News digest | August 2026

Corporate Law Practice

The Government adopts decision to further incentivise distributed generation and increase electricity imports

The Cabinet of Ministers of Ukraine adopted Resolution No. 1041 on 19 August 2026, introducing amendments to Cabinet Resolution No. 1127 of 27 October 2023 and the Regulation approved thereunder, thereby expanding protection mechanisms against mandatory power curtailments for non-household consumers.

Power restriction measures (excluding special emergency outage schedules) will not apply to non-household consumers if, in each settlement hour, at least one of the following conditions is met:

• the volume of imported electricity purchased accounts for at least 80% of total consumption;
• at least 80% of total consumption is covered by self-generated electricity;
• at least 80% of total consumption is covered by electricity purchased under bilateral agreements from distributed generation producers (specifically gas-piston and gas-turbine units at which electricity generation commenced no earlier than 1 September 2022).

The preferential regime for distributed generation will apply provided that the consumerʼs electrical installations and the generation facility are located within the licensed operating area of the same distribution system operator and connected to its grid within a single oblast. For consumers with connections to multiple distribution operators, the aggregate volume of such purchased power must account for at least 80% of their total consumption.

Furthermore, the resolution provides for updates to daily information sharing. Once the relevant amendments take effect, suppliers and consumers purchasing electricity directly from distributed generation producers will submit data on purchased volumes to distribution system operators and NPC Ukrenergo by 13:00 on the day preceding the delivery day, while distribution system operators will report to Ukrenergo by 14:00.

The Government updates the state portfolio guarantee scheme to support business

The Cabinet of Ministers of Ukraine adopted Resolution No. 1007 on 10 August 2026, amending the Procedure for Providing State Guarantees on a Portfolio Basis. The updates were developed by the Ministry of Finance following a review of the programmeʼs performance over 2020–2025, aimed at strengthening payment discipline, streamlining bank operations, and safeguarding state budget funds.

First, banks are prohibited from adding loans to the guaranteed portfolio where the borrower has overdue credit indebtedness as of the date of inclusion or during the preceding 120 calendar days, or tax arrears as of that date. An exception applies to indebtedness arising from delayed payments under state support programmes.

Second, enterprises on whose debts the state has executed guarantee payouts lose the right to obtain new state-guaranteed loans for the entire duration of their outstanding debt to the state budget and for an additional 365 days following full repayment.

The resolution also establishes flexibility in managing “50/70” and “80/80” bank portfolios, allowing new loans to be redirected to the alternative portfolio should calculated limit caps be reached.

Additionally, before filing a claim with the guarantor, the bank must apply debt workout instruments. If a loan for which a guarantee payout has been received is subsequently restructured, the bank must repay the amount of that payout together with the accrued penalty. To prevent excessive risk concentration, the lending bank must monitor the maximum aggregate indebtedness under such loans granted to the borrower and members of its group of related counterparties by all lending banks, based on information obtained from the borrower and data from the NBU Credit Register. This monitoring applies where their indebtedness to the relevant lending bank under all loans included in the portfolio exceeds UAH 10 million, or UAH 40 million for agricultural producers.

NEURC regulates electricity sales by energy storage operators and expands options for RES producers

The National Energy and Utilities Regulatory Commission (NEURC) adopted Resolution No. 1360 on 11 August 2026, amending the Retail Electricity Market Rules regarding electricity sales by energy storage operators and the provision of backup power supply by renewable energy sources (RES) producers.

The resolution incorporates the relevant mechanism into the Retail Electricity Market Rules. Energy storage operators may provide electricity to a consumerʼs electrical installations sharing a common connection point, subject to commercial metering being organised in accordance with the applicable requirements. Electricity may be sold to such a consumer under a sale and purchase agreement without obtaining an electricity supply licence.

Concurrently, backup power capabilities for RES producers have been expanded. They may supply electricity not only to their own facilities but also to installations of related parties located on the same or adjacent land plots and, in the case of electricity generation from biomass and biogas, also on separate land plots in the circumstances provided for by the Rules. Such backup power supply is subject to the applicable technical and commercial metering requirements; sales of electricity to related parties within these backup power arrangements do not require an electricity supply licence.

