COMMISSION STAFF WORKING DOCUMENT Ukraine 2024 Report Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF REGIONS 2024 Communication on EU enlargement policy
Date: 2024-10-30
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Ukraine, accession criteria, accession negotiations, pre-accession strategy, regional cooperation

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 30.10.2024  SWD(2024) 699 final  COMMISSION STAFF WORKING DOCUMENT Ukraine 2024 Report Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF REGIONS 2024 Communication on EU enlargement policy                         {COM(2024) 690 final} - {SWD(2024) 690 final} - {SWD(2024) 691 final} - {SWD(2024) 692 final} - {SWD(2024) 693 final} - {SWD(2024) 694 final} - {SWD(2024) 695 final} - {SWD(2024) 696 final} - {SWD(2024) 697 final} - {SWD(2024) 698 final}  
 
 
Contents 
1. 

Introduction .................................................................................................................................................... 3 

1.1. 

Context.......................................................................................................................................................... 3 

1.2.  Main findings of the report ........................................................................................................................... 4 

1.3. 

State of play of the accession negotiations ................................................................................................. 21 

2. Cluster 1: The Fundamentals of the Accession Process ................................................................................... 22 

2.1. Functioning of democratic institutions and public administration reform ........................................................ 22 

2.1.1 Democracy ................................................................................................................................................. 22 

2.1.2. Public administration reform .................................................................................................................... 25 

2.2. Rule of law and fundamental rights.................................................................................................................. 28 

2.2.1  Chapter 23: Judiciary and fundamental rights ....................................................................................... 28 

2.2.2  Chapter 24: Justice, freedom and security ............................................................................................. 43 

2.3. Economic criteria ............................................................................................................................................. 52 

2.3.1. The existence of a functioning market economy ...................................................................................... 52 

2.3.2. The capacity to cope with competitive pressure and market forces within the Union .............................. 56 

2.4. Public procurement, statistics and financial control ......................................................................................... 59 

Chapter 5 - Public procurement .......................................................................................................................... 59 

Chapter 18 - Statistics ......................................................................................................................................... 60 

Chapter 32 - Financial control ............................................................................................................................ 61 

3. Good neighbourly relations and regional cooperation ...................................................................................... 62 

4. Ability to assume the obligations of membership ............................................................................................. 64 

Cluster 2: Internal market ........................................................................................................................................ 64 

Chapter 1 - Free movement of goods .................................................................................................................. 64 

Chapter 2 - Freedom of movement for workers .................................................................................................. 65 

Chapter 3 - Right of establishment and freedom to provide services.................................................................. 65 

Chapter 4 - Free movement of capital ................................................................................................................. 66 

Chapter 6 - Company law ................................................................................................................................... 67 

Chapter 7 - Intellectual property law .................................................................................................................. 68 

Chapter 8 - Competition policy ........................................................................................................................... 68 

Chapter 9 - Financial services ............................................................................................................................. 69 

Chapter 28 - Consumer and health protection ..................................................................................................... 70 

Cluster 3: Competitiveness and inclusive growth ................................................................................................... 72 

Chapter 10 - Digital transformation and media ................................................................................................... 72 

Chapter 16 - Taxation ......................................................................................................................................... 73 

Chapter 17 - Economic and monetary policy ...................................................................................................... 74 

Chapter 19 - Social policy and employment ....................................................................................................... 75 

Chapter 20 - Enterprise and industrial policy ..................................................................................................... 77 

1 

 
 
Chapter 25 – Science and research ..................................................................................................................... 78 

Chapter 26 - Education and culture ..................................................................................................................... 79 

Chapter 29 - Customs union ............................................................................................................................... 80 

Cluster 4: The green agenda and sustainable connectivity ...................................................................................... 81 

Chapter 14 - Transport policy ............................................................................................................................. 81 

Chapter 15 - Energy ............................................................................................................................................ 82 

Chapter 21 - Trans-European networks .............................................................................................................. 84 

Chapter 27 - Environment and climate change ................................................................................................... 85 

Cluster 5: Resources, agriculture and cohesion ....................................................................................................... 87 

Chapter 11 - Agriculture and rural development ................................................................................................ 87 

Chapter 12 - Food safety, veterinary and phytosanitary policy .......................................................................... 88 

Chapter 13 - Fisheries and aquaculture ............................................................................................................... 89 

Chapter 22 – Regional policy and coordination of structural instruments .......................................................... 90 

Chapter 33 - Financial and budgetary provisions................................................................................................ 91 

Cluster 6: External Relations ................................................................................................................................... 92 

Chapter 30 - External relations ........................................................................................................................... 92 

Chapter 31 - Foreign, security and defence policy .............................................................................................. 93 

Annex I – Relations between the EU and Ukraine .................................................................................................. 95 

Annex II – Statistical data ....................................................................................................................................... 98 

2 

 
 
 
 
 
 
1. 

INTRODUCTION1 

1.1. 

CONTEXT 

Despite  the  continuation  of  Russia’s  war  of  aggression,  Ukraine  has  shown  remarkable  resilience  and 
commitment to its European path. Ukraine applied for EU membership on 28 February 2022. Following 
the Commission’s recommendation in November 2023, the European Council in December 2023 decided 
to  open  accession  negotiations.  With  the  four  remaining  steps  set  out  in  the  Commission 
recommendations of November 2023 completed, the Council adopted the negotiating framework in June 
2024. The first Intergovernmental Conference marking the formal opening of the accession negotiations 
took place on 25 June 2024, and bilateral screening meetings have started in July. 

Regular  political  and  economic  dialogue  between  the  EU  and  Ukraine  has  continued  through  the 
Association Agreement including a Deep and Comprehensive Free Trade Area, and the joint bodies under 
the  agreement.  A meeting of  the  EU-Ukraine  Association  Council  took  place in  March  2023.  The  EU-
Ukraine  joint  security  commitments  signed  in  June  2024  stated  that  security,  resilience  and  defence 
support,  as  well  as  Ukraine’s  EU  accession  process,  support  to  reforms,  macro-financial,  humanitarian 
and  reconstruction  assistance  reinforce  each  other.  For  its  part,  Ukraine  committed  to  continue 
undertaking reforms in line with its EU path, including in the security, defence and intelligence sectors. 

Since the beginning of the Russian aggression, the EU and its Member States have mobilised almost EUR 
122 billion in support of Ukraine and its people. The Ukraine Facility entered into force on 1 March 2024 
providing up to EUR 50 billion in predictable and flexible support for Ukraine for 2024-2027, to support 
its recovery, reconstruction and modernisation, in line with its EU path. Of this amount, EUR 12.4 billion 
has  already  been  disbursed.  Most  funding  under  the  Facility  will  be  disbursed  to  the  State  budget  on 
fulfilment  of  the  conditions  included  in  the  Ukraine  Plan,  which  sets  out  the  reform  and  investment 
agenda  for  the  country.  The  recommendations  in  this  report  are  aligned  with  the  main  priorities  of  the 
Ukraine  Plan for  the  coming  12 months.  The  Ukraine  Donor  Platform (previously Multi-agency  Donor 
Coordination  Platform)  co-chaired  by  the  Commission  coordinates  support  not  just  for  established 
financing instruments but also Ukraine’s immediate financing needs and its future economic recovery and 
reconstruction needs across different sources. 

The  EU  supports  the  independence,  sovereignty  and  territorial  integrity  of  Ukraine,  within  its 
internationally recognised borders. Ukraine maintains a high level of alignment with the EU’s Common 
Foreign and Security Policy (CFSP). 

1 The 2024 report is presented in a renewed format and structure. Main findings of the report, together with the recommendations 
(previously  grey  assessment  boxes)  are  brought  together  at  the  beginning  of  the  report.  Furthermore,  under  the  fundamentals 
cluster, for better readability and comparability across all reports, certain data is provided (also) in the form of graphs. 

3 

 
 
 
 
 
 
1.2.  MAIN FINDINGS OF THE REPORT2 

CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS 

Democracy 

the 

legal  framework  remains  conducive 

Overall, 
the  organisation  of democratic  elections. 
Key recommendations  from  the  latest  OSCE/ODIHR  election  observation  mission  reports  have  been 
implemented. Electoral reforms should continue to address outstanding recommendations and prepare for 
the post-war elections. 

to 

The Ukrainian Parliament (Verkhovna Rada) continued to discharge its legislative function, ensuring an 
uninterrupted  democratic  decision-making  process.  Key  decisions,  especially  on  defence  and  security 
questions, were adopted by clear cross-party majorities. The use of urgent procedure to pass legislation is 
limited. Ukraine adopted a law on law-making, paving the way for a strengthened legislative process after 
the  lifting  of  martial  law.  However,  additional  efforts  are  needed  to  ensure  comprehensive  impact 
assessments for proposed legislation and legislative oversight of the executive, including monitoring the 
implementation of legislation during and after martial law. The parliamentary opposition needs to be able 
to perform its function. 

The main institutional  EU integration structures were set up and are actively involved in the screening 
process.  EU  integration  expertise,  planning  and  interinstitutional  mechanisms  should  be  further 
strengthened so that they can cope effectively with the EU accession process. This strengthening should 
include the drafting of a National Programme for the Adoption of the  Acquis. Active involvement of all 
stakeholders  needs  to  be  ensured  with  the  emphasis  on  cooperation  between  executive  and  legislative 
powers. The government needs to continue engaging in public communication on EU integration. 

Ukraine’s government has continued to perform its functions in an effective way, prioritising security and 
defence, EU integration, economic recovery and reconstruction. Decentralisation reform should advance. 

While  civil  society  organisations  (CSOs)  in  Ukraine  continue  to  operate  in  a  broadly  enabling 
environment,  reported  instances  of  pressure  against  civil  society  activists  and  organisations  raise 
concerns.  Ukrainian  authorities  should  take  swift  and  decisive  action  to  bring  perpetrators  to  justice, 
implement sanctions, and, where needed, strengthen existing mechanisms to protect civil society activists. 
The adoption of the Law on public consultations will help ensure that civil society remains an important 
part  of  Ukrainian  democracy  and  that  CSOs  are  generally  recognised  and  treated  as  such  by  state 
institutions. 

Public administration reform 

Ukraine has some level of preparation in the field of public administration reform and has made  some 
progress. Ukraine’s public administration has maintained its resilience in the current challenging context 
of  the  war,  and  continued  to  provide  services  for  the  public  and  for  businesses,  helped  by  a  sustained 
digitalisation of services. A law was adopted aligning and harmonising around 200 laws with the Law on 

2 This report covers the period from 15 June 2023 to 1 September 2024. It is based on input from a variety of sources, including 
contributions from the government of Ukraine, EU Member States, European Parliament reports and information from various 
international and non-governmental organisations. It also includes the results of comparative assessments and indices produced 
by other stakeholders, in particular in the area of rule of law. 

The report uses the following assessment scale to describe the state of play: early  stage, some level of preparation, moderately 
prepared,  good  level  of  preparation  and  well  advanced.  To  describe  progress  made  during  the  reporting  period,  it  uses  the 
following  scale:  backsliding,  no  progress,  limited  progress,  some  progress,  good  progress  and  very  good  progress.  Where 
appropriate, interim steps have also been used. 

4 

 
 
 
administrative  procedure  (LAP).  An  interim  salary  reform  was  introduced  via  the  2024  Budget  Law. 
Delivering  on  EU  enlargement  and  recovery  processes  will  require  Ukraine  to  strengthen  its  public 
administration’s capacity and improve human resource management, evidence-based policy making and 
monitoring. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should, in particular: 

→  in line with the Ukraine Plan,  advance with the salary reform by adopting legislation to introduce a 
fair and transparent remuneration framework based on functional classification positions; and adopt 
legislation to improve procedures for merit-based recruitment, promotion and dismissal; 

→  in  line  with  the  Ukraine  Plan,  make  progress  in  the  country-wide  roll-out  and  use  of  the  unified 

Human Resources Management Information System; 

→  complete implementation of the Law on administrative procedure, aligning sectoral and implementing 

legislation and bringing digital procedures into line with the law. 

Chapter 23: Judiciary and fundamental rights 

Ukraine has some level of preparation with regard to the judiciary, fight against corruption and respect 
for fundamental rights and made some progress.  

Functioning of the judiciary 

Ukraine  has  some  level  of  preparation  in  the  functioning  of  the  judiciary.  Some  progress    has  been 
made  during  the  reporting  period.  Ukraine  continued  to  implement  the  reform  of  selection  of 
Constitutional  Court  of  Ukraine  (CCU)  judges  and  appointed  two  new  CCU  judges.  The  High 
Qualification  Commission  of  Judges  (HQCJ)  resumed  the  selection  of  ordinary  judges  on  the  basis  of 
legislation that was improved in December 2023. It also restarted the process of qualification evaluation 
(vetting)  for  sitting  judges  with  the  involvement  of  the  Public  Integrity  Council  (PIC).  A  transparent 
selection  of  the  management  and  staff  of  the  Service  of  Disciplinary  Inspectors  continued.  One  new 
member  of  the  High  Council  of  Justice  (HCJ)  was  elected.  The  audit  of  the  e-judiciary  system  was 
completed. The unified criteria for evaluating the integrity of judges still need to be approved by the HCJ. 
The institutional capacities of the HCJ, HQCJ and the PIC should be strengthened in view of their high 
workloads.  Russia’s aggression against Ukraine has however continued to impose a human toll also on 
the judicial system, with several judges and court staff killed in Russian attacks throughout 2024.  

The Commission’s recommendations from last year were  partially met and remain valid. In the coming 
year, Ukraine should, in particular: 

→  in line with the Ukraine Plan, continue to fill judicial vacancies, based on improved legislation; set up 
a new court to hear administrative cases involving national state agencies following a transparent and 
merit-based selection procedure for its judges with the involvement of independent experts; 

→  in  line  with  the  Ukraine  Plan,  continue  the  qualification  evaluation  (vetting)  of  judges  in  line  with 
established  procedures  and  with  the  involvement  of  the  PIC;  start  and  continue  settling  old 
disciplinary proceedings (complaints) with the involvement of the Disciplinary Inspectors Service and 
based  on  the  prioritisation  criteria  approved  by  the  HCJ;  adopt  legislation  to  improve  judges' 
declarations of integrity and the procedure for verifying them;  

→  in line with the Ukraine Plan, adopt the law on the enforcement of court decisions related to monetary 
and non-monetary obligations and further digitalisation of enforcement proceedings; launch the data 
collection system for the enforcement of court decisions; adopt and start implementing a roadmap to 

5 

 
 
modernise IT in the judiciary based on audit results; 

→  continue  to  fill  judicial  vacancies  in  the  Constitutional  Court;  further  improve  the  legislative 
framework  for  investigations  and  adjudication  of  criminal  cases,  in  particular  as  regards  high-level 
corruption, including to review existing pretrial investigation time limits and to remove provisions in 
the  Criminal  Procedure  Code  on  the  automatic  closure  of  cases;  make  further  progress  on  the 
introduction  of  a  transparent  and  merit-based  selection  of  management-level  prosecutors  and 
strengthening of the disciplinary system for prosecutors, by amending the legal framework and taking 
the  necessary  institutional  measures;  take  effective  measures  to  address  corruption  risks  in  the 
Supreme Court. 

Fight against corruption 

Ukraine  has  some  level  of  preparation  in  the  prevention  of  and  fight  against  corruption.  It  has  made 
some  progress,  notably  by  strengthening  its  anti-corruption  institutional  framework  and  the  gradual 
building  of  a  track  record  in  investigating,  prosecuting  and  adjudicating  high-level  corruption  cases. 
Ukraine  has  strengthened  the  independence  and  the  institutional  capacity  of  the  Specialised  Anti-
Corruption  Prosecutor’s  Office  (SAPO),  the  National  Anti-Corruption  Bureau  of  Ukraine  (NABU)  and 
the National Agency for Corruption Prevention (NACP) by increasing the number of staff among other 
measures. This has helped specialised anti-corruption bodies to become more effective and to achieve a 
notable  level  of  enforcement  in  high-level  corruption  cases.  Targeted  risk  assessments  and  dedicated 
measures are needed to address corruption in the most vulnerable sectors. 

The  Commission’s  recommendations  from  last  year  were  mostly  implemented.  In  the  coming  year, 
Ukraine needs in particular to: 

→  in  line  with  the  Ukraine  Plan,  increase  the  number  of  judges  for  the  High  Anti-Corruption  Court 

(HACC) and increase the number of administrative staff; 

→  continue  efforts  to  further  improve  the  track-record  on  high-level  corruption  cases,  including  the 
seizure  and  confiscation  of  criminal  assets,  focusing  on  top  officials  and  high-impact  cases  that 
address systemic corruption in most relevant sectors and institutions; remove existing obstacles that 
hinder these efforts; strongly advance the implementation of the State Anti-Corruption Programme to 
a satisfactory level; 

→  further  strengthen  the  capabilities  of  NABU  pertaining  to  forensic  examinations  and  independent 
wiretapping; urgently finalise the deployment and complete operational use of the e-case management 
system  for  the  anti-corruption  agencies  and  the  HACC;  ensure  HACC  has  suitable  permanent 
premises. 

Fundamental rights 

Ukraine has implemented some key reforms, such as the overhaul of legislation on the protection of the 
rights  of  persons  belonging  to  national  minorities.  Other  necessary  reform  measures  –  such  as 
implementation  of  the  Istanbul  Convention,  improvement  of  the  support  system  for  persons  with 
disabilities and increased investigation of torture and ill-treatment in places of detention – have yet to be 
addressed. 

The Commission’s recommendations from last year were partially met and remain valid.  In the coming 
year, Ukraine should in particular: 

→  continue implementing the amended legislation on the protection of the rights of persons belonging to 
national minorities in close cooperation with national minority representatives and providing adequate 
resources and capacity-building to the relevant authorities; 

6 

 
 
→  adopt legislation on data protection in full compliance with EU acquis; fully implement the Istanbul 

Convention; review the performance of the National Preventive Mechanism; 

→  in  line  with the  Ukraine  Plan,  adopt the  strategy  for de-institutionalisation  of care  for  persons  with 

disabilities and older persons. 

Freedom of expression 

Ukraine is between having some level of preparation and a moderate level of preparation with regard 
to freedom of expression. Ukraine has made some progress, amid the constraints and adverse conditions 
created  by  the  ongoing  Russian  military  aggression,  such  as  the  roadmap  for  re-establishing  the  media 
landscape post-war. 

The Commission’s recommendations from last year were partially met and remain valid. In the coming 
year, Ukraine needs in particular to: 

→  ensure the  safety  and independence  of journalists  and  respect for  their  public  information role; and 

swiftly investigate all cases of intimidation and harassment against them; 

→  provide adequate funding for the public service broadcaster that would allow the independent public 

service media to carry out its role enshrined in Ukraine’s legislation; 

→  continue its efforts to maintain and gradually restore a transparent, pluralistic and independent media 
landscape, ensuring that restrictions imposed on security grounds are in compliance with key public 
rights and interests, such as access to information and media freedom. 

Chapter 24: Justice, freedom and security 

Ukraine  has  some  level  of  preparation  in  the  field  of  justice,  freedom  and  security,  and  made  some 
progress, notably  through the adoption  of  legislation criminalising  the  large-scale  smuggling  of  goods, 
updating laws strengthening financial investigations and anti-money laundering measures as well as the 
adoption of the action plan for the implementation of the overarching strategic plan on law enforcement 
reform (OAS AP). Ukraine also adopted a law on preventive restructuring frameworks, which is pending 
the  signature  of  the  President.  However,  multiple  shortcomings  persist.  Integrity  and  accountability 
mechanisms remain weak, as do institutional cooperation and coordination. As regards integrated border 
management (IBM), the launching of the IBM Coordination Centre contributed to effective data sharing 
and inter-agency cooperation, but further work is needed.    

The Commission’s recommendations from last year were partially met and remain valid. In the coming 
year, Ukraine should in particular: 

→  make tangible progress in implementing the  action plan for the implementation of the overarching 

strategic plan on law enforcement reform (OAS AP); 

→  introduce transparent and merit-based recruitment and selection procedures for managerial positions 
in  central  and  regional  offices  of  the  National  Police  and  the  State  Bureau  of  Investigation  (SBI), 
with  meaningful  involvement  of  independent  experts,  along  with  strong  disciplinary  and  anti-
corruption rules tailored to the local context and addressing actual corruption risks; 

→  adopt  a  new  integrated  border  management  (IBM)  strategy  with  an  action  plan  incorporating 

measurable implementation indicators. 

Fight against organised crime 

7 

 
 
Ukraine has some level of preparation to implement the EU acquis and made some progress, notably on 
firearms and other small arms and light weapons, financial investigations and revising legislation on the 
Economic  Security  Bureau  of  Ukraine  (ESBU).  However,  the  serious  and  organised  crime  threat 
assessment  (SOCTA)  has  still  not  been  adopted  and  no  body  has  yet  been  set  up  to  be  the  permanent 
national coordinator of the fight against organised crime. 

The Commission’s recommendations from last year were partially met and remain valid. In the coming 
year, Ukraine should in particular: 

→  in line with the Ukraine plan, enact the law reforming the Asset Recovery and Management Agency 

(ARMA); 

→  draft  and  adopt  the  SOCTA,  strengthen  the  institutional  capacities  needed  to  implement  it  and 

establish a permanent national coordinator to fight organised crime;  

→  continue  developing  and  adopt  relevant  legislation  on  financial  investigations,  allocate  sufficient 
resources, and provide additional trainings to ensure systematic conducting of financial investigations 
by law enforcement agencies. 

ECONOMIC CRITERIA 

The existence of a functioning market economy 

Ukraine has made some progress and is between an early stage of preparation and having some level 
of  preparation  in  establishing  a  functioning  market  economy.  Economic  growth  in  2023  exceeded 
expectations  and  inflation  fell  to  the  pre-war  central  bank  target,  which  allowed  the  rollback  of  some 
emergency measures. The authorities have made very good progress in implementing important reforms 
as  part  of  the  Ukraine  Plan,  International  Monetary  Fund  (IMF),  and  Macro  Financial  Assistance+ 
(MFA+)  programmes,  which  have  proven  to  be  effective  policy  anchors.  However,  in  the  challenging 
context of the war, public finances have continued to deteriorate, and the destruction of key infrastructure 
is severely disrupting economic activity. The business environment is affected by corruption, low levels 
of competition, and, increasingly, labour shortages.  

Ukraine  has  advanced  on  last  year’s recommendations,  which remain  valid.  In  the  coming  year,  taking 
into account also its commitments under the Plan, Ukraine should in particular: 

→  enhance  the  domestic  revenue  base  and  the  sustainability  and  transparency  of  public  finances,  in 
particular by rationalising tax exemptions, strengthening the functioning of the State Tax Service, and 
improving  publication  of  macro-fiscal  data,  including  general  government  data.  Continue  to 
implement  policies  underpinning  macroeconomic  and  financial  stability,  including  through  regular 
asset  quality  assessments  of  the  banking  sector,  and  start  implementing  the  Non-Performing  Loans 
strategy;  

→  adopt  the  state  ownership  policy  and  the  triage  document  for  state-owned  enterprises  (SOEs)  and 

continue deregulation efforts;  

→  step  up  efforts  to  tackle  the  growing  presence  of  labour  shortages  in  the  economy,  including  by 
implementing the Demographic Development Strategy, while also reducing informality in the labour 
market through relevant measures under the national revenue strategy. 

The capacity to cope with competitive pressure and market forces within the Union 

Ukraine is at an early stage of preparation in terms of its capacity to cope with the competitive pressure 

8 

 
 
and market forces within the EU and has made limited progress in this area against the background of 
the destruction caused by the war and limited resources available. 

