuesday, August 9, 2011
2. UKRAINE'S MARKET TUMBLING ON US DOWNGRADE
Strategy Report, Phoenix Capital Research, Kyiv, Ukraine, Tuesday, June 9, 2011
3. ARNALL GOLDEN GREGORY ADDS INTERNATIONAL BUSINESS, FOOD AND DRUG PRACTICES TO WASHINGTON OFFICE
Joining Atlanta-based AGG in the nation's capital are Partners Michael E. Burke and P. Terrence Gaffney and Of Counsel Gene Burd.
Arnall Golden Gregory LLP, Atlanta, GA & Washington, D.C., Monday, August 8, 2011
4. UKRAINE'S FINANCE MINISTRY SELECTS BNP PARIBAS TO LAUNCH LETTERS OF CREDIT TO REALIZE JOINT PROJECT WITH WORLD BANK
Interfax, Kyiv, Ukraine, Monday, August 8, 2011
5. ASTERS ADVISED KYIVSTAR'S PARENT, VIMPELCOM, ON DEBT FINANCING
Asters law firm, Kyiv, Ukraine, Wed, July 27, 2011
6. SOFTSERVE CELEBRATES 18 YEARS OF INNOVATIVE SOLUTIONS AND SUCCESS
SoftServe, Fort Myers, FL, Wed, July 27, 2011
7. BANKING AND FINANCE NEWS IN UKRAINE
Salans News, Salans law firm, Kyiv, Ukraine, Friday, July 29, 2011
8. MAGISTERS TO MERGE WITH EGOROV PUGINSKY AFANASIEV & PARTNERS
Creating the largest law CIS firm
Magisters, Moscow – Kyiv, Ukraine, Tue, July 19, 2011
9. UKRAINE: NEW LAW ON LIABILITY FOR DAMAGES CAUSED BY DEFECTIVE GOODS
CMS Cameron McKenna LLP, Kyiv, Ukraine, Wed, July 27, 2011
10. ABBOTT LABORATORIES JOINS U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
One of the top health care companies based in Chicago, Illinois; medical & nutritional products & pharmaceuticals, Fortune 500 company
U.S.-Ukraine Business Council (USUBC), Washington, D.C., Thursday, July 14, 2011
11. ASTARTA-KYIV JOINS U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
Largest Ukrainian sugar producer, agri-industrial company, farming 225 thousand hectares of agricultural land
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Wed, July 6, 2011
12. TWENTIETH ANNIVERSARY OF UKRAINE'S INDEPENDENCE RECEPTION IN WASHINGTON, D.C.
Independence Day Reception Thursday, September 15th at Library of Congress in Washington, D.C.
U.S.-Ukraine Business Council (USUBC), Washington, D.C., Tue, Aug 9, 2011
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1. INVESTMENTS & INNOVATION IN UNCONVENTIONAL HYDROCARBONS
CIS oil and gas producers still show little interest in unconventional hydrocarbons
Ernst & Young, Kyiv, Ukraine, Tuesday, August 9, 2011
KYIV, MOSCOW – Even with abundant conventional hydrocarbon resources, CIS oil and gas producers still show little interest in unconventional hydrocarbons, according to the report Coalbed methane from Ernst & Young. This fact will constrain investments in unconventional hydrocarbons for many years ahead.
Prioritizing coalbed methane prospects in the CIS is the key output of this work. Ernst & Young considered fields of 100 sq. km so they could perform a comparative analysis. The larger a field is, the more interesting the project is to potential investors.
“As characteristics of the discussed parameters often demonstrated excessive spreads, a decision was made to independently interpret the available information,” said Andrey Kobzev, Ernst & Young Director, Moscow Oil and Gas Center. “Obviously, reliance only on public sources enables just a very general evaluation of specific acreages in terms of potential for developing coalbed methane.”
“In such terms, Kemerovo’s total coal resources make the region an unquestioned leader,” said Victor Borodin, Ernst & Young Tax Partner. “However, we decided to summarize a number of parameters in one table, such as recoverable reserves per well, discounted production cost (including capex), number of wells in a field and each well’s calculated absolute open flow and a field’s overall guaranteed production rate (plateau production). As mentioned above, it is now difficult to forecast the output of pilot coalbed methane projects. Therefore, we developed three potential scenarios, including low productivity, expected productivity and high potential.”
By comparing Kazakhstan’s, Ukraine’s and Russia’s figures, Ernst & Young concluded that coalbed methane projects are very attractive in the Kuznetsk Basin. Ernst & Young’s estimates are derived from preliminary data and cannot form the only basis for a decision. The company ranked countries based on aggregate results and concluded that projects have strong potential in Russia, while Ukraine and Kazakhstan are about equally competitive.
“But the technical component is often not the main consideration in the choice of a country for investing. Potential investors would also evaluate debt burden, costs to overcome administrative barriers and other factors inherent in major projects", said Alexey Kondrashov, Ernst & Young Partner, Moscow Oil and Gas Center and Global Oil and Gas Tax Leader.
