On Tuesday, 10 November, the Verkhovna Rada (VR) adopted in the first reading draft law No.16137 “On Investment Funds”, according to Danylo Hetmantsev, head of the Tax Committee of the Verkhovna Rada. The bill was supported by 260 Members of Parliament.
Main provisions on public and alternative funds
The draft law is intended to reform the collective investment system and create new opportunities to attract private capital. Public funds will operate under the European UCITS model and will be aimed at a wide range of investors.
Alternative funds will be permitted to work with a broader range of assets, including real estate and stakes in private companies. The document also provides for a transitional period and the transformation of existing collective investment entities in accordance with the new rules.
What will change for investors and business
The draft law envisages that investors will be able to place funds into various assets through professional asset management companies. For business, this should broaden financing opportunities, in particular for infrastructure projects and the reconstruction of enterprises.
The transitional period will give institutions time to adapt and convert into new structures in line with the law’s requirements. Specific timelines and conditions for transformation will be determined in subsequent readings and accompanying regulatory acts.
Involvement of regulators and international partners
Draft law No.16137 was developed with the participation of the National Commission on Securities and the Stock Market, the Financial Committee of the Verkhovna Rada and the World Bank. The document is aimed at harmonising Ukrainian legislation with European requirements.
So far the draft law has been adopted only as a basis; further refinement and consideration in the second reading lie ahead.