Ukraine has advanced in last year’s recommendations, which remain valid. In the coming year, Ukraine 
should in particular: 

→  continue  taking  measures  to  support  the  repair,  rehabilitation  and  building  of  infrastructure,  in 
particular related to energy generation capacity, including from renewable decentralised sources; 

→  take  measures  to  facilitate  investment  by  establishing  a  unified,  comprehensive  and  transparent 
framework  for  planning and  management  of  public  investments,  implementing the  commitments  in 
the Roadmap for Public Investment Management and the corresponding action plan;  

→  take steps to improve the quality of education and training to ensure outcomes align with the needs of 
the labour market, including the skills required for reconstruction, in particular through implementing 
the reforms and investments set out in the Ukraine Plan in this area. 

Chapter 5 - Public procurement 

Ukraine has some level of preparation in the area of public procurement. Limited progress was made, 
primarily through the  preparation of a draft law on public procurement the adoption of the Strategy for 
Reforming  the  Public  Procurement  System  for  2024-2025,  and  progress  in  reducing  exceptions  to  the 
laws on public procurement required under martial law. 

The  Commission’s  recommendations  from  last  year  were  only  partially  met  and  remain  valid.  In  the 
coming year, Ukraine should in particular: 

→  make  progress  towards  adopting  EU-acquis-compliant  laws  on  public  procurement  and  on 

concessions and public-private partnerships (PPPs); 

→  draw up a road map for enhancing public procurement control by the State Audit Service, in line with 

the Ukraine Plan; 

→  assess the relevance of the current exceptions to public procurement legislation under martial law and 

take measures to reduce them to the minimum. 

Chapter 18 - Statistics 

Ukraine has some level of preparation in official statistics. In view of the martial law, respondents are 
not obliged to provide data and hence data collection by the State Statistics Service of Ukraine (SSSU) is 
very limited. Despite these circumstances, Ukraine has made some progress towards alignment with the 
EU  acquis,  including  the  adoption  of  the  national  law  on  statistics  to  integrate  the  European  Statistics 
Code of Practice, the classification of the statistical regions of Ukraine, and approval of the Programme 
for the development of official statistics up to 2028. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should, in particular: 

→  further  strengthen  the  administrative  capacity  of  the  SSSU  and  the  coordination  of  the  national 

statistical system to improve the quality of statistics;  

→  increase  the  production  and  transmission  of  timely,  high-quality  statistics  to  Eurostat,  sex-

disaggregated where relevant. 

Chapter 32 - Financial control 

9 

 
 
Ukraine  is  at  an  early  stage  of  preparation  for  implementing financial  control.  Ukraine made  limited 
progress concerning internal controls and external audit. 

The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should, in particular: 

→  increase the quality of public sector internal auditing and bring it in line with relevant international 
standards  by  adopting  the  new  international  internal  audit  standards  and  strengthen  the  role  of  the 
Centralised Harmonisation Unit; 

→  strengthen  the  mandate  and  political,  financial  and  administrative  independence  of  the  Accounting 

Chamber of Ukraine, through the adoption of a new law; 

→  strengthen  oversight  of  the  state  budget  by  increasing  cooperation  between  Parliament  and  the 
Accounting  Chamber  and  improve  the  state  financial  control  system  in  line  with  international 
standards and EU best practice and the commitments under the Ukraine Plan. 

CLUSTER 2: INTERNAL MARKET 

Chapter 1 - Free movement of goods 

Ukraine is moderately prepared in the field of free movement of goods and has made  some progress 
through  alignment  with  the  EU  product  acquis  and  the  reintroduction  of  market  surveillance  in  some 
sectors. 

The Commission’s recommendations from last year were partially met and remain valid.  In the coming 
year, Ukraine should in particular: 

→  ensure full alignment with the EU acquis on market surveillance and resume full implementation of 

inspections and checks by the market surveillance authorities; 

→ 

further align legislation with the acquis on general principles and harmonised sectoral legislation; 

→  pursue  full  integration  into  the  European  Quality  Infrastructure  in  the  field  of  standardisation, 

metrology and market surveillance. 

Chapter 2 - Freedom of movement for workers 

The country remains at an early stage of preparation in the field of freedom of movement of workers. 
No progress was made. 

The  Commission’s  recommendations  from  last  year  were  not  implemented  and  remain  valid.  In  the 
coming year, Ukraine should in particular: 

→  bring  its  legal  framework  into  line  with  the  EU  acquis  on  access  to  the  labour  market,  and  in 

particular with rules on non-discrimination on grounds of nationality against EU workers; 

→  work  on  concluding  agreements  on  social  security  coordination  and  healthcare  insurance  with  EU 

Member States. 

→  Carry  out  preparatory  work  towards  joining  the  European  Network  of  Employment  Services 

(EURES) upon accession. 

Chapter 3 - Right of establishment and freedom to provide services 

10 

 
 
 
Ukraine has some level of preparation in relation to the right of establishment and freedom to provide 
services. Limited progress was made. Further efforts are needed to align legislation with the EU acquis 
under this chapter. 

The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should in particular: 

→  take  measures  towards  eliminating  existing  restrictions  for  the  provision  of  services,  using  the 

possibilities provided for by the Association Agreement; 

→  continue progress on alignment with the EU postal acquis, including the Regulation on cross-border 

parcel delivery services; 

→  continue progress in aligning with the EU acquis on mutual recognition of professional qualifications. 

Chapter 4 - Free movement of capital 

Ukraine is between having some level of preparation and a moderate level of preparation in the field 
of  the  free  movement  of  capital.  Some  progress  was  made,  in  particular  as  regards  relaxation  of  the 
foreign currency  restrictions  introduced during martial  law.  Furthermore,  Ukraine  made  preparations to 
apply for the Single European Payments Area (SEPA). 

The Commission’s recommendations from last year were partially met and remain valid. In the coming 
year, Ukraine should in particular: 

→  in  line  with  the  Ukraine  plan,  prepare  and  implement  the  next  National  Risk  Assessment  in 
accordance  with  the  updated  methodology  for  the  national  assessment  of  money  laundering  and 
terrorist financing risks in Ukraine; 

→  continue preparations to apply to join SEPA; 

→  take steps to set up a unified registry of bank accounts for individuals and legal entities in line with 
the  EU  acquis  and  complement  legislation  on  beneficial  ownership  registration  for  all  types  of 
corporate and legal entities in Ukraine, including trusts. 

Chapter 6 - Company law 

Ukraine has some level of preparation in the field of company law. Some progress was made, including 
legislative amendments on foreign branches and country-by-country reporting by multinational enterprise 
groups,  and  aligning  national  accounting  standards  with  international  financial  reporting  standards 
(IFRSs) for SMEs. 

The Commission’s recommendations from last year were only partially met and therefore remain valid. In 
the coming year, Ukraine should in particular: 

→  develop  a technological solution for transferring  the  financial  statements  of  registered legal  entities 

into a unified state register; 

→  make  further  improvements  concerning  transparency  requirements  for  capital  markets,  in  line  with 

EU acquis; 

→  further align legislation with the EU acquis, on digital tools and processes and takeover bids. 

Chapter 7 - Intellectual property law 

Ukraine  has  some  level  of  preparation  on  intellectual  property  law.  Limited  progress  was  made, 
namely adoption of implementing legislation to implement the Law on copyright and related rights. 

11 

 
 
The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should in particular: 

→  continue alignment with the EU  acquis on copyright, industrial property rights, as well as on trade 

secrets; 

→  improve the functioning of collective management organisations and the payment of royalties to right 

holders; 

→  further improve the industrial property rights (IPR) enforcement system, in particular by combating 
piracy and counterfeit products, making the intellectual property court operational, and leverage the 
collaboration with the European Union Intellectual Property Office. 

Chapter 8 - Competition policy 

Ukraine  has  some  level  of  preparation  in  competition  policy  and  there  was  limited  progress.  The 
amendments to the Law on the protection of economic competition entered into force in January 2024. 

The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should in particular: 

→  amend the law on State aid to align it with the EU acquis and fully unsuspend the application of State 

aid control by AMCU, in line with the commitments in the Ukraine Plan; 

→  compile  a  reliable  and  comprehensive  inventory  of  State  aid  schemes  instituted  before  the 

establishment of the authority responsible for State aid control in Ukraine;  

→   pursue further steps towards alignment with the EU acquis under this Chapter, including the State aid 
acquis  in  connection  with  services  of  general  economic  interest,  also  following  the  relevant 
commitments in the Ukraine Plan. 

Chapter 9 - Financial services 

Ukraine has some level of preparation in the field of financial services and has made some progress. It 
continued to reverse emergency measures, strengthened regulation of non-bank financial services, notably 
by implementing new legislation on insurance and credit unions. 

The  Commission’s  recommendations  from  2023  were  partially  implemented  and  remain  valid.  In  the 
coming year, Ukraine should in particular: 

→  start preparations for an independent asset quality assessment of the banking sector, in line with the 

Ukraine Plan commitments; 

→  continue  to  align  banking  regulations  (including  bank  resolution  and  bank  deposit  guarantee 
schemes) and regulations for non-banking sectors, including insurance and regulation of securities 
and capital markets, investment funds and financial market infrastructures; 

→ 

in line with the Ukraine Plan, further implement the new Law on the National Securities and Stock 
Market  Commission,  following  the  principles  of  the  International  Organisation  of  Securities 
Commission. 

Chapter 28 - Consumer and health protection 

Ukraine  has  some  level  of  preparation  in  consumer  and  health  protection.  Some  progress  was  made 
with limited reintroduction of market surveillance, new measures on cancer prevention and initiatives on 
communicable diseases, serious cross-border health threats and health inequalities. 

12 

 
 
The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  adopt  legislation  that  aligns  with  the  EU  acquis  on  market  surveillance  and  on  general  product 

safety; 

→  adopt a national health strategy and action plan, including provisions on public healthcare and health 
information  systems,  underpinning  investments  in  the  sector,  in  line  with  Ukraine  Plan 
commitments; 

→  adopt legislation that further aligns with the EU acquis on serious cross-border threats to health. 

CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH 

Chapter 10 - Digital transformation and media 

Ukraine is between a moderate and a good level of preparation in the field of digital transformation 
and  media.  It  made  some  progress.  Notably,  Parliament  adopted  the  Law  on  amendments  to  certain 
legislative  acts  regarding  implementation  of  European  legislation  on  roaming.  Ukraine  also  started 
preparatory work on the regulatory framework for radio spectrum policy and further developed its well-
advanced e-government system. In addition, Article 36 of the Law on media entered into force, bringing 
Ukraine into line with the EU Code of Conduct on countering illegal hate speech online. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  ensure full alignment with EU roaming acquis and its implementation that would allow integration 

of Ukraine into the EU “roam like at home” area;  

→  ensure  that  independent  telecom  and  media  regulators  and  central  executive  bodies  in  the  field  of 
electronic communications have sufficient funding and human resources to perform their role; 

→ 

further align with the EU Directive on the security of network and information systems (NIS), in line 
with Ukraine Plan commitments. 

Chapter 16 - Taxation 

Ukraine has some level of preparation in the field of taxation. Good progress was made. Notably, the 
Tax Code was amended to further align it with EU acquis. The first automatic exchange of information on 
financial accounts started successfully in 2024. 

The  Commission’s  recommendations  from last  year were  well implemented  but  remain  valid  as further 
alignments should be pursued. In 2024, Ukraine should in particular: 

→ 

improve in aligning legislation on VAT incentives, the structure of excise duties and rates; 

→  amend national legislation to further align it with the Anti-Tax Avoidance Directive; 

→  make  further  progress  in  preparing  to  implement  provisions  of  the  Directive  on  Administrative 

Cooperation (DAC) concerning exchange of information with EU Member States. 

Chapter 17 - Economic and monetary policy 

Ukraine is moderately prepared in the field of economic and monetary policy. Since last year, there has 
been  good  progress,  with  a  gradual  return  to  a  flexible  exchange  rate  regime  without  undermining 

13 

 
 
 
macroeconomic  stability, inflation  targeting  as  well as  by  reinstating the  publication  of  a medium-term 
budgetary framework. 

The  Commission’s  recommendations  from  last  year  were  implemented.  In  the  coming  year,  Ukraine 
should in particular: 

→  continue  implementation  of  the  NBU  strategy  to  ease  foreign  exchange  restrictions,  transition  to 

greater exchange rate flexibility and return to inflation-targeting; 

→  limit monetary financing of the state budget; 

→  improve  medium-term  budgetary  framework  policies  and  practices,  in  particular  by  enhancing 

technical capacities. 

Chapter 19 - Social policy and employment 

The country remains at an early stage of preparation in the field of social policy and employment and 
limited progress has taken place. 

The  Commission’s  recommendations  from  last  year  were  only  partially  met  and  remain  valid.  In  the 
coming year Ukraine should in particular: 

→  adopt new framework legislation for labour relations and occupational safety and health in line with 
the  EU  acquis,  ensure  an  enabling  environment  for  bipartite  and  tripartite  social  dialogue,  and 
strengthen the capacities of social partners; 

→  adopt the strategy for de-institutionalisation of alternative care for children in line with Ukraine Plan 

commitments and ensure implementation of the related reforms; 

→  continue to reform the social benefit system and put in place a system for procuring social services in 
line  with  the  Ukraine  Plan  commitments,  so  as  to  improve  their  targeting,  adequacy  and 
sustainability. 

Chapter 20 - Enterprise and industrial policy 

Ukraine is between having some level of preparation and a moderate level of preparation in the field 
of enterprise and industrial policy. Since last year, it has made good progress, notably in setting mid-term 
priorities for SMEs in the SME strategy and its action plan until 2027, approved by the Government  in 
August  2024.  A  new  version  of  the  action  plan  on  deregulation  was  also  adopted  in    September  2024 
providing measures for dynamic deregulation and enhancement of the business environment, in line with 
the Ukraine Plan.  

The  Commission’s  recommendations  from  last  year  were  largely  implemented.    In  the  coming  year, 
Ukraine should, in particular: 

→  in  line  with  the  Ukraine  Plan,  continue  deregulation  and  digitalisation  of  permitting  procedures  to 

further enhance the business environment and investment climate in Ukraine; 

→  implement measures to stimulate private sector and industrial development, facilitate the transition to 
the  production  of  goods  with  higher  added  value  and  support  incentives  to  attract  foreign  direct 
investment. 

Chapter 25 – Science and research 

Ukraine is moderately prepared in the field of science and research. Some progress has been achieved, 
notably in integrating Ukraine into Horizon Europe and on regional smart specialisation strategies. 

14 

 
 
The Commission’s recommendations from last year were partially met and remain valid. In the coming 
year, Ukraine should in particular: 

→  intensify  efforts  to  take  advantage  of  the  opportunities  presented  by  Horizon  Europe,  taking 
advantage of the establishment of the Horizon Europe office in Ukraine and taking active part in the 
relevant governance structures; 

→  continue enabling the administrative conditions to design regional smart specialisation strategies. 

Chapter 26 - Education and culture 

Ukraine has some level of preparation  in education and culture. Some progress was made, including 
with measures on education and training statistics, improvements to the network of education institutions, 
approval of a strategic plan on education reforms, adoption of a National Strategy for the Development of 
Inclusive Education for 2024-2029 and its corresponding action plan for 2024-2026, as well as adoption 
of the law on preschool education. 

The  Commission’s  recommendations  from  last  year  were,  therefore,  well  implemented.  In  the  coming 
year, Ukraine should, in particular:  

→  ensure that legislation on preschool education is implemented; 

→  ensure that legislation on vocational education is adopted and enters into force; 

→  ensure that the Strategy for the Development of Ukrainian Culture is adopted. 

Chapter 29 - Customs union 

Ukraine has a good level of preparation with regard to the customs union and made good progress. The 
Ukrainian Customs Code was further aligned with the EU Customs Code. The International operation of 
the  New  Computerised  Transit  System  –  phase 5 (NCTS-P5)  started  successfully  in  April  2024.  A law 
criminalising large-scale smuggling of all goods was adopted. 

The Commission’s recommendations from last year were well implemented.  In the coming year, Ukraine 
should in particular: 

→  progress with the implementation of recent amendments to the Customs Code and finalise and adopt a 

new Customs Code, aligned with the EU Customs Code; 

→  make progress in implementing the Strategic Plan for digitalisation of the State Customs Service for 

2024-2026 and further proceed with extending the current NCTS phase 5 to NCTS phase 6;  

→  improve administrative capacities of the State Customs Service by implementing competency-based 
people management approach into main HR processes (selection, performance appraisal, professional 
development and trainings).  

CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY 

Chapter 14 - Transport policy 

Ukraine has some level of preparation in the field of transport policy, with limited progress achieved. 

The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should in particular: 

15 

 
 
 
→  adopt the Law on railway transport creating an institutional and legislative set-up for competitive rail 
market in line with EU standards and as required by the Ukraine Plan, and start preparatory work for 
a law amending certain legislative acts on merchant shipping and shipping on inland waterways; 

→  adopt the revised  National  Transport  Strategy  2030  and  the  Strategy  for  developing  and  expanding 
the border infrastructure with EU member states and the Republic of Moldova until 2030 in line with 
the Ukraine Plan, and start implementation; 

→  adopt  the  social  and  market  rules  for  road  transport,  strengthen  administrative  capacities  and 
enforcement  of  the  compliance  with  the  haulage  market  rules  and  measures  of  traffic  safety  and 
establish inspection and investigation bodies for rail, road and inland waterways. 

Chapter 15 - Energy 

Ukraine  has  a  good  level  of  preparation  in  the  field  of  energy  and  made  some  progress.  It  adopted 
renewables  legislation  and  a  National  Energy  and  Climate  Plan  and  implemented  market  coupling 
measures.  Ukraine  has  suffered  the  steady  massive  destruction  of  its  energy  infrastructure,  which  has 
negatively  impacted  its  security  of  supply  and  planning  capability.  The  gas  sector  has  seen  increasing 
monopolisation under martial law. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming period, Ukraine should in particular: 

→  advance the green energy transition by starting to implement the National Energy and Climate Plan 
(NECP), adopting a market-based legislative and regulatory framework for renewable energy (RES) 
investment in line with Ukraine Plan commitments and resolving the issue of debt settlement for RES 
producers; 

→  advance electricity market reforms by adopting and implementing the electricity integration package 
(which will involve designating a Nominated Electricity Market Operator amongst other measures), 
and  taking  next  steps to  implement the  law  on  wholesale  energy  market  integrity  and  transparency 
(REMIT)  (which  will  involve  adopting  implementing  legislation  and  developing  the  IT  system)  in 
line with Ukraine Plan commitments; 

→  in line with Ukraine Plan commitments, adopt legislation to further strengthen the energy regulator’s 

independence and build a track record of fair and transparent decision-making. 

Chapter 21 - Trans-European networks 

Ukraine  has  some  level of  preparation in  the  field of  TENs,  with  some  progress  achieved,  related  to 
energy trading with the EU. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  assess  the  potential  for  upgrades  to  critical  energy  and  transport  infrastructure,  including  with 
neighbouring countries, and plan those upgrades; ensure better connections with EU Member States 
through more efficient TEN-T rail and road border-crossing points; 

→  further  align  with  and  implement  the  TEN-T-  and  TEN-E-related  regulatory  framework,  including 
alignment  with  the  new  TEN-T  and  TEN-E  Regulations  and  improvements  to  the  permit-granting 
process for TEN-E projects; 

→  develop administrative capacities and scale up project preparation to ensure that transport and energy 

infrastructure projects can be implemented in line with EU standards. 

16 

 
 
Chapter 27 - Environment and climate change 

Ukraine  has  some  level  of  preparation  in  the  field  of  environment  and  climate  change  and  has  made 
some progress including enhanced public access to environmental information, adoption of legislation on 
waste  management,  industrial  pollution,  chemicals,  and  water  quality.  On  climate,  some  progress  was 
made with the adoption of the framework law on climate policy in October 2024, formalising Ukraine’s 
alignment  with  the  EU’s  long-term  target  of  climate  neutrality  by  2050,  and    the  National  Energy  and 
Climate Plan (NECP)  in  June 2024. The ongoing war and the martial law hinder the implementation of 
some of the legislation.  

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  ensure  environment  and  climate  mainstreaming  and  the  application  of  cross-cutting  horizontal 
environmental  legislation,  in  particular  regarding  environmental  impact  assessment  (EIA)  and 
strategic  environmental  assessment  (SEA),  to  all  plans,  programmes,  and  projects,  including  those 
relating to reconstruction. This implies further limiting the regime of exemptions, and implementing 
and enforcing the EU acquis relating to environmental crime, liability and access to justice; 

→  based  on  the  Law  on  State  climate  policy,  prepare  and  submit  a  new,  more  ambitious  Nationally 
Determined Contribution under the Paris Agreement, update the long-term low-emission development 
strategy and ratify the Kigali Amendment to the Montreal Protocol; 

→  progress  towards  an  effective  carbon-pricing  mechanism  by  resuming  the  compulsory  monitoring, 
reporting and verification of greenhouse gas emissions and adopting the action plan for setting up a 
national emissions trading system. 

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION 

Chapter 11 - Agriculture and rural development 

Ukraine  remains  at  an  early  stage  of  preparation  in  the  field  of  agriculture  and  rural  development. 
Some progress was made in further aligning legislation with the EU  acquis, including legislation on 
quality policy and organic farming. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  adopt and start implementing the Strategy for Agriculture and Rural Development up to  2030, and 
strengthen the administrative capacity for its implementation, and continue the alignment to the EU 
acquis;  

→  implement  legislation  on  the  SAR,  and  use  the  SAR  for  all  agriculture  and  rural  development 

support programmes; 

→  develop a farm sustainability data network (FSDN). 

Chapter 12 - Food safety, veterinary and phytosanitary policy 

Ukraine  remains  moderately  prepared  in  this  chapter.  Some  progress  was  made,  notably  by 
implementing the strategy for alignment with the acquis, extending the use of the EU’s trade control and 
expert system (TRACES) and reforming food safety institutions. 

The  Commission’s  last  year’s  recommendations  were  partially  implemented  and  remain  valid.  In  the 
coming year, Ukraine should in particular: 

17 

 
 
 
→  conclude  the  legislative  alignment  needed  to  meet  the  requirements  of  the  AA  on  plant  health, 
genetically  modified  organisms  and  official  controls,  further  align  with  the  EU  animal  welfare 
legislation and strengthen administrative capacities for implementing the requirements; 

→  continue extending the use of TRACES with new certificates, for phytosanitary and other purposes; 

→  continue  the  reform  of  food  safety  bodies  and  enforce  animal  registration,  identification  and 

movement monitoring, in line with EU requirements. 

Chapter 13 - Fisheries and aquaculture 

Ukraine  has  some  level  of  preparation  in  the  field  of  fisheries  and  aquaculture.  Good  progress  was 
made.  An  electronic  management  system  was  set  up  and  legislation  was  adopted  in  line  with  the  EU 
acquis. 

The Commission’s recommendations from last year were well implemented.  In the coming year, Ukraine 
should in particular: 

→  continue  to  align  national  legislation  with  the  EU  acquis,  including  legislation  on  the  collection, 

management and use of data, the traceability of aquatic resources and inspection system; 

→  take preparatory steps towards the setting-up of a dedicated fisheries control body to combat illegal, 

unreported and unregulated (IUU) fishing; 

→  continue to upgrade Ukraine’s state electronic fisheries management system (e-Fish) and harmonise it 

with equivalent EU registers. 

Chapter 22 – Regional policy and coordination of structural instruments 

Ukraine  has  some  level  of  preparation  in  the  field  of  regional  policy  and  coordination  of  structural 
instruments.  Limited  progress  was  made,  with  more  notable  progress  in  implementing  territorial 
cooperation programmes (Interreg) with the Member States. 