“Estimating and forecasting permeability of reservoir rocks at planned development sites is the most relevant issue in the CIS,” noted Andrey Kobzev. “Of course, companies could ignore that stage and immediately proceed with implementation, but they will face this issue again at a later stage when testing different technologies and well designs.”
Such projects will drive technological innovation and investments in logistics and infrastructure. They will also boost economic growth in the regions which have coal reserves. “We estimate potential investments in such projects in the CIS at hundreds of millions of US dollars,” commented Victor Borodin. “Addressing the issues described above will help accelerate investments. Hopefully, we will see at the ‘round table’ not only company executives interested in coalbed methane projects, but also regulators. It is time to discuss burning issues. If the dialogue takes place, we may see an independent sector emerge in three to five years that will rely on innovative technology and management solutions.”
About Ernst & Young
Ernst & Young is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 141,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.
Ernst & Young expands its services and resources in accordance with clients’ needs throughout the CIS. 3,500 professionals work at 18 offices in Moscow, St. Petersburg, Novosibirsk, Ekaterinburg, Kazan, Krasnodar, Togliatti, Yuzhno-Sakhalinsk, Almaty, Astana, Atyrau, Baku, Kyiv, Donetsk, Tashkent, Tbilisi, Yerevan, and Minsk.
For more information about our organization, please visit www.ey.com.
NOTE: Ernst & Young is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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2. UKRAINE'S MARKET TUMBLING ON US DOWNGRADE
Strategy Report, Phoenix Capital Research, Kyiv, Ukraine, Tuesday, June 9, 2011
KYIV– With the often volatile Ukrainian stock market sensitive to global financial events, the US credit rating downgrade by S&P caused extensive domestic market tumult. In a massive sell-off, most equities lost more than 10% of their price on Aug. 8. Though Ukraine’s stock market plunge was deeper than its counterparts (Russian RTS: -7.8%; MSCI EM: -4.88%; STOXX Europe 600: -4.14%), equities should witness a turnaround as the global financial turmoil eases.
Given that the major Ukrainian companies reported upbeat financials for 1H11, the current price level provides for attractive multiples on some of the strongest stocks. Shares of Motor Sich (MSICH UK) and Ferrexpo (FXPO LN) are priced with EV/EBITDA multiple of 3x-4x, having their lowest valuation ratios in a year.
Stocks in a freefall. The Ukrainian Exchange (UX) suffered harsh losses on Aug. 8 as the major stock index lost 8.3% of its value, the largest single-day decline in the last 12M. Since the beginning of August, the UX Index has plummeted 15.7%, accounting for most of its 20.1% plunge on a YTD basis. If to exclude Ukrnafta stock (18.07% share; +29.5% YTD) as having non-representative dynamics, the Index plummeted 11.4% on Aug. 8 and 18.2% since the start of the month.
Global risk considerations trigger sell-off. Along with global equities, the Ukrainian market sank on S&P’s action to lower the US debt rating from AAA level to AA+. In Ukraine’s case, the UX index dynamics was aggravated by the greater volatility of the local market. Ukraine’s domestic development, however, remain mostly unaffected. While the worldwide economic slowdown will put a drag on Ukraine’s recovery, the nation’s GDP growth will well exceed 4% Y-o-Y, we estimate. Such macroeconomic improvements were recently noted by the Fitch rating agency, which changed country’s sovereign credit outlook to positive from stable.
Corporate earnings growth points to attractive valuation. The Aggregated EBITDA of the UX Index’s major industrial companies, representing 62.7% of the basket, strengthened by 12% Y-o-Y in 1H11. As corporate earnings and stock market dynamics diverged in 2011, valuation multiples on some of Ukraine’s strongest companies declined to their lowest post-crisis levels. We believe the financials reported in the 2H11 will only serve to confirm the trend seen in the year’s first half.
FXPO priced at 4.1x EV/EBITDA 2011F multiple. The value of Ferrexpo (FXPO LN) stock plunged 13% on Aug. 8 and 25% since the beginning of the month. Currently, FXPO trades at an attractive EV/EBITDA multiple of 4.1x on 2011F earnings and 3.4x on 2012F numbers, while being fundamentally strong. The company posted impressive 1H11 results, having increased EBITDA by 86% Y-o-Y and net income by 112% Y-o-Y. We estimate its EBITDA will increase 33% Y-o-Y in 2011 and net income to power forth by 37% Y-o-Y.
MSICH EV/EBITDA 2011F ratio stands at 2.97x. Motor Sich (MSICH UK) stock slid 11% on Aug. 8 and 19% since the beginning of August. As a result, its EV/EBITDA ratio dwindled to 2.97x on 2011F financials and 2.6x on 2012F. The company boosted its EBITDA by 51% Y-o-Y and bottom line by 66% Y-o-Y in 1H11. We expect 12% Y-o-Y growth in the company’s EBITDA in 2011 to $246 mln, backed by healthy foreign demand and secured backlog of orders. (www.phoenix-capital.ua)
NOTE: Phoenix Capital is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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3. ARNALL GOLDEN GREGORY ADDS INTERNATIONAL BUSINESS, FOOD AND DRUG PRACTICES TO WASHINGTON OFFICE
Joining Atlanta-based AGG in the nation's capital are Partners Michael E. Burke and P. Terrence Gaffney and Of Counsel Gene Burd.
