Martial law in Ukraine: Implications for Business

On November 26, 2018, the Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Approval of the Decree of the President of Ukraine “On the Introduction of the Martial law in Ukraine” (official text at the time of this publication is not available). The Law will come into force only after official publication.

Thus, from 2 pm on November 26, 2018 till 2 pm on December 26, 2018 (30 calendar days) martial law regime will be introduced in Vinnytsia, Lugansk, Mykolaiv, Odesa, Sumy, Kharkiv, Chernihiv, as well as Donetsk, Zaporizhzhia, Kherson regions and inland waters of Ukraine in Azov-Kerch water area. In other regions of Ukraine martial law was not introduced.

The mentioned Decree of the President of Ukraine and the Law of Ukraine do not directly restrict economic activity of business entities on the territory of Ukraine (including those where martial law regime has been introduced).
The Decree of the President of Ukraine, on the other hand, provides for a theoretical possibility to introduce certain restrictions on the territories of Ukraine, where martial law regime has been introduced, until December 26, 2018.

Such restrictions may be imposed by military command: General Staff of the Armed Forces of Ukraine, Joint Operational Headquarters of the Armed Forces of Ukraine, command of branches of the Armed Forces of Ukraine, etc.

The list of possible restrictions is stipulated in Art. 8 of the Law of Ukraine “On the legal status of martial law regime”, among which are:

• imposition of labour obligation;
• use of capacities and labour resources of enterprises, institutions and organizations of all forms of ownership for defence purposes, changing of their work regime, carrying out other changes in their activity, as well as working conditions in accordance with labour legislation;
• compulsory alienation or seizure of privately owned property;
• introduction of curfew (prohibition to stay in certain periods of time on the streets and other public places);
• establishment of a special regime of state entry and exit, restriction of freedom of movement;
• verification of documents of individuals, and in case of necessity, inspection of belongings, vehicles, baggage and cargo, office spaces and accommodation of individuals;
• prohibition on trading weapons, highly potent chemical and poisonous substances, as well as alcohol beverages and alcohol-based substances;
• regulation of the work of telecommunication enterprises, printing companies, publishing houses, television and radio organizations and centres as well as other cultural enterprises, institutions, organizations and mass media;
• to intern (to detain forcibly) citizens of the foreign (enemy) state that is threatening to attack or is carrying out aggression against Ukraine;
• evacuation of the population;
• dismissal of the heads of enterprises, institutions and organizations for improper fulfilment of their duties specified by the Law of Ukraine “On the legal status of martial law regime”, etc.

Consequently, introduction of the martial law in 10 regions of Ukraine and inland waters in no way limits economic activities of business entities on the territory of Ukraine, but merely testifies the right of competent authorities to adequately impose appropriate restrictions in these areas and inland waters until December 26, 2018. The only restriction directly connected with conduction of martial law on the territory of Ukraine for individuals and business entities is the prohibition of strikes, mass gatherings and movements.

GOLAW lawyers will promptly inform you about all relevant changes concerning the introduction of martial law on the territory of Ukraine and its implications for business.