The Commission’s recommendations from last year were partially implemented and remain valid. In the 
coming year, Ukraine should in particular: 

→  operationalise  the  State  Strategy  of  Regional  Development  by  drafting  and implementing  an  action 

plan; 

→  ensure that adequate financial support is allocated to the recovery, reconstruction and modernisation 

needs of sub-national authorities; 

→  strengthen  the  coordination  framework  within  regional  policy  to  ensure  systematic  and  inclusive 

engagement of regional and local stakeholders, coordinated by the government. 

Chapter 33 - Financial and budgetary provisions 

Preparations under this chapter are at an early stage. There was limited progress in the areas covered 
by the chapter. 

The Commission’s recommendation from last year were only partially implemented and remains valid. In 
the coming year, Ukraine should: 

→  set up a coordination structure for administrative processes needed for an own resources system and 

further strengthen awareness among key stakeholders. 

18 

 
 
 
CLUSTER 6: EXTERNAL RELATIONS 

Chapter 30 - External relations 

Ukraine has a good level of preparation in the field of external relations, with significant convergence 
with  the  EU.  Limited  progress  was  made,  mainly  through  ensuring  that  Ukraine’s    trade  policy  has 
largely remained  in compliance with World Trade Organization (WTO) and AA rules. 

The Commission’s recommendations from last year were only partially implemented and remain valid. In 
the coming year, Ukraine should in particular: 

→  continue to ensure that its trade policy remains in compliance with WTO and AA rules, including by 
ensuring respect to the obligations on National Treatment of GATT Article III:4 and Article 34 of the 
Association Agreement; 

→  before  any  new  bilateral  trade  agreement,  assess  its  impact,  in  light  of  candidate  status  and 
forthcoming accession, ensuring that any such agreement contains a clause allowing early termination 
in the event of EU accession. 

Chapter 31 - Foreign, security and defence policy 

Ukraine  has  a  good  level  of  preparation  in  the  field  of  foreign,  security  and  defence  policy.  Good 
progress  is  demonstrated  by  continued  intense  political  dialogue  with  the  EU  at  all  levels  and 
significantly enhanced security and military cooperation with the EU and its Member States. EU-Ukraine 
joint security commitments were signed in June 2024. Ukraine maintains a high level of alignment with 
the EU’s common foreign and security policy (CFSP). 

The recommendations from 2023 were well implemented but remain valid. In the coming year, Ukraine 
should in particular: 

→  align  Ukraine’s  legislative  framework  with  the  provisions  of  the  Rome  Statute  of  the  International 

Criminal Court (ICC) and its related instruments; 

→  further align with statements by the High Representative on behalf of the EU and with EU sanctions 

(Official EU Council positions and CFSP actions). 

1.3. 

STATE OF PLAY OF THE ACCESSION NEGOTIATIONS 

Following  the  first  Intergovernmental  Conference on  accession  negotiations  with  Ukraine,  the 
Commission launched the bilateral screening process on 8 July, building on the explanatory meetings held 
earlier. The process is progressing smoothly. 

   

19 

 
 
 
 
 
 
 
2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS 

2.1. FUNCTIONING OF DEMOCRATIC INSTITUTIONS AND PUBLIC ADMINISTRATION REFORM 

Ukraine’s  constitution and  legislation  enshrine the  principles  of  democratic  pluralism  and  a multi-party 
political  system,  the  rule  of  law  and  respect  for  fundamental  rights.  On  24 February  2022,  as  a 
consequence  of  Russia’s  war  of  aggression,  Ukraine  temporarily  invoked  martial  law  by  a  Presidential 
decree approved by Parliament. Martial law has remained in place since then, with the current thirteenth 
extension valid up to 9 November 2024. 

Martial law allows for the introduction of certain restrictions on individual rights and freedoms, and on 
the  rights  and  legal  interests  of  legal  entities.  Its  application  has  been  proportionate,  overall.  Cases  of 
disproportionate  travel  restrictions  for  representatives  of  the  parliamentary  opposition  and  alleged 
pressure on civil society organisations (CSOs) need to be properly addressed. 

2.1.1 Democracy 

Elections 

No  elections  were  conducted  during  the  reporting  period,  as  they  are  prohibited  under  martial  law.  In 
November  2023  and  April  2024,  representatives  of  all  parliamentary  groups  made  a  commitment  to 
holding the first post-war election, with sufficient notice, once martial law has ended. 

Work  on  a  comprehensive  revision  of the electoral  code  progressed.  On  27 May  2024,  a  draft  law  was 
registered, implementing OSCE/ODIHR recommendations on balanced representation of women and men 
in Parliament and on local councils. The Central Election Commission, in cooperation with international 
partners  and civil  society  organisations,  developed  a  draft  package  of  amendments  to  the  legal 
and organisational frameworks for elections, including amendments on updating the electoral register and 
out-of-country  voting.  Ukraine  implemented  key  recommendations  from  the  OSCE/ODIHR  election 
observation  reports.  However,  some  recommendations  still  need  to  be  addressed,  including  those  on 
removing  restrictions  on  electoral  rights  based  on  intellectual  or  psychosocial  disability  and  on 
implementing practical measures in polling stations to strengthen the secrecy of the ballot. Ukraine should 
also take into account the Commission Recommendation3 on inclusive and resilient electoral processes.  

Parliament 

Parliament continued to exercise its powers despite the ongoing war and martial law and has been taking 
an active part in the overall reform process and carrying out legislative tasks. Between 15 June 2023 and 
1 September 2024, 277 laws were adopted, out of which 239 fully entered into force.  

Ukraine took steps to strengthen the legislative process, by adopting the law on law-making, which is to 
be  enacted  one  year  after  the  end  of  martial  law.  Its  effects  have  yet  to  be  assessed.  In  the  meantime, 
Parliament should take practical steps to improve the overall procedural and methodological framework 
for impact assessment of draft legislation and ex post legislative evaluation. Parliament also amended the 
legislation  on  procedures  for  appointing  judges  to  the  Constitutional  Court,  and  laws  on  parliamentary 
committees,  on  the  status  of  National  Deputies  and  on  temporary  investigative  commissions.  In  June 
2024,  the  law  on  public  consultations  was  adopted,  which  will  be  an  important  step  in  increasing 
transparency and quality of the legislation once the martial law is lifted. 

Parliament  continued  to  work  in  a  way  that  was  not  wholly  transparent.  In  the  reporting  period 
journalists  were  readmitted  to  the  chamber,  albeit  with  some  limitations  relating  to  security  concerns. 
However,  recordings  of Parliament's  deliberations,  including  plenary  sessions,  have  been  regularly 
published online – by Parliament itself and by individual Members of Parliament . 

In  August  2023,  the  law  on  political  parties  was  amended  to  improve  the  legal  framework  for  state 

3 Commission Recommendation (EU) 2023/2829 of 12 December 2023 

20 

 
 
 
funding  of  political  parties  and  state  oversight  of  parties’  activities.  The  amendments  restored  the 
requirement  for  parties  to  submit  reports  to  the  National  Agency  on  Corruption  Prevention  (NACP). 
Legislation  on  political  parties  is  still  in  need  of  a  comprehensive  update,  including  procedures  for 
holding political parties to account for breaches of financing rules. 

There  were  no  significant  changes  concerning  parliamentary  oversight  and  control.  The  monitoring 
and implementation of legislation requires further strengthening. Due to the war, parliamentary oversight 
is mostly limited to closed meetings between leaders of majority or parliamentary groups and individual 
ministers, which is suboptimal. Reinstating public consultations and scrutiny is crucial, when martial law 
is lifted. 

Concerning  gender  balance,  the  share  of  female  MPs  slightly  increased  in  the  reporting  period  and 
remains at a record high level. Overall, women are represented in political life, but structural barriers to 
such  as 
active  participation, 
traditional  gender  norms,  remain 
in place. 

In the reporting period, a number 
of  opposition  MPs  were  subject 
to  certain  restrictions,  especially 
as regards travelling abroad. It is 
vital  for  democratic  resilience 
that  there  continues  to  be  space 
for political  dialogue  with  the 
opposition,  civil  society  and 
independent  media,  as  well  as  a 
diplomatic role for Parliament in 
promoting  Ukraine’s  needs  and 
reforms abroad. 

EU integration 

The  institutions  in  charge  of  the  EU  integration  process  are  in  place.  Following  the  December 2023 
European Council decision on opening accession negotiations with Ukraine, the first Intergovernmental 
Conference took place on 25 June 2024. The bilateral phase of the screening started in July, based on the 
explanatory meetings held between January and May 2024. 

The Ukrainian Delegation for the accession negotiations was appointed, with the Deputy Prime Minister 
for European and Euro-Atlantic integration of Ukraine as Chief negotiator. 

Playing  a  central  role  within  the  Ukrainian  institutional  set-up  for  EU  integration  is  the  Government 
Office for Coordination on European and Euro-Atlantic Integration, within the Secretariat of the Cabinet 
of  Ministers  of  Ukraine.  Deputy  ministers  responsible  for  European  integration  were  appointed  in  the 
ministries.  To further  consolidate  EU  integration  structures,  expert  groups  were  set  up  to  deal  with  the 
technical aspects of the EU integration process. 

There  is  an  overall  consensus  among  Ukrainian  society  and  authorities,  including  the  parliamentary 
opposition, that EU integration is a priority for the country. A large majority of the Ukrainian population 
supports EU membership for the country. 

Governance 

Despite Russia’s ongoing war of aggression, Ukraine’s government has continued to function effectively. 
In the reporting period, there were changes in the composition of the government (in place since March 
2020) and six ministers were replaced. The government focused on strengthening security and defence, 
pursuing reforms related to EU integration, ensuring macroeconomic stability, and supporting economic 

21 

 
 
and general recovery. 

Multi-level  governance  remained  crucial  to  the  country's  resilience  and  recovery.  Tangible  measures 
aimed at exploiting the potential of municipalities should be put back on track, as set out in the Ukraine 
Plan,  in  line  with  the  European  Charter  of  Local  Self-Government.  Recently  adopted  laws  on 
transparency in local self-government and on democracy at the local level, which is yet to be signed by 
the President, aim to improve local decision-making. 

A  transparent  mechanism  should  be  set  up  to  finance  the  recovery,  reconstruction  and  modernisation 
needs  of  sub-national  authorities,  in  line  with  the  Ukraine  Facility  Regulation.  A  formal  coordination 
framework  has  yet  to  be  put  in  place  to  ensure  that  local  authorities  and  associations  are  consistently 
involved in policy design and implementation. 

With the growing number of local military administrations, Ukraine should clarify, in law, the criteria for 
setting  them  up.  Discontinuation  of  local  self-government  should  be  a  last  resort;  alternative  security 
measures should be given preference where the situation allows, especially in the territories away from 
the frontline. 

Fiscal  decentralisation  was  maintained,  with  64%  of  personal  income  tax  (PIT)  allocated  to 
municipalities,  yet  PIT  from  military  staff  was  re-directed  to  strategic  industries.  To  stabilise  the  local 
fiscal base, Ukraine should make progress on ensuring a fair distribution of PIT to municipalities where 
taxpayers actually reside, upgrade real estate registries, thus extending the local-tax base, and introduce 
reasonable administrative fees for local services. 

Civil society 

CSOs in Ukraine continue to contribute to the resilience of society at large. Civil society remains a key 
element in Ukrainian democracy, maintaining social bonds and fabrics. A policy and legal framework to 
facilitate volunteering in CSOs is in place. Despite restrictions imposed by martial law, CSOs continued 
their  activities  relatively  unhindered.  Registering  non-governmental  organisations  is  easy,  inexpensive 
and  transparent  in  principle,  but  it  is  reported  that,  during  registration,  excessive  bureaucratic 
requirements and checks by various authorities (tax authorities, Ministry of Justice) can create delays and 
difficulties  for  CSOs  in  practice.  Constructive  collaboration  between  authorities  and  CSOs  does  take 
place in a wide range of policy areas. 

Since  2023,  there  have  been  an  increasing  number  of  reports  of  pressure  being  put  on  CSOs  and 
investigative journalists. These include threats and intimidation against journalists, media professionals, 
civil  activists  and  lawyers,  which  is  an  issue  of  serious  concern.  In  response,  the  National  Police  and 
Security  Service 
issued  public 
condemnations  and  spoke  of  swift  and  impartial  investigations.  Sustained  follow-up  will  be  needed  to 
bring  the  perpetrators  to  justice  (for  these  more  recent  attacks  and  similar,  older  ones),  along  with 
measures to strengthen existing mechanisms to protect civil society activists from such pressures. 

launched  enquiries,  while  representatives  of 

the  government 

Current rules on money laundering and the financing of terrorism can make it hard for CSOs to access 
banking services. Efforts to address these issues – in collaboration with responsible authorities and CSOs 
– should continue. 

The  government  expanded  its  public  funding  programmes  for  CSOs.  Ukraine  has  several  strategic 
documents that foster civil society engagement. These continued to be implemented in a consultative and 
transparent process. In June 2024, the Law on public consultation was adopted, requiring extensive  and 
mandatory  consultations  by  state  authorities  and  local  self-government  in  decision-making  before 
adopting legislation. However, the Law will not enter into force until 12 months after the end of martial 
law. 

2.1.2. Public administration reform 

22 

 
 
Strategic framework for public administration reform (PAR) 

The  strategic  framework  for  public  administration  is  in  place.  The  PAR  strategy  still  needs  to  be 
implemented more effectively. 

The 2022-2025 PAR strategy and 2022-2025 public financial management (PFM) strategy are in place, 
together  with  the  accompanying  action  plans.  Progress  has  been  consistent  on  service  delivery, 
digitalisation  and,  more  recently,  was  demonstrated  in  salary  reform  steps,  but  it  has  been  much  less 
pronounced in the fields of public service and human resource management, and in the digitalisation of 
internal business processes within public administration. 

The internal institutional framework within PAR remains unchanged. The Secretariat of the Cabinet of 
Ministers (SCMU) played the formal leadership role. Collaboration and synergy between the responsible 
institutions  in  the  field  of  civil  service  digitalisation  needs  strengthening.  Management  and 
coordination mechanisms for PAR and PFM strategies are in place and operational. The role of the PAR 
Coordination  Council  in  implementing  the  PAR  strategy  should  be  strengthened,  with  a  more  results-
oriented approach. The financial sustainability of PAR remains a challenge. 

Policy development and coordination 

The policymaking system is coordinated by the SCMU. The capacity for evidence-based policy making 
remains  insufficient.  The  quality  of  explanatory  notes  and  impact  analysis  accompanying  legislative 
proposals is poor and should be improved. Information on the costing of policy documents and legislative 
acts is largely absent. 

The role of the government as an initiator of draft legislation continued to be limited, with most adopted 
draft legislation submitted by Members of Parliament (MPs). Parliamentary drafts often lack explanatory 
notes and proper impact assessments, which affects the quality of laws. The Law on public consultation 
was  adopted,  which  makes  public  consultations  mandatory  on  laws  and  by-laws  submitted  by  the 
government  and  local  self-government  bodies.  The  law  does  not  provide  for  mandatory  public 
consultation on draft legislation submitted by MPs, which significantly reduces its scope. 

The monitoring of the implementation of policies and legislation has been adversely affected by the war 
and is conducted on an ad hoc basis. As for implementation of the Ukraine Plan, the monitoring, control 
and audit systems have been set up and are based on proper internal control principles. 

Public finance management 

Public finance management is broadly in place and efforts to improve it are ongoing. The reform process, 
partially suspended in 2022, has resumed gradually. The 2022-2025 Public Finance Management Reform 
Strategy  aims  to  restore  medium-term  budget  planning  in  2024.  The  2024-2030  National  Revenue 
Strategy adopted in December 2023 focuses on mobilising tax collection, aligning national tax legislation 
with  the  EU  requirements,  upgrading  IT  systems  and  improving  human  resource  management  in  the 
medium to long term. 

A  roadmap  for  public  investment  management  (PIM)  reform  was  developed  in  2023,  with  an  action 
plan for its implementation adopted in June 2024. The action plan sets out several steps for introducing 
the regulatory framework, increasing institutional capacity, introducing strategic planning and creating a 
methodology and IT architecture for PIM.  

The Strategic Investment Council, which is at the core of the institutional setup of the PIM system, was 
established  in  May  2024.  The  first  Single  Project  Pipeline  was  formed  for  approval  by  the  Strategic 
Investment  Council  in  September  2024.  The  institutional  framework  of  the  PIM  system  needs  to  be 
further strengthened in order to enhance transparency, accountability, and effectiveness at all stages of the 
public investment management cycle. This includes reinforcing the institutional capacity of the Strategic 
Investment Council and its role in facilitating inter-ministerial co-ordination in the PIM system. 

23 

 
 
There is a need to improve planning capacity to ensure the development of a strategic vision for Ukraine’s 
economic  recovery  and  reconstruction.  This  will  help  to  inform the development  of strategic  plans and 
documents defined in the PIM action plan and guide the prioritisation of projects in sectoral pipelines and 
the Single Project Pipeline.  

The procedures for public investment at the local level need to be aligned with the general principles of 
the decentralisation reform. Moreover, Ukraine has committed to developing and implementing a digital 
management tool for reconstruction under the Ukraine Plan. 

Ukraine has made progress in piloting the Digital Restoration EcoSystem for Accountable Management 
(DREAM) as an integral part of the IT architecture to support the PIM process. 

Budget transparency and openness needs to be restored, except where security concerns preclude it. A 
new budget planning IT tool is being used to draw up the 2025 budget. An independent fiscal oversight 
body  has  yet  to  be  established  to  monitor  compliance  with  fiscal  rules,  fiscal  risks  and  government 
forecasting.  Effective  oversight  of  the  budget  process  is  needed.  Expenditure  needs  to  be  made  more 
effective  at  all  levels  the  government,  given  the  sizeable  gap  between  planned  and  actual  spending. 
Gender-based budgeting is still at a very early stage, and not reflected in the Budget Code. 

Public service and human resources management 

Public  service  and  human  resources  management  still  needs  to  be  improved.  Martial  law  continues  to 
have a significant influence on the civil service regulatory framework.  During the COVID-19 pandemic 
and since the introduction of martial law, there has been no competitive recruitment and selection to the 
civil  service  based  on  merit  and  equal  opportunities.  The  widespread  use  of  non-transparent  direct 
appointments continues to undermine the professionalism, independence and stability of the civil service. 
Although turnover rates have decreased since 2019, both staff turnover and vacancy rates remain high.  

Progress  was  made  in  implementing  job  classifications,  with  the  introduction  of  the  ‘interim’  salary 
reform  via  the  2024  Budget  Law.  Salaries  are  now  based  on  job  classification  and  pay  grades,  pay 
bonuses  are  limited,  and  management  has  less  power  in  defining  salaries.  However,  the  system  is  still 
based on the concept of ‘levels of jurisdiction’ of institutions, where all institutions are divided into three 
groups with five different basic salary levels without transparent criteria for this division. The effects of 
the  interim  reform  should  be  analysed  with  the  view  to  designing  a  sustainable  framework  under  a 
comprehensive law. 

Internal digitalisation and the roll-out of the human resource management information system advanced 
slowly  with  coverage  of  some  40 000  posts.  Further  progress  is  needed  in  this  field.  In  particular,  the 
payroll  system  should  be  used  more  widely,  in  all  government  entities.  This  should  result  in  fully 
transparent and comparable human resource data across the entire civil service. 

Gender  balance  in  the  civil  service  continues  to  be  uneven.  At  the  end  of  2023,  senior  civil  service 
management  comprised  70%  men  and  30%  women,  middle  management  34%  men  and  66%  women, 
while 22% of non-managerial civil servants were men and 78% women. 

Accountability of the administration 

The  administration  needs  to  be  made  more  accountable.  There  has  been  no  significant  redesign  of  the 
organisational  architecture  of  public  administration.  Internal  governance  within  ministries  lacks  a  clear 
separation  of  powers  at  the  highest  level  of  management,  namely  between  deputy  ministers  and  state 
secretaries. In ministries, large policy areas are managed and coordinated by political appointees (deputy 
ministers) instead of professionally selected senior public service managers. 

Ukraine managed to keep the system of public accountability operational, yet certain mechanisms need 
improvement. The recommendations of the independent oversight bodies (Ombudsman and Accounting 
Chamber) should be followed by public administration. However, scrutiny by the Accounting Chamber 
requires further improvement and the relevant legislation should be aligned with international standards. 

24 

 
 
The  right  of  citizens  to  access  public  information  is  well-regulated  and  consistently  applied.  Ukraine 
regularly and systematically publishes open data on the dedicated government portal, but access to some 
public information is restricted for security reasons. 

The Law on administrative procedure, which entered into force in December 2023, unified administrative 
procedures to further align them with EU practices and to strengthen the right to good administration. The 
law  was  accompanied  by  substantive  training  for  officials  at  all  levels.  In  October  2024,  a  law  was 
adopted to align and harmonise around 200 laws with the LAP and bring existing exemptions back into its 
scope.  Further  harmonisation  is  still  needed  as  regards  the  tax  code,  land  relations  sector  and  digital 
procedures.  The application of the law to the National Bank of Ukraine’s public administration functions 
was postponed until January 2025 to provide sufficient time for its implementation. The adoption of the 
Law on citizen appeals should help delineate between administrative procedure cases and other forms of 
public petitions. 

As for the right to administrative justice, no new court was established since the abolition of the Kyiv 
district administrative court (KDAC) in December 2022. The Kyiv region administrative court, which has 
been temporarily assigned to handle KDAC cases, has struggled to address the backlog. This undermines 
access to administrative justice involving central government bodies. 

Service delivery to the public and to businesses 

Service delivery to  the public and to businesses is working overall.  User-focused service delivery  and 
digitalisation features under the Government Priority Action Plan for 2024 and continues to enjoy strong 
political  support.  Progress remained consistent,  in  particular  due to  a  progressive  uptake of new  digital 
services.  Offline  provision  of  services  continued  via  a  large  network  of  local  administrative  service 
centres (ASCs). The number of ASCs that are accessible to people with disabilities and senior citizens is 
steadily growing. To further increase administrative service provision capacity, Ukraine should adopt the 
proposed Law on administrative fees. 

2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS 

2.2.1  Chapter 23: Judiciary and fundamental rights 

The EU’s founding values include the rule of law and respect for human rights. An effective (independent, 
high-quality  and  efficient)  judicial  system  and  an  effective  fight  against  corruption  are  of  paramount 
importance, as is respect of fundamental rights in law and in practice. 

Functioning of the judiciary 

Strategic documents 

The 2021-2023 strategy for the development of the justice system and constitutional judiciary expired at 
the end of 2023 and has not yet been replaced by a new strategy. Ukraine should develop a new mid-term 
strategic  document  for  the  justice  system.  It  should  cover  optimisation  of  the  court  network,  court 
management  and  judicial  governance  system,  consolidation  of  the  Supreme  Court  and  an  improved 
selection  procedure  for  its  judges,  modernisation  of  procedural  codes,  enforcement  of  court  decisions, 
alternative  dispute  resolution,  digitalisation,  and  reforms  of  the  Bar,  legal  education  and  the  judicial 
training system. 

The action plan implementing the overarching strategic plan for reform of the law enforcement sector for 
2023-2027, which inter alia foresees some prosecutorial and legal education reforms, was adopted by the 
Cabinet of Ministers in August 2024 (See Chapter 24). 

Management bodies 

The  main  management  bodies  are  in  place.  The  High  Council  of  Justice  (HCJ)  was  renewed  with  the 

25 

 
 
 
involvement of the Ethics Council, and it currently consists of 17 out of 21 members. Two HCJ vacancies 
need  to  be  filled  under  the  President’s  quota  for  which  the  competition  is  ongoing  and  two  under  the 
quota  of  the  Congress  of  Attorneys.  After  the  resignation  of  the  chairman  of  the  renewed  High 
Qualification Commission of Judges (HQCJ), a new chairman was elected by the HQCJ in August 2024, 
while the competition for one HQCJ vacancy continued. In December 2023, the HCJ dismissed the Head 
of the State Judicial Administration on suspicion of corruption and nominated his deputy as acting head 
while the competition was ongoing. 

