CURRENT ISSUE (November-December 2021)

In focus – Energy

Each and every heating season in Ukraine puts the topic of energy onto the political agenda. The past autumn is no exception, provoking lots of talk regarding the availability of gas and coal at storages, record global gas prices, attempts to put Nord Stream 2 into commercial operation, challenges for generation capacities, emerging electricity imports from Belarus and the possibility of local blackouts. The key issues are the results of Russia’s geopolitical strategy to blackmail Europe. To be fair, a significant chunk of problems come from the Soviet legacy, as energy efficiency in the household sector was not properly reformed.

Expert Opinion

The Legal Manual for Using the Window of Opportunity in the Ukrainian Energy Sector

by Sergii Zheka

The Ukrainian energy sector has been developing steadily over the last couple of years and has seen particularly growing interest from foreign companies wishing to enter the Ukrainian gas and electricity markets. Foreign companies may, of course, participate in the above-mentioned markets without setting up permanent establishments in Ukraine (e.g. trade on the border with Ukraine or store gas in Ukrainian gas facilities). That is what some foreign companies do.

Sergii Zheka is a senior associate at Wolf Theiss

In Re

Legal Regulation of Green Hydrogen in Ukraine

by Maryna Hritsyshyna

Ukraine has incredibly large potential for renewable energy production. According to the atlas of energy potential of renewable energy sources of Ukraine, as prepared by the Institute of Renewable Energy Sources, the potential of installed capacities for renewables in Ukraine is 874 GW, where 688 GW is wind energy and 82.76 GW is solar energy. As for the assessment of green hydrogen production in Ukraine, according to the most basic scenario, Ukraine’s renewable energy potential is 537 GW of installed capacities, though this could rise to 771 GW pursuant to a more optimistic scenario. On the basis of these figures, the potential for green hydrogen production in Ukraine is 505,133 million cubic meters.

Maryna Hritsyshyna is a counsel at Sayenko Kharenko

Ukraine’s Huge Biomethane Potential — What Potential Exporters should Know

by Maksym Sysoiev, Volodymyr Omelchenko

Biomethane prospects in Ukraine

Thanks to its extensive agricultural sector, Ukraine holds vast resources for the production of biomethane. This green energy source has garnered significant attention by Ukrainian producers and foreign investors, as many countries offer incentives for biomethane to become the green energy alternative to natural gas used in industry.

Maksym Sysoiev is a partner at Dentons
Volodymyr Omelchenko is a junior associate at Dentons

Implementation of REMIT into Ukrainian legislation

by Natalia Hutarevych

In 2015, Ukraine introduced a new natural gas market model based on the European Union model. In 2019, a new electricity market model was launched in line with EU rules. At the same time, Ukrainian energy market models have their specifics, which have been caused, among other things, by a desire to mitigate the impact of dramatic changes in energy market rules on the least protected participants and consumers.

Natalia Hutarevych is a senior associate at Sayenko Kharenko

News

Deals

Baker McKenzie advised the shareholders of Depositphotos

AVELLUM advised MHP on investment into Foodz

Baker McKenzie advised First Ukrainian International Bank

Sayenko Kharenko advised Getin Holding S.A.

Cameron McKenna Nabarro Olswang advised EBRD

Cases

Dutch Supreme Court rules to review decision obliging Russia to pay USD 50 billion to YUKOS shareholders

Google lost case related to fine of EUR 2.42 billion to European Commission

German court rejects claim filed against Nord Stream-2 by environmental experts

Russia to compensate USD 1.4 billion for Crimea: Oschadbank appeals to French Court of Cassation

Draft

Parliament upheld new tobacco taxation mechanism

Draft law crucial for timber market adopted in first reading

Law digest

President Volodymyr Zelensky signed law on energy efficiency

Bureau of Economic Security will start its operations in full

Parliament adopted a new law on the insurance market

The chamber

American Chamber of Commerce Presents the 2021 Thanksgiving Award to Ukraine’s Healthcare Professionals

Biznews

Banking & Finance

EBRD to invest USD 75 million in Ukrenergo Eurobonds to repay “green” debts

Internet

Yahoo, as well as LinkedIn earlier, cease operations in China

M&A

Americans to acquire Depositphotos developer

Google invested USD 1 billion in CME Group

Aviation

Ukraine and EU signed long-awaited Treaty on Open Skies

Investment

This year companies around the globe raised a record amount of USD 600 billion at IPO

Applications for “investment nannies”: 17 have been filed by Ukrainian investors, and 10 — by international companies

Facebook to hire 10,000 persons to create a virtual world

State Sector

The largest state-owned enterprises earned UAH 13 billion in six months

Cover Story

Commitment to Stabilization

The regulatory developments surrounding the establishment of the electricity market in Ukraine and commitments undertaken by the Government towards the renewable energy investors are part of a long-lasting, ongoing battle on all fronts involving stakeholders and the state. We discussed the situation with new and existing investment projects with Ivan Bondarchuk, counsel, head of energy and natural resources at LCF Law Group, as well as the state’s performance to stabilize the situation and relaunch the confidence of investors.

Biz Lunch

Timely Questions

Investment arbitration may be seen as an indicator of business climate, investors’ trust in and predictability of state policies, and reputational concerns for states. We have reached out to David Pinsky, a partner in the New York office of Covington & Burling, and asked about the investment arbitration landscape and about his firm’s international arbitration practice. As arbitration counsel in investment arbitration cases involving Ukraine, in particular aimed at recovery of damages from Russia’s seizure of Ukrainian investments in Crimea, Mr. Pinsky explained his commitment to his work from both a professional and a human side. Our editorial team is grateful to him for speaking with us.

Crux

Legal Digest

For the past few months, we have carefully monitored the most important novelties and initiatives in Ukrainian legislature. The highlights of the period are definitely the newly-adopted Law On Meditation and the recently signed EU-Ukraine Open Skies agreement, both of which were long-awaited in the legal sphere and beyond. Another significant initiative is the presidential draft On Ratification of the Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters. For your attention there is also Law No. 3959-1, which finalizes the launching of the Bureau of Economic Security and important laws in the agriculture and infrastructure fields.
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