Litigation Practice

Discharging all creditors’ claims other than fines and penalties allows a bankruptcy case to be closed even at the liquidation stage – Commercial Cassation Court

Discharging all creditors’ claims, other than fines and penalties, is grounds for closing bankruptcy proceedings even at the liquidation stage, with the outstanding penalties themselves deemed discharged by operation of law, as the commercial court notes in its ruling.

This conclusion was reached by the Supreme Court, sitting as a panel of judges of the Commercial Cassation Court, in its judgment of 7 July 2026 in case No. 926/3228/24.

In the case under review, the owner of the debtor’s corporate rights had discharged the creditors’ claims of the first, third and fourth priority ranks. The only claims left outstanding were a fine and a penalty falling within the sixth priority rank – claims of the tax authorities accrued on tax arrears for land lease payments and for the late payment of the unified social contribution.

The Supreme Court noted that Article 41(7) and Article 90(1)(5) of the Bankruptcy Procedure Code of Ukraine allow a case to be closed once the debtor has satisfied all creditors’ claims, with any remaining penalties deemed discharged by operation of law regardless of their type or origin, including penalties accrued on tax arrears. The Court also rejected the argument that closing the case required the debtor to hold assets, stressing that the subject matter of bankruptcy proceedings is the debtor’s liabilities – its debts – rather than any existing property. Following its review, the Supreme Court dismissed the tax authority’s cassation appeal and left the first-instance court’s ruling and the appellate court’s judgment unchanged. For a debtor and the owner of its corporate rights, this means that having a third party discharge the claims register remains an effective way of concluding a case even during liquidation proceedings, and a creditor’s objection based on an unpaid penalty does not prevent such closure.

A Ukrainian court cannot divide spouses’ property located abroad, but this does not relieve it of the duty to divide their property in Ukraine – Civil Cassation Court

Where spouses’ joint property includes assets located abroad, Ukrainian courts have no power to decide matters concerning that property – such assets fall within the exclusive jurisdiction of the state in whose territory they are located.

This conclusion was reached by the Supreme Court, sitting as a panel of judges of the Civil Cassation Court, in its judgment of 12 August 2026 in case No. 461/1743/23.

In the case under review, the claimant sought a declaration of title to real estate acquired by the parties in Ukraine as compensation for real estate in Turkey remaining with her husband. The lower courts dismissed the claim, considering that they had no power to deal with foreign assets and were therefore not prepared to offset their value against Ukrainian property.

The Supreme Court agreed with this approach only in part, holding that, while the lower courts were indeed not entitled to take the value of the foreign real estate into account when determining the parties’ shares, this did not relieve them of the duty to ensure a fair division of the property located in Ukraine. The Supreme Court closed the proceedings as regards the property located in Turkey as falling within the exclusive jurisdiction of the state where it is located, and, as regards the division of the real estate in Ukraine, quashed the lower courts’ decisions and remitted the case for fresh consideration by the first-instance court. For parties to disputes involving foreign assets, this means that a claim for the division of such property must be brought in the state where it is located, and that a Ukrainian court can neither divide it nor take its value into account when dividing domestic property.

Voluntary repayment of a debt after a claim has been filed does not relieve the defendant of the duty to reimburse the court fee in full – Civil Cassation Court

Where a defendant voluntarily pays off a debt after the claimant has already applied to the court, causing the claimant to withdraw the claim as a result, the court costs are borne by the defendant in full.

This conclusion was reached by the Supreme Court, sitting as a panel of judges of the First Judicial Chamber of the Civil Cassation Court, in its judgments of 5 August 2026 in case No. 953/10140/25 and of 15 July 2026 in case No. 345/5838/25.

In the cases under review, the first-instance courts had closed the proceedings after the claimants withdrew their claims once the defendants satisfied those claims during the course of the proceedings. The lower courts recovered only 50% of the court fee from the defendants, reimbursing the remainder from the state budget.