The  new  Public  Integrity  Council  (PIC),  composed  of  20  civil  society  and  media  representatives,  was 
formed  in  August  2023.  Its  cooperation  with  the  HQCJ  in  qualification  evaluation  and  on  judicial 
selection procedures is positive overall, despite some differences when assessing the integrity of judicial 
candidates. The HQCJ should systematically ensure transparency and adequate reasoning in its decision-
making and the HQCJ and PIC should further improve their cooperation.   

The  Council  of  Prosecutors  (CoP)  and  the  Qualification  and  Disciplinary  Commission  of  Prosecutors 
(QDCP) continued their operation, but their independence, in particular from the Office of the Prosecutor 
General (OPG), integrity, powers and autonomous resources need to be strengthened. The CoP is still a 
part-time body. 

Independence and impartiality 

Overall,  the  constitution  and  legislation  guarantee  the  independence  of  the  judiciary,  but  certain 
shortcomings persist, in law and in practice. Business associations still raise concerns about the judiciary 
and corruption as obstacles to doing business in Ukraine. The renewed judicial-governance bodies need to 
continue their work, alongside other measures, to effectively improve the independence, impartiality and 
accountability of the judiciary and restore public trust in it, which remains very low. 

The allocation of cases to judges is based on a randomised (automatic) system and objective criteria, but it 
should  be  further  improved  as  part  of  the  renewal  of  the  unified  judicial  information  and 
telecommunication  system  (UJITS).  Legislation  should  be  changed  to  ensure  that  judges  cannot  be 
involved in decisions on their own recusal and that such decisions are subject to appeal. In July 2023, the 
Criminal  Code  article  criminalising  intentional  unjust  court  decisions  was  repealed  to  better  protect 
judicial independence. 

Ukraine still needs to introduce a system of random allocation of cases among prosecutors based on strict 
and  objective  criteria,  including  specialisation,  with  proper  safeguards  against  manipulation  and  an 
effective appeal mechanism against decisions disqualifying a prosecutor. 

250

200

150

100

50

0

Graph 2: Ukraine - Requests for protection from 
undue influence

200

128

14

8

0

2022

93

61

0

2023

High Council of Justice

Requests received
Outcome of decisions Validation
Outcome of decisions Rejection
Outcome of decisions Pending

Source: Ministry of Justice 

26 

the 

The selection of judges of the Constitutional 
Court of Ukraine (CCU) continued with the 
involvement  of  the  Advisory  Group  of 
Experts.  Several  competitions  had  to  be 
relaunched due to the shortage of candidates 
selection  criteria.  The 
who  met 
Parliament (in May 2024) and the Congress 
of  Judges  (in  September  2024)  appointed 
one  new  CCU  judge  each,  following  a 
transparent  procedure.  The  competition  for 
filling 
remaining  CCU  vacancies 
continues.  Ukraine  should  adopt  legislation 
improving  the  constitutional  procedure,  in 
line  with  the  2021  Venice  Commission 
recommendations. 

four 

 
 
Accountability 

The  rules  on  accountability  for  the  judiciary  are  largely  in  place,  but  need  to  be  further  upgraded  and 
enforced  in  practice.  In  November  2023,  the  HQCJ  resumed  the  qualification  evaluation  (vetting)  of 
sitting judges with the involvement of the PIC. Some 2 500 judges have undergone this procedure, while 
more  than  1  700  judges  still  have  to.  From  November  2023  to  August  2024,  the  HQCJ  evaluated  125 
judges and recommended 28 for dismissal, including 2 who refused the evaluation. The HCJ dismissed 4 
judges. The Supreme Court issued a decision in June 2024 which deviated from its previous practice and 
which may undermine the qualification evaluation procedures involving the PIC prior to December 2023. 
The  qualification  evaluation  experienced  delays  due  to  limited  capacities  of  the  HQCJ,  the  PIC,  the 
National Agency for Corruption Prevention (NACP) and the National Anti-Corruption Bureau of Ukraine 
(NABU). While the NABU and the NACP should step up their analytical support to the HQCJ, the latter 
should  also  develop  autonomous  capabilities,  e.g.  for  testing  legal  knowledge  and  conducting  credible 
integrity checks.  The  PIC’s  capacities  and  efficiency  should  be strengthened,  e.g.  by  providing support 
staff and by enhancing access to information. The HCJ should step up its review of HQCJ submissions on 
the dismissal of judges who fail the qualification evaluation.  

inspectors  of 

Graph 3: Ukraine - Disciplinary 
procedures outcome of decisions 
- 2023

Following the adoption of legislation in August and September 2023, the HCJ resumed handling a severe 
backlog  of  some  14 000  disciplinary  complaints  against 
judges  and,  in  November  2023,  it  approved  criteria  for 
prioritising  disciplinary  complaints.  In  December,  the  HCJ 
launched the competitions for the  head, deputy  head and  24 
disciplinary 
the  Service  of  Disciplinary 
Inspectors  (SDI).The  SDI  urgently  needs  to  be  set  up  to 
support the HCJ in addressing a large backlog of disciplinary 
complaints.  The  HCJ  rules  on  prioritisation  of  disciplinary 
cases  should  be  systematically  applied  and  priority  cases 
handled  without  delays.  The  HCJ  should  improve  the 
reasoning  and  uniformity  of  practice  in  disciplinary  cases. 
Disciplinary  offences  relating  to  judges’  conduct  need  to  be 
defined more precisely, in line with the  Council of Europe’s 
Group 
(GRECO) 
recommendations. 

against  Corruption 

Sanctions pronounced

Prosecutors

Completed

States 

Initiated

Judges

1000

of 

104

250

100

172

20

10

12

6

1

Source: CEPEJ

To  enhance  the  accountability  of  the  judiciary  and  public  trust  in  it,  Ukraine  should  adopt  legislation 
revising the system of judges' declarations of integrity. An upgraded system should include, for judges of 
the highest courts, a temporary but meaningful verification procedure that involves independent experts. 
Corruption risks in the Supreme Court still need to be adequately addressed, in particular through the use 
of improved integrity declarations and verifications by the HQCJ, as well as asset declaration checks and 
lifestyle monitoring by the NACP, and an improved selection of Supreme Court Judges on the basis of the 
new  legislative  framework  and  unified  criteria  for  evaluating  the  integrity  of  judges,  approved  by  the 
HCJ. 

The NACP has prepared the procedures for verification of asset declarations and lifestyle monitoring for 
ordinary  and  CCU  judges,  but  these  have  not  been  accepted  by  the  HCJ  and  the  CCU,  while  new 
procedures were not yet prepared.  

The attestation of prosecutors is being completed. It includes integrity and professionalism vetting.  The 
attestation should be completed without further delays and prosecutors failing it should be dismissed in 
line with the law, while pending court cases should be resolved. The disciplinary system for prosecutors 
should be further improved in line with GRECO recommendations. The QDCP’s composition should be 
reviewed  to  increase  the  share  of  prosecutors  and  a  transparent  selection  procedure  for  all  QDCP 
members  should  be  introduced,  including  a  credible  integrity  check.  The  power  to  review  complaints 

27 

 
 
against decisions of the QDCP should be transferred to the CoP. 

Quality of justice 

The  legal  framework  for  the  selection  of  judges  has  been  improved  through:  the  adoption  of  a  law  in 
December  2023  that  streamlined 
judicial  selection  rules,  shortened 
the  stages  of  competitions  and 
defined 
for 
candidates; the setting of common 
HQCJ-PIC 
for 
determining  non-compliance  with 
integrity  and 
the  criteria  of 
the 
and 
ethics; 
professional 
adoption  by  the  HQCJ  of  new 
regulations 
competitive 
for 
selection of judges and evaluation 
of candidates.  

indicators 

integrity 

criteria 

The  judiciary  continues  to  suffer 
from  severe  understaffing.  More 
than  2000  vacancies remain  to  be 
filled (August 2024). The number 
of  judicial  vacancies  grew  during  the  reporting  period,  largely  due  to  retirement  and  resignations.  A 
difficult  situation  also  persisted  with  the  non-judge  court  staff  amid  low  salaries  and  resignations.  The 
HQCJ  opened  three  competitions  for  first-instance  court  judges,  appeal  court  judges  and  High  Anti-
Corruption  Court  (HACC)  judges  at  the  first  and  appellate  level.  From  January  to  July  2024,  the  HCJ 
filed 399 submissions for appointment of judges to the President, while the latter appointed 329 judges. 
Given the  wide  scope  of work  and  high  workload,  the  capacities  of the  HQCJ  and  the    HCJ  should  be 
reinforced, and their secretariats further reformed.   

More efforts are needed to ensure the uniformity of court  practice within the first, appeal and cassation 
instances. Divergent court practice is inter alia caused by heavy caseload, insufficient procedural filters, 
absence of measures to ensure uniformity of case law at the appellate level, underdeveloped research and 
analytical capacities and IT tools in courts. Further reforms in this area require a thorough assessment and 
inclusive consultations. 

The  system  for  selecting  management-level  prosecutors  still  needs  to  be  improved,  in  particular  to 
enhance transparency and ensure credible integrity, professionalism and leadership checks. The selection 
and  dismissal  procedures  for  the  Prosecutor  General  should  be  made  more  transparent,  objective  and 
meritocratic, and less prone to politicisation. 

Periodic performance evaluation of judges and prosecutors is needed, based on clear, objective rules and 
assessment  criteria  in  line  with  GRECO  recommendations.  Currently,  there  are  two  parallel  systems 
envisaged for evaluating prosecutors, without the involvement of prosecutorial governance bodies. These 
systems  remain  questionable.  No  progress  was  made  on  Bar  reform  during  the  reporting  period.  The 
relevant legislation has yet to be aligned with the Constitution, applicable European standards and good 
practices. The reform should follow inclusive consultations and aim to reset the National Bar Association 
of  Ukraine  bodies  based  on  a transparent  procedure and  substantially  improve qualification,  admission, 
disciplinary, financial management and continuous training systems. 

The  National  School  of  Judges  (NSJ)  and  the  renewed  Prosecutorial  Training  Centre  continued  their 
training  activities  and  international  cooperation.  Institutional  reforms  of  the  NSJ  should  still  be 
implemented  to  strengthen  the  NSJ’s  managerial  and  operational  capacities.  The  NSJ  should  also 

28 

 
 
introduce a comprehensive training needs assessment and evaluation, and modernise its training curricula 
and teaching methods. 

1
0,8
0,6
0,4
0,2
0

Graph 5: Ukraine - Alternative dispute 
resolution - 2023

n/a

n/a

n/a

Settlement
agreements

Finalised
mediations

Mediators

Mediation cases

n/a: not available

Some progress on legal education reform was achieved. 
The  law  on  individual  educational  paths  was  adopted, 
enabling  an  overhaul  of  legal  education  standards. 
Requirements  for  admission  of  law  students  were 
strengthened.  The  Government  started  removing  pre-
higher  education  institutions  from  the  legal  education 
system. The first Unified State Qualification Exam was 
held  for  law  graduates,  albeit  exempting  graduates  of 
law  enforcement  universities.  Ukraine  should  separate 
legal  education  and  law  enforcement  training,  and 
should  further  strengthen  and  unify  legal  education 
standards,  admission,  licencing  and  funding  rules, 
while  increasing  the  focus  on  EU  law,  practical  legal 
skills and integrity. 

The  judiciary  continues  to  suffer  from  severe  underfunding  and  war-related  damage  to  court 
infrastructure.  Funding  for  the  judiciary  in  the  2024  budget  covered  only  around  57%  of  its  needs, 
although it was increased compared to 2023. 

Further  efforts  are  needed to expand  alternative  dispute resolution (ADR), including  implementation  of 
the 2021 mediation law. There is no national data collection system on various forms of ADR, including 
on the number of mediators and mediation cases. Arbitration is underdeveloped and underused. 

Efficiency 

Despite war-related problems and other challenges, most courts in Ukraine maintained a high degree of 
efficiency. However, more efforts are needed to digitalise the justice system, including the court and case 
management, and enforcement of court decisions. In December 2023, a technical audit of the UJITS was 
completed; it concluded that the UJITS is largely obsolete and in need of an overhaul. A functional audit 
of  UJITS,  completed  in  August  2024,  pointed  to  the  deficiencies  in  the  judiciary’s  ICT  coordination, 
management  and  maintenance  processes.  Ukraine  should  also  adopt  legislation  to  expand  the  use  of 
remote online hearings. Some progress was achieved with the regulation of electronic cabinet use for the 
exchange of documents, interoperability between UJITS and other state registers and digitalisation of the 
criminal justice chain. In April 2024, Ukraine started developing an e-case management system for pre-
trial criminal investigations (SMEREKA). 

Following  the  abolition  of  the  controversial  Kyiv  district  administrative  court  (KDAC)  in  2022,  a  new 
court  still  needs  to  be  set  up  with  the  involvement  of  independent  experts  and  a  credible  integrity  and 
professionalism check of candidates. The Kyiv region administrative court, which has been temporarily 
assigned  to  handle  KDAC  cases,  has  struggled  to  address  the  backlog.  The  qualification  evaluation 
procedure for all former KDAC judges must be completed. 

In May 2024, the Parliament adopted legislation that allows certain criminal cases to be heard by a single 
judge of the HACC (rather than by a panel of three judges, depending on the severity of the penalty) to 
increase  efficiency.  The  Parliament  also  introduced  the  right  for  certain  high-level  officials  (including 
members of parliament) to opt for their criminal cases in any court to be heard by a panel of three judges 
regardless of the severity of the penalty. This provision should be reviewed in view of its proportionality 
and its impact on judicial efficiency. 

29 

 
 
Graph 6.1 Ukraine - Efficiency of 
courts (%)

107

99

98

100

99

100

98

95

108
106
104
102
100
98
96
94
92
90
88

Graph 6.2 Ukraine - Efficiency of 
courts (days) 

89

88

77

66

66

54

33

24

100
90
80
70
60
50
40
30
20
10
0

1st
instance

2nd
instance

1st
instance

2nd
instance

1st
instance

2nd
instance

1st
instance

2nd
instance

Criminal cases

Non-criminal cases*

Criminal cases

Non-criminal cases*

Clearance rate in 2022 %
Clearance rate in 2023 %

Disposition time 2022 (days)
Disposition time 2023 (days)

*Civil and commercial cases,
administrative cases, non-litigous
cases, other cases

Source: CEPEJ and national
authorities for 2nd instance

*Civil and commercial cases,
administrative cases, non-litigous
cases, other cases

Source: CEPEJ and national
authorities for 2nd instance

Legislative changes to the Criminal Procedure Code were introduced in December 2023 to remove time-
limits for investigations and the mandatory closure of cases upon expiry of these time-limits  before the 
notice of suspicion. As regards the phase after the notice of suspicion, the mandatory closure of criminal 
cases due to the expiration of the time-limit and the length of the time limit should be reviewed to ensure 
effective investigations. 

Ukraine  has  a  large  number  of  non-executed  judgments  from  the  European  Court  of  Human  Rights 
(ECtHR).  Most  of  these  relate  to  enforcement  of  domestic  court  decisions,  prison  and  detention 
conditions, lengthy judicial proceedings or the independence and accountability of the judiciary. Ukraine 
should also launch the data collection system on the enforcement of court decisions, adopt legislation on 
enforcement and digitalisation of enforcement proceedings, and continue implementing the strategy and 
action  plan  for  resolving  the  problem  of  non-enforcement  of  domestic  court  decisions.  Beside  existing 
moratoria on enforcement, in May 2024, Ukraine adopted a law introducing a temporary moratorium on 
insolvency  and  enforcement  actions  against  critical  infrastructure  companies  controlled  by  the  state.  It 
contains provisions, which could negatively impact on the enforcement of court decisions.  

International crimes 

As of August 2024, 142 059 criminal proceedings related to international crimes were registered, and 911 
persons were indicted and 305 convicted for war crimes and the crime of aggression. The draft law on the 
ratification of the Rome Statute of the International Criminal Court was adopted in August 2024. Related 
implementing  legislation  aligned  with  international  criminal  law  standards  has  yet  to  be  adopted. 
September 2023 saw the adoption of the Strategic Plan on Implementation of Prosecutorial Competences 
in  the  area  of  International  Crimes  Prosecution  for  2023-2025.  The  Plan  is  aimed  at  building  the 
capacities of the prosecution service and pre-trial investigation bodies, and strengthening inter-agency and 
international cooperation in this field. The OPG increased support for victims and witnesses and adopted 
standard operating procedures for more effective investigation and prosecution of international crimes.  

Fight against corruption 

Track record 

The  track  record  on  the  fight  against  corruption  has  further  improved.  Anti-corruption  institutions 
continued  their  efforts  in  building  a  credible  track-record  of  investigating  and  adjudicating  high-level 
corruption  cases  and  the  overall  number  of  indictments  and  judgments  during  the  reporting  period  has 

30 

 
 
      
 
reached an all-time high since the key anti-corruption institutions.  

Increasingly, NABU and SAPO are tackling complex crime schemes and systemic corruption. NABU and 
SAPO  should  further  improve  their  case  prioritisation  policy  and  work  on  more  high-level  and  high-
impact  cases.  In  addition,  the  value  of  assets seized  and  confiscated  in  NABU  proceedings is  still low. 
This warrants analysis and new strategic approaches. 

Institutional framework 

The  institutional  framework  for  the  fight  against  corruption  is  largely  in  place  but  needs  to  be  further 
improved in terms of both preventive measures and law enforcement. NABU and SAPO have maintained 
their  operational  effectiveness  and  remain  important  institutional  pillars  in  the  anti-corruption 
infrastructure.  Their  institutional  capacity  was  further  strengthened  and,  following  the  adoption  of 
legislative  amendments  in  December  2023,  NABU  and  SAPO  have  gradually  started  to  increase  their 
human  resources.  In  March,  SAPO  became  a  separate  legal  entity,  which  formalised  its  institutional 
independence from the Office of the Prosecutor General. NABU still lacks appropriate access to timely 
and  independent  forensic  services  and  autonomous  wiretapping  capabilities  in  its  high-level  corruption 
investigations.  The  powers  of the head  of  SAPO should  be  gradually  expanded.  For  example,  the  head 
should  be  able  to  open  investigations  and  approve  investigative  actions  by  NABU/SAPO  against 
members  of  parliament  independently  from  the  Prosecutor  General.  An  increase  in  NABU’s  regional 
presence and capacities should be considered.  

Following an internal investigation and disciplinary proceeding, the NABU Director dismissed his First 
Deputy  in  September  due  to  misconduct  against  a  whistle-blower  who  reported  an  alleged  leakage  of 
information.  It  will  be  important  that  NABU  addresses  the  underlying  internal  structural  issues  to 
effectively prevent leaks of information and ensures the effectiveness of its Internal Control Department. 
Appropriate  actions  should  be  taken to implement the  results  and  recommendations  of the forthcoming 
external  independent  NABU  audit.  The  deployment  of  the  NABU-SAPO  e-case  management  system 
progressed  slowly.  Remaining  legal  and  technical  obstacles  should  be  addressed,  particularly  those 
preventing defence lawyers from connecting to the system, to ensure its immediate full deployment and 
complete operational use. 

The  HCJ  and  the  HQCJ  launched  a  competition  to  recruit  25  new  judges  to  the  HACC,  which  would 
bring the total number of judges to 63. In this regard, it will be important that the current mandate of the 
PCIE  will  be  extended  to  ensure  that  these  judges  are  selected  with  the  full  participation  of  the  PCIE. 
HACC also intends to recruit additional staff and is in urgent need of suitable permanent premises. 

The NACP has delivered good results and shown its independence from political and vested interests. A 
new NACP head was selected in February 2024. After the restoration of the e-asset declaration system in 

31 

 
 
 
October  2023,  the  Agency  re-opened  public  access  to  the  register  of  declarations.  In  December  2023, 
additional  legislation  was  enacted  removing  the  NACP’s  restrictions  on  verification  of  assets  acquired 
before the declarant took public office, as well as restrictions on renewed verification of declarations. The 
NACP  reformed  its  approach  to  verifications  of  asset  declarations  with  a  new  focus  on  risk-based 
assessments, but further streamlining of internal procedures is necessary. Many successful cases originate 
from  external  notifications  and  the  NACP  should  raise  the  number  of  cases  of  unexplained  wealth 
detected  through  its  own  analysis.  Although  the  NACP  has  access  to  relevant  registers  and  databases, 
several are outdated and require significant updates. The Verkhovna Rada should broaden penalties for 
unexplained  wealth  and  considerably  reduce  the  currently  applicable  thresholds  to  make  the  sanctions 
regime  relevant  and  effective.  In  addition,  it  should  be  considered  to  extend  the  personal  scope  of  the 
asset declaration obligation also to staff of private offices of high level political officials, including their 
advisors and assistants.   

With respect to  whistleblower protection,  NACP launched the unified whistleblower reporting portal in 
September 2023 as a way of centralising all reporting on corruption crimes; however, less than 10% of 
entities  are fully  connected  to  the portal.  The  number  of  whistleblower  reports submitted to  the  NACP 
increased from 1 328 in 2022 to 2 730 in 2023 but only 15 cases  went to court. The HACC issued two 
decisions granting monetary awards to two whistleblower in the total amount of EUR 325 000.  

Strategic documents 

Strategic  policy  documents  are  in  place  and  of  high  quality.  The  2021-2025  State  Anti-corruption 
Strategy is currently being implemented through the 2023-2025 State Anti-Corruption Programme (SAP) 
and action plan. 

The NACP has a dedicated unit and launched an IT system for monitoring implementation of the SAP. 
However, that implementation is behind schedule. Ukraine should advance implementation of the SAP, 
and introduce suitable penalties for continued non-compliance. SAP implementation is also hampered by 
a  shortage  of  staff  and  budgetary  resources;  adjustments  are  required.  It  is  further  recommended  that 
Ukraine makes an early start on the implementation effectiveness assessment for the current 2021-2025 
State  Anti-Corruption  Strategy  and  conducts  an  inclusive  preparatory  process  for  a  subsequent  strategy 
and implementation program.  

Legal framework 

The  legal  framework  on  the  fight  against  corruption  is  in  place  and  was  more  closely  aligned  with 
international  standards  during  the  reporting  period.  Legislation  strengthening  SAPO,  NABU  and  the 
NACP was adopted and implemented. However, changes are needed to improve provisions on preventive 
measures  and  law  enforcement,  in  particular  the  Criminal  Procedure  Code.  It  is  recommended  that 
Ukraine  amends  the  statute  of  limitations  to  ensure  higher  enforcement  of  liability  for  corruption 
offences; legislative amendments to improve the instrument of plea bargaining and to prevent procedural 
misuse  during  criminal  trials  also  have  still  to  be  adopted.  The  legal  framework  on  whistleblower 
protection remains to be aligned with the EU acquis. 

In  March  2024,  Ukraine  enacted  the  law  on  lobbying,  establishing  a  first  framework  for  regulating 
lobbying. The law addresses a wide range of lobbying methods in line with international standards and 
best  practice,  setting  clear  ethical  boundaries  and  a  high  level  of  transparency.  Lobbying  is  defined 
comprehensively, with non-commercial CSOs excluded from the definition, and the range of penalties is 
coherent and acceptable overall. The NACP is mandated with oversight and enforcement of the lobbying 
law. 

In March 2024 the NACP completed and dispatched a self-assessment report to the GRECO Secretariat 
on the implementation of GRECO’s recommendations from 2023. Ukraine should continue to align with 
the  norms  of  the  OECD  Anti-Bribery  Convention  and  the  recommendations  of  the  OECD  Council, 
including the reform of corporate liability.  

