Month: May 2025

Importer’s liability for false information in the declaration: what businesses need to know in 2025

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Author: Anastasia Holovatyuk, Lawyer at F&P

1. Relevance of the topic

In 2025, Ukrainian businesses will face tighter control over customs clearance of imported goods. Legislative changes, in particular the entry into force of Law No. 3926-IX, are aimed at harmonizing customs legislation with EU standards and increasing the transparency of foreign economic activity. In this context, the responsibility of importers for providing false information in customs declarations is gaining special attention.( PwC)

2. Legislative changes: new rules of the game

On October 31, 2024, amendments to the Customs Code of Ukraine came into force, which provide for:

  • implementation of updated customs clearance and post-audit procedures; 
  • strengthening liability for submitting false information in customs declarations; 
  • introducing criminal liability for intentional submission of false information that leads to customs evasion. 

In particular, Article 485 of the Customs Code of Ukraine provides for a fine of 50% to 100% of unpaid customs duties for submitting false information that affected the determination of the customs value, product code or country of origin.

3. Case law: emphasis on intent and evidence

In its decisions, the Supreme Court of Ukraine emphasizes the need to prove the importer’s intent in submitting false information. In particular, in case No. 760/14721/16-a, the court noted that the mere fact of incorrect determination of the UKTZED product code is not a violation if there is no evidence of intentional underpayment of customs duties.(KPMG)

4. Practical implications for business

Inaccurate information in customs declarations may result in:

  • charging additional customs duties and fines; 
  • delays in customs clearance of goods; 
  • loss of business reputation and trust on the part of partners. 

Particular attention should be paid to the correct determination of the customs value of goods. In case of doubts about the accuracy of the information provided, the customs authorities have the right to request additional documents to confirm the declared value.(DLF)

5. Recommendations for importers

It is recommended to minimize the risks associated with submitting false information in customs declarations:

  • ensure that all documents submitted to the customs authorities are thoroughly checked; 
  • use the services of qualified customs brokers and lawyers; 
  • implement internal procedures for controlling the correctness of customs documents; 
  • conduct regular staff training on current changes in customs legislation. 

6. Conclusion

In 2025, the liability of importers for submitting inaccurate information in customs declarations will become particularly relevant. Changes in legislation and increased control by the customs authorities require businesses to pay increased attention to the correctness of customs documents. Ensuring transparency and compliance of customs clearance with legal requirements is a key factor in successful foreign economic activity.

How to avoid legal problems when concluding international contracts: tips for 2025

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Author: Aliona Yevtushenko, lawyer at F&P

In 2025, international contracting has become even more challenging due to geopolitical instability, reforms in Ukrainian legislation, and increased regulatory requirements. For Ukrainian companies seeking to enter international markets or attract foreign partners, it is critical to consider new legal risks and adapt their practices to the changes. In this article, we will review key recommendations on how to avoid legal problems when entering into international contracts, based on the latest legislative changes and expert commentary.

1. Consider changes in Ukrainian legislation

In January 2025, the Verkhovna Rada of Ukraine adopted a law abolishing the Commercial Code of Ukraine. This step is aimed at harmonizing Ukrainian legislation with European standards and eliminating overlaps between the Commercial and Civil Codes. From now on, economic relations are regulated mainly through the Civil Code of Ukraine and special laws.

This means that when entering into international contracts, you should carefully check which rules apply to a particular type of contract and take into account the new corporate governance requirements, especially for state-owned and municipal enterprises that are subject to mandatory corporatization.

2. Pay attention to international agreements and conventions

Ukraine is a party to the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters, which entered into force in September 2023. This opens up opportunities for Ukrainian companies to enforce judgments abroad, but also imposes obligations to comply with international standards in contracts.

When entering into contracts, it is important to provide for choice of jurisdiction clauses, arbitration clauses and dispute resolution mechanisms that comply with the requirements of the Convention.

3. Avoid political risks and non-transparent conditions

In May 2025, Ukraine and the United States ratified a framework agreement on cooperation in the field of mineral resources. While this agreement opens up new opportunities for investment, experts point to legal gaps and the lack of clear implementation mechanisms, which may create risks for investors.

When entering into international contracts, avoid terms and conditions that can be changed as a result of political pressure or instability, and ensure that there are clear force majeure clauses and mechanisms to protect the interests of the parties.

4. Engage professional legal counsel

Given the complexity of international law and the constant changes in legislation, it is important to engage experienced lawyers who specialize in international law and have experience with specific jurisdictions. This will help to avoid mistakes when entering into contracts, correctly formulate the terms of the agreement and anticipate possible risks.

