From now on, signing foreign trade contracts in Ukraine will be a lot easier.
The reason – Ukrainian President Petro Poroshenko has signed the law “On Amendments to Several Legislative Acts of Ukraine on the Elimination of Administrative Barriers to Export of Services,” which allows contracts to be made up not just in paper form, but also electronic.
The law will mainly help freelancers that sell their services abroad, including IT professionals, as it allows Ukrainians who sell intellectual property abroad to strike deals with clients from other countries without having to have a paper sales-purchase agreement, with physical signatures.
“This will stimulate a faster inflow of foreign currency into Ukraine, which in turn will have a positive impact on the development of small- and medium-sized businesses in the country,” the lead author of the bill, independent lawmaker Victoria Ptashnyk, told the Kyiv Post.
The law also lowers administrative barriers in terms of currency earnings accounting and financial reporting. It also forbids banks from requiring a Ukrainian translation of documents in English. Invoices will be recognized as primary documents, and they can now be signed with an electronic signature.
Ukrainian President Petro Poroshenko talks to experts after signing a law to simplify outsourcing from Ukraine on Dec. 1. (president.gov.ua)
Under the old legislation, any transaction that was conducted abroad was defined as foreign economic activity, so any e-business in Ukraine that sold to foreign buyers was subject to Ukraine’s currency controls.
That meant that foreigners who bought Ukrainian services over the internet, and Ukrainian sellers, had to provide documents – an invoice and a purchase/sale agreement – physically signed by both sides and verified by a bank.
All the documents for such e-transactions could only in paper form, and signed and sent by post by the buyer to the vendor, totally negating the whole point of convenient, paperless e-business.
“We are switching from e-procurement to e-contracts,” Poroshenko said, referring to the electronic procurement system ProZorro. “Today we took the first step to equipping everyone, from businessmen to the prime minister, with arguments why investors should enter the Ukrainian market, and why fantastic business conditions will be created here,” Poroshenko said on signing the law.
Kyiv Post staff writer Denys Krasnikov can be reached at [email protected].
