Doing Business

  • Reaching the Consumers
  • Selling
  • Operating a Business
  • Investing

Reaching the Consumers

Population in Figures

Total Population:
Urban Population:
Rural Population:
Density of Population:
79 Inhab./km²
Men (in %)
Women (in %)
Annual Growth Rate of the Population:
Medium Age:
Ethnic Origins of the Population:
Ukrainians 77.8%, Russians 17.3%, Others 4.9%.

Population of main cities (including suburbs)

Source:, 2005 - Last Available Data.

Age of the Population

Life Expectancy in Years
Source: World Bank, last available data., 2009 - Last Available Data.
Distribution of the Population By Age Bracket in %
Under 5:
6 to 14:
16 to 24:
25 to 69:
Over 70:
Over 80:

Household Composition

Total Number of Households (in million)**17.2
Average Size of the Households**2.5 Persons

Consumption Expenditure

Purchasing Power Parity2009201020112012 (e)2013 (e)
Purchasing Power Parity (Local Currency Unit per USD)3.143.573.964.334.68
Definition: Purchasing Power Parity is the Number of Units of a Country's Currency Required to Buy the Same Amounts of Goods and Services in the Domestic Market as USD Would Buy in the United States.
Note: (e) Estimated Data
Household Final Consumption Expenditure200820092010
Household Final Consumption Expenditure
(Million USD, Constant Price 2000)
Household Final Consumption Expenditure
(Annual Growth, %)
Household Final Consumption Expenditure per Capita
(USD, Constant Price 2000)
Household Final Consumption Expenditure
(% of GDP)
Source: World Bank - Last Available Data.
Consumption Expenditure By Product Category as % of Total Expenditure2009
Food and non-alcoholic beverages33.2%
Alcoholic beverages, tobacco and narcotics5.3%
Clothing and footwear4.8%
Housing, water, electricity, gas and other fuels10.3%
Furnishings, household equipment and routine maintenance of the house3.5%
Recreation and culture3.2%
Restaurants and hotels2.3%
Miscellaneous goods and services3.3%
Source: UN Data, Last Available Data
Information Technology and Communication Equipment, per 100 Inhabitants2009
Telephone Subscribers149.8
Main Telephone Lines28.7
Cellular Mobile Subscribers121.1
Internet Users22.5
Source: International Telecommunication Union, Last Available Data


Distributing a Product

Distance Selling

Type of Products
All types of legal products can be found on the internet.
Evolution of the Sector
Direct selling is constantly progressing. The Ukraine has 1.5 million direct sales agents with a total annual income of up to EUR 389 million.
Direct Marketing Enterprises
Viland, Products for the home. Gateway to online sales websites, All products

Big Names in Distance Selling

Ukraine Direct Selling Association

Distribution Network

Types of Outlet

Supermarkets and Hypermarkets
Food products ATB-marketSilpoFurshetVelyka KyshenyaAmstor
Cash and Cary
Food products Metro
Specialized Shops
All types of non-food products: cosmetics, electronic, home appliances, etc. Kvadrat (in Ukranian), MetrogradGlobusBrocard BessarabsskïiFoxtrot (in Ukranian),Eldorado (in Ukranian),  Mega MaxAgromat, Budmax, Nova Linia.
All types of non-food products: cosmetics, electronic, home appliances, etc. Fozzy, Intermarket, Pakko

Evolution of the Retail Sector

Growth and Regulation
Few structures carry out distribution and the follow-up of imports. The distribution sector remains very traditional and fragmented, but the arrival of foreign competitors could widen the range of products and services, contribute to stabilizing prices and stimulate competition. Franchises are growing, but there is a legal vacuum as far as intellectual property is concerned, and barriers to the development of small companies.
The most developed distribution circuit is retail trade. Food shops can either be non-specialized or specialized in a single range of products. There are also department stores especially in Kiev such as the Department Store Ukraine, the Zum which is the equivalent of Printemps in Paris (Selfridge's in London), the department toystore, Dytiachy Syit - Children's World, the large jeweler's Koschtan, and for perfume and cosmetics, Lancôme.
The market share of non-organized retail is increasingly encroached upon.
Market Shares
Non-organized retail shops have 43% of the market, local shops control 25%, while supermarkets have approximately 12% market share.
Organizations in the Retail Sector
Association of Ukrainian Distributors

Commercial Intermediaries

Trading Companies
  • Main Actors
The main Ukranian wholesalers are: Fozzy GroupMetro Cash&Carry Ukraine, ATB, Furshet and Velyka Kyshenia. It should be noted that regional wholesalers (such as Donetsk, Amstor, Fozzy Group, Furshet and Lviv Intermarket) have stronger growth than national wholesalers.

