Volodymyr Zelensky signed the Law on reforming Ukroboronprom

2 October, 2021

President Zelensky signed the Law, which fully launches the reform of State conglomerate Ukroboronprom. Officially, the Law will enter into force when it is published.
The reform provides for transforming Ukroboronprom into transparent companies with a system of corporate governance following the best international standards. It is essential for Ukraine’s national security, our capability to protect democracy and constant movement towards Euro-Atlantic integration.
The reorganisation of Ukroboronprom is to happen within three months now, with the decision from the Cabinet of Ministers’ side. When the new joint-stock company (JSC) is established, Ukroboronprom itself will be liquidated.

The corporatisation of Ukroboronprom and the introduction of corporate governance standards in line with OECD standards should increase the competitiveness of the Ukrainian defence industry on the world market, attract more investment projects, and promote more efficient enterprises that will provide the Ukrainian army with high-quality armament.

This draft law was developed with the active participation of civil society. NAKO experts submitted nine proposals with amendments to the second reading of this law. The parliamentary Committee on National Security, Defence, and Intelligence supported the vast majority of our recommendations.
Now, careful monitoring of the corporatisation by civil society and international partners is vital. Hence, NAKO plans to strengthen oversight of the transformation of defence companies and the liquidation of the concern to minimise corruption risks.
In particular, NAKO will closely monitor:

the process of forming the new JSC’s Supervisory Board and governing bodies;
setting corporate governance standards in the new JSC’s charter;
transfer of property and assets during corporatisation.

We believe that the success of Ukraine’s defence industry reform lies in the proper and accountable implementation of the law!