5. Adhere to the principles of transparency and integrity

International partners are increasingly paying attention to the compliance of contracts with ESG principles (environmental, social and corporate governance). Compliance with these principles not only reduces legal risks, but also enhances the company’s reputation internationally.

Conclusion

Concluding international contracts in 2025 requires Ukrainian companies to have a high level of legal literacy, be attentive to changes in legislation and be ready to adapt to new challenges. Following the above recommendations will help minimize legal risks and ensure the successful implementation of international projects.

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Corporate agreement: the key to stable partnerships. Why do you need to enter into a corporate agreement even in companies with a minimum number of members?

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Author: Viktoriia Staryk, lawyer at F&P

In today’s Ukrainian business environment, especially after the abolition of the Commercial Code of Ukraine in 2025, a corporate agreement is becoming not only a tool for large corporations, but also a necessity for small and medium-sized enterprises. This document allows to clearly define the rights and obligations of the participants, decision-making and conflict resolution mechanisms, which is especially important in the context of legal uncertainty and economic instability.

 

What is a corporate agreement?

A corporate agreement is a written agreement between the company’s shareholders that sets out the procedure for exercising their rights and obligations within the framework of corporate relations. It may be paid or gratuitous and is concluded to resolve internal issues that are not always detailed in the company’s charter. In particular, a corporate agreement may establish:

It is important to note that the corporate agreement must not contradict the company’s charter and the current legislation of Ukraine.

 

Legislative changes in 2025: new challenges and opportunities

In 2025, Ukraine underwent significant changes in corporate legislation. In particular, the Commercial Code of Ukraine was abolished, which led to the need for businesses to adapt to the new regulatory environment. Instead, the Law of Ukraine “On Peculiarities of Regulation of Business Activities of Certain Types of Legal Entities and Their Associations in the Transition Period” came into force.( aktiv-alb.com, Verkhovna Rada of Ukraine)

This law provides for amendments to the Civil Code of Ukraine, in particular, regarding the possibility of legal entities to exist in the organizational and legal form of “association of legal entities”. Such changes are aimed at improving corporate governance and increasing the country’s investment attractiveness.( Advisor in the field of public procurement)

 

Why should a company with a minimum number of shareholders enter into a corporate agreement?

The question often arises: is a corporate agreement necessary in companies with only two or three members? The answer is unequivocally yes. Even in such companies, situations may arise that require clear regulation:

  • Withdrawal of a shareholder from the company. A corporate agreement may provide for the procedure for redemption of shares and settlements between participants.

  • Distribution of profits. The agreement allows for individual terms of profit distribution other than pro rata distribution of shares.

  • Strategic decision-making. You can determine which decisions are made unanimously and which are made by a majority vote.

  • Protection against unfair practices. The agreement may contain provisions on liability for breach of obligations and dispute resolution mechanisms.

Thus, a corporate agreement is a kind of “insurance” for the company’s shareholders, ensuring predictability and stability in their relationships.

 

Tips for concluding a corporate agreement

  1. Involvement of professionals. The drafting of a corporate agreement should be entrusted to experienced lawyers who will take into account all the nuances of the law and the specifics of the company’s activities.

  2. Individual approach. There is no universal template for a corporate agreement. Each agreement should take into account the specifics of a particular company and its members.

  3. Regular review. Changes in legislation or company structure may require amendments to the corporate agreement. It is recommended that you periodically review the agreement and make any necessary adjustments.

 

Conclusion

The conclusion of a corporate agreement is an important step for any company, regardless of the number of shareholders. This document helps to avoid many potential conflicts, ensures transparency in relationships and contributes to the stable development of the business. In the context of constant changes in legislation and the economic situation, a clear and well-thought-out corporate agreement is the key to the company’s successful operation.

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The model of controlled foreign companies (CFC): how to prepare for a tax audit in 2025

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Author: Olena Andriyko, lawyer at F&P

Introduction

In 2025, Ukrainian residents who have stakes in or control over foreign companies will be required to file reports on controlled foreign companies (CFCs). This is part of the government’s efforts to combat tax evasion and ensure transparency in international business. Given the changes in legislation and increased scrutiny by tax authorities, it is important to know how to properly prepare for a tax audit in the area of CFCs. (tax.gov.ua)

  1. Who is obliged to submit a CFC report?

According to the Tax Code of Ukraine, individuals and legal entities-residents of Ukraine who:(Law firm “Pravova Dopomoga”)

  • own more than 50% of a share in a foreign company;
  • own 10% or more if the total shareholding of Ukrainian residents in the company exceeds 50%;
  • have actual control over a foreign company.