32 

 
 
Fundamental rights 

General framework 

The general framework for fundamental rights is satisfactory. The government has maintained its overall 
respect for fundamental rights and has shown its commitment to protecting them and further aligning with 
the EU acquis, despite the restraints due to the ongoing war and martial law. Martial law has led to some 
restrictions of rights and freedoms, but they have remained largely in proportion to the security situation 
and  have  generally  been  applied  with  caution.  Ukrainian  institutions  should  continuously  assess  the 
nature and scope of martial law-related restrictions. Where the security situation permits, they should, in 
consultation with the affected groups, consider lifting restrictions that are not necessary or proportionate 
to the objectives sought. Ukraine should already now develop a strategy to ensure that at  the end of the 
martial law, the country can swiftly restore all restricted rights and freedoms. 

International human rights instruments 

The European Convention on preventing and combating violence against women and domestic violence 
(Istanbul  Convention)  has  been  ratified  and  needs  to  be  more  consistently  implemented.  Ukraine  made 
significant progress towards the ratification of the Rome Statute of the International Criminal Court by 
adopting the ratification law for the Rome Statute 
towards  aligning  domestic 
and  made  steps 
legislature  with 
obligations. 
Amendments  to  the  criminal  code  as  regards  the 
definition  of  crimes  against  humanity  and  war 
crimes are still needed. 

Graph 8: Ukraine - ECtHR judgments 

international 

10000

12000

9656

8045

8000

European Court of Human Rights  

6000

4000

3571

1901

0

151

356

168

159

2000

During  the  reporting  period,  the  European  Court 
of Human Rights (ECtHR) found breaches of the 
European  Convention  on  Human  Rights  relating 
mainly to the protection of property, the right to a 
fair  trial,  the  right  to  liberty  and  security  of 
persons  and  the  prohibition  of  torture.  There  are 
currently  616  cases  under  enhanced  supervision 
by  the  Committee  of  Ministers.  These  cases 
predominantly  concern  issues  related  to  unlawful  arrests,  length  of  detention  on  remand,  violations  of 
right to life, ill-treatment by police, poor detention conditions and lack of adequate medical treatment, as 
well as excessive lengths of criminal and civil proceedings and lack of effective remedy. Ukraine needs to 
address systemic or structural issues raised by the Court notably in the areas of judiciary, law enforcement 
and human rights and to ensure systematic and timely enforcement of ECtHR judgements. 

16.06.2022 - 15.06.2023
16.06.2023 - 01.09.2024

New
allocated
applications

Pending
applications

Judgments Breaches

Source: ECtHR

Promotion and enforcement of human rights 

33 

the  enforcement  of 
Overall, 
human 
remains 
rights 
satisfactory.  The  Parliamentary 
Commissioner  for  Human  Rights 
–  the  Ombudsperson,  the  major 
body 
investigating  human 
rights  violations  –  is  active  and 
efficient  but  is  under-resourced 
properly 
cannot 
and 
implement  its  mandate  in  all  the 
areas  it  is  responsible  for.  The 

for 

so 

 
 
legal base defining mandate as both national human rights institution and equality body needs 
to be reformed in order to be fully aligned with EU acquis.  

Ukraine  needs  to  update  its  national  human  rights  strategy  and  finalise  and  implement  the  state  policy 
strategy  for  restoring  power  and  reintegrating  the  population  of  the  occupied  territories  to  ensure  that 
careful attention is paid to the safeguarding  of fundamental rights when reintegrating territories currently 
outside government control. 

Prevention of torture and ill treatment 

 Despite legal improvements and some improvements in individual facilities and in investigations, torture 
and ill treatment remain an issue of concern in Ukraine’s prison and detention system. In August 2024, 
the action plan to implement the overarching strategic plan for reform of the law enforcement sector for 
2023-2027 was adopted by the Cabinet of Ministers. The plan includes the introduction of annual public 
reporting  to  Parliament  on  the 
work  of  the  Prosecutor  General’s 
Office  and  the  State  Bureau  of 
Investigation  to  investigate  cases 
of torture and protect victims. The 
National  Preventive  Mechanism 
has  yet  to  be  reviewed  in  close 
specialised 
consultation  with 
CSOs.  The  conditions  in  the 
prison  system  and  detention 
centres  remain  an 
issue  of 
concern. Ukraine should closely 
adhere  to  the  guidance  by  the 
Council  of  Europe  anti-torture 
Committee (CPT).  

the 

have 

authorities 

While 
launched  at  least  five  criminal  investigations  into  allegations  of  violations  committed  by  their  own 
security  forces  in  2023,  involving  22  victims,  the  UN  High  Commissioner  for  Human  Rights  has 
observed a lack of progress in investigating or prosecuting such cases. The Ombudsperson still needs to 
strengthen cooperation with CSOs specialised in this area. 

Execution of criminal sanctions 

On  17 May  2024,  the  law  on  conditional  early 
release of persons serving a prison sentence  entered 
into force, allowing convicts, except those who have 
committed  the  most  serious  crimes,  to  receive 
conditional  early  release  in  exchange  for  military 
service.  Close  monitoring  by  responsible  authorities 
will  be  needed  to  ensure  that  the  rights  of  these 
newly  recruited  soldiers  are  fully  respected.  The 
recommendations  by  the  European  Committee  for 
the  Prevention  of  Torture  to  transfer  responsibility 
for prison healthcare to the Ministry of Health have 
yet  to  be  implemented.  In  March  2024,  legislation 
entered into force, introducing probation supervision 
as  a  new  type  of  criminal  punishment  as  an 
alternative  to  a  custodial  sentence  and  potentially 
reducing prison overcrowding. 

80,00
70,00
60,00
50,00
40,00
30,00
20,00
10,00
0,00

34 

Graph 11: Ukraine - Prisons

68,80

60,90

9

8,5

Occupancy rate (%)

2022

Average duration of
pre-trial detention
(months)
2023

Source: Ministry of Justice

 
 
Protection of personal data 

Personal  data  protection  is 
still  not  fully  compliant 
with  the  EU  acquis.  Draft 
laws  on  personal  data 
protection  and  on 
the 
National  Commission  on 
Personal  Data  Protection 
public 
and 
information,  registered  in 
2022,  are 
to  be 
adopted.  

access 

still 

to 

Freedom  of 
belief 

religion  or 

1500

1000

500

0

Graph 12: Ukraine - Data protection

1205

844

85

101

Inspections

Complaints
received

75

92

Decisions

2022

2023

3

11

0

0

Administrative
sanctions

Declarations of
data breaches

Source: Ombudsman of Ukraine

In general, Ukrainian authorities protect this freedom, and incidents of hate speech and intimidation based 
on  religion  are  rare.  No  infringements  of  religious  rights  were  reported  in  government-controlled 
territories of Ukraine. It is important to ensure that freedom of religion continues to be upheld all over the 
country in an effective way. 

---------------------------------------------------------------------------------------------------------- 

Freedom of expression 

Protection of journalists 

In the reporting period, violations of freedom of speech continued to be recorded in Ukraine, particularly 
in  the  Russian-controlled  territories.  In  government-controlled  territory  there  have  been  instances  of 
alleged  harassment  and  intimidation  of  journalists,  including  unlawful  surveillance  and  threats  of 
enlistment into the  armed forces.  Criminal investigations in these cases are  still  ongoing.  Two  cases  of 
strategic  law  suits  against  public  participations  (SLAPPs)  related  to  journalistic  investigations  were 
reported. 

Legislative environment 

On  26 June  2024, the  government  adopted the roadmap  to  support the  re-establishment  of  a pluralistic, 
transparent and independent media space after the end of martial law, following consultations with civil 
society.  The  roadmap  provides  a  thorough  concept  for  the  post-war  recovery  of  the  media  landscape, 
access  to  public  information  and  measures  to  combat  disinformation.  The  amendments  made  to  the 
Commander-in-Chief’s order in February 2024 clarified the rules for interaction between the military and 
journalists  near  the  frontline,  facilitating  the  work  of  journalists  in  these  zones.  On  13 May 2024,  the 
President signed a law aimed at making local self-governance more transparent, by requiring the regular 
publication  of  transcripts  or  broadcast/streaming  of  meetings  of  local  councils  and  their  permanent 
committees. 

Implementation of legislation/institutions 

Although  the  powers  of the  media  regulator, the  National  Council of  Ukraine  on  Television  and  Radio 
Broadcasting, have been expanded by the Law on media, the Council has limited resources and capacities 
to exercise them. In November 2023, the National Council approved the Strategy for 2024-2026, and, in 
January 2024, an action plan for implementing the strategy was adopted. However, when the Parliament 
adopted, in November 2023, the law on the state budget, it suspended the provisions of the Law on media 
regarding funding guarantees for the National Council and its apparatus for 2024. As a result, the Council 
has been under-funded. 

35 

 
 
Public service broadcaster and other media outlets 

Ukraine’s  independent  public  broadcaster  Suspilne–UA:PBC  operates  in  a  politically  neutral  way.  The 
supervisory board of the public service broadcaster is an independent body that includes representatives 
from  civil  society  and  media  experts.  Public  funding  for  the  broadcaster  in  accordance  to  the  legal 
requirements  continues  to  be  a  challenge.  In  May  2024,  the  United  News  TV  marathon  was  partially 
reshaped,  providing  more  autonomy  for  Suspilne,  enabling  it  to  launch  its  own  round-the-clock 
broadcasting on the First TV channel. 

In  2023,  the  Ukrainian  government  invested  public  funds  into  the  TV  marathon  project.  It  should  be 
reassessed whether this is the best platform for enabling a free exchange of views among Ukrainians. The 
main objective of Parliament’s media channel should be to share information on parliamentary business, 
including the work of representatives of the parliamentary opposition. 

Economic factors 

Ukraine’s independent media continue to struggle with the economic impact of the war, in particular with 
the diminished advertising market and lack of revenue, especially in regions near the frontline. 

Internet 

During  the  reporting  period,  Ukraine  continued  to  face  several  challenges  to  internet  freedom,  in 
particular  stemming  from  measures  taken  to  counter  Russian  cyberattacks,  hacking  and  disinformation 
campaigns.  Within  Ukraine,  since  the  start  of  martial  law,  web  resource  blocking  has  been  the 
responsibility  of 
for  Operations  and  Technology  Management  of 
Telecommunications  Networks  (NCU).  The  restrictions  imposed  by  the  NCU  have  been  in response to 
national  security  concerns.  However,  access  to  internet  resources  should  be  governed  by  proper 
regulation,  in  compliance  with  international  human  rights  standards  and  the  EU  acquis  on  freedom  of 
expression, data protection and a person’s right to privacy. 

the  National  Centre 

Professional organisations and working conditions 

Low salaries increasingly force qualified media personnel to seek alternative employment, for instance in 
international organisations offering higher salaries. 

----------------------------------------------------------------------------------------------------------- 

Freedom of assembly and association 

The Ukrainian government continues to respect the right to freedom of assembly and  association. While 
the government exercises restraint when using martial law to introduce temporary restrictions on the right 
to peaceful assembly, Ukraine would still benefit from a comprehensive law compliant with international 
standards to regulate the organisation and conduct of events constituting peaceful assembly. 

Labour and trade union rights are covered in Chapter 19 - Social policy and employment. 

Property rights 

Property  rights  are  generally  respected  in  the  government-controlled  territories  of  Ukraine,  but  the 
modernisation of the state land registry system remains incomplete. The authorities are applying property-
rights legislation introduced at the start of the full-scale invasion, in particular concerning the monitoring 
of property damage and compensation for property damage. 

Non-discrimination 

Overall,  Ukrainian  society  is  increasingly  open  and  tolerant  towards  vulnerable  persons  and  in  general 
hate  speech  and  hate  crime  are  being  prosecuted.  Ukrainian  legislation  addressing  non-discrimination 
remains to be fully aligned with European and international standards, in terms of scope and definition of 
areas as well as concerning data collection.  The definitions of the European Commission against Racism 

36 

 
 
and Intolerance (ECRI) on hate speech are still to be fully applied.  Criminal legislation does not cover 
sexual orientation and gender identity. 

The Parliament’s Commissioner for Human Rights (the Ombudsperson) is the main institution to receive 
and follow-up on complaints concerning  discrimination and became member of the European network of 
equality bodies (EQUINET) in 2023, potentially extending its ability to develop its work in line with the 
EU  acquis  on  non-discrimination  including  the  role  of  equity  bodies.  Capacities  of  police  officers, 
prosecutors, judges and staff of the Ombudsperson have increased, but further efforts are needed to tackle 
discrimination, hate speech and hate crime through suitable training and effective enforcement. 

Gender equality 

Ukraine  has  several  laws  in  place  to  improve  gender  equality  by  countering  gender  discrimination  and 
gender-based  violence.  However,  more  efforts  are  needed  to  ensure  the  legislation  is  adequately 
implemented. Gender-based violence remains a critical issue and more decisive measures are needed to 
tackle it, especially in view of the ongoing war in Ukraine. In May 2024, the Cabinet of Ministers adopted 
a resolution for the procedure and conditions for providing local support services for victims of domestic 
and gender-based violence, allowing for addressing the issue of local budgets for gender-based violence 
prevention.  Services  and  infrastructure  for  victims  of  gender-based  violence  and  conflict-related  sexual 
violence should be strengthened, including through the resumption of services which were suspended due 
to the full-scale invasion.  

to 

Following the ratification of the Council of Europe Convention on Preventing and Combating  Violence 
Against  Women  and  Domestic 
Violence 
(Istanbul  Convention) 
two  years  ago,  Ukraine  adopted 
the  Code  on 
amendments 
Administrative  Offences  in  May 
  to  bring  legislation  on 
2024 
preventing 
combating 
and 
domestic  violence  in  line  with  the 
remain 
Convention.  As 
the  new 
protection  gaps 
legislation, 
the 
national  legal  framework  in  line 
with 
Istanbul  Convention 
should  continue,  as  well  as  to 
the  Directive  on 
comply  with 
against 
violence 
combating 
women  and  domestic  violence. 
Gender  equality  has  also  been 
identified as a horizontal issue for recovery and reconstruction, including in the Ukraine Plan under the 
Ukraine Facility. 

there 
in 
strengthening 

the 

Rights of the child 

The  State  Service  of  Ukraine  for  Children  was  set  up  in  September  2023  and  is  responsible  for 
implementing  policies  in  the  field  of  children’s  rights.  In  collaboration  with  CSOs  and  in  consultation 
with  families,  Ukraine  continued  to  strengthen  social  protection  for  children  and  increase  support  for 
families with children. Procedures and criteria for determining the best interests of the child have yet to be 
formulated.  

Similarly, there is room to strengthen an integrated child protection system to prevent family separation, 
support  alternative  family  based  care  and  reintegration  of  children  deprived  of  parental  care  from 

37 

 
 
institutions into families. It remains challenging to ensure quality education for all children, in particular 
those  displaced  and  children  near  the  front-line.  Despite  the  progress  of  12  child-friendly, 
interdisciplinary  and  multi-agency  centres  and  the  Barnahus  model  already  established,  alternative 
services ensuring child-friendly justice  and free legal aid are still to be further developed.  

The number of children in institutional care has decreased from 67 586 in 2021 to 64 550 in 2023. The 
Coordination Centre for the Development of Family Upbringing and Child Care took promising first steps 
towards  reforming  childcare,  leading  to  a  draft  National  Strategy  and  Action  Plan  for  Better  Care  in 
spring  2024.  Deinstitutionalisation  should  remain  a  priority,  including  the  strengthening  of  integrated 
social services to prevent family separation and support alternative family placements and reintegration of 
children from institutions into families. 

Persons with disabilities 

The number of persons with disabilities continues to grow (both among civilians and in the armed forces). 
The  Ukrainian  authorities  face  the  ongoing  challenge  of  implementing  accessibility  policies  and 
upholding  the  rights  of  people  with  disabilities  in  evacuation,  reconstruction  and  recovery  processes, 
while Ukraine is only partly aligned with EU acquis so far.  

With  regard  to  deinstitutionalisation  of  adults  with  disabilities,  action  and  investment  are  needed  to 
provide proper infrastructure for foster families, social services and healthcare, in particular at local and 
regional  level.  This  should  also  include  the  adoption  of  measures  to  support  inclusive  education  and 
access  to  employment  for  persons  with  disabilities.  Furthermore,  the  legal  means  for  persons  with 
disabilities  to claim  their  rights  are  limited.  In  line  with the  Ukraine  Plan,  Ukraine  should improve  the 
rehabilitation system for people with disabilities. 

LGBTIQ persons 

The general trend of increasing tolerance and acceptance of lesbian, gay, bisexual, transgender, intersex 
and queer (LGBTIQ) persons continued. However, progress stalled on key pieces of legislation, including 
the  draft  law  amending  the  Code  on  Administrative  Offences  and  the  Criminal  Code  to  combat 
manifestations  of  discrimination  (registered  in  2021),  which  will  include  sexual  orientation  and  gender 
identity under its definition of hate crimes. The draft law on the Institute of Registered Partnerships has 
not  progressed,  despite the  ECtHR  judgment  of  1 June  2023  reiterating the  requirement for  the state  to 
ensure the equal treatment of same-sex couples in Ukraine. 

Procedural rights and victims’ rights 

Procedural rights are outlined and protected in the Law on the judiciary and status of judges and in the 
Criminal  Procedure  Code,  but  their  implementation  suffers  from  inefficiencies  and  weaknesses  in  the 
judicial system. Ukraine’s legislation has yet to be aligned with the EU acquis. The country’s legislation 
on victim rights should be fully aligned with the Victims’ Rights Directive and the Directive relating to 
compensation  to  crime  victims  as  well  as  sectorial  legislation  on  victims’  rights  that  responds  more 
directly to the specific needs of victims of particular types of crime such as  domestic violence, human 
trafficking  and  child  abuse.  In  2023,  the  Coordination  Centre  for  the  Support  of  Victims  and 
Witnesses  was  set  up  within  the  Office  of  the  Prosecutor  General.  This  is  a  significant  step  in  the 
creation of infrastructure needed to provide victims with practical support and protection. 

In  2023,  the  Parliament’s  Commissioner  for  Human  Rights  received  5 003  reports  on  violations  of 
procedural rights, 1 660 on administrative and civil proceedings, 3 151 on criminal proceedings and 192 
on places of detention. Many of these refer to violations of the right of access to justice and the right to a 
fair  trial,  excessively  lengthy  proceedings  and  violations  of  rights  by  law  enforcement  officers.  These 
issues reflect structural problems in the practices of the judiciary and law enforcement authorities, which 
have yet to be addressed. 

Protection of minorities 

38 

 
 
In  general,  the  rights  of  persons  belonging  to  the  diverse  ethnic,  linguistic,  religious  and  national 
minorities were upheld in the territory controlled by the government.  

Following the recommendations of the Venice Commission, Ukraine on 8 December 2023 amended the 
legislation on national  minorities,  introducing  substantial  changes  to  the  Laws  on  national  minorities 
(Communities), on media, on state language, on publishing and on education, followed by several bylaws, 
roadmaps and methodologies. While noting that the Venice Commission has not pronounced itself on the 
follow-up  given  to  its  recommendation,  the  Commission  considers  that  Ukraine  has  taken  all  the 
necessary measures.  

The Implementation of the reform is key to its success and should be conducted in close consultation with 
the representative of national minorities. On 31 May the Council of National Minorities was established, 
which  is  an  important  step  for  the  representation  of  national  minorities.  A  public  administration  with 
adequate  resources  and  capacities  is  essential  to  successfully  implement  the  reform  at  all  levels  of 
government. In addition, bilateral discussions are ongoing with Hungary aimed at further strengthening 
the protection of national minorities. 

Roma4 

Despite  the  efforts  of  state  authorities,  NGOs  and  international  organisations,  the  Roma  community 
continues  to  face  significant  challenges,  exacerbated  by  the  ongoing  Russian  aggression.  In  December 
2023, the Cabinet of Ministers adopted the national Roma action plan and allocated funds for effective 
implementation  of  the  national  strategy  for  Roma  integration  and  protection.  In  the  field  of  education, 
work on the codification of the Romani language is ongoing and implementation of the primary school 
curricula has been slow due to a lack of Roma teachers. Access to health services and identity documents, 
poverty and displacement during the war, discrimination and exclusion continue to be serious obstacles to 
full integration of Roma communities into Ukrainian society. 

Internally displaced persons (IDPs) 

Based on International Organisation for Migration data for December 2023, about 3.7 million people are 
displaced within Ukraine, with a further 6.5 million refugees from Ukraine in the rest of the world. The 
Ukrainian  government  continues  to  implement  its  strategy  on  internal  displacement  which  runs  until 
2025, accompanied by an operational plan for 2023-2025. 

Persistent difficulties are reported in ensuring sufficient budget allocations for social services. In March 
2024,  changes  were  made  to  eligibility  for  the  IDP  living  allowance,  which  is  now  based  on  a  set  of 
socio-economic  vulnerability  profiles  (amendment  of  Cabinet  of  Ministers’  Resolution  332).  While  the 
shift from IDP-status to a vulnerability-based approach is welcome, there are concerns that IDPs may not 
be aware they need to re-register for assistance and that vulnerable individuals could be impacted or even 
excluded by the change. In the context of the Ukraine Plan, Ukraine has committed to ensuring access to 
housing for people in need, in particular IDPs. 

Citizenship rights 

In 2024, the President submitted a draft law on the acquisition and termination of Ukrainian nationality. 
In particular, it would allow for dual nationality for nationals of certain countries, including EU Member 
States.  Dual  nationals  would  be  obliged  to  declare  that  in  their  relations  with  Ukraine,  they  are  to  be 
treated  as  Ukrainian  nationals,  which  would  require  careful  consideration  in  the  light  of  the  future 
application of the rules on EU citizenship. 

2.2.2  Chapter 24: Justice, freedom and security 

4 In line with the terminology of European institutions the umbrella term ‘Roma’ is used here to refer to a number of 
different groups, without denying the specificities of these groups. 

39 

 
 
 
 
The  EU  has  common  rules  for  border  control,  visas,  external  migration  and  asylum.  Schengen 
cooperation entails the lifting of border controls inside the EU. Member States also cooperate in the fight 
against organised crime and terrorism, and on judicial, police and customs cooperation. 

Fight against organised crime 

Institutional set-up and legal alignment 

Ukraine improved its legislation in several fields relating to the fight against serious and organised crime; 
the overall legal framework needs further alignment with the EU acquis. 

Ukraine  adopted  the  action  plan  for  the  implementation  of  the  overarching  strategic  plan  on  law 
enforcement  reform  (OAS AP).  Successful implementation  of the  OAS  AP  by  the  end  of  2027  will  be 
crucial for reforming the civilian security sector of Ukraine in line with EU standards and best practices. 
Ukraine  made  progress  by  criminalising  the  smuggling  of  goods,  including  cigarettes,  through  an 
amendment  to  the  Criminal  Code  and  the  Code  of  Criminal  Procedure  in  December  2023.  It  is  now 
crucial  to  focus  on  effective  implementation.  The  law  rebooting  the  Economic  Security  Bureau  of 
Ukraine (ESBU) was adopted by Parliament on 20 June and signed by the President on 28 June 2024. Its 
swift implementation will be of central importance, in particular the transparent and merit-based selection 
of the Head of ESBU and the re-attestation of other staff. 

Ukraine made some progress on legislation relating to financial investigations. The Law on the prevention 
and  counteraction  of  legalisation  (laundering)  of  the  proceeds  from  crime  was  updated.  Procedures  for 
asset tracing and recovery were improved, and the powers of financial investigators strengthened. Ukraine 
expanded the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Organisations 
to include detailed information on ultimate beneficial owners, improving transparency. However, further 
progress is needed on legislation relating to financial investigations, particularly concerning the adoption 
of relevant secondary legislation. It is important to allocate sufficient resources, provide trainings and take 
other  necessary  steps  to  ensure  that  financial  investigations  are  conducted  systematically  and  in  a 
comprehensive  and  effective  way.  Ukraine  adopted  an  action  plan  for  implementing  the  asset  recovery 
strategy,  advancing  reforms  on  a  number  of  important  areas,  particularly  the  reforms  of  the  legal 
confiscation mechanisms, asset return, asset tracing and identification in line with international legislation 
and good practices. Now it is important to make progress with its implementation. Ukraine should also 
continue with the comprehensive reform of the ARMA, also known as the National Agency of Ukraine 
for the identification, tracing and management of assets derived from corruption and other crimes in line 
with the EU acquis.  