Arnall Golden Gregory LLP, Atlanta, GA & Washington, D.C., Monday, August 8, 2011
ATLANTA, GA and WASHINGTON, D.C. – Arnall Golden Gregory's Washington office, which opened in January with a focus on privacy law, has expanded its scope to strengthen the firm's International Business and Food and Drug practices. Joining Atlanta-based AGG in the nation's capital are Partners Michael E. Burke and P. Terrence Gaffney and Of Counsel Gene Burd.
Mr. Burke's practice focuses on structuring cross-border transactions and advising clients on U.S. export controls and the Foreign Corrupt Practices Act. Mr. Burke also is involved in venture capital and private equity financing and private company M&A. He is an editor of the Thomson/West book "Corporate Counsel's Guide to Doing Business in China," and is Chair-Elect of the American Bar Association Section of International Law. Mr. Burke had chaired the Asia & Pacific Team at Williams Mullen.
BURD HAS BEEN ADVISING COMPANIES ABOUT BUSINESS IN FORMER SOVIET UNION
Mr. Burd has been advising companies on conducting business in the former Soviet Union for nearly 15 years, and also represents foreign companies in the U.S. The majority of his work involves international dispute resolution. Mr. Burd served as Managing Director of the Marks, Sokolov & Burd Ukrainian office. He is Co-Chair-Elect of the Russia/Eurasia Law Committee of the ABA Section of International Law.
Mr. Gaffney has more than 20 years experience representing clients before the FDA, the FTC, Congress and other government agencies. He will be working closely with Alan G. Minsk, leader of AGG's Food and Drug Team, and William H. Kitchens, Partner in the Healthcare/Life Sciences Group. Mr. Gaffney formerly was an attorney at SmithKline Beecham and a critical care nurse at a large teaching hospital.
"We're delighted to bring these quality lawyers on board," Managing Partner Glenn P. Hendrix said. "They enhance two of our core practice areas — Life Sciences and International Business."
The D.C. office is led by Privacy Partner Robert R. Belair. Working with Mr. Belair on privacy matters are Partners Kevin Coy and Montserrat C. Miller, and Associate Kim Phan. America's dean of privacy attorneys, Alan F. Westin, Columbia University professor emeritus, is a senior policy advisor.
Arnall Golden Gregory LLP is a mid-size law firm in Atlanta and Washington, D.C., that serves the business needs of growing public and private companies. Through mergers and acquisitions, capital markets financing, strategic alliances, joint ventures, regulatory compliance, litigation and other business-related guidance, the firm helps clients across a broad range of industries turn legal challenges into business opportunities.
LINK: http://www.prnewswire.com/news-releases/arnall-golden-gregory-adds-international-business-food-and-drug-practices-to-dc-office-125950133.html
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4. UKRAINE'S FINANCE MINISTRY SELECTS BNP PARIBAS TO LAUNCH LETTERS OF CREDIT – JOINT PROJECT WITH WORLD BANK
Interfax, Kyiv, Ukraine, Monday, August 8, 2011
KYIV — The Ukrainian Finance Ministry has selected BNP Paribas to launch letters of credit to realize a joint project with the World Bank entitled "Urban Infrastructure Development," reads a posting on the ministry's Web site.
"BNP Paribas won a tender to select a foreign bank to launch letters of credit as a part of a loan between Ukraine and the International Bank for Reconstruction and Development [part of the World Bank Group] for the Urban Infrastructure Development project," reads the report.
As reported, the Ukrainian government and World Bank started realizing the Urban Infrastructure Development project in February 2009: a $140 million credit is issued under the project. The credit agreement was signed on May 26, 2008. The government-secured credit is issued for 17 years with a Libor+4.01% interest rate. The project is being realized through selection and support of most urgent investment projects in the water supply, sewage system and solid household waste recycling areas. BNP Paribas has a subsidiary bank in Ukraine – UkrSibbank.
LINK: http://www.interfax.com.ua/eng/eco/76098
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Promoting U.S.-Ukraine business relations & investment since 1995.
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5. ASTERS ADVISED KYIVSTAR'S PARENT, VIMPELCOM, ON DEBT FINANCING
Asters law firm, Kyiv, Ukraine, Wed, July 27, 2011
KYIV – Asters advised VimpelCom, a leading international telecommunications holding and Kyivstar's parent, on USD 2.2 billion debt financing with 3-year floating rate guaranteed notes, long 5-year guaranteed notes and long 10-year guaranteed notes, all guaranteed by VimpelCom Holdings' subsidiary OJSC "Vimpel-Communications".
