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Law on concessions will be adopted in the fall - Zelenskyi

09 August 2019, 09:12

Law on concessions will be adopted in the fall - Zelenskyi

President of Ukraine Volodymyr Zelenskyi announced that the new Verkhovna Rada will adopt a law on concessions in the fall. It is reported by

‘In autumn we will pass the law on concession that will allow the state to work safely with the private sector. We would be very happy to see Turkish companies as truly reliable partners in our projects’, Zelenskyi emphasized during his speech at the Ukrainian-Turkish Business Forum on Thursday.

He called on Turkish businessmen to enter Ukrainian private market with their capital, experience and technology.

Verkhovna Rada passed the government bill ‘On Concessions’ on April 3, 2018. President of Ukraine Petro Poroshenko in his address to the parliament in September 2018 expressed a hope that the law would be adopted before the 2019 election.

In November 2018, members of Verkhovna Rada Committee on Economic Policy were unable to reach consensus on the bill. In particular, the People’s Deputy of Opposition Bloc, Yurii Voropaiev, proposed introducing into the law a regulation on concession on the basis of direct state agreements with the concessionaire bypassing tendering procedure. According to the Deputy, this regulation should be applied to the companies that have already rented and modernized property granted on concession. Voropaiev also proposed to introduce to all sectors of the economy the regulation on state compensation for the risks to be incurred by the concessionaire. Current version of the bill stipulates such payments only in favour of the road sector: if the project fails to achieve indicators specified in the contract, the state is obliged to pay compensation to the private investor. In addition, in the event of ports concession, Voropaiev suggests including in the contract the entire port infrastructure and not just individual facilities.

SE ‘Stevedoring Company (SC) Olvia’, SE ‘Kherson Sea Trade Port (KSTP)’ and  Ferry Complex of the SE ‘Sea Trade Port ‘Chernomorsk’’ are the sites for implementation of the pilot concession projects in the port industry. It was anticipated that the tender for selection of concessionaires for the property of SE ‘SC ‘Olvia’’ and SE ‘KSTP’ could be announced in April 2019, and the winners would be determined in July-August 2019.

According to Acting Chairman of the SE ‘Ukrainian Sea Ports Authority’ Raivis Veckagans, tender for concession of the property of SE ‘SC ‘Olvia’’ and SE ‘KSTP’ can be held without waiting for adoption of the new law ‘On Concessions’. ‘We are elaborating concession based on the existing law. We will not wait. But we hope that a new law ‘On Concessions’ will be passed since it is more transparent, more understandable and closer to European standards (...) We intend to hold tender so that Kherson and Olvia may already receive these contracts’, stated Veckagans in January 2019.

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