The Civil Cassation Court quashed those decisions as regards the refund of half of the court fee from the state budget and increased the amount recovered from the defendants to the full court fee – from UAH 1,514.00 to UAH 3,028.00 in one case, and from UAH 242.24 to UAH 484.48 payable by each of the two defendants in the other. The Court stressed that Article 142(3) of the Civil Procedure Code of Ukraine is a special provision establishing a self-contained rule alongside the general rules governing the allocation of court costs. For claimants, this means that paying off a debt “at the last moment” does not reduce the debtor’s burden of bearing the court fee.

Unclaimed land shares and undistributed land plots may be leased out without a land auction regardless of the number of prospective tenants – Grand Chamber of the Supreme Court

Under the legislation in force at the time the disputed lease agreements were concluded – in particular Law No. 2145-IX, adopted to ensure food security under martial law – undistributed land plots and unclaimed land shares (pai) held by the relevant authorities may be leased out without a land auction, regardless of the number of prospective tenants.

This conclusion was reached by the Grand Chamber of the Supreme Court in its judgment of 1 July 2026 in case No. 911/1138/25.

The Court noted that undistributed land plots and unclaimed land shares are not state- or municipally owned land but remain subject to a collective ownership regime, with local self-government bodies acting merely as their temporary administrators. Such plots may be leased out under either of two procedures, neither of which requires an auction, even where several persons are interested in the plot.

In the case under review, a dispute arose between two companies over lease agreements for land plots formed by a settlement council. The Grand Chamber established that the disputed plots had been formed at the request of the person who subsequently obtained them under lease, and that a mere wish to use the land does not create a pre-emptive right to lease it. Following its review, the Grand Chamber allowed the cassation appeals, quashed the appellate court’s judgments and upheld the first-instance court’s decision, finding no grounds to depart from the conclusions of the Administrative Cassation Court and the Civil Cassation Court. For agricultural businesses, this means that taking the initiative in forming a plot and applying to the council does not, in itself, give an advantage over another prospective tenant, and the absence of an auction is not a ground for challenging another party’s lease agreement.

Force majeure and the Chamber of Commerce and Industry certificate: the Commercial Cassation Court has referred to the Grand Chamber the question of the limits of exemption from liability

By a ruling of 19 August 2026, the Commercial Cassation Court referred case No. 904/2344/24, concerning the recovery of penalties, to the Grand Chamber of the Supreme Court pursuant to Article 302(5) of the Commercial Procedure Code of Ukraine, as one raising an exceptional legal problem in the application of force majeure.

The problem is that Supreme Court case law has developed differing approaches as to whether a certificate of the Chamber of Commerce and Industry exempts the debtor from liability for the entire period of delay or only for the periods during which proper performance was objectively impossible – including within a single series of similar cases involving the same parties. A second issue concerns the limits on submitting new evidence during a fresh review of a case.

The panel of the Commercial Cassation Court proposed that the Grand Chamber depart from automatically exempting a debtor from liability on the mere fact of holding a CCI certificate despite partial performance of its obligations, formulate criteria for assessing the impact of force majeure (Article 617 of the Civil Code of Ukraine) on each period of delay, and establish procedural limits on submitting evidence created after a quashed decision. This is a proposal from the panel, not the position of the Grand Chamber, which has not yet expressed its final conclusion. Anyone whose position in a dispute rests on a CCI certificate should now check whether the impossibility of performance has been confirmed separately for each period of delay.

Tax Law Practice | Tax Alert

New Customs Code of Ukraine passed at first reading

On 19 August 2026, the Verkhovna Rada of Ukraine adopted draft law No. 15450 of 28 July 2026 as a basis.