The 3-year USD 200 million floating rate notes bear an annual interest rate of 3 month USD LIBOR plus 4.00% and is due in June 2014. The long 5-year USD 500 million issue has a coupon of 6.2546% and is due in March 2017. The long 10-year USD 1.5 billion issue has a coupon of 7.5043% and is due in March 2022.
Barclays Bank PLC, BNP Paribas, Citigroup Global Markets Limited, HSBC Bank plc, ING Bank N.V. and The Royal Bank of Scotland plc have acted as lead managers for the financing. VimpelCom Holdings B.V. intends to use the net proceeds from the issuance to provide funds to its direct parent, VimpelCom Amsterdam B.V., to repay any outstanding amounts under VimpelCom Amsterdam B.V.'s loan from a group of international banks (including Barclays Capital, BNP Paribas, Citibank, N.A., London Branch, ING Bank NV, HSBC Bank plc and The Royal Bank of Scotland plc) in a principal amount of up to USD 2.5 billion due March 31, 2012 (USD 2.2 billion of which was drawn down).
Asters' transaction team included associates Svitlana Chepurna, Yevgen Kravtsov, Anna Novodvorska and Yevgen Porada under supervision of senior partner Armen Khachaturyan and managing partner Oleksiy Didkovskiy. Akin Gump LLP acted as English law counsel to the issuer.
ABOUT ASTERS
Asters is a full-service independent national law firm. With 15 years of experience the firm has one of the longest track records on the country's young legal market. Asters is among the most recommended law firms for Ukraine according to reputable international legal directories The Legal 500, PLC Which Lawyer?, Chambers Global, IFLR 1000, and Ukraine's legal market research publications.
A list of the firm's clients includes major international corporations, such as Boeing, Coca-Cola, Marathon Oil, Miele, News Corp., New Line Cinema, Nissan Motor, Nokia Corporation, Philip Morris, Renault, Telenor ASA, Toshiba Corporation, and the world's leading financial institutions ABN AMRO, Barclays Capital, Citibank, Credit Suisse, Deutsche Bank, EBRD, IFC, ING Bank, JP Morgan Chase, Standard Bank, Swedbank and the World Bank.
NOTE: Asters law firm is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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6. SOFTSERVE CELEBRATES 18 YEARS OF INNOVATIVE SOLUTIONS AND SUCCESS
SoftServe, Fort Myers, FL, Wed, July 27, 2011
FORT MYERS, FL – SoftServe Inc., a leading global provider of proven high quality software development, testing and consulting services, marked its 18th anniversary on July 15, 2011. The festivities took place in Lviv, Ukraine, where the company was originally founded.
This year the Viking Bay resort outside of Lviv, which has become the traditional gathering place for SoftServe`s Company day, hosted 1300 SoftServe`s employees from Lviv, Rivne, Chernivtsi, Ivano-Frankivsk, Ukraine and Fort Myers, U.S., as well as a number of visiting clients.
The whole-day event was dedicated to honoring the outstanding achievements in high-quality software service delivery and impeccable customer experiences that have established SoftServe as a recognized industry leader. The convivial atmosphere of accomplishment and enjoyment was increased by the numerous sports and entertainment events.
TARAS KYTSMEY, SOFTSERVE'S PRESIDENT
In his opening speech, Taras Kytsmey, SoftServe’s President, emphasized the importance of a combined team effort that has been continuously ensuring the company`s success and thanked the employees for their loyalty to the company`s values and principles.
“It is our commitment to progress and innovation, our unwavering interest in the advancement of software technology and mutually advantageous partner relations that brought us here today. Despite the constantly changing market conditions, our corporate strategy has prevailed as we continuously grow our business and reach new heights in developing leading-edge software technologies. We are starting a new era in SoftServe`s history, further broadening our horizons and facing all the challenges in the commonly recognized capacity of a major global industry leader”.
Among SoftServe’s most recent achievements are the prestigious listings in the 2011 Global Services 100, the 2011 Global Outsourcing100®, and the 2011 Best Employers in Central and Eastern Europe. The full list of awards can be found here.
ABOUT SOFTSERVE, INC.
SoftServe is a leading global provider of proven high quality software development, testing and consulting services. We are committed to bringing the best commercial software to independent software vendors and enterprises. We combine our unmatched experience with best practices delivering SaaS/Cloud, Mobility and SDLC innovative solutions. With an onshore/offshore delivery model, we collaborate with our customers helping them drive their business and differentiate themselves within their markets. SoftServe has successfully completed over 2,500 projects for over 150 global companies.
Founded in 1993, SoftServe is headquartered in Fort Myers, Florida, with an award-winning development organization based in Ukraine and the Philippines. For more information, please visit www.softserveinc.com.
