Review of the procedure for recognition of representative offices of non-residents operating in Ukraine as critically important for the purposes of employees' reservation
Review of the procedure for recognition of representative offices of non-residents operating in Ukraine as critically important for the purposes of employees' reservation
Starting from December 20, 2024, representative offices of non-residents operating in Ukraine (representative offices of foreign business entities, non-governmental organizations of other states, and international non-governmental organizations) have finally been granted the possibility of being recognized as critical for the purpose of reservation of employees due to the entry into force of the Order of the Ministry of Economy No. 28003 dated 18.12.2024 "Some issues of Recognition of Enterprises, Institutions, and Organizations of Critical Importance for the Sectors of the National Economy" (hereinafter referred to as the "Order"). The Order establishes criteria for recognizing such representative offices as being of critical importance to the national economy, supplementing the criteria for recognizing them as critical, which had been previously set forth in the Resolution of the Cabinet of Ministers of Ukraine No. 76 dated January 27, 2023, as amended by the Resolution No. 988 dated August 16, 2024. In this regard, the EVERLEGAL team has prepared a corresponding review.
What criteria must representative offices of non-residents meet to be recognised as critical?
- operation in Ukraine for at least the past 2 calendar years;
- accreditation (registration) in Ukraine in accordance with the procedure established by law;
- registration with Ukrainian tax authorities;
- absence of international sanctions recognized by Ukraine, applied in the manner prescribed by law;
- non-application of special economic and other restrictive measures (sanctions) under Article 5 of the Law of Ukraine No. 1644-VІІ "On Sanctions" dated August 14, 2014 to the representative offices or their ultimate beneficial owners. The absence of such sanctions can be confirmed by an extract from the State Register of Sanctions.
- exclusion of activities in territories where active hostilities are ongoing and/or temporarily occupied territories by the Russian Federation, as defined in the list approved by the Ministry of Reintegration, for which no end date for hostilities or temporary occupation has been established;
- non-engagement in activities within the territories of the Russian Federation and the Republic of Belarus;
- the accrued average salary of employees is not less than the average salary in the country for the last reporting tax year, multiplied by a coefficient of 2.
Verification of compliance with this criterion requires the use of data on the average salary in the country published by the State Statistics Service of Ukraine.
To calculate the average salary of employees, you can use the relevant explanation of the Ministry of Economy.
Where should a non-resident representative office submit an application for critical importance designation?
The Ministry of Economy.
What documents should be attached to the application?
Copies of documents confirming compliance with the established criteria and submission of tax reports for the last calendar quarter in accordance with the procedure established by law.
What is the timeframe for considering the application?
No more than 10 working days.
For what period can a representative office of a non-resident be recognized as critical?
12 months. Upon the expiration of this period, the representative office will need to confirm its compliance with the established criteria again by submitting a corresponding application to the Ministry of Economy.
How is the reservation of employees carried out after the representative office of a non-resident is recognized as critical?
In electronic form through the Diia Portal by submitting lists of employees proposed for reservation.
How many employees can be reserved by a non-resident representative office?
No more than 50% of the total number of military-liable employees, excluding military-liable women.
You can view and download the review via the link.
Our experts: Svitlana Teteria, Counsel; Alina Ivanchuk, Junior Associate
