Civil Code and Legislation Necessitated by Adoption

Adoption of the Civil Code will necessitate the amendment of existing laws or the introduction of new laws.  The Civil and Economic Codes must be amended to be consistent with the new Civil Code.  The CLC will identify laws that must be reconciled with the Civil Code and offer proposed amendments to these laws.  The CLC will also actively promote the new Civil Code with training programs for lawyers and other professionals.

Bankruptcy Law

The CLC will work with the special committee of the Verkhovna Rada appointed to develop a unified approach to the amendment of the bankruptcy law with particular attention to the protection of creditors’ rights.  The CLC will propose amendments to curb abuses associated with fictitious bankruptcy, false creditors, asset stripping, and the fraudulent acquisition of property in bankruptcy estates.  The CLC will clarify provisions of other laws and regulations enabling debt for equity swaps.  A priority will be an amendment to the bankruptcy law allowing secured creditors to easily remove collateral from a bankruptcy case and proceed against the collateral without further restriction in order to efficiently enforce collateralized loans.

Mortgage Law

The CLC will continue as a member of the working group of Ministry of Justice and the Coordination Council of the Cabinet of Ministers and work with the Association of Ukrainian Banks and the Ukrainian Mortgage Association to improve and support the draft law “On Hypothecation”.  The CLC will offer proposals to refine foreclosure procedures, improve priority provisions, and develop a system for mortgage-backed securities.  The CLC will work to enable land-based lending and assist in the development of new financial instruments and model procedures and assist the Association of Ukrainian Banks in developing standards for the issuance of mortgage loans and the pooling of loans for secondary market transactions.

Credit Bureau Law

The CLC will introduce a legislative and regulatory framework for the operation of credit bureaus and the establishment of credit rating agencies.  This will improve the credit environment by facilitating an accurate assessment of the creditworthiness of borrowers and an appropriate rating system, thus reducing the default risk to creditors.

Law on Secured Transactions

The CLC will continue to support and offer improvements to the law on “Secured Transactions” in coordination with the World Bank and appropriate working groups to provide an expansion of the concept of security interest and rights considered as collateral, define proper registration procedures and priority provisions, assure that proposals for the movable registry will function properly and will remain separate from the land registry, and improve the mechanisms for enforcement of collateral.

Law on Judicial Enforcement

The CLC will develop amendments to the Law of Ukraine “On Enforcement of Judicial Decisions” to define deadlines for enforcement actions, establish the procedure for appealing actions or inactions of the state executory officer, clarify provisions to control the cost of the enforcement process, and statutorily define a transparent procedure for public auction for execution sales.  The CLC will also propose amendments for effective pre-trial settlement of claims and introduce mechanisms for mediation, arbitration and other methods of alternative dispute resolution.  Private mechanisms for enforcement of judicial decisions will be formulated and introduced.

Law on Financial Leasing

The CLC will work to support a law “On Financial Leasing” to provide a consistent, predictable treatment of financial leases under a rational tax framework and allow sufficient flexibility in leasing arrangements both in the commercial and non-commercial sectors.

Law Registration of Business Entities

The CLC will work with the Verkhovna Rada Committee for Industrial Policy and Entrepreneurship to establish a uniform companies’ registry that will authenticate the existence of legal entities, properly identify enterprises and entrepreneurs, disclose those authorized to enter into agreements on behalf of a legal entity, and define methods for service of process in civil actions.