NOTE: Softserve, Inc. is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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7. BANKING AND FINANCE NEWS IN UKRAINE
Salans News, Salans law firm, Kyiv, Ukraine, Friday, July 29, 2011
KYIV – Banking and Finance News in Ukraine- June-July 2011: In this Issue:
- On Amending Certain Legislative Acts of Ukraine Regarding Regulation of Relations between Creditors and Consumers of Financial Services
- On Amending Certain Regulatory Legal Acts of the National Bank of Ukraine
- On Amending Certain Legislative Acts of Ukraine Regarding Bonds
- On Amending Certain Laws of Ukraine Regarding Supervision on a Consolidated Basis
- On Amending Certain Legislative Acts of Ukraine on Prevention of Legalisation (Laundering) of Revenues of Proceeds from Crime
- Regarding Amending Regulation of Activity of Limited Liability Companies
1. On Amending Certain Legislative Acts of Ukraine Regarding Regulation of Relations between Creditors and Consumers of Financial Services
The Law of Ukraine dated 8 July 2011 No. 7351 (the “Law”)
The Law adds provision to the Law “On Consumer Rights Protection”, which prohibits lending (obtaining) consumer credits in foreign currency in the territory of Ukraine. It is also prohibited for a lender to fix in the agreement on lending consumer credits any charges, interests, commission fees, payments etc. for actions which are not services in the definition of this Law.
The Law will enter into force if it is signed by the President of Ukraine and after it has been published.
2. On Amending Certain Regulatory Legal Acts of the National Bank of Ukraine
Resolution No. 111 of the NBU Management Board, dated 6 May 2011 (the “Resolution”)
The Resolution amended the Regulation on the Procedure and Conditions for Trading in Foreign Currency (approved by resolution No. 281 of the NBU Management Board dated 10 August 2005), whereby banks are allowed to perform currency swap operations for purchase and sale as well as for foreign currency exchange. It determines that currency swap operations are performed within a time period of up to 365 calendar days. It also permits entering into foreign exchange forward contracts with clients within the set currency position.
The resolution came into force.
3. On Amending Certain Legislative Acts of Ukraine Regarding Bonds
The Law of Ukraine dated 2 June 2011 No. 3461-VI (the “Law”)
The Law “On Securities and Stock Market” was amended by adding the provision whereby bonds may exist exclusively in a non-documentary form. Apart from that, the definition of targeted bonds was clarified. Targeted bonds are discharged through the transfer of goods and/or provision of services according to the requirements established by the terms of the bonds’ placement and by payment of funds to the bonds’ holder (the previous edition did not mention a possibility to pay funds). It is also specified that legal entities may place only interest-bearing and discount bonds for amounts not exceeding three times the amount of the equity capital or third party security. The Law also provides for certain other amendments.
The Law enters into force from 1 January 2012.
4. On Amending Certain Laws of Ukraine Regarding Supervision on a Consolidated Basis
The Law of Ukraine dated 19 May 2011 No. 3394-VI (the “Law”)
With the goal to supervise the activity of financial groups, the Law made a number of amendments and additions to corresponding laws. Thus, the Law differentiates the powers between State regulators with regard to supervision on a consolidated bases and defined forms of supervision on a consolidated basis. The Law considers relations of control between its participants as the main criterion for definition of a financial group.
Depending on entities performing supervisory functions within a group and the activity of what financial institutions (banks or financial institutions) prevail, financial groups are divided into bank groups and non-banking financial groups. Accordingly, the NBU is vested with supervision over bank groups on a consolidated basis, and the State Commission for Regulation of Financial Services Markets and the State Commission for Securities and Stock Market – over non-banking financial groups. The corresponding authority with the goal to supervise on a consolidated basis is entitled to determine subgroups within a bank (or correspondingly financial) group, which consist of at least two financial institutions, and perform supervision over them on a sub-consolidated basis.
According to the Law, a financial group is obliged to determine a responsible person within the participants of a financial group and agree with him/her a corresponding State regulator. The responsible person from a financial group must ensure compliance to the requirements by the group, which are determined by a corresponding State regulator. The Law establishes a number of other provisions regarding supervision on a consolidated base.
The Law enters into force on 19 December 2011.
5. On Amending Certain Legislative Acts of Ukraine on Prevention of Legalisation (Laundering) of Revenues of Proceeds from Crime
The Law of Ukraine dated 21 April 2011 No. 3267-VI (the “Law”)
The Law adds a definition of stock market manipulation to the Law of Ukraine “On State Regulation of Securities Markets in Ukraine”. In addition, it is stipulated that signs of stock market manipulation are defined by the State Commission for Securities and Stock Market. Further it introduces criminal responsibility for stock market manipulation.
The Law entered into force on 19 May 2011.
6. Regarding Amending Regulation of Activity of Limited Liability Companies
According to the Law of Ukraine “On Introducing Amendments to Some Laws of Ukraine Regarding the Number of participants of limited liability companies dated 12 May 2011, entered into force on 11 June 2011, the maximum number of participants of a limited liability company is increased from 10 persons to 100. Apart from this, the Law of Ukraine “On Amending Certain Legislative Acts Regarding Simplification of the Procedure of Establishing Business” dated 21 April 2011 (entered into force on 7 June 2011), the requirements regarding the minimum amount of statutory capital of the company are cancelled.
