The Law of Ukraine
On General Principles of Special (Free) Economic Zones Creation and Functioning
Date of Entry into Force:
November 18, 1992
The Law of Ukraine “On General Principles of Special (Free) Economic Zones Creation and Functioning” defines the procedure of creation and liquidation and the mechanism of special economic zones functioning on the territory of Ukraine, general legal and economic grounds for their status, as well as general rules of regulation of relations between subjects of economic activity in these zones and local councils of people's deputies, bodies of state executive power and other bodies.
Special (free) economic zone is defined by the Law as a part of Ukrainian territory with special legal regime of economic activity and procedure of application and action of Ukrainian legislation, which provides for the introduction of customs, tax and financial economic privileges for national and foreign legal entities and natural persons.
The Law states that special economic zones are created with the purpose of attraction of foreign investments which would facilitate development of infrastructure on priority directions of national economy, attraction and implementation of new technologies, market methods of economic activity, as well as improvement of natural and labor resources use.
It is established that the following types of special economic zones may be formed on the territory of Ukraine: free customs zones and ports, export and transit zones, customs warehouses, technological parks, complex production zones, tourist recreational zones, insurance and banking zones, etc.
The Law ensures that special economic zone shall be created on initiative of the Cabinet of Ministers of Ukraine or the President of Ukraine by decision of the Verkhovna Rada of Ukraine. Besides, the Law permits special economic zone to be created on initiative of local councils or local administrations.
The Law regulates the procedure of consideration of documents regarding special economic zones creation and adoption of respective decision by the bodies which deal with the process of the above zones creation. Also the Law contains provisions devoted to conditions of technical and economic grounding of expediency of special economic zone creation, as well as to authorities of bodies of state power concerning management of such zones.
According to the Law, special economic zones shall enjoy favorable customs conditions and customs taxation regime, in particular: privileged regime and taxation level, specific currency and financial conditions, banking credit system, credit and insurance system, conditions of separate types of payments and state investment system.
Summary version from 11.06.2003