Using a Commercial Agent

The Advantages
Sales are accelerated and there is less stockage by going through a commercial agent, you also have direct contact with the clientele and enjoy the advantages of the agent's knowledge of the market.
Elements of Motivation
The main motivating factor for the agent is his commission.
The Average Amount of Commission
The commission amount is negotiated when contracting and depends on the task.
Breach of Contract
The agent has to be notified one month prior to the termination date of the contract.
Finding a Commercial Agent
Setting Up a Commercial Unit
The Advantages
Decision are taken by the parent company, thus simplifying the subsidiary's operation. Ukranian legislation does not impose a minimum size in order to open a subsidiary.  It is in the interest (commercial and financial) of foreign companies exporting to the Ukraine to open a branch office.
Where to Be Vigilant
The subsidiary has to deal with a complex and rigid law, which as a precaution, leads to getting in touch with lawyers in order to ensure the proper formation of the company, in terms of legality.
Different Possible Forms of Settlement
  • A Representative Office
Since a representative office cannot sign a contract in its name, nor do any marketing or distribution of its products, the opening of a branch office is the foreigner's preferred solution.
  • A Company
It is necessary to register the subsidiary at the Ministry of Economy (cost: approximately UAH 15,000).


Evolution of the Sector
To be franchised is very common in the Ukraine. It is the most sought after type of company formation. A fair on franchises takes place every year. For more information on the rights regarding franchise, you can consult the website.
Some Big Franchises
Specialized franchise consultancy for Central and Eastern European countrie. Franchise gateway in the Ukraine Comprehensive gateway  of franchises in the Ukraine
For Further Information
The Civil Code The Commercial Code of Ukraine


Operating a Bussiness

Legal Forms of Companies

Types of Companies and Capital (Max/Min)Number of Partners/Shareholders and Liability
Private Limited Company
Minimum: around EUR 81.82
No minimum. Max: 10
Limited to capital
Public Limited Company
Minimum: around EUR 89,600
No minimum nor maximum
Limited to capital

Business Setup Procedures

Setting Up a CompanyUkraineEastern Europe & Central Asia
Procedures (number)10.006.30
Time (days)27.0016.30
Source: Doing Business.
For Further Information
Consult Doing Business Website, to know about procedures to start a Business in Ukraine. Business Support Department
The Competent Organization
The formation of a company with foreign shareholding has to be registered with the local administration where the headquarter of the company being formed is situated. It is also necessary to register with the Minisry of Foreign Relations and Trade.

Recovery Procedures

Bankruptcy Laws
The law on the restitution of the debtor's solvency or the declaration of bankruptcy came into force in Janunary 2000.

The Active Population in Figures

Labor Force22,060,000
Source: CIA - The world factbook
Total activity rate-58.10%
Men activity rate65.40%-
Women activity rate52.00%-
Source: UN - United Nations
Employed Persons, by Occupation (% of Total Labor Force)
Source: NationMaster

For Further Information About the Labor Market
COE, Labor migration Statistics on the Ukranian labor market

Working Conditions

Opening Hours
  • Legal Weekly Duration
44 hours for services and trade and 48 hours for industry.
  • Maximum Duration
It is possible to go over the 40 hours a week for some professions: 44 hours for services and shops and 48 hours for industry. 120 hours per year of overtime is the limit, except in certain categories (managers and other).

Working Rest Day
Saturday and Sunday are the weekly days of rest.
Paid Annual Vacation
The Ukranians have a right to 24 days of paid vacation per year, plus 13 days public holidays, which are not working days.
Retirement Age
55 for women and 60 for men.
Child Labor and Minimum Age For Employment
The minimum working age is 17 years.

The Cost of Labor


Minimum Wage
960 UAH (120 USD). It should be noted that salaries have to be paid twice a month: half the salary every two weeks.
Average Wage
Average monthly gross earnings in Ukraine is UAH 2,083 (USD 268).
Other Forms of Pay
  • Pay For Overtime
In theory, overtime work can only be imposed in a "case of emergency".  Overtime, (not more than 120 hours per year) is paid double.
  • Pay For Rest Days Worked
If the employee works during a day of rest, he is paid double.
  • Pay For Night Hours
The night shift is remunerated according to the current collective convention and cannot be below the 120% of the daily rate. For more information, refer to the report on the Regulation of Labor and Employment in the Ukraine published by the Volkov Koziakov & Partners.
  • Pay For Overtime at Night
Night overtime is paid double.