This newsletter does not constitute legal advice with respect to any matter or set of facts and may not be relied upon for such purposes. Readers are advised to seek appropriate legal advice before entering into any transaction, making any determination or taking any action related to matters discussed herein. No part of this newsletter may be copied or quoted without the prior written consent of Salans. LINK: www.salans.com
NOTE: Salans is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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8. MAGISTERS TO MERGE WITH EGOROV PUGINSKY AFANASIEV & PARTNERS
Creating the largest law firm in the CIS
Magisters, Moscow – Kyiv, Ukraine, Tue, July 19, 2011
MOSCOW- KYIV – We are delighted to announce that Magisters, a leading CIS-based law firm, and Russia's leading law firm Egorov, Puginsky, Afanasiev & Partners have agreed to join forces and merge to create the largest law firm in the CIS, with a robust international outreach.
The merger will offer clients unprecedented opportunities. Both firms share the philosophy of international excellence combined with unique local knowledge. Consolidation of two great firms and their enhanced resources will provide new value and unmatched offering with the best in class legal services to the clients in Russia, Ukraine, Belarus, Kazakhstan and worldwide.
The new firm will exceed 300 lawyers, with 27 partners with offices in Moscow, St Petersburg, Kyiv, Minsk, Astana and associate offices in London and Washington, D.C. On behalf of all partners and the entire team, we would like to take this opportunity to thank you for your support and for your trust in the firm. Bringing together our enhanced capabilities, unique know-how and the joint team of the best lawyers in the region we will significantly strengthen our service offering to continue providing you with the top level legal advice and the utmost care in client service.
Should you have any questions or require any further information, please do not hesitate to contact us: www.magisters.com.
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9. UKRAINE: NEW LAW ON LIABILITY FOR DAMAGES CAUSED BY DEFECTIVE GOODS
CMS Cameron McKenna LLP, Kyiv, Ukraine, Wed, July 27, 2011
KYIV – The Ukrainian Parliament has recently adopted a new law on the Liability for Damages Caused by Defects in Goods (the “Law”) which will enter into force on September 17, 2011.
The Law separates procedures for claiming damages caused by movable and immovable goods, and services (works), and respectively amends provisions of the Civil Code of Ukraine and the Law on Consumer Rights Protection. Any liability that does not fall under definition of the Law will remain subject to provisions of the Civil Code. In particular, liability for damages caused by defects in immovable property or services (works) will be governed by the Civil Code, as amended by the Law, while liability for damages caused by movable goods will be governed by the Law.
The Law in particular applies to liability for damages cased to individuals and legal entities by defects in goods that are movable property (finished products, raw materials, component parts), including those that form part of other movable or immovable property, and specifically includes electricity. The term “damages” under the Law is limited to injuries, damage to health, death, and damage to or destruction of property (other than the defective goods).
The most significant amendment introduced by the Law is that the liability for damages caused by defective goods will now be placed on the manufacturer (while under the applicable law, an injured party can claim damages from either the manufacturer or seller at its sole discretion).
An importer of defective movable goods (any person that has imported goods to Ukraine for sale, lease, leasing or any other distribution) bears liability as a manufacturer. However, each seller of defective movable goods bears liability as a manufacturer only in cases where the manufacturer can not be determined and unless it communicates to the injured party within thirty days the name and location of the manufacturer or a person that supplied such goods to him.
Nonetheless, the manufacturer of movable goods will be exempted from liability if it proves one of the following circumstances:
- it did not introduce the goods into distribution;
- the defect which caused damages originated after the goods were introduced into distribution by the manufacturer, unless such defect originated due to the design or content of the goods;
- the goods were not produced or distributed by the manufacturer in the course of its commercial activity; or
- the defect originated due to manufacturer’s compliance with mandatory requirements of the law or instructions of state authorities.
In addition to the abovementioned circumstances, the manufacturer of the defective component part of the product is relieved of the liability if it proves that the defects relate to the design of the finished product or to the technical documentation issued by the finished product’s manufacturer.
The Law establishes a 3-years statute of limitations for claims for damages caused by defective movable goods, including in case of injuries, damage to health or death. Compensation for such damages may be awarded if they were suffered within ten years from the date the movable goods were introduced into distribution and the injured party filed a claim against the manufacturer before the expiration of this mentioned term.
At the same time, damages caused by defects in movable goods or services (works) shall be compensated if they are suffered within the established validity term, or within ten years from manufacturing/provision of services (completion of works) if such term is not established. Law: Law of Ukraine “On Liability for Damages Caused by Defects in Goods” dated 19 May 2011 N3390-VI.