The State Financial Monitoring Service made progress, working with national and international partners 
and closely following legislative developments in the EU. The Council of Europe’s Committee of Experts 
on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL) 
is currently evaluating measures against money laundering and terrorism financing. Its follow up report is 
expected at the end of 2024. (See Chapter 4 for details). 

Ukraine still lacks a law on acquisition and possession of civilian firearms. However, it made progress in 
this  area  with  the  adoption  of  a  law  ensuring  the  participation  of  civilians  in  the  defence  of  Ukraine, 
improving  the mechanism to declare and control firearms. The Criminal Code does not fully comply with 
international  obligations,  in  particular  on  the  legal  circulation  of  firearms.  Certain  types  of  weapons, 
including  military-grade  firearms  need  to  be  more  strictly  controlled,  and  Ukraine  needs  to  introduce 
liability for illicit firearms manufacturing and trafficking. 

It  is  crucial  to  adopt  the  serious  and  organised  crime  threat  assessment  (SOCTA).  There  has  been  no 
progress  on  setting  up  a  permanent  national  coordination  body  to tackle  organised  crime  and  on 
upgrading  inter-agency  cooperation  and  coordination  mechanisms,  including  business  processes  and  IT 
infrastructure.  The  Law  on  organisational  and  legal  principles  of  combating  organised  crime  is  still 
outdated.  

40 

 
 
Ukraine  has  not  implemented  the  provisions  of  the  recently  adopted  legislation  on  strengthening 
parliamentary oversight  of  security  and  intelligence  services, including the  SSU,  which  should  be  done 
without a delay. The mandate of the SSU should focus on its national security tasks. The SSU’s pre-trial 
investigation  functions  should  be transferred  to  the  dedicated law  enforcement agencies  (LEAs) and  its 
monopoly on communication intercepts (wiretaps) should be lifted and internal oversight mechanisms and 
procedures should be streamlined in line with best EU practices. 

Ukraine  should  focus  on  strengthening  integrity  and  anti-corruption  in  the  criminal  justice  system,  to 
build public trust and the fight against serious and organised crime. Corruption among authorities remains 
widely spread, with several high-ranking officials removed from office due to corruption cases. Ukraine 
should  introduce  transparent  and  merit-based  recruitment  and  selection  procedures  for  managerial 
positions  in  central  and  regional  offices  of  the  NP  and  the  SBI,  with  meaningful  involvement  of 
independent experts, and strong disciplinary and anti-corruption frameworks tailored to the local context, 
addressing actual corruption risks.  

Implementation and enforcement capacity 

8000

12000

10000

held 

Graph 14: Ukraine - Serious* and organised crime cases

The  war  has  brought  significant  new tasks, relating to  defending the country,  protecting the  population 
and  critical  infrastructure,  investigating  international  crimes  and  dealing  with  losses  of  personnel  and 
equipment  and  reduced  financing.  Despite  these  new  tasks  and  other  war-related  challenges,  Ukrainian 
institutions continue to demonstrate strong resilience and determination to deliver on their mandates. The 
war has had an impact on international criminal networks and traditional trafficking routes, creating new 
crime risks, in particular risks linked to arms and trafficking in human beings. Institutions have limited 
capacities  to  tackle  organised  crime.  Inter-agency  cooperation  lacks  efficiency  and  is  marred  by  the 
absence of a permanent coordinator and clear procedures. Regional Organised Crime Task Forces have 
been  set  up  in  all 
and 
regions, 
have 
workshops 
been 
to 
inter-
strengthen 
agency 
cooperation. 
Existing  rules  and 
court  practice  on 
the  inadmissibility 
of 
evidence 
gathered  by  LEAs 
the  unclear 
and 
and 
division 
fragmentation 
of 
competences, 
the 
undermine 
fight 
against 
complex  forms  of 
crime 
organised 
the 
increase 
and 
risk of corruption.  

2021
Number of individuals / legal entities under Investigation
Individuals / legal entities indicted
Final court decision
Final convictions

*Data on serious crime cases stem from the aggregation of cases of money laundering, cybercrime, production and trafficking of drugs, firearms 
related offenses, terrorism, trafficking in human beings and smuggling of persons. Corruption cases are showcased in Chapter 23. 

Source: National data collected via the organised
crime and corruption track record (OCCTR) e-platform

Serious crimes Organised

Serious crimes Organised

Organised
crimes

Serious crimes

crimes

crimes

10055

2630

2098

7706

1556

7508

1970

2083

6402

1546

6736

1961

9248

3626

2971

4046

2732

3739

2000

4000

6000

2022

2023

240

235

305

166

194

234

0

Organised crime investigations  

In 2023 the number of criminal investigations into organised crime groups and criminal organisations and 
the number of indictments were higher in 2023 than in 2022, and this trend has continued in the first half 
of 2024, but further progress is needed. 

41 

 
 
Ukraine made some progress in developing the e-case management system in the criminal justice chain. 
(See Chapter 23 for details). 

A policy concept for reforming forensics in line with international best practices should be drafted and 
adopted. 

International  cooperation  between  Ukraine’s  police  and  prosecutorial  bodies  and  other  countries’  is 
well developed and continued to produce positive results, including in uncovering cross-border organised 
crime  activities.  Productive  cooperation  with  Europol,  as  well  as  the  European  Union  Agency  for  Law 
Enforcement  Training  (CEPOL)  continued.  From  1  April  2023  to  29  February  2024,  Ukraine  was 
involved in 82 cases at Eurojust – most of them related to organised crime, money laundering activities, 
swindling and fraud.  During the period from 1 September 2023 to 3 September 2024 Ukraine created 21 
new  joint investigative teams (JIT)    with foreign countries, including  15  JITs  with  EU Member  States. 
Moreover, 15 JITs created before 1 September 2023 continue their activities, thus currently there are 30 
JITs with EU Member States.  

Ukraine’s LEAs actively use SIENA, the secure information exchange network application platform, for 
EU  law  enforcement.  The  SSU  uses  SIENA-CT  to  communicate  with  Europol  on  counterterrorism. 
Within  the  European  Multidisciplinary  Platform  Against  Criminal  Threats,  Ukraine  cooperates  on  15  
operational action plans. There has been limited progress in implementing intelligence-led policing. The 
National Police finalised setting up its regional offices across all regions. Ukraine does not have a unified 
information and intelligence gathering system for all LEAs. 

In  2023,  Ukraine  further  developed  its  track  record  on  suspicious  financial  transactions.  The  state 
financial  monitoring  service  (SFMS)  registered  155  369  suspicious  financial  transactions  (52  123  in 
2022) and sent 608 referrals to the LEAs (934 in 2022). The agencies made use of SFMS referrals in 498 
criminal proceedings (349 in 2022). The SFMS also sent 479 replies to 298  international requests (1 242 
in 2022).  

As  regards  trafficking  in  human  beings  (THB),    the  State  Border  Guard  Service  (SBGS)  and  the 
National Police (NP) have increased measures at border crossing points to counter THB. In 2023, Ukraine 
participated in the implementation of 19 EMPACT operational actions on trafficking in human beings. In 
2023, 164  criminal offences of human trafficking were registered, in 109 offenses people were notified of 
suspicion and there were 147 indictments.  91 people were recognised as victims of human trafficking (30 
women, 16 minors). Pre-trial investigation was completed regarding 24 criminal offenses committed by 
organised groups and criminal organisations. In the reporting period, the Department of Migration Police, 
together with LEAs from 12 EU countries, joined the Operational Task Force aimed at combating sexual 
exploitation, coordinated by Europol. Ukraine should increase the efforts to detect and identify victims of  
trafficking  in  human  beings  and  strenghten  the  capacity  of  social  services  to  provide  the  victims  with 
adequate protection. 

Ukraine has actively engaged with the international law enforcement community to address risks related 
to the trafficking of small arms and light weapons. A national firearms focal point became operational 
in  July  2024,  as  the  Cabinet  of  Ministers  approved  a  regulation  creating  the  Coordination  Centre  on 
Countering  Illegal  Circulation  of  Firearms,  its  Components  and  Ammunition.  It  will  be  important  to 
ensure the necessary trained staff and provide access to databases to make it fully operational. A national 
registry  of  firearms  has  been  operational  since  23 June 2023,  enabling  to  register  and  collect  all 
information on firearms and their tracing, from the moment of importation/manufacture or seizure. In the 
reporting period, no cases of large-scale trafficking of firearms and other small arms and light weapons 
were documented. Compared to the previous period, there  has been a significant increase in seizures of 
firearms and ammunition. Ukraine cooperates well with Europol and shares all data regarding seizures. In 
2023, the number of registered criminal cases involving firearms continued to increase compared to the 
previous periods (10 457 cases in 2023, 2 206 cases in 2022 and 394 cases in 2021).  

42 

 
 
On cybercrime, the SSU now investigates all cyberattacks against critical cyber infrastructure (starting in 
2024). Proactive measures against online child sexual exploitation are temporarily limited in scale due to 
a war-related lack of staff. 

On  money  laundering,  the  track  record  improved.  In  2023,  305  criminal  proceedings  on  money 
laundering were registered, 242 indictments were sent to court and  50   verdicts were issued. 31 people 
were convicted of money laundering offences. For comparison, in 2022, the number of indictments was 
117 with 19 verdicts and 16 convicted offenders.  

The  witness  protection  system  is  still  underdeveloped  and  fragmented;  there  are  no  significant 
developments to report. 

Cooperation in the field of drugs 

Institutional set-up and legal alignment  

The legal framework for the fight against drugs needs further alignment with the EU acquis.  

a 

5000

3904

4000

national 

Graph 15: Ukraine - Cases related to production and 
trafficking of drugs

Ukraine  is  a  party  to  the  relevant  international  narcotic  drug  control  conventions.  There  is  a  certain 
amount  of  inter-agency  cooperation,  coordinated  by  the  Ministry  of  Health.  The state-owned  enterprise 
Public  Health  Centre  run  by 
the Ministry of Health  became 
responsible 
for gathering 
information  on  drug  abuse. 
There is no progress on setting 
up 
drugs 
observatory or a national early 
the 
system 
warning 
detection  of  new  psychoactive 
substances.  The  national  drug 
policy  strategy  for  the  period 
the 
2030 
up 
accompanying  action  plan  for 
2023-2025  have  not  been 
adopted.  Ukraine  successfully 
cooperates  with  the  European 
Union Drugs Agency. 

Number of individuals / legal entities under Investigation
Individuals / legal entities indicted
Final court decision
Final convictions

Source: National data collected via the organised
crime and corruption track record (OCCTR) e-platform

and 

1125

1000

1521

2000

2022

1333

2021

3322

3000

4150

3303

3693

3082

1237

1191

2023

1357

on 

to 

0

Implementation 
enforcement capacity 

and 

The use of drugs and other illegal substances is a growing problem. Drugs, especially synthetic drugs, are 
sold  and  widely  available  across  Ukraine,  including  at  the  frontline.  The  illicit  production  of  synthetic 
drugs continues. Drug monitoring is heavily affected by the war. Cooperation among judicial entities and 
LEAs should be increased, as should international cooperation in this area. In 2023, the National Police 
exchanged information with LEAs in other countries in 48 cases related to drug trafficking. Some of this 
information  was  exchanged  via  Europol’s  secure  information  exchange  system  SIENA  or  with  the  US 
Drug Enforcement Administration. 

As for Ukraine’s track record, in 2023, 4150 individuals/legal entities were under investigation for crimes 
linked to production or trafficking of drugs (3303 in 2022), there were 3693 indictments (3082 in 2022), 
1521 final court decisions (1237 in 2022) and 1357 final convictions (1125 in 2022).  

Fight against terrorism 

Institutional set-up and legal alignment  

43 

 
 
The Anti-Terrorism Centre of the Security Service of Ukraine (SSU) is the inter-agency body tasked with 
coordinating national efforts to fight terrorism.  The National Security and Defence Council involves all 
relevant critical infrastructure-protection state agencies (the State Service of Special Communication and 
Information  Protection,  the  Ministry  of  Energy,  the  Ministry  of  Infrastructure,  the  SSU,  the  National 
Police and others). Ukraine has comprehensive anti-terrorism legislation and is a party to the relevant UN 
and Council of Europe counter-terrorism conventions and protocols. 

Implementation and enforcement capacity 

The  law  enforcement  and  justice  institutions  in  charge  of  counterterrorism  work  professionally  and 
effectively. The SSU looked at the terrorism threat in connection with Russia’s war of aggression against 
Ukraine, and SSU counterterrorism units are highly involved in countering and investigating war crimes 
committed  by  Russian  military  and  intelligence  and  in  the  protection  of  critical  infrastructure.  Since 
March  2023,  the  SSU  has  been 
connected  to  the  Europol  secure 
messaging  network  SIENA,  and 
since  June  2024,  it  has  gained 
access  to  the  specialized  SIENA 
CT 
Terrorism) 
application. 

(Counter 

Judicial  cooperation  in  civil 
and criminal matters 

and 

standards, 

legal  framework 
The  current 
is comprehensive 
partly 
aligned  with  the  EU  acquis  and 
European 
and 
cooperation  with 
international 
partners  has  further  improved. 
Ukraine  has  87 bilateral  treaties 
and  agreements  on  cooperation 
in civil and criminal matters with 
50 countries,  Eurojust  and  the  UN.  Ukraine  is  also  a  Party  of  all  the  core  Conventions  adopted  by  the 
Hague  Conference  on  Private  International  Law.  In  the  reporting  period,  Ukraine  maintained  good 
cooperation  with  partners  in  providing  and  requesting  mutual  legal  assistance  in  civil  and  criminal 
matters. 

Ukraine  continued  its  cooperation  with  Eurojust.  The  issue  of  limited  participation  of  Ukrainian 
representatives  in  joint  investigation  teams  due  to  legal  constraints  has  been  addressed.  Ukraine  took 
further  steps  to  develop  close  cooperation  with  the  European  Public  Prosecutor’s  Office  (EPPO).  The 
EPPO concluded a working arrangement with Prosecutor’s General Office of Ukraine on 18 March 2022, 
followed by a working agreement with the National Anti-Corruption Bureau in July 2023. In June 2024, 
Ukraine  gave  a  commitment  that  its  competent  authorities  would  cooperate  closely  on  the  prevention, 
detection  and  correction  of  irregularities,  fraud,  corruption  and  other  illegal  activities,  and  on  the 
investigation and prosecution of offences affecting the assistance provided to Ukraine under the Ukraine 
Facility, including with the EPPO. 

The  insolvency  regime  in  Ukraine  should  be  further  improved  and  aligned  with  the  EU  acquis.  In 
September  2024,  the  Parliament  adopted  a  law  to  approximate  the  legislative  framework  with  the  EU 
Directive  2019/1023  on  preventive  restructuring  frameworks  with  the  aim  to  introduce  an  insolvency 
prevention  system  and  early  warning  tool  for  legal  entities  and  entrepreneurs.  Further  legislation  for 
simplified  insolvency  procedures  for  micro,  small  and  medium-sized  enterprises  in  line  with  the  EU 
Directive 2019/1023 should still be developed and adopted.  

44 

 
 
Legal and irregular migration 

Institutional set-up and legal alignment 

The  legal  framework  on  legal  and  irregular  migration  is  partly  aligned  with  the  EU  acquis  and  the 
management of migration needs to be further improved. Inter-agency coordination among the Ministry of 
Internal Affairs, the State Migration Service (SMS), the SBGS and the Ministry of Foreign Affairs needs 
to be further strengthened. In January 2024, the state migration policy strategy up to 2025 was amended. 
The corresponding  action  plan  for  2024-25  was  approved  by  the  Cabinet  of  Ministers  on  3  September 
2024. 

Amendments to migration legislation partially aligned Ukrainian law with the EU acquis on the status of 
third-country  nationals  who  are  long-term  residents  and  on  the  right  to  family  reunification.  Further 
alignment is needed concerning a single permit for work and residence for third-country nationals. 

While the legislative framework for a mass influx of migrants is in place, Ukraine lacks a mechanism for 
inter-agency  coordination  in  the  event  of  a  migration  crisis.  The  principle  of  non-refoulement  is 
embedded  in  the  legislation  on  voluntary  and  forced  returns.  Over  the  year,  the  voluntary  returns 
procedure  was  rarely  applied.  Ukraine  is  relatively    advanced  in  implementing  the  return  directive.  No 
rules  were  adopted  on  passenger  information  and  visa  verification  obligations  for  carriers  transporting 
foreign nationals to Ukraine. 

Implementation and enforcement capacity 

Graph 17: Ukraine - Number of irregular movements

1664

In  the  reporting  period  the 
number  of  irregular  migrants 
detected 
SMS 
throughout Ukraine was lower 
than in the previous year. 

the 

by 

1800
1600
1400
1200
1000
800
600
400
200
0

731

145

137

234

149

number 

Romania 

the  Republic 

The largest 
of 
migrants  detected  originated 
of 
from 
Moldova, 
and 
Russia.  Most  illegal  migrants 
illegal 
were  detained 
crossing  at  the  EU  border. 
There also have been cases of 
illegal  smuggling  of  persons 
the  state  border  of 
across 
Ukraine, 
as 
registered 
criminal  offences  and  investigated  by  relevant  authorities.  The  capacity  of  migrant  accommodation 
centres operated by the SMS remained unchanged. 

Source: State Border Guard Service of Ukraine 

n
a
t
s
i
n
a
h
g
f
A

a
v
o
d
o
M

a
v
o
d
o
M

a
v
o
d
o
M

a
n
a
m
o
R

e
y
i
k
r
ü
T

e
y
i
k
r
ü
T

a
i
s
s
u
R

a
i
s
s
u
R

for 

2021

2022

2023

a
t
o
T

a
t
o
T

a
t
o
T

321

45

83

92

28

27

l

l

l

l

l

i

l

Reports  from  2023  of  challenges  relating  to  border  control  remain  valid.  The SBGS  continued  to 
cooperate with the European Border and Coast Guard Agency (EBCGA) on information exchange, joint 
risk analysis, operations and staff training, with no major changes in the reporting period. 

Procedures  on  readmission  remained  unchanged.  The  2007  EU-Ukraine  readmission  agreement  and 
implementing protocols between Ukraine and eight EU Member States were applied. Ukraine agreed new 
protocols  with  Spain,  Latvia,  Hungary  and  Romania.  A draft  implementing protocol  with  Slovakia  was 
approved and is awaiting signature. 

45 

 
 
The  integrated  migration  management  system  is  not  fully  operational.  Complementary  legislation  on 
processing of biometric data should be adopted for full operationalisation of the system with automated 
business  process  workflows 
for inter-agency cooperation. 

Asylum 

Institutional  set-up  and  legal 
alignment 

limited 

support 

Asylum  legislation  is  broadly 
aligned  with  the  EU  acquis, 
but the management of asylum 
needs  to  be  further  improved. 
is 
Only 
available  for  asylum  seekers 
owing  to  the  lack  of  capacity 
and  shortage  of  staff.  Ukraine 
should  be  prepared  to  start 
discussions  with  the  European 
Union 
Agency 
Asylum 
(EUAA)  regarding  a  future 
roadmap 
bilateral 
for 
cooperation.  

Implementation and enforcement capacity 

In  the  reporting  period,  the  number  of  applications  for  protection  declined.  No  cases  of refoulement  or 
non-admission  at  the  borders  were  reported,  although  the  capacity  to integrate  recognised  refugees 
remained  limited.  The  average  duration  of  the  asylum  procedure  is  six  months,  but  it  can  take  longer 
given the current situation in Ukraine and the fact that some applicants remain out of country. In 2023 
there  were  109  applications,  eight  persons  were  recognised  as  refugees  and  45  as  persons  in  need  of 
additional protection.   

Visa policy 

The national visa regime is largely aligned with that of the EU, including the EU acquis on the processing 
of applications, the criteria for granting protection and the processes for issuing visas. However, the list of 
third countries with which Ukraine has visa-free regimes needs further alignment with the EU’s list. The 
security  features  of  visas  and  travel  documents  are  broadly  aligned.  Phasing  out  of  non-biometric 
passports by 2026 is ongoing. Issuance of visas at the border was suspended on 24 February 2022 and has 
not been resumed. 

The  visa-free  regime  with  the  EU  is  in  operation.  Ukraine  continues  to  meet  visa  liberalisation 
benchmarks. 

Schengen and external borders 

Institutional set-up and legal alignment 

The legislative framework for the management of external borders is partly aligned with the EU  acquis. 
In the reporting period, the integrated border management (IBM) strategy up to 2025 was amended and a 
corresponding  action  plan  for  2023-2025  approved.  However,  the  strategy  does  not  explicitly  cover 
aspects related to Ukraine’s EU integration and the plan still requires concrete indicators for measuring its 
implementation progress. There is no Schengen action plan in place. The legislative framework for border 
control is only partly aligned with EU policy and best practices. Adopting the law on the processing of 
passenger  data  (API/PNR)  could  improve  the  national  system  for  combating  terrorism  and  organised 

46 

 
 
crime. It could also help to bring legislation into line with international standards in this field. 

Implementation and enforcement capacity 

Overall, further alignment with the EU IBM standards is required, and IBM institutional capacities and 
inter-agency  cooperation  mechanisms  should  be  further  improved.  In  the  reporting  period,  the  Inter-
Agency  Working  Group  for  IBM  met  only  twice.  In  April  2024,  the  National  Coordination  Centre  for 
IBM was launched. While this was an important step for effective data sharing and cooperation, ensuring 
that  its  operations  bring  concrete  results  will  be  crucial.  There is  still no structured  crisis  response 
mechanism. 

Shortages  of  staff,  appropriate  infrastructure  and  equipment  are  the  main  challenges  for  border 
management agencies’ capacities, this year as in the past. In March 2024, a law was adopted to increase 
the number of SBGS staff to 75 000 within a year of the lifting of martial law. While border checks meet 
minimum  standards,  technical  infrastructure  requires  a  significant  upgrade.  Additional  capacities  are 
needed  to  counter  smuggling,  including  weapons  and  people.  While  risk-analysis-based  border 
surveillance  mechanisms  are  satisfactory,  border  surveillance  is  not  fully  effective.  A  considerable 
amount  of  infrastructure  has  been  destroyed  at  border  crossing  points  on  the  northern,  eastern 
and southern sections, and half of the border crossing points remain closed due to the war. 

Ongoing  efforts  by  the  SBGS  and  the  State  Customs  Service  have  resulted  in  some  improvements  on 
fighting  corruption  at  the  border.  Further  developments  of  the  automated  exchange  of  customs’ 
information at the Ukrainian-Moldovan border allows for enhanced transparency and accountability. State 
Border  Guards  continued  to  digitise  border  management  processes,  improving  traceability  and 
introducing  measures  to  ensure  the  accountability  of  the  inspectors.  Nevertheless,  more  effective 
measures  are  needed.  The  SBGS  continues  to  cooperation  with  the  EBCGA  on  information  exchange, 
joint risk analysis, operations and staff training, with no major changes in the reporting period. 

On  operational  cooperation  with  neighbouring  countries,  in  the  reporting  period  Ukraine  negotiated 
and reached a bilateral agreement on joint controls with Poland. 

Counterfeiting of the euro – criminal law aspects 

The relevant legislation is not in line with the EU acquis on measure to combat counterfeit currency.  

