Ukroboronprom plans transformation of state defense industry

Ukroboronprom announced Wednesday a plan to transform the State Concern and its member enterprises.

The military attaches of foreign countries expressed their interest in cooperation with government authorities in the process of transformation.

As it was reported, on October 6, 2021, the Law of Ukraine No.1630-IX states "The State Concern shall be transformed into a joint-stock company, and the state unitary and state-owned enterprises of Ukroboronprom shall be transformed into business companies (joint-stock companies or limited liability companies), being under 100% government control."

At that, the companies will be full successors to the rights and obligations of the member enterprises of the State Concern. Contracts, authorization documents (licenses, permits, etc.) held by the enterprises, shall remain valid until their expiration date.

The law provides guarantees for maintaining the status of subjects of foreign economic activity and the right to export-import operations with military products. The continuity of the powers of enterprises as developers, manufacturers and suppliers of weapons and military hardware shall also be ensured.

The State Concern will be reorganized into a joint-stock company — a Corporate Center, responsible for implementation of a corporate governance model at Ukroboronprom member enterprises, as well as for attracting investment.

The Supervisory Board of the Corporate Center shall consist of representatives of the state and independent members. The law stipulates that the Supervisory Board must consists of at least one third of independent members, not exceeding half of the members of the Supervisory Board. The Cabinet of Ministers of Ukraine shall appoint and dismiss the representatives of the state from the Supervisory Board upon the recommendation of the Ministry of Strategic Development. At the same time, independent members shall be elected by the Cabinet of Ministers of Ukraine based on the results of competitive selection.


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