ABOUT CMS CAMERON MCKENNA LLP
CMS Cameron McKenna LLP is a limited liability partnership registered in England and Wales with registration number OC310335. Further information about the firm can be found at www.cms-cmck.com. CMS Cameron McKenna LLP is a member of CMS, the organisation of European law firms. Further information can be found at www.cmslegal.com
NOTE: CMS CAMERON MCKENNA LLP is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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10. ABBOTT LABORATORIES JOINS U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
One of the top health care companies based in Chicago, Illinois; medical & nutritional products & pharmaceuticals, Fortune 500 company
U.S.-Ukraine Business Council (USUBC), Washington, D.C., Thursday, July 14, 2011
WASHINGTON, D.C. — Abbott Laboratories, Chicago, Illinois, a Fortune 500 company and a leading global health care company, has been approved for membership in the U.S.-Ukraine Business Council (USUBC), the USUBC executive committee announced today on behalf of the entire USUBC membership of over 165 companies and organizations who have business operations, investments, educational or other development programs in Ukraine.
About Abbott
Abbott is a global, broad-based health care company devoted to the discovery, development, manufacture and marketing of pharmaceuticals and medical products, including nutritionals, devices and diagnostics. The company employs nearly 90,000 people and markets its products in more than 130 countries.
Abbott in Ukraine
Abbott started operations in Ukraine from 1998. To date, Abbott employs 230 people who work to provide access to Ukraine’s patients in the areas of HIV, Rheumatoid Arthritis, Premature Infant Health, Bechterew’s Disease, Psoriasis, Emergency Medicine & Anesthesia, Gastroenterology, Women‘s Health, Pulmonary Disease, and Cardiology. In total, 40 of Abbott’s medicines are available in the Ukraine, and new launches of innovative and globally used products in Oncology, Parkinson Disease, Crohn’s Disease, Ulcerative Colitis, and Renal Care are planned for 2012-2015.
Abbott in Ukraine & USUBC
USUBC has been working with Gintautas Storpirstis, Regional General Manager, Commonwealth of Independent States CIS; Vitaliy Gordienko, Head of the Representative Office in Kyiv; Alexander Bondarenko, CIS Business Development & Commercial Hub Manager; Monika Maciulyte, Government Affairs Manager, CIS and other key members of the Abbott staff in Kyiv. Alexander Bondarenko will represent Abbott on the USUBC board of directors.
"We are pleased Abbott and the other international health care companies are contributing largely to strengthening the healthcare system, patient health and the quality of life in Ukraine" said Morgan Williams, Director, Government Affairs, Washington Office, SigmaBleyzer Private Equity Investment Management Group, who serves as President of the U.S.-Ukraine Business Council (USUBC), "USUBC welcomes the opportunity to work with Abbott on key issues in Ukraine."
INFORMATION: Other news about Abbott Laboratories and information is available on the company's Web site at www.abbott.com.
USUBC Membership Reaches 165
The U.S-Ukraine Business Council (USUBC), founded in 1995 in Washington, D.C., now has over one-hundred sixty-five members. Membership in January of 2005 was eight, in January of 2007 was 22, reached 100 in January of 2009 and membership topped 150 in January of 2011. The complete list of USUBC members can be found at http://www.usubc.org/members.php. For a list of the USUBC board of directors go to the following link: http://www.usubc.org/site/u-s-ukraine-business-council-board-of-directors.
LINK: http://www.usubc.org/site/recent-news/abbott-laboratories-joins-u-s-ukraine-business-council-usubc.
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[return to index] [U.S.-Ukraine Business Council (USUBC), www.usubc.org]
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U.S.-Ukraine Business Council (USUBC): http://www.usubc.org
"A strong international voice for business in Ukraine"
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11. ASTARTA-KYIV JOINS U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
Largest Ukrainian sugar producer, agri-industrial company, farming 225 thousand hectares of agricultural land
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Wed, July 6, 2011
WASHINGTON, D.C. – Astarta-Kyiv LLC, a large agri-industrial company and the leader of the Ukrainian sugar sector, Kyiv, Ukraine, has been approved for membership in the U.S.-Ukraine Business Council (USUBC), the USUBC executive committee announced today on behalf of the entire USUBC membership of over 160 companies and organizations who have business operations, investments or other development programs in Ukraine.
Astarta's agricultural business is primarily aimed at the growing of the sugar beets, over 2.5 million tons annually, by agricultural companies controlled by their Group, which is the main raw material for their seven sugar plants. Astarta-Kyiv's sugar plants focus their operations on the production and sale of sugar, sugar by-products and related services.
Astarta strengthened their leading position as the largest Ukrainian sugar producer with 13% share of domestic sugar production in the 2010 production season. Astarta has a major contract to supply sugar to Coca-Cola Ukraine.
GROWING & SELLING GRAIN CROPS AND OIL SEEDS
Due to the necessity of crop rotation in the cultivation of the sugar beets Astarta is also involved in growing and selling various grain crops and oil seeds including wheat, barley, soybeans, corn and sunflower seeds. Cattle farming and dairy livestock are an additional activity. With more than 24 thousand cattle headcount Astarta is the largest producer of industrialized milk in Ukraine.
Their agri-industrial units consist of seven sugar plants, dairy livestock facilities, mixed fodder plant, seed processing plant and agricultural production with 225 thousand hectares under lease. Agricultural land under lease is expected to reach 250,000 hectares by the end of 2011.