Starting from 2024, the ownership threshold has been reduced to 10%, which expands the range of persons required to report.

  1. Reporting deadlines in 2025

For individuals:

  • by May 1, 2025, together with the declaration of property and income.(ck.tax.gov.ua)

For legal entities:(Law firm “Pravova Dopomoga”)

  • by March 1, 2025, together with the corporate income tax return.

  1. Penalties for violation of CFC rules

The following fines apply in 2025:(Victoria)

  • Late submission of the report: 1 subsistence minimum (SM) for each day of delay, but not more than 50 SM (maximum UAH 151,400).
  • Submission of inaccurate or incomplete information: 3% of the CFC’s income or 25% of the adjusted profit, whichever is higher, but not more than 1000 PM (approximately UAH 3.028 million).
  • Failure to notify of acquisition or termination of control: 300 PM for each fact (over UAH 900,000) .

It is worth noting that during the period of martial law, there is a temporary suspension of fines for violations committed since January 1, 2022, provided that the reporting is submitted within 6 months after the lifting of martial law.Victoria)

  1. Preparing for a tax audit

To avoid problems during a tax audit, it is recommended:

  • Ensure timely and complete submission of CFC reporting.
  • Prepare financial statements of the CFC certified in accordance with the requirements of the law.
  • Keep all documents confirming control over the foreign company and its financial performance.
  • Seek expert advice to verify the correctness of the reporting and compliance with legal requirements.

  1. Recommendations for business

  • Assess the ownership structure of foreign companies and determine whether they fall within the definition of a CFC.
  • Check the availability of all necessary documents to confirm the control and financial performance of the CFC.
  • Ensure timely submission of CFC reports and notifications.
  • In case of doubt or difficulties, seek professional legal assistance.

Conclusion

In 2025, compliance with the reporting requirements for controlled foreign companies is critical to avoiding significant fines and ensuring business transparency. Timely preparation, proper execution of documents and consultation with experts will help you successfully pass a tax audit and ensure the stability of your business in the face of changing legislation.

Contact our law firm for professional support in matters related to CFCs and tax legislation.

Customs Clearance of Dual-Use Goods: Specifics and Legal Risks

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Author: Uliana Luchkevych, lawyer at F&P

In the context of increasing export control measures and military assistance, Ukraine increasingly faces the need for a precise and cautious approach to customs clearance of dual-use goods. Errors at this stage can be either financial implicationsand criminal risks for companies and their officials.

What are dual-use goods?

Dual-use goods are products, equipment, technologies or software that can be used for both civilian and military purposes. For example:

  • drones and their components, 
  • optical devices, 
  • encryption software, 
  • materials for the manufacture of armor, 
  • equipment for the chemical industry. 

The list of such goods is regulated by the CMU Resolution and international agreements, in particular The Wassenaar Regime.

Main legal risks

  1. False declaration
     A company that submits a declaration without properly identifying the goods as dual-use may be accused of violating export control laws. 
  2. Lack of permits
     Export or import of dual-use goods requires a special permit of the State Export Control Service of Ukraine. Its absence is grounds for detention of goods and penalties.  
  3. Criminal liability
     In some cases, the violation is qualified as smuggling or violation of the rules of the international regime of control over military goods. 

What should businesses pay attention to?

  • Accurate classification of goods
     Before customs clearance, it is recommended that you contact a technical specialist or lawyer to help determine whether the goods fall under the “dual-use” criteria.
  • Obtaining preliminary clarifications
     You can request a preliminary assessment from the State Export Control Service to reduce the risk of incorrect declaration.
  • Correct execution of contracts
     A foreign economic agreement must clearly reflect the purpose of the goods, their technical characteristics, and the end user.
  • Staff training
     Accountants, logisticians, and foreign trade managers should be familiar with the criteria for determining such goods and the requirements for clearance.

How we help

Law firm Fedoryshyn & Partners advises businesses on:

  • classification of goods in accordance with national and international controls, 
  • obtaining import/export permits, 
  • execution of foreign economic contracts with minimization of risks, 
  • representation in customs disputes and cases of cargo detention. 

Contact us if your company works with sensitive products or plans to enter foreign markets. The right legal strategy today is a guarantee of security and business continuity tomorrow.