2.3. ECONOMIC CRITERIA 

47 

 
 
 
2.3.1. The existence of a functioning market economy 

Economic governance  

Despite the significant challenges, Ukraine has demonstrated a strong commitment to implementing 
reforms  as  part  of  EU  and  IMF  programmes.  The  Ukrainian  authorities  successfully met the  policy 
conditions under the MFA+ in 2023. On 18 March 2024, the Ukrainian government adopted the Ukraine 
Plan – the overarching reform agenda for 2024-2027, which is projected to boost growth potential in the 
medium term. According to the Staff-Level Agreement for the fifth review, Ukraine met all quantitative 
performance  criteria  and  structural  benchmarks  under  the  IMF  Extended  Fund  Facility  programme  in 
September  2024.  Additionally,  in  an  effort  to  streamline  reform  management  and  enhance  oversight, 
Ukraine established a ‘Reform  Matrix’  –  a  comprehensive  framework  designed to  coordinate  and  track 
policy reforms across various sectors. 

The Ukrainian authorities were able to gradually start reapplying market principles in 2023. Strong 
economic performance and substantial international aid paved the way for a rollback of some emergency 
measures and partial return to market reforms and policies throughout 2023-2024. In October 2023, the 
National  Bank  of  Ukraine  (NBU)  transitioned  to  a  managed  float  system  for  the  hryvnia,  and  in 
September 2024, it updated the Medium-Term Monetary Policy Guidelines, outlining a return to inflation 
targeting,  with  a  5% inflation target  as the  central  NBU  objective  over a  three-year horizon.  The  NBU 
further  eased  foreign  exchange  (FX)  restrictions,  permitting  the  repatriation  of  new  dividends  and  the 
repayment of interest for old external loans. Further, the government adopted a 3-year debt management 
strategy  for  2024-2026  and  reinstated  the  medium-term  budget  framework  with  the  approval  of  the 
Budget Declaration for 2025-2027. 

Macroeconomic stability  

48 

Table 8.1:202120222023Ukraine - Key economic figuresGDP per capita (% of EU-27 in PPS)28,834,728,029,8Real GDP growth (% change)-0.3 3,4-28,85,3Economic activity rate of the population aged 15-70  (%), total1)62,362,357,756,7Unemployment rate of the population aged 15-70 (%), total1)9,19,924,319,2Employment of the population aged 15-70 (annual growth %)-0,6-0,9-22,14,8Nominal wages (annual growth %)22.5 20,96,017,4Consumer price index (annual growth %) 16.49,420,212,9Exchange rate against EUR29.1 32,334,039,5Current account balance (% of GDP)-0.6 -1,94,9-5,2Net foreign direct investment, FDI (% of GDP) -2.3-3,8-0,1-2,4General government balance (% of GDP)-2.4 -4,0-15,6-19,6General government debt (% of GDP) 67.250,577,782,3Sources: Eurostat, World Bank, International Monetary Fund, National Bank of Ukraine2015-20 average 
 
 
Ukraine’s  economy  is  showing  significant  resilience.  Following  the  economic  contraction  of  almost 
29% in 2022, real GDP expanded by a 
higher-than-expected  5.3% 
in  2023. 
The economy’s strong performance was 
underpinned by supportive fiscal policy 
bolstered  by 
international  aid,  and 
robust  agricultural  output.  Investment 
expanded  markedly,  although  from  a 
private 
very 
consumption  grew  by  6.1%,  supported 
inflation 
by 
some 
easing 
improvement 
labour  market 
the 
in 
conditions.  In  early  2024,  economic 
activity  has  remained  dynamic,  with  a 
notable increase in goods exports, after 
Ukraine regained control of a shipping corridor in the Black Sea. However, increased attacks on energy 
infrastructure  in  the  first  half  of  2024  destroyed  about  50%  of  energy  production  capacity,    disrupting 
economic  activity.  However,  efforts  to  rebuild  damaged  infrastructure  and  increase  electricity  import 
capacity  have  gathered  pace.  Beyond  the  war,  Ukraine’s  economy  continues  to  suffer  from  an 
unfavourable business environment, a declining working-age population, and reliance on agriculture and 
low value-added sectors with limited potential for productivity gains.  

base,  while 

low 

and 

The current account returned to a deficit in 
2023  after  a  record  surplus  in  2022.  The 
current  account  returned  to  a  5.2%  deficit  in 
2023  due  to  a  widening  trade  deficit  (imports 
of  goods  increased  while  exports  were  held 
back  by  bottlenecks)  and  a  declining  income 
balance  (driven  by  a  decrease  in  international 
grants,  which  have  been  replaced  by  loans). 
Higher  reinvested  earnings  by  firms,  which 
have gradually adapted to the war context, also 
worsened  the  current  account.  Strong  external 
inflows  continued,  mostly  from 
financing 
international  partners 
strengthened  gross 
international  reserves,  which  stood  at  USD 
37.2 billion in July 2024, or 4.8 months of imports.  

Inflation  eased  substantially  in  2023  and  2024,  after  peaking  in  2022.  The  decline  in  inflation  was 
driven by several factors, including: lower food prices due to strong harvests in 2023, reduced external 
price pressures, a tight monetary policy, increased confidence in the national currency, and the complete 
cessation of monetary financing. As a result, inflation returned to its pre-war target in early 2024. This 
enabled  the  NBU  to  cut  the  key  policy  rate  by  a  cumulative  1200  basis  points  since  July  2023  and 
introduce a managed float system in October 2023.  

Public  finances  deteriorated  further  in  2023.  After  a  sizeable  increase  to  16.1%  of  GDP  in  2022  
(25.4% of GDP excluding grants), the fiscal deficit widened further to 20.3% of GDP in 2023 (27.1% of 
GDP excluding grants), largely driven by a hike in defence expenditure and weak tax revenues. Ukraine 
continues to lack access to international debt markets and relies on domestic financial markets (at the cost 
of  high  interest  rates)  and  foreign  assistance  to  address  its  financing  needs.  As  a  result,  public  debt 
increased to 84.4% of GDP in 2023. The agreement to restructure private debt with bondholders, reached 
in August 2024 following a two-year payment freeze, is estimated to relief Ukraine of USD 22.75 billion 

49 

-25-20-15-10-5051020192020202120222023Graph 2:Ukraine -Current account selected components and FDIGoods and services trade balanceWork remittances balanceCurrent account balanceNet FDI% of GDPSource: WiiW, IMF, Central Bank of Ukraine  
 
of 

sustainability 

in  debt-service  payments  by  2033 
(over 75% reduction). This marks a 
significant  step  towards  ensuring 
the 
public 
transparency  of 
finances.  The 
public 
improved, 
although  the  publication  of  some 
budget  documentation  is  limited 
and  access  restricted,  such  as  for 
General Government fiscal data. 

finances  has 

The macroeconomic policy mix is 
focused  on  maintaining  stability 
amidst  the  ongoing  Russia’s  war 
of aggression. Fiscal policy has been adjusted to support war efforts by increasing expenditure in defence 
and constraining expenditure in non-defence categories. Given the sizeable fiscal deficit, the government 
has put forward measures to increase domestic revenues, including a permanent increase in the corporate 
income  tax  rate  for  banks  to  25%.  The  adoption  of  the  National  Revenue  Strategy  is  also  a  welcome 
development,  as  it  aims  to  revise  tax  privileges  and  incentives  that  limit  revenues,  and  improve  the 
functioning of the State Tax Service by encouraging modern compliance risk management practices and 
increasing  digitalisation.  However,  large  expenditure  needs  and  dependence  on  external  financing 
underscore the need to step up efforts to increase revenue in the medium term. Monetary policy has been 
crucial  in  maintaining  financial  stability  and  bolstering  confidence  in  the  domestic  currency,  while  the 
recent  easing  cycle  has  been  an  appropriate  response  to  inflation  dynamics.  Foreign  exchange  market 
conditions have remained broadly stable, with the exchange rate depreciating by a cumulative 6.6% in the 
first  five  months  of  2024  and  the  spread  between  the  cash  and  official  exchange  rates  compressed  to 
below 1%.  

Functioning of product markets  

Business environment  

War-related  and  long-standing  challenges  continue  to  weigh  on  business  activity  and  investment, 
but  the  government  has  made  progress  with  reforms.  While  the  war  remains  the  primary  factor 
constraining business activity and production, other indirect factors such as high input prices and labour 
shortages  are  increasingly  limiting  business  activity.  The  government  provides  significant  support 
through  state  credit  initiatives,  employment  programmes,  and  by  expanding  the  war-insurance 
architecture.  The  business  environment  would  nevertheless  benefit  from  better  coordination  of  support 
measures,  while  additional  actions  to  curb  corruption,  market  dominance  and  red  tape  could  enhance 
investment  levels.  Adopted  in  September  2023,  the  law  improving  the  legal  framework  for  the  Anti-
Monopoly  Committee  (AMCU)  is  a  significant  step  in  this  direction.  However,  weaknesses  remain, 
particularly  the  absence  of  a  competitive  process  for  appointing  the  head  of  the  AMCU,  as  well  as 
insufficient procedures for imposing fines and holding AMCU representatives accountable. Deregulation 
efforts led to the abolition of 111 legal acts and the optimisation of 584 in 2023-2024. Key administrative 
procedures have been simplified, particularly in customs and bankruptcy, while the implementation of the 
Ukraine Plan is expected to bring further improvements, notably in terms of the insolvency framework. 
Ukraine continues to have a large informal economy5. However, the government is taking steps to reduce 
its size by strengthening the capacity and functioning of key institutions like the State Tax Service with a 
view to increasing compliance. 

5 According to World Economics (2024), which uses an average of the latest estimates from economists around the 
world, Ukraine’s informal economy represents about 44.2% of GDP. Any estimations need to be taken with caution 
given the variety of methodological approaches. 

50 

 
 
 
State influence on product markets  

The state footprint in the economy remains high. In 2023, the public sector accounted for 22% of gross 
value added, up from 6% in 2021, and total government consumption increased to almost 42% of GDP, 
from just below 40% in 2022. SOEs continued to play a significant role in the economy; Ukraine’s state 
portfolio included more than 3000 of them. As part of the Ukraine Plan, the government has committed to 
a series of reforms aiming to reduce the state influence in the economy and modernise those SOEs that 
will  remain  in  state  ownership,  based  on  a  new  state  ownership  policy  and  improved  governance  and 
management  of  SOEs.  As  part  of  government’s  commitment  to  ensure  separation  of  accounts  between 
Public  Service  Obligations  (PSOs)  and  non-PSOs  activities  in  SOEs,  Ukraine  should  adopt  a  roadmap 
defining  relevant  steps,  assess  the  legislation  identified  therein  and  amend  the  legislation  to  ensure  a 
mandatory structural separation of accounts in all top SOEs. The government continues to monitor and 
control the prices of certain essential goods. Household electricity tariffs were increased in June 2024 to 
reflect higher production and import costs, though they remain below the cost of production. 

Privatisation and restructuring  

Notable  progress  has  been  observed  in  the  corporate  governance  of  SOEs,  while  privatisation 
efforts  have  been  modest.  In  2023,  annual  revenues  from  privatisation  amounted  to  EUR  108  million 
(0.05%  of  GDP),  an  all-time  high.  Despite  this,  privatisation  has  been  limited  to  small  property  and 
production  assets;  there  have  been  no  large-scale  privatisation  deals  in  2023  and  2024.  However,  the 
government  plans  to  relaunch  them  when  conditions  allow.  The  Rada  adopted  a  law  on  corporate 
governance  of  SOEs  in  February  2024  to  align  it  with  OECD  Guidelines,  setting  out  the  managerial 
powers of SOE supervisory boards (granting exclusive powers to appoint managers, as well as to approve 
strategies  and  financial  plans)  and    introducing  mandatory  elements  in  the  internal  control  system 
(compliance,  risk  management,  and  internal  audit).  This  is  expected  to  increase  efficiency  and  reduce 
political influence on SOE’s operational activities. Moreover, an OECD-compliant corporate governance 
in state-owned enterprises in the energy sector is crucial to ensure their efficient and effective functioning, 
and given the repair and new infrastructure needs. 

Functioning of the financial market  

Despite  the  persistence  of  war-related  risks,  the  banking  sector  continues  to  be  stable,  profitable, 
and with ample liquidity. High interest rates, strong operational efficiency, and moderate provisioning 
pushed  profits  in  the  banking  sector  to  a  record  EUR  2.6  billion  (1.3%  of  GDP)  in  2023,  even  after 
accounting for the temporary increase in the corporate tax rate to 50%. The resilience assessment of the 
largest  banks,  published  by  the  NBU  in  early  2024,  showed  that  the  sector  as  a  whole  has  sufficient 
capital and a substantial margin of safety. As part of the Ukraine Plan, the NBU will resume its regular 
resilience assessment of the banking sector to include stress testing under the adverse scenario. Although 
the  non-performing  loans  (NPLs)  ratio  is  still  very  high,  it  decreased  slightly  from  38.2%  in  February 
2023 to 36.8% in February 2024. The government has published a strategy to further reduce NPLs, setting 
out  specific  actions  to  improve  the  resolution  framework  and  create  incentives  for  the  development  of 
NPL market, inter alia. The market share of the state-owned banks increased to 53.6% in 2023 following 
the nationalisation of Sense Bank in July 2024.  The selection of a new Board is currently ongoing, with 
at  least  six  members  needed  for  the  Board  to  be  operational.  The  law  on  state-owned  bank  (SOB) 
privatisation  was  adopted,  which  should  accelerate  the  reduction  of  state  ownership  in  the  sector.  The 
Ministry of Finance is expected to appoint an internationally recognised financial advisor to prepare two 
systemic SOBs, i.e., Sense Bank and Ukrgasbank with 4% and 6% of total assets, respectively, for sale. 
Thanks to government-backed subsidized lending initiatives (e.g., ‘5-7-9’ programme for SMEs and the 
‘eOselya’ for mortgages), banks’ claims to the private sector have stopped declining and are starting to 
grow. However, overall lending to the private sector remains subdued, even if surveys suggest that access 
to finance is not a significant barrier to conducting business at this stage. Capital markets and non-bank 
financial intermediation continue to be in a very early stage of development, with no progress observed 

51 

 
 
over the past year. 

Functioning of the labour market  

The war is exacerbating persistent labour and skill shortages in the labour market. Around 38% of 
businesses  mentioned  that  finding  qualified  workers  was  a  significant  challenge,  and  some  estimates 
suggest  that  the  overall  labour  shortage  will  reach  16%  of  labour  demand  in  2024.  At  the  same  time, 
while official data is scarce, there is some indication that labour shortages, particularly in male-dominated 
sector such as construction and mining, have led to increased labour market participation among women, 
which  has  been  structurally  low  in  Ukraine.  To  address  key  labour  market  issues,  the  government, 
together with private job search agencies, have created a common job portal which includes an estimated 
230,000  vacancies  at  any  one  time.  Some  reforms  of  the  State  Employment  Service  have  also  been 
launched. In line with the Ukraine Plan, the government has prepared a demographic strategy outlining, 
inter alia, steps to facilitate the return of refugees (e.g., reducing administrative processes for the return of 
individuals)  and  internally  displaced  persons  (e.g.,  providing  support  to  them  to  start  a  business  or 
organising tailored training courses). Distortions caused by the large marginal tax rates for low-income 
workers contribute to informality and reduce labour supply. A reform of the personal income tax system 
is foreseen in the National Revenue Strategy to address this issue.  

2.3.2. The capacity to cope with competitive pressure and market forces within the Union 

Education and innovation 

While  outcomes  lag  behind  those  in  the  EU  in  particular  due  to  the  effects  of  Russia’s  war  of 
aggression,  the  authorities  are  taking  steps  to  improve  the  quality  of  education.  While  public 
spending  on  education  as  a  share  of  GDP  declined  in  2023  reflecting  the  large  number  of  displaced 
children and the prevalence of online learning, it remains similar to that in the EU. Results from the most 
recent  PISA  (Programme  for  International  Student  Assessment)  study  in  2022  showed  a  decline  in 
performance compared to the previous round in 2018, likely due to the combined effects of the pandemic 
and  the  war.6  The  Ministry  of  Education  and  Science  adopted a  new strategic  plan covering  the  period 
from 2024 to 2027, which prioritises improvements to early childhood education, vocational education, 
updated curricula and digitalisation, among other areas. In addition, the Ukraine Plan contains a number 
of measures and investments to improve human capital in particular through the education system. The 
authorities  have  also  taken  steps  to  prepare  the  education  and  training  system  to  meet  the  needs  of 
Ukrainians returning from abroad. These include accelerated curricula as well as short retraining courses 
for returnees in critical areas such as construction. Spending on research and development remains low 
standing at 0.32% of GDP in 2022. The country currently still ranks third among lower middle-income 
countries in the World Intellectual Property Organisation’s 2023 Global Innovation Index. 

Physical capital and quality of infrastructure  

Ukraine  has  continued  to  address  urgent  reconstruction  needs  amidst  tight  budgetary  resources. 
According  to  the  most  recent  Rapid  Damage  and  Needs  Assessment  released  in  February  2024,  direct 
damage to Ukraine’s buildings and infrastructure had reached almost EUR 142 billion by the end of 2023. 
Ukraine  has  continued  addressing  urgent  reconstruction  needs,  in  particular  for  energy  generation,  but 
also for housing and roads. Among the steps taken are  measures to facilitate and de-risk private sector 
investment such  as  insurance  and streamlined  processes for  construction  and infrastructure  projects.  As 
Russia  continues  to  attack  Ukrainian  energy  infrastructure,  having  taken  out  over  half  of  the  power 
generation capacity, urgent reconstruction needs will remain high. The Ukraine Plan commits the country 

6 The PISA study was conducted in October 2022 in only 18 of Ukraine’s 27 regions. The results are thus not 
entirely comparable with those from 2018. Nevertheless, the authorities themselves do make the comparison (in 
their contribution to the enlargement report) and conclude that ‘the educational loss of Ukrainian 15-year-olds in 
reading can be estimated to be about two years of schooling.’ 

52 

 
 
 
to important public investment management reforms which will be key to recovery and reconstruction. In 
addition, the authorities have laid out several steps within the Plan addressing the destruction of critical 
housing, social, administrative, transport and energy infrastructure. 

Good  digital  connectivity  has  been  key  to  the  country’s  resilience  during  the  war  despite  slower 
progress last year. The proportion of Ukrainian households with internet access (79%) has not changed 
substantially  since  2021,  though  this  remains  below  the  EU  average  of  92%.  Internet  providers  have 
managed to maintain service provision for example by repairing damaged mobile towers. Notably, 85% 
of  internally  displaced  people  made  use  of  ‘Diia’,  the  government’s  app  and  web  portal  for  public 
services; 19.8 million users accessed the app from their smartphones. Ukraine scored above the Eastern 
Partnership average for e-government services for SMEs and support for the digitalisation of SMEs in the 
2024  OECD  SME  Policy  Index.  Frequent  attacks  on  digital  infrastructure  underscore  the  need  for 
cybersecurity safeguards, rebuilding efforts and increasing infrastructure resilience. 

Sectoral and enterprise structure  

There  was  a  marked  shift  from  agriculture  and  industry  to  services  in  2022  which  stabilised  in 
2023. Agriculture’s share of GDP fell from over 12% in 2021 to around 7.5% in 2023, following a 30% 
decrease in total agricultural production in 2022. However, Ukraine’s exports continue to rely heavily on 
agricultural  products,  which  account  for  65%  of  all  exports,  despite  major  challenges  including  the 
inability to access inputs, loss of farmland, risks from mines, destruction of machinery and soil damage. 
Industry has seen a similar decline (to 20%), and the share of construction halved while the relative size 
of  the  service  sector  grew to  around  69%  of  GDP.  Industrial  production is  dominated  by energy,  basic 
metals, mining and other lower value-added industries. The information and communication technology 
sector,  where  Ukraine  had  been  developing  a  comparative  advantage,  maintained  its  relative  share  of 
output at 5.2% of GDP, and digital services make up 12% of total exports.  

Nearly all registered businesses in Ukraine are SMEs. SMEs employ 74% of the Ukrainian workforce 
and  generate  64%  of  added  value  in  the  economy.  These  businesses  have  shown  remarkable  resilience 
despite the war: 91% of SMEs that stopped operating have resumed trading. According to a survey from 
January  2024,  about  a  quarter  of  SMEs  have  benefited  from  state  or  international  assistance,  though 
access  to  finance  remains  a  commonly  cited  obstacle.  Ukraine’s  Small  Business  Act  scores,  which 
assesses  the  SME  policy  framework  against  EU  and  international  best  practice,  improved  in  all 
dimensions  between  2020  and  2024,  in  particular  in  the  areas  of  internationalisation,  business 
development  services,  skills  and  women’s  entrepreneurship.  In  other  areas  such  as  access  to  finance, 
public procurement and operational environment, progress has been slow, which reflects the impact of the 
war.  The  Ukraine  Plan  contains  a  number  of  measures  and  investments  to  improve  the  business 
environment and provide access to finance for SMEs. 

Economic integration with the EU and price competitiveness  

The overall openness of the economy as measured by the trade-to-GDP ratio declined from about 
87% in 2022 to 78% in 2023 as a result of disruptions related to the war. The disruption of the Black 
Sea and overland export routes of Ukrainian agricultural products have hampered exports, though the EU-
Ukraine Solidarity Lanes provided alternative transport routes and the opening of the new Black Sea route 
since  August  2023  has  significantly  improved  export  volumes.  Despite  the  overall  decline,  the  EU 
remains Ukraine’s largest trading partner, taking about 65% of Ukraine’s exports and accounting for more 
than half of Ukraine’s imports of goods. Since 2022, the EU has fully liberalised trade of all products by 
adopting  temporary  autonomous  trade  measures.  The  EU  is  also  the  largest  source  of  foreign  direct 
investment  (FDI)  in  Ukraine,  accounting  for  three-quarters  of  FDI  stock  in  2022.  The  real  effective 
exchange  rate  appreciated  slightly  in  2023  driven  by  higher  inflation  and  a  slower  exchange  rate 
depreciation in the hryvnia.  

53 

 
 
2.4. PUBLIC PROCUREMENT, STATISTICS AND FINANCIAL CONTROL  

Chapter 5 - Public procurement 

EU  rules  ensure  that  the  public  procurement  of  goods,  services  and  works  in  any  Member  State  is 
transparent  and  open  to  all  EU  economic  operators  on  the  basis  of  non-discrimination  and  equal 
treatment. 

Institutional set-up and legal alignment 

The legal framework on public procurement remained mostly unchanged and thus partially aligned with 
the  EU  Directives  on  public  procurement.  It  is  necessary  to  ensure  further  alignment  of  the  Public 
Procurement Law (PPL) as well as laws on public-private partnerships (PPPs), concessions and definition 
of defence procurement with the EU Directives. The government adopted the Strategy for Reforming the 
Public Procurement System for 2024-2026 and an Action Plan for its implementation in February 2024. 
While the Strategy lays the groundwork for planned strategic development, it should be supported by a 
clear and structured approach for its implementation. 

Since  2022  PPL  retains  temporary  domestic  content  requirements  for  a  period  of  10  years  for  selected 
machines and equipment. Contracting authorities have continued facing difficulties in the application of 
these  requirements  because  of  burdensome formalities  and the ambiguity  of  the rules.  Contracts falling 
within  the  scope  of  Ukraine’s  international  commitments,  including  the  Association  Agreement  (AA) 
with the EU, are exempted from this requirement. Yet, the exact coverage of this exemption should be 
made  clear  for  contracting  authorities  in  compliance  with  the  principles  of  equal  treatment  and  non-
discrimination, as set out in the AA. 