According to the draft, the new Customs Code proposes, amongst other things, the following:

• a full transition to the customs terminology of the European Union, the introduction of a system of authorisations and customs procedures, as well as European approaches to decision-making, declarations, customs debt, guarantees and exemptions from customs duties;
• existing authorisations of indefinite duration will remain in force, whilst those of limited duration will remain valid until the end of the specified period. Companies with Authorised Economic Operator (AEO) status will retain the benefits of being a trusted partner of the customs authorities, in particular reduced physical and documentary controls and priority clearance;
• a mechanism is being introduced whereby businesses will be able to substantiate the customs value of goods even before the customs authorities have taken a formal decision; 
• the code provides for the exchange of data between businesses and customs via an electronic ‘’single window’’. Permits from other authorities will be automatically fed into the system;
• A clear mechanism is established for appealing against decisions, actions or omissions by customs authorities – initially to a higher-level authority and, if necessary, to the courts;
• the draft law retains the existing exemptions from import duties, in particular those relating to the support of defence capabilities, the energy sector and the provision of humanitarian aid. For the duration of martial law and for one year following its termination, the duty-free thresholds for goods in citizens’ luggage will also remain in force – up to 500 euros/50 kg by land transport and up to 1,000 euros/50 kg by air transport;
• The draft law provides for the granting of operational and investigative powers to the customs authorities.

Tax relief on land plots in the combat zone: draft bill registered

On 24 August 2026, draft law No. 15552 was registered with the Verkhovna Rada of Ukraine, establishing exemptions from land tax for plots of land located in combat zones.

Under the bill, land charges will temporarily not be levied or payable for plots in combat zones, in occupied territories and within 40 km of active hostilities.

Land charges (including both land tax and rent for state- and municipally-owned land) shall temporarily not be levied nor paid in respect of plots and land shares (parcels) if all of the following conditions are met:

• the plot of land is situated in a zone of active hostilities;
• the plot of land is situated in territories temporarily occupied by Russia;
• the land plot is situated within a zone no further than 40 km from areas of active hostilities.
• the land plot must be owned or held (including under a lease) by individuals  from 1 January 2025 until 31 December of the year in which martial law is terminated or lifted, and by legal entities from 1 March 2025 until 31 December of the same year in which martial law is terminated or lifted.

For the purposes of interpreting the term ‘’territories within a 40-kilometre radius’’, it shall be established that these are the territories of local authorities whose administrative boundaries fall wholly or partly within the 40-kilometre zone from the administrative boundary of the area of active hostilities. 

In this regard, the presence of natural or man-made obstacles (sea, bay, estuary, river, reservoir, etc.) is irrelevant. 

Plans are in place to update the criteria for classifying enterprises as micro, small, medium-sized and large

The Cabinet of Ministers of Ukraine has approved the draft Law of Ukraine ‘’On Amendments to the Law of Ukraine ‘’On Accounting and Financial Reporting in Ukraine” regarding the introduction of sustainability reporting’’.

It should be noted that this draft law aims to align the asset and turnover thresholds used to classify a company into a specific category of enterprises with the updated rules of the European Union.

The key changes regarding the classification of enterprises relate to the book value of assets and a company’s net turnover for the purposes of determining its status. The draft law proposes setting the following thresholds:

• Micro-enterprises: book value of assets up to €450,000 and net turnover up to €900,000;
• Small enterprises: book value of assets up to €5 million and net turnover up to €10 million;
• Medium-sized enterprises: book value of assets up to €25 million and net turnover up to €50 million;
• Large enterprises: book value of assets exceeding €25 million and net turnover exceeding €50 million.

Updates to the criteria for classifying enterprises into categories will affect matters such as the timing of tax audits.

Taxation of engineering structures under property tax: the State Tax Service’s position

The Southern Interregional Directorate of the State Tax Service for Work with Large Taxpayers has set out its position on the taxation of engineering structures under the property tax on immovable property other than land plots. 

In accordance with the National Classifier of Buildings and Structures NK 018-2023, engineering structures (all structures not classified as buildings, including linear engineering and transport infrastructure facilities and structures on them) are classified under Section 2 of the Classifier, specifically the following sub-sections:

• Transport infrastructure’ (code 21), specifically, tracks, streets, roads and road structures, shipbuilding industry structures, etc.;
• ‘’Pipelines, electronic communications networks and power transmission lines’’ (code 22), in particular, main water pipelines, above-ground, underground or underwater electronic communications network lines, relay systems, radio, television and cable networks, telecommunications towers and radio communications structures, etc.;
• ‘’Complex industrial facilities’’ (code 23), in particular, installations and structures for mines, quarries and mining wells (for example, loading and unloading stations, mine shafts, coking and gas works, etc.);
• ‘’Other engineering structures’’ (code 24), in particular sports grounds and pitches equipped for outdoor sports such as football, baseball, rugby, water sports, athletics, motor racing, cycling or horse racing, etc.