WARSAW STOCK EXCHANGE
Since August 2006 ASTARTA'S shares have been listed on the Warsaw Stock Exchange. They also have financing lines with the U.S. EX-IM Bank, EBRD, FMO, Citi bank and other leading international lenders. All of their operations are located in the Poltava, Vinnytsya, Khmelnyrsky, Ternopil and Zhytomyr Oblasts (administrative regions) of Ukraine. The Ukrainian parent company provides centralized sales.
US COMPANIES PROVIDE HUGE AGRICULTURAL MACHINERY FLEET
Astarta has a very large agricultural machinery and transportation fleet. Over 1,300 pieces of agricultural equipment has been purchased from United States agricultural machinery companies. Astarta has planters, grain combines, tractors, grain drills, sprayers and sugar beet equipment manufactured by such companies as:
- AGCO (Duluth, Georgia), http://www.agcocorp.com/;
- Amity Technology (Fargo, North Dakota). www.amitytech.com;
- Case New Holland (Racine, Wisconsin), www.cnh.com;
- Great Plains Manufacturing (Salina, Kansas), http://www.greatplainsmfg.com/,
- John Deere (Moline, Illinois) http://www.deere.com, and
- Wil-Rich (merged with Amity Technology)(Wahpeton, North Dakota), http://www.wil-rich.com.
Astarta has purchased over 700 pieces of sugar beet equipment from Amity Technology/WIC Sugar Beet Equipment Line, working with Howard Dahl and Brian Dahl, founders and principal owners, in Fargo, North Dakota. All of these agricultural machinery companies are members of the U.S.-Ukraine Business Council (USUBC).
ASTARTA AND USUBC
Astarta-Kyiv was recommended as a member for USUBC by several U.S. companies as one of the leading Ukrainian agribusiness's that is professionally managed and meets international standards for financing, transparency and accounting. USUBC has been working with Viktor Ivanchyk, the Founder and CEO; Yana Kavushevska, Ph.D., Advisor to CEO & Press Secretary and Mykola Kovalski, Director for Business Development and Investor Relations.
"Viktor Ivanchyk is well known as one of the top ten agribusiness leaders and managers in Ukraine. USUBC is proud to have Astarta-Kyiv as a new member and look forward to working with such an outstanding company," said Morgan Williams Director, Government Affairs, Washington Office, SigmaBleyzer Private Equity Management Group, who serves as President of the U.S.-Ukraine Business Council (USUBC). "USUBC plans to work closely with Astarta to expand their strong connections to U.S. agricultural machinery, seed, crop protection supply companies and with U.S. financial institutions."
INFORMATION: For further information on Astarta-Kyiv, go to http://www.astartakiev.com/?id=300.
USUBC MEMBERSHIP REACHES 165 – A NEW RECORD
The U.S.-Ukraine Business Council (USUBC), founded in 1995 in Washington, D.C., now has over one-hundred sixty-five members…a new record for USUBC. Membership in January of 2005 was eight, in January of 2007 was 22, reached 100 by January of 2009 and topped 150 in January of 2011. The complete list of USUBC members can be found at: http://www.usubc.org/members.php. For a list of the USUBC board of directors go to the following link: http://www.usubc.org/site/u-s-ukraine-business-council-board-of-directors.
LINK: http://www.usubc.org/site/recent-news/astarta-kyiv-joins-u-s-ukraine-business-council-usubc.
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[return to index] [U.S.-Ukraine Business Council (USUBC), www.usubc.org]
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12. TWENTIETH ANNIVERSARY OF UKRAINE'S INDEPENDENCE RECEPTION IN WASHINGTON, D.C.
Independence Day Reception Thursday, September 15th at Library of Congress in Washington, D.C.
U.S.-Ukraine Business Council (USUBC), Washington, D.C., Tuesday, August 9, 2011
WASHINGTON, D.C.- The Ambassador of Ukraine to the USA, Olexander Motsyk, announced at a recent luncheon in Washington, sponsored by the U.S.-Ukraine Business Council (USUBC), that the Embassy of Ukraine to the USA will sponsor a large gala reception in Washington, D.C. on Thursday evening, September 15th in honor of the Twentieth Anniversary of Ukraine's Independence. The Ambassador said the reception will be held, for the first time, at the world famous Library of Congress.
The Ambassador said Ukraine is very proud to celebrate twenty years of Independence and considers this a significant achievement in the long history of Ukraine. Ambassador Motsyk said he expects the reception will be the largest Ukrainian Independence Day event ever held in Washington.
The U.S.-Ukraine Business Council (USUBC) agreed to support the work of the Ukrainian Embassy to honor the 20th Anniversary of Ukraine's Independence and to assist in finding corporate sponsors for the major event, according to Morgan Williams, Director, Government Affairs, Washington Office, for the SigmaBleyzer Private Equity Investment Management Group, who serves as President of the U.S.-Ukraine Business Council (USUBC).
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