Social Security Costs

The Areas Covered
Accidents, illnesses, retirement, death, disability, maternity, medical care, family and child benefits and unemployment benefits.
Contributions Paid By the Employer: 47.5 %. Contributions Paid By the Employee: 1.5 %.
Competent Organization
Ministry of Labour and social Policy

Management of Human Resources


Method of Recruitment
Some agencies impose their own recruitment methods, some are go betweens.
Recruitment Agencies
There are different types of recruitment agencies in the Ukraine, either specialized in a precise area or targeted at temporary employment. Most of them have their own websites.
Recruitment Websites
Work in UkraineWork in KievWork in Kiev

The Contract

Type of Contract
Employment contracts are regulated by law, collective agreements and individual negotiations. An employee is on probation of 1 to 3 months. During this period, the employee can be dismissed or confirmed.  There are three employement contracts: Permanent, temporary and provisional.

Breach of Contracts
  • Retirement
Retirement age is set at  60 years for  men and 55 years for women. It can be premature in certain sectors.
  • Dismissals
An employer can dismiss an employee for continued bad performance, serious fault, unjustifiable absence of more than 3 hours or prolonged illness of more than four months and company economic problems. An employee can resign with two weeks notice.
  • Other Possible Methods
For more information, refer to the report on the Ukranian employement market published on the Salans website.
Labor Laws
Labor LawEmployement Law

Dispute Settlement

Conciliation Process

  • Legal Framework
The law that deals with contentious matter between employers and employees in the Ukraine is the International Commercial Arbitration Act.
  • Procedure
In the case of a dispute. the parties can go to the Ukranian Tribunal of Commerce or an international court, by common agreement. Since 1994, parties can lodge an appeal with an international commercial arbitration court, which is a lot more advantageous.

Judicial Structures

  • Competent Legal Body
The body in charge of contetious matters between employers and employees in the Ukraine is the International Commercial Arbitration Court.

Social Partners

Social Dialogue and Involvement of Social Partners
The Federation of Ukrainian Trade Unions, which unites 44 unions and 26 regional associations, brings together more than 10 million members.
Unionization Rate
The Ukraine has nearly 15 million unions for an active population of 22 million people.
Ukrainian Trade Union FederationList of Ukrainian trade unions
Regulation Bodies
Ministry of Labor and Social Policy


FDI in Figures

Increasing in the recent years, the FDI flux into Ukraine have slowed down due to the global recession and the severe economic crisis affecting the country. Apart from the economic downturn, the inefficient and corrupted legal system, complexity of legislation and regulation, poor contract and enforcement and poor governance constitute serious impediments to investment. This is so despite the fact that the country has its strengths: a large domestic market, proven agricultural potential, energy and mineral resources and a strategic geographic location which makes it a transit hub and a gate to Europe. The main investors in Ukraine are Cyprus, Germany, The Netherlands, UK, Austria, the United States and Russia. Apart form the energy sector, direct foreign investment is concentrated mainly in the banking and food processing sectors. You can refer to the Invest in Ukraine website for more information.
Foreign Direct Investment200820092010
FDI Inward Flow (million USD)10,9134,8166,495
FDI Stock (million USD)46,99752,02157,985
Performance Index*, Ranking on 141 Economies4745-
Potential Index**, Ranking on 141 Economies48--
Number of Greenfield Investments***12592-
FDI Inwards (in % of GFCF****)23.025.9-
FDI Stock (in % of GDP)26.144.3-
Source: UNCTAD - Last Available Data.
Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

FDI Inflows By Countries and Industry

Main Investing Countries2010, in %
The Netherlands9.6
Main Invested Sectors2010, in %
Financial sector24.0
Real Estate8.0
Wholesale and retail10.0
Source: State Statistics of Ukraine - Last Available Data.
Form of Company Preferred By Foreign Investors
Limited liability companies and joint stock companies.
Form of Establishment Preferred By Foreign Investors
A subsidiary is preferred by foreign investors as it is very advantageous.
Main Foreign Companies
You can see the list of the main foreign companies established in the Ukraine.

