Best Acquisition / Leveraged Finance Lawyers in Ukraine

About Acquisition / Leveraged Finance Law in Ukraine

Acquisition and leveraged finance law in Ukraine focuses on structuring, documenting, and implementing financial arrangements for acquiring businesses or significant assets, often using borrowed funds. Leveraged finance typically involves using a higher proportion of debt relative to equity, with the assets of the company being acquired often serving as collateral for the loans. This sector navigates the interplay between local Ukrainian banking regulations, foreign currency controls, corporate law, and cross-border transaction rules. Lawyers play a critical role in ensuring that deals comply with Ukrainian legal requirements, safeguard the rights of all parties, and facilitate a smooth transfer of ownership or assets under secure financial arrangements.

Why You May Need a Lawyer

Legal assistance in acquisition and leveraged finance in Ukraine is essential in multiple scenarios. Whether you are a Ukrainian or foreign investor planning to buy a local business, a lender contemplating financing an acquisition, or a company seeking to expand via acquisition, legal issues can be complex. Common situations requiring legal support include:

• Negotiating and drafting loan agreements and security documents
• Structuring acquisition deals to mitigate legal and financial risks
• Navigating regulatory approvals, antitrust clearances, or licensing requirements
• Ensuring compliance with currency control and cross-border transfer regulations
• Conducting legal due diligence on target entities or assets
• Handling enforcement of security or insolvency issues if a deal encounters difficulties

Given the complexity of Ukrainian laws and the involvement of multiple parties, expert legal guidance ensures protection of interests and compliance with the law throughout the transaction process.

Local Laws Overview

Key aspects of Ukrainian law pertinent to acquisition and leveraged finance include:

• Company Law: Regulates the creation, operation, and takeover of companies, including restrictions on certain share transfers and mandatory procedures for acquisitions of significant stakes.
• Banking and Finance Laws: Govern the provision of loans, set out security structures such as mortgages and pledges, and lay down procedures for registering securities over assets.
• Foreign Currency Regulation: Ukrainian law has historically placed certain restrictions on payments in foreign currency and on the movement of money across borders, though these rules have been gradually liberalized.
• Antitrust and Competition Law: Requires review and approval of many acquisition transactions by state authorities to prevent monopolies or unfair competition.
• Tax Law: Acquisition structures are subject to Ukrainian tax rules, including value added tax, corporate profit tax, and implications for cross-border payments or withholdings.
• Insolvency Law: Sets out creditor rights and procedures in case a borrower or target entity becomes insolvent.
• Enforcement and Dispute Resolution: Ukrainian courts and international arbitration may be available depending on the parties’ agreements, bearing in mind local rules on enforcement of foreign judgments and arbitral awards.

Deal structures often combine Ukrainian and foreign law elements, particularly when international banks or investors are involved. Regulatory compliance and sound legal documentation are essential to avoid future disputes or regulatory sanctions.

Frequently Asked Questions

What is leveraged finance and how does it differ from traditional bank financing in Ukraine?

Leveraged finance generally refers to using a larger portion of borrowed money, often secured against the assets or shares of the target company. This differs from traditional bank loans which may require lower risk and stronger financial covenants.

Is foreign participation allowed in Ukrainian acquisition and leveraged finance deals?

Yes, foreign investors and lenders can participate in such deals, but must comply with Ukrainian currency control, licensing, and notification requirements, especially when transferring funds or shares across borders.

What security interests can lenders obtain under Ukrainian law?

Lenders often seek pledges over shares, mortgages on real estate, assignments of receivables, and security over movable assets. The form and registration requirements for each type of security differ.

Are there restrictions on payments in foreign currency?

Ukrainian law regulates payments in foreign currency and cross-border transfers. Recent reforms have eased some restrictions, but procedural requirements and National Bank regulations still apply.

Do acquisition or leveraged finance deals need to be registered with Ukrainian authorities?

Registration may be required for certain security interests and in cases involving regulated industries or significant assets. Antitrust approval is necessary when certain financial or market thresholds are met.

What are the main steps in a Ukrainian acquisition financing transaction?

Key steps include due diligence, negotiations, signing the sale, loan, and security documents, obtaining necessary approvals, registering security, and completing financial settlement.

Can foreign law govern acquisition or finance contracts in Ukraine?

Parties may select foreign law as the governing law for certain agreements, but aspects relating to real estate, corporate matters, and certain security documentation may be governed by mandatory Ukrainian law.

How does the enforcement of security work in Ukraine?

Enforcement procedures depend on the type of security and may involve courts, notaries, or trustees. The process can be lengthy and is subject to Ukrainian law and procedural rules.

What is legal due diligence and why is it important?

Legal due diligence is a comprehensive review of the target company's or asset's legal and financial situation. It helps identify risks and liabilities, ensuring that the buyer and lender make informed decisions.

What are the common pitfalls in Ukrainian leveraged buyouts?

Common issues include non-compliance with regulatory approvals, weak security structures, unforeseen tax liabilities, and difficulties in enforcing security or contract rights. Early legal advice helps mitigate these risks.

Additional Resources

For more information and support regarding acquisition and leveraged finance in Ukraine, consider the following resources:

• National Bank of Ukraine - Regulatory body for currency control, banking licenses, and financial regulation
• Antimonopoly Committee of Ukraine - Authority responsible for competition and antitrust approvals
• Ministry of Justice of Ukraine - Provides guidance on corporate registration and property rights
• Ukrainian Bar Association - Professional organization for lawyers often specializing in finance and acquisitions
• Local and international law firms with dedicated banking, finance, and corporate practice groups

Engaging with these organizations or consulting their official websites can provide further clarity on procedural requirements and updated regulations.

Next Steps

If you require legal assistance with acquisition or leveraged finance in Ukraine, consider taking the following steps:

• Define your objectives and gather relevant documentation about the proposed transaction or financing
• Identify lawyers or law firms specializing in acquisition and finance in Ukraine, checking their relevant experience and reputation
• Arrange an initial consultation to outline your goals and understand possible legal strategies, timelines, and costs
• Work closely with your legal advisor throughout due diligence, negotiations, documentation, and post-deal compliance
• Remain proactive in monitoring regulatory requirements and changes to ensure ongoing compliance for your transaction

Professional legal support is invaluable in navigating the complexities of acquisition and leveraged finance, safeguarding your investments and helping you achieve your business goals in Ukraine.