The President of Ukraine recently signed law No. 4961 on industrial parks, which significantly reduces bureaucracy and expands opportunities for business.
Area limit removed and access to loans opened
Previously industrial parks were limited to 1,000 ha; this restriction has now been abolished. Park management companies can now attract financing, in particular under the “Affordable Loans 5−7-9%” programme.
The law also simplifies procedures for subleasing plots to residents without the need for the landlord’s ongoing consent. A prohibition has been introduced on the participation of companies linked to the aggressor country or to sanctioned individuals; a park is removed from the state register if it fails to submit reports for two consecutive periods.
Incentives for residents and the role of parks during the war
Residents of industrial parks are exempt from VAT (value-added tax) and customs duties when importing new equipment, and may be exempt from corporate profit tax for up to 10 years. The state covers up to 50% of the costs of connection to engineering networks.
During the period of full-scale invasion, parks are used as a tool to guarantee safety and to relocate enterprises from frontline territories, and their number is increasing in western regions. Rapid production of high-tech products requires enclosed industrial zones with reliable power supplies, which industrial parks provide.
State aid: grants for infrastructure and connections
Under the “Made in Ukraine” programme there are two strands of non-repayable grants: infrastructure development — up to 150 million hryvnia, and compensation for network connections — 150 million hryvnia. Funds from the first strand are allocated to managing companies for the construction of roads, railway tracks, gas pipelines, water pipelines and so on.
Under the second strand the state compensates up to 50% of the cost of connection to electricity, gas and other networks; for de-occupied and frontline territories this share may be up to 80%. The main administrator of the funds is the Ministry of Economy through state bank partners — Ukreximbank, Oschadbank and PrivatBank.
