A new bill being considered by parliament may prevent foreign companies from investing in a number of key business sectors
Foreign companies may soon find it impossible to invest in a number of lucrative business sectors in Ukraine if parliament approves a new bill to limit foreigners’ access to certain sectors of the economy – or ban it altogether.
The new draft law, authored by Oleksandr Volkov, one of the Verkhovna Rada’s most influential deputies and a close ally of President Leonid Kuchma, was formally registered on May 17 and distributed among deputies on May 30.
Several lawmakers interviewed for this story could not comment on the bill or the prospects for its approval, citing unfamiliarity with the document.
The bill proposes banning foreign investment in several sectors of the economy, including:
* production and distribution of nuclear energy, maintenance of nuclear power plants, and transportation and disposal of nuclear waste;
* uranium and diamond mining industries;
* weapons production and servicing;
* production of stamps, drivers’ licenses, passports and other documents of this type; and
* production of Ukrainian bank notes;
Should it become law, the bill would limit foreign participation in the following areas of business:
* distribution of electricity and production of specialized energy equipment;
* sea, river, railway and air transport;
* mining and processing of precious metals;
* space research projects;
* maintenance and use of oil storage facilities;
* state postal and communication services;
* production and sale of alcohol;
* transportation, trade, storage, and processing of toxic and radioactive materials; and
* construction of military plants, production and sale of military equipment.
The draft law authorizes the government restrict foreign investment in a given project by using methods like setting a maximum share of foreign ownership.
However, the bill also stipulates that if any of its articles conflict with international agreements on foreign business activities in Ukraine, the international agreements take precedence.
The bill must pass several stages before it can be voted for at a parliament session. It first needs to be debated and approved by the Rada’s committee for economic policy, property, and investment, then a majority of deputies must vote to include it into the session agenda.
Lawmakers said that the soonest the Rada can debate the bill – assuming it passes all the preliminary stages of approval – would be the last week of June.