The State Tax Service notes that properties classified under Section 2 of the Classifier which do not have the characteristics of buildings are not subject to tax on immovable property other than land plots.

Criminal Law Practice

The name and photograph of a suspect in law enforcement agencies’ public communications: the Supreme Court clarifies the permissible limits of informing the public

In the resolution of 22 June 2026 in case No. 761/1004/20, the Joint Chamber of the Civil Cassation Court within the Supreme Court clarified that, under Part 4 of Article 296 of the Civil Code of Ukraine, disclosing the name of a person apprehended, suspected, or accused of a criminal offence is allowed only after a final conviction or in other cases provided for by law. This provision safeguards against premature “criminal stigmatisation” through public communications. The proviso “in other cases provided for by law” does not grant a general right to disclose names for public information or reporting purposes.

The Court held that law enforcement agencies’ obligation to inform the public does not justify disclosing personal data of individuals suspected of criminal offences. The Laws of Ukraine “On the National Police”, “On the National Anti-Corruption Bureau of Ukraine”, and “On the Security Service of Ukraine” set out general communication principles but do not establish specific rules for disclosing personal data of participants in criminal proceedings.

Therefore, requiring law enforcement agencies to inform the public does not grant them the right to disclose personal data in a way that could create a public perception of guilt before a conviction.

However, reporting a notice of suspicion, charges, or the progress of an investigation does not violate the law if neutral procedural language is used. The key factors are the statement’s content and tone, and whether it could lead the public to believe that guilt has been established.

The range of officials for anti-corruption legislation is to be expanded: the draft law is being prepared for the second reading

Draft Law No. 15056 proposes amendments to the Criminal Code of Ukraine (“the Criminal Code of Ukraine”), the Criminal Procedure Code of Ukraine (“the CPC of Ukraine”), and the Law of Ukraine “On Prevention of Corruption” to align with Ukraine’s accession to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The Committee on Law Enforcement of the Verkhovna Rada has recommended adoption at the second reading and in full.

The draft law proposes amending Article 18 of the CC of Ukraine to remove the requirement that members of international parliamentary assemblies are considered officials only if Ukraine is a member of the assembly. After adoption, all members of such assemblies will be classified as “officials”.

If Draft Law No. 15056 is adopted and enacted, the definition of “foreign state officials” in the note to Article 364 of the Criminal Code will be expanded. Currently, it includes individuals in legislative, executive, or judicial positions in a foreign state, as well as those performing state functions for a state body or enterprise. The draft law adds individuals in local government or autonomous-entity positions within a state, and those performing state functions for state or local bodies or for state-owned or communal enterprises.

A suspect’s presence in temporarily occupied territory is a sufficient ground for declaring that person wanted, without the need for an international wanted notice, as per the position of the Supreme Court

In the resolution of 16 July 2026 in case No. 760/17974/24, the Criminal Cassation Court within the Supreme Court upheld the judgment in a case involving collaborationism (Article 111-1 of the CC of Ukraine). The Court rejected the defence counsel’s argument that special criminal proceedings conducted in the convicted person’s absence violated part 3 of Article 323 of the CPC because no international wanted notice was in place.

The Court clarified that placing a person on the interstate or international wanted list for offences under Article 111-1 of the Criminal Code is not required when special criminal proceedings concern someone in temporarily occupied territory who has been declared wanted for evading a summons issued by an investigator or a court. It is sufficient if pre-trial investigation records show that the person is in the temporarily occupied territory of Ukraine or the aggressor state and, after proper notification, fails to appear as summoned without valid reason.

Additional confirmation of a person’s presence in temporarily occupied territory may include open-source information, such as internet evidence of their specific location. Under part 1 of Article 281 of the CPC, this is grounds for declaring the suspect wanted.