Why You Should Choose to Invest in Ukraine

Strong Points
The country's main strong points are: - One of the biggest markets in Europe with 47 million consumers; - The most dynamic GDP growth in Europe; - A very good education system. The Ukraine is placed fourth in the world, in terms of specialists with diplomas in the high-tech sector; - A strategic geographical positioning, the country being situated at the entry of Europe, Russia and Asia; - The emerging middle class estimated at 20% of the population; - The presence of investors such as Kraft FoodsCoca-ColaHewlett PackardCargillKnauf,Raiffeisen BankCredit Agricole and many others; and - The strengthening and reforms of the banking sector's.
Weak Points
The country's weak points are: - The small amount of support given to foreign investors by the law; - The weakness of the national oil company, Naftogaz's, financial situation and the country's permanent risk of being unable to pay its gas bill; - The drop in industrial production in 2009; - A high rate of inflation; - Political instability; - Endemic corruption.
Government Measures to Motivate or Restrict FDI
Following the orange revolution, investment friendly reforms have allowed for the considerable increase of FDI. In effect, the government wishes to strongly attract foreign investors. Except for certain key sectors like banking and telecommunications, most sectors are entirely open to FDI.

Protection of Foreign Investment

Bilateral Investment Conventions Signed By Ukraine
The Ukraine has signed 64 investment protection bilateral agreements, namely with the United States and most of the OECD and the CIS countries.
International Controversies Registered By UNCTAD
Disagreement with German regarding a petro-chemical complex.
Member of the Multilateral Investment Guarantee Agency

Country Comparison For the Protection of Investors

UkraineEastern Europe & Central Asiaالولايات المتحدةGermany
Index of Transaction Transparency*
Index of Manager’s Responsibility**
Index of Shareholders’ Power***
Index of Investor Protection****
Source: Doing Business - Last Available Data.
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Procedures Relative to Foreign Investment

Freedom of Establishment
The administrative formalities depend on the form of company to be created. The Ukrainian agency for the promotion of foreign investment allows you to get information about the authorizations necessary for setting up business.
Acquisition of Holdings
The legislation provides for the possibility of creating a Ukrainian company with foreign investment in a Private Limited Company, in a joint-stock company, or in a 100% subsidiary form, and regulates their constitution and running. Acquisition of holdings in an existing company, especially  within the ongoing privatization programme, is subject to the same legal procedures but requires approval from the State Assets Funds.
Obligation to Declare
The agency for the promotion of foreign investment in the country allows you to get information about the authorizations necessary for setting up business.
Competent Organization For the Declaration
Ukrainian Ministry of Finance
Requests For Specific Authorizations
All companies active in the sectors of banking, insurance, security, pharmacy, and the production of alcohol must obtain a State license.
Learn more about Foreign Investment in Ukraine on, the Directory for International Trade Service Providers.

Office Real Estate and Land Ownership

The Possibility of Buying Land and Industrial and Commercial Buildings
It is possible to invest in real estate and non cultivating land.
Risk of Expropriation
The risk of expropriation is still very present in the Ukraine. Ukranian law provides for total compensation in case of expropriation, except for extreme emergency cases.

Investment Aid

Forms of Aid
Overall, the Ukraine does not seem to have a stable policy with regard to investment assistance. The unpredictability of the decisions is puzzling (like the sudden removal of free economic trade zones) and does not reassure foreign investors.
Privileged Domains
Loans, tax-free, simplified administrative procedure to register a company.
Privileged Geographical Zones
High technology and alternative energies.
Free Zones
The law on Special Economic Zones defines three types of areas: free trade zones, regions with special investment regimes and priority development regions.
Organizations Which Finance
Invest in Ukraine

Investment Opportunities

The Key Sectors of the National Economy
Financial sector, agriculture and agro-chemistry.
High Potential Sectors
High technology, agriculture, agro-chemistry, aerospace industry, alternative energy, tourism and hospitality, transport and logistics.
Privatization Programs
The IMF gave recommendations to the Ukraine to further liberalize and to privatize the land owenership sector.
Tenders, Projects and Public Procurement
Tenders Info, Tenders in Ukraine DgMarket, Tenders Worldwide

Sectors Where Investment Opportunities Are Fewer

Monopolistic Sectors
It is impossible to acquire agricultural land.
Sectors in Decline
Due to the crisis, the declining sectors are construction (building), automobile and electronics and the metallurgy sector.