Legal protection in litigation with counterparties: steps to help win the case

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Author: Maryna Pokotylo, Partner at F&P

Disputes with counterparties can arise even in the case of carefully drafted contracts. Late payment, failure to fulfill obligations, delivery of low-quality goods are just some of the problems that occur in business relationships. Timely legal support and the right defense strategy can be the key to winning in court.

1. Pre-trial settlement of a dispute: an opportunity to save resources

Before going to court, it is important to exhaust all possibilities for pre-trial settlement. Ukrainian law does not explicitly require the claim procedure in all cases, but compliance with it often plays a positive role.

Actions to take:

  • Submit a claimThe letter should clearly state the essence of the violation, your requirements, the deadline for responding and the legal grounds. Pursuant to Article 179(7) of the Commercial Procedural Code of Ukraine, a copy of the claim may be attached to the statement of claim as evidence of pre-trial activity.

  • Document the negotiationsIf you hold telephone or in-person negotiations, confirm them in writing (by letter or email).

  • Engage an intermediary or mediatorThis mechanism is effective in disputes where the parties have a long-standing relationship.

Tip: Conclude contracts with mediation clauses – this is an additional tool for resolving conflicts without going to court.

2. Complete preparation of the evidence base: every document counts

In a court dispute, the basis is proper and admissible evidence. It is worth remembering that in commercial proceedings, the burden of proof rests with the party that substantiates certain circumstances (Article 74 of the Commercial Procedural Code of Ukraine).

We are collecting evidence:

  • Main contract and annexesCheck whether all pages are signed, whether the signature of an authorized person is included, and whether there is a seal.

  • Acts, invoices, delivery notesconfirm the fact of fulfillment or non-fulfillment of obligations.

  • Correspondence.including electronic (via email or messengers), which can be attached as printouts with technical headers.

  • Financial documents.payment orders, bank statements, reconciliation statements.

  • Witnesses.Witnesses: witnesses are rarely used in commercial disputes, but they can be useful in disputes over the transfer of things or the performance of work.

3. Legal structuring of a statement of claim: not only content but also form

A statement of claim is not just a statement of facts. It is a document that the court evaluates formally. Violation of even the technical requirements may result in the statement being left without motion or returned.

Key elements:

  • Structurecomplies with the requirements of Article 162 of the Commercial Procedural Code of Ukraine. It must contain data on the parties, the nature of the dispute, justification, evidence, the amount of the claim, claims and attachments.

  • Correct jurisdictionIt is important to establish which court to file a lawsuit in. Violation of jurisdiction will slow down the process.

  • Court feeCourt fee: paid in accordance with the Law of Ukraine “On Court Fee”. For example, for property claims, it is 1.5% of the price of the claim, but not less than one minimum wage.

Tip: When the price of the claim is high, it is worth filing a motion for installment or deferral of the court fee.

4. 4. Behavior in litigation: strategy, flexibility and procedural discipline

Effective participation in court proceedings requires systematic work:

  • Active position.Provide explanations, answer the court’s questions, and respond to the other party’s motions in a timely manner.

  • Counterclaim or counterclaims: use the opportunity to make counterclaims (Art. 177 of the CCP).

  • Use of security measuresFor example, seizing the defendant’s accounts or prohibiting the alienation of property. This will help avoid situations where there is nothing to recover after the case is won.

  • Involvement of expertsIn case of technical or specialized issues (e.g., construction, IT services, audit).

  • Submission of procedural documents through the Electronic Court: speeds up communication with the court and guarantees the filing is recorded.

5. Enforcement of the judgment: collection strategies

Getting a decision is only half the battle. Actual implementation is the next step.

  • Applying to the executive serviceSubmit the application together with the writ of execution. From the moment the proceedings are initiated, the enforcement officer has the right to take action against the debtor.

  • Private performersThey often work faster than the public service. According to the Law of Ukraine “On Enforcement Proceedings”, you can choose a private enforcement officer.

  • Application of sanctions for evasionIf the debtor ignores the court decision, criminal proceedings may be initiated under Article 382 of the Criminal Code of Ukraine (failure to comply with a court decision).

  • Asset monitoringIdentifying new accounts, movable and immovable property of the debtor in time will help the bailiff to act more effectively.

Conclusion

Success in a legal dispute with a counterparty is not only the result of being right on the merits, but also the consequence of a professionally built strategy: from pre-trial settlement to enforcement of the judgment. In difficult situations, the assistance of experienced lawyers becomes a decisive advantage.

Fedoryshyn & Partners team has many years of experience in commercial disputes. We help businesses protect their interests effectively, legally and strategically.

Contact us – we know how to win your case.

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