Due to the war, Ukraine introduced temporary exceptions from the public procurement legislation by way 
of government decrees. While the scope of exceptions has been reduced, further measures are required to 
reduce and maintain exceptions to the minimum. The amendment to the PPL introducing exemption for 
innovative  medicines  purchased  via  managed  entry  agreements,  adopted  by  Parliament  in  March  2024, 
necessitates the ending of the exemption as soon as circumstances allow. 

Implementation and enforcement capacity 

The constraints in availability of adequate human and financial resources affect the institutional capacity 
of management of public procurement across the institutions. Despite the war, the authorities have largely 
ensured  implementation  and  enforcement  capacity  in  public  procurement,  including  the  use  of  the  e-
procurement system ProZorro. 

The overreliance on price as the sole award criterion indicates a significant imbalance in prioritisation of 
price over quality. 

54 

 
 
 
Two  new  central  procurement  bodies  respectively  for  defence  non-military  and  military  procurement 
were established by the Ministry of Defence and started their operations in the end of 2023. Large-scale 
procurement training programme in defence sector was launched in the beginning of 2024. 

The State Audit Service continues to carry out monitoring of legal compliance of contract award and 
implementation.  The  coverage  of monitoring and  ex post internal  audit  of  public  procurement  remains 
modest. 

The  contracting  authorities  need  to  continue  building  capacity  to  manage  public  procurement 
processes. Professional standards, professionalisation strategy and training policy based on training needs 
assessment remain to be put in place. 

Overall legal and institutional framework regarding integrity and management of conflicts of interest is 
in  place.  However,  risk  assessments  within  the  contracting  authorities,  internal  and  external  controls 
remain weak. A sector anti-corruption strategy based on a risk assessment is missing. 

Efficient remedy system 

The legislation on the right to legal remedy is partly aligned with the EU acquis. A steady increase in the 
number of complaints to 15 255 cases in 2023 compared to 7 939 complaints in 2022 highlights the need 
of pursing the recruitment of public procurement commissioners, 4 out of maximum 10 were recruited in 
2023. The enhancement of the Antimonopoly Committee of Ukraine’s internal administrative capacities 
to support the work of commissioners should be continued. 

Chapter 18 - Statistics 

European  statistics  are  developed,  produced  and  disseminated  by  EU  Member  States,  guided  by  the 
principles  and  criteria  elaborated  in  the  Regulation  on  European  statistics,  such  as  professional 
independence, impartiality, reliability, transparency and confidentiality. Common rules are provided for 
the methodology, production and dissemination of statistical information, which are further specified in 
sectoral legislation that constitute the EU acquis on statistics. 

On statistical infrastructure, in September 2023, Ukraine established a National Council of Statistics as 
a consultative body to the Cabinet of Ministers with a coordination role, but it was not fully functional 
yet. Ukraine adopted legislation to align with the European standards and to integrate the principles of the 
European  Statistics  Code  of  Practice  and  approved  the  Programme  for  the  development  of  official 
statistics  until  2028.  The  institutional  framework  for  statistics  and  the  administrative  capacity  of  the 
institutions  involved  need  further  strengthening,  and  the  coordination  role  of  the  SSSU  should  be 
enhanced. Overall, the legal framework remains partially in line with the EU acquis.  

The SSSU adopted a Communication Strategy and developed a standard quality report of State statistical 
observation  ‘input-output’  tables  and  published  it  on  its  website.  Moreover,  the  SSSU  introduced  the 
Single Integrated Metadata Structure for reporting on the quality of State statistical observations in line 
with  the  EU  acquis.  Making  some  data  publicly  available  for  international  comparisons  remains 
unresolved due to the martial law. 

On classifications and registers, Ukraine approved an updated version of the Nomenclature of Industrial 
Products based on PRODCOM 2023. Ukraine also aligned its classification of the statistical regions with 
the EU acquis on the establishment of a common classification of territorial units for statistics. 

The collection of macroeconomic and government finance statistics  remains disrupted due to martial 
law. Ukraine started compiling quarterly financial accounts. Since March 2024, data on the monthly and 
quarterly  balance  of  payments  and  international  investment  position  has  been  published  in  EUR  and 
UAH. 

Ukraine  improved  the  methodology  for  calculating  indicators  of  demographic  statistics  of  enterprises, 
approved the waste classification procedure and the national list of wastes in line with the EU acquis and 

55 

 
 
adopted the methodology for calculating greenhouse gas emissions in line with the EU acquis, based on 
which air emission accounts for 2021 were published. Still, substantial progress is expected in the  areas 
of business, trade, social, agriculture, transport, energy and environment statistics. 

Chapter 32 - Financial control 

The  EU  promotes  the  reform  of  national  governance  systems  to  improve  managerial  accountability, 
sound financial management of income and expenditure, and external audit of public funds. The financial 
control  rules  further  protect the  EU’s  financial interests  against fraud in the  management  of  EU  funds 
and the euro against counterfeiting. 

Public internal financial control (PIFC) 

The strategic framework for PIFC is in place as part of the public finance management reform strategy 
for 2022-2025. The Centralised Harmonisation Unit has been developing a web PIFC portal to improve 
its  efficiency.  The  cooperation  between  the  PIFC  institutions,  the  auditing  institution  and  the  law 
enforcement agencies needs to be improved. Delegated managerial accountability and risk management 
practices still need to be fully incorporated into legislation and administrative practices. 

Continued efforts to strengthen the quality of internal audit and its alignment with international standards 
should be ensured. Internal audit offices were established in 92% of all key spending units, 30 additional 
internal  auditors  were  hired,  however  around  30%  of  internal  audit  positions  still  need  to  be  filled.  A 
certification  commission  for  the  internal  audit  function  has  been  established  within  the  Ministry  of 
Finance. 

External audit 

The current legal framework for external audit needs to be brought in line with international standards 
for  supreme  audit  institutions.  Ukraine  should  improve  the  political,  administrative  and  financial 
independence of the Accounting Chamber of Ukraine (ACU) and extend its mandate to cover all public 
spending  (including  through  financial  audits).  The  delineation  of  mandates  between  the  ACU  and  the 
State Audit Service requires improvement. 

In  June  2023,  the  ACU  adopted  the  International  Framework  of  Professional  Pronouncements  for  their 
operations  and  endorsed  methodologies  for  both  compliance  and  performance  audits,  meaning  that  all 
three types of audit methodologies are now in place in line with international standards and will need to 
be  implemented.  ACU  is  currently  in  the  initial  stages  of  conducting  audits  in  compliance  with 
international standards. 

The  impact  of  the  ACU’s  work  remains  limited  and  requires  improvement.  Some  progress  has  been 
achieved  concerning  monitoring  the  implementation  of  audit  recommendations  and  the  set-up  of  a 
specialised  IT  tools.  To  promote  reforms,  the  audits  should  be  chosen  based  on  risk  and  impact 
assessment,  which  needs  to  be  reflected  in  the  ACU’s  operational  plan  for  2025.  The  process  of 
conducting  initial  financial  audits  on  the  annual  consolidated  financial  statements  of  institutions  has 
started. 

Protection of the EU’s financial interests 

The national legislation ensures some degree of alignment with the EU acquis in terms of protection of 
EU’s  financial  interests.  Liability  for  fraud  that  impacts  the  EU  budget  needs  to  be  established  and 
strengthened. A national anti-fraud strategy to protect EU’s financial interests still needs to be adopted. 

While an anti-fraud coordination service (AFCOS) has not yet been established to facilitate effective 
cooperation  and  exchange  of  information  with  the  European  Anti-Fraud  Office  (OLAF).  The  State 
Audit Service was nominated as the national contact point for cooperation with OLAF and the European 
Court of Auditors. Ukraine should set up a network of all national authorities involved in the protection of 
the  EU’s  financial interests  and ensure that the respective roles  of  these  authorities  are  clearly  defined. 

56 

 
 
Currently cooperation between the relevant national authorities and OLAF takes place on a case-by-case 
basis. Ukraine is encouraged to develop this into a solid track record of cooperation.  

3. GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION 

Russia’s  unprovoked  and  unjustified  full-scale  war  of  aggression  against  Ukraine  continues  to  affect 
Ukraine’s relations with enlargement countries and neighbouring Member States, as well as its activities 
in regional formats. Most neighbouring countries were represented by high-level delegates at the Summit 
of Peace organised by Switzerland in June 2024, showing their political support for Ukraine. 

Ukraine participates in the Eastern Partnership, and is part of a number of regional formats, including the 
Central  European  Initiative,  Black  Sea  Economic  Cooperation,  the  Organization  for  Democracy  and 
Economic Development and the Regional Cooperation Council. 

Ukraine  maintains  longstanding  close  ties  with  neighbouring  Moldova.  Bilateral  political  dialogue  has 
been strengthened at all levels reflecting Moldova’s strong support for Ukraine in the context of Russia’s 
war. The dialogue on EU accession issues has been further boosted by the fact that the explanatory phase 
of screening took place for Ukraine and Moldova simultaneously. The two countries also discuss regional 
and  security  issues, the situation in the  Transnistrian  region and management  of  water resources of the 
Nistru River, which remains a challenging topic. 

Ukraine  and  Georgia  continue  to  implement  a  strategic  partnership  begun  in  2017.  While  Georgia 
supports Ukraine’s territorial integrity and sovereignty, Ukraine has expressed concerns that Georgia has 
not aligned itself with EU sanctions against Russia and does not cooperate on military-technical matters. 
The  ill  health  of  former  Georgian  President  Saakashvili,  a  Ukrainian  citizen,  continues  to  cause 
diplomatic tensions. 

Türkiye is a strategic partner for Ukraine, with important bilateral economic and people-to-people ties, 
evidenced by a bilateral visa-free regime and a free trade agreement (not yet ratified). Bilateral relations 
have been bolstered since the beginning of Russia’s full-scale war by Türkiye’s technical, humanitarian 
and  military  support  for  Ukraine,  and  by  its  co-sponsoring  of  UN  resolutions  supporting  Ukraine’s 
territorial  integrity  and  sovereignty.  In  January 2024,  Ukraine  and  Türkiye  signed  an  accord  that  will 
allow  Turkish  companies  to  take  part  in  the  reconstruction  of  Ukrainian  infrastructure.  Nevertheless, 
Türkiye  has  not  aligned  with  EU  sanctions  against  Russia  in  light  of  the  latter’s  full-scale  aggression. 
Ukraine has not joined all common foreign and security policy statements on Türkiye in the past. 

In  the  Western  Balkans,  Ukraine’s  relations  with  Albania  remain  good.  Albania  has  sponsored  or  co-
authored all resolutions in support of Ukraine during its non-permanent membership (2022-2023) of the 
UN Security Council. 

Relations  with  Bosnia  and  Herzegovina  are  based  on  the  latter’s  support  for  Ukraine’s  territorial 
integrity  and  sovereignty  and  its  condemnation  of  Russia’s  war  of  aggression.  Overall  good  bilateral 
relations  have  been  affected  by  certain  statements  on  Russia’s  role  in  Europe  and  significant  political 
difficulties around the implementation of restrictive measures against Russia. The two countries enjoy a 
visa-free regime. 

The ties between  Ukraine and North Macedonia are strong and deepening through political dialogue, 
diplomatic  support  and  military  assistance  in  the  face  of  Russia’s  full-scale  war.  North  Macedonia 
declared its support for Ukraine as a priority for its Chairmanship of the OSCE in 2023. 

Ukraine-Montenegro relations continue to be strong, bolstered by the latter’s continued support in UN 
fora and on sanctions, trade and technical and military assistance. 

Ukraine-Serbia relations have improved. Ukrainian and Serbian presidents held a milestone meeting in 
February  2024,  where  the  latter  confirmed  Serbia’s  support  for  Ukraine’s  territorial  integrity  and 

57 

 
 
 
sovereignty and committed to increasing humanitarian assistance for Ukraine. Serbia is Ukraine’s biggest 
trading  partner  in  the  Western  Balkans,  though  negotiations  on  a  free  trade  agreement  still  need  to  be 
concluded. 

Ukraine  has  not  recognised  the  independence  of  Kosovo  but  has  indicated  continued  support  for  EU-
facilitated dialogue between Belgrade and Pristina. Ukraine also participated in the NATO Kosovo Force 
mission until 2022, when it withdrew its contingent of servicemen and military equipment. Kosovo has 
decided on a voluntary basis to support all Declarations by the High Representative on behalf of the EU 
and has aligned with EU restrictive measures, including all those related to Russia’s aggression against 
Ukraine. 

Ukraine  and  Hungary  have  continued  efforts  to  strengthen  dialogue,  particularly  in  fields  in  which 
Hungary  provides  Ukraine  with  support  and  the  protection  of  rights  of  persons  belonging  to  national 
minorities. Numerous meetings, including some at heads-of-states level, have taken place, contributing to 
an overall positive momentum to relations between two countries. 

Poland is one of Ukraine’s closest strategic partners with regard to the Russian war of aggression. Poland 
provides  vital  political,  humanitarian,  economic,  technical  and  defence  assistance  and  hosts  the  largest 
number  of  Ukrainian  refugees.  Ukraine  signed  the  security  commitment  agreement  with  Poland  in  the 
margins of the NATO Summit 2024. There have been challenges in relations between the two countries 
over imports of Ukrainian grain and the licences for Ukrainian drivers in the transport sector, leading to 
delays at Poland-Ukraine border crossing points. Both countries have shown strong political commitment 
to finding a solution. 

Ukraine  and  Romania  continue  to  cooperate  closely  and  have  recently  strengthened  their  bilateral 
political  dialogue.  Since  early  2022,  Romania  has  contributed  significantly  to  the  export  of  Ukrainian 
food products through EU solidarity lanes and hosted logistical hubs for the delivery of EU humanitarian 
and civil protection support to Ukraine. Also, a new trilateral cooperation format encompassing Ukraine, 
Moldova and Romania has been set up. 

Ukraine’s good relations with Slovakia have also been enhanced during the Russian war of aggression. 
Slovakia provided political, military, financial and humanitarian assistance, and international advocacy in 
support  of  Ukraine’s  policy  goals.  Slovakia  hosts  a  significant  number  of  Ukrainian  refugees  under 
temporary protection arrangements. 

Relations with Bulgaria are bolstered by Bulgarian political, financial, military and humanitarian aid for 
Ukraine, and by growing economic ties. They were also nurtured by Bulgaria’s support for EU solidarity 
lanes. 

4. ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

CLUSTER 2: INTERNAL MARKET 

This cluster covers: the free movement of goods (Chapter 1); freedom of movement for workers (Chapter 
2); right of establishment and freedom to provide services (Chapter 3); free movement of capital (Chapter 
4);  company  law  (Chapter  6);  intellectual  property  law  (Chapter  7);  competition  policy  (Chapter  8); 
financial services (Chapter 9); and consumer and health protection (Chapter 28). 

Chapter 1 - Free movement of goods 

The  free  movement  of  goods  ensures  that  many  products  can  be  traded  freely  across  the  EU  based  on 
common rules and procedures. Where products are governed by national rules, the principle of the free 

  This  designation  is  without  prejudice  to positions  on  status  and  is  line  with  UNSCR  1244/1999  and  the  ICJ  Opinion on  the 
Kosovo declaration of independence. 

58 

 
 
 
 
movement of goods prevents these rules from  creating unjustified barriers to trade. 

General principles 

The  Deep  and  Comprehensive  Free  Trade  Area  (DCFTA)  between  the  EU  and  Ukraine  requires 
alignment  with  EU  acquis  in  the  harmonised  area  and  provides  for  the  possibility  to  conclude  an 
Agreement on Conformity Assessment and Acceptance (ACAA). Preparations for an ACAA between the 
EU and Ukraine are well advanced. 

Non-harmonised area 

Ukraine needs to screen its legislation, procedures, standards and technical requirements for compliance 
with Articles 34-36 of the Treaty on the Functioning of the European Union. 

Harmonised area: quality infrastructure 

On  standardisation,  Ukraine’s  legislation  is  fully  aligned  with  the  EU  acquis.  The  national  technical 
staff  of  the  standardisation  body  (UkrNDNC)  decreased  from  121  to  78,  and  there  was  no  progress  in 
becoming  a  full  member  to  the  European  Committee  for  Standardisation  (CEN)  and  the  European 
Committee for Electro-technical Standardisation (CENELEC). National standards in Ukraine are adopted 
in  conformity  with  the  European  Harmonised  standards,  but  Ukraine  still  has  old  conflicting  standards 
that urgently need to be withdrawn. 

Ukraine has made progress in aligning its legislation to the EU acquis on accreditation and on conformity 
assessment. The National Accreditation Agency of Ukraine is a signatory of  the European Cooperation 
for  Accreditation  Multilateral  Agreement  (EA  MLA)  in  the  areas  of  accreditation  of  testing  and 
calibration  laboratories,  medical  laboratories,  conformity  assessment  bodies,  management  system 
certification bodies, personnel certification bodies and inspection bodies. Ukraine is a full member of the 
International Laboratory Accreditation Cooperation (ILAC) and the International Accreditation Forum. 

The  metrology  infrastructure  was  reorganised.  Ukraine  strengthened  the  capacities  of  its  national 
metrology institutes in Kyiv and Ivano-Frankivsk but in March 2024 the National Metrology Institute in 
Kharkiv suffered further war damage, impacting calibration and measurement capabilities on weight and 
time.  Ukraine  is  not  yet  a  member  of  the  European  Association  of  National  Metrology  Institutes 
(EURAMET). 

Ukraine is partly aligned with the EU acquis on market surveillance. Market surveillance scheduled and 
unscheduled  checks  have  been  reintroduced  since  1 April  2024  for  three  priority  sectors  linked  to  its 
ACAA  application.  Market  surveillance  needs  to  be  brought  back  fully,  including  for  e-commerce,  to 
ensure the quality and safety of products circulating on the market as envisaged in the Ukraine Plan. 

Harmonised area: sectoral legislation 

On EU ‘new and global approach’ product acquis, Ukraine fully aligned to the EU acquis on measuring 
instruments and non-automatic weighing instruments. 

In regard to EU ‘old approach’ product acquis, no progress was made on alignment. 

On procedural measures, no progress was made. 

A corruption risk mitigation strategy needs to be developed for market surveillance bodies, in line with 
overall anti-corruption policy framework. 

Chapter 2 - Freedom of movement for workers 

Citizens of one Member State have the right to work in another Member State and must be given the same 
working and social conditions as other workers. 

Ukraine’s legislation is not aligned with the EU acquis on access to the labour market. No significant 

59 

 
 
changes  took  place  during  the  reporting  period.  Foreigners  and  stateless  persons  can  be  employed  in 
Ukraine after obtaining an appropriate permit issued by the State Employment Service of Ukraine. There 
is no specific legislation on employment of EU nationals, who therefore fall under the same conditions as 
nationals of non-EU countries. Ukraine should take steps to align its legislation with the EU  acquis on 
access to the labour market. 

No measure has been adopted in relation to the preparations to join the EURES Network upon accession. 

On  the  coordination  of  social  security  systems,  Ukraine  has  eight  bilateral  social  security  agreements 
with  EU  member  states.  No  agreements  for  bilateral  coordination  of  social  security  systems  were 
concluded over the reporting period. 

No national health insurance card has yet been implemented in Ukraine. Implementation of the European 
Health Insurance Card might therefore be challenging. 

Chapter 3 - Right of establishment and freedom to provide services 

EU natural and legal persons have the right to establish themselves in any Member State and to provide 
cross-border  services.  For  certain  regulated  professions,  there  are  rules  on  mutual  recognition  of 
qualifications. EU rules on postal services focus on improving the quality of universal service, gradual 
market opening to competition, and the establishment of an independent regulator. 

The  EU-Ukraine  Association  Agreement  grants  the  right  of  establishment  and  cross-border  supply  of 
services  to  EU  natural  and  legal  persons  in  Ukraine,  with  some  exceptions.  The  process  of  removing 
exceptions not in line with the acquis has not been initiated. Ukraine should start to take progressive steps 
to align its legislation with the Services Directive. 

On  the  mutual  recognition  of  professional  qualifications,  the  legislation  and  approach  followed  by 
Ukraine  varies  depending  on  the  sector.  Further  efforts  are  needed  to  align,  in  particular  with  the 
minimum  training  requirements  of  Directive  for  the  sectoral  professions,  the  directives  on  the  free 
movement  of  lawyers  and  the  Directive  on  a  proportionality  test  before  adoption  of  new  regulation  of 
professions. No agreement for mutual recognition of professional qualifications currently exists with the 
EU. 

In the area of postal services, the new law on postal communications entered into force in 2023 and is 
partially aligned with the EU Postal Services Directive. Secondary legislation for the provision of postal 
services  entered  into  force  in  October  2023.  The  state-owned  designated  universal  service  provider 
maintains the exclusive  right to  provide  a  universal  postal service.  There  were 195  economic  operators 
included  in  the  national  state  register  on  postal  service  providers  active  in  the  postal  market.  Ukraine 
needs  to  continue  aligning  with  the  EU  postal  acquis,  including  the  Regulation  on  cross-border  parcel 
delivery services, in line with its commitments under the AA. 

Chapter 4 - Free movement of capital 

In  the  EU,  capital  and  investments  must  be  able  to  move  without  restrictions,  with  common  rules  for 
cross-border  payments.  Banks  and  other  economic  operators  apply  certain  rules  to  support  the  fight 
against money laundering and terrorist financing. 

On  capital  movements  and  payments,  the  NBU  started  to  implement  its  strategy  for  easing  the  war-
related foreign currency restrictions, transition to greater exchange rate flexibility and return to inflation-
targeting. The NBU has nearly completed implementation of the first stage of the roadmap for the gradual 
easing of FX restrictions. In May 2024, rules on payments for imports of goods and services, leasing and 
rent,  loan  repayments  were  eased.  Restrictions  remain  under  national  legislation  to  the  acquisition  of 
agricultural land by EU nationals. 

On  payment  systems,  the  NBU  has  been  making  progress  to  apply  for  membership  in  the  SEPA  by 

60 

 
 
aligning its legal framework with the EU acquis but the process is still underway. The main requirements 
of  the  SEPA  Regulation  have  been  met  including  on  the  ISO 20022  XML  standard  and  the  IBAN 
payment  account  identifier.  The  alignment  of  the  Ukrainian  legal  framework  with  provisions  of  the 
Payment Services Directive 2 (PSD2) has also been advancing, including on transparency of conditions 
and  information  requirements  for  payment  services.  Some  further  alignment  with  the  PSD2  is  still 
needed,  for  example  to  reflect  derogations  concerning  information  requirements  for  the  low-value 
payment instruments and electronic money. 

On  the  fight  against  money  laundering  and  terrorism financing (AML/CFT),  Ukraine  continued  to 
align its legislation with the EU  acquis, The NBU updated relevant regulations for banks and non-bank 
institutions to apply a risk-based approach when dealing with PEPs. Further progress is still to be made in 
some  areas  including  supervision  of  virtual  assets  service  providers  and  financial  investigations.  In 
December  2023,  the  government  adopted  the  action  plan  on  preventing  money  laundering,  terrorism 
financing and proliferation financing also to address MONEYVAL’s recommendations. In the reporting 
period, the State Financial Monitoring Service of Ukraine started to revise and update the Methodology 
for  the  National  Risk  Assessment  of  money  laundering  and  terrorist  financing  risks  to  cover  all  recent 
changes made in the international AML/CTF standards. The updated Methodology is to be completed by 
end 2024 and forms the basis for the fourth National Risk Assessment. 

Ukraine  needs  to  set  up  a  register  for  holders  of  bank  accounts,  payment  accounts  and  safe-deposit 
including development of the implementing legislation as well as the necessary software and hardware. It 
must also complement its legislation, in line with the EU acquis, to ensure that beneficial owners of all 
corporate and other legal entities incorporated within Ukraine, as well as beneficial owners of trusts and 
other types of legal arrangements operating in Ukraine are properly registered.  

Chapter 6 - Company law 

The EU has common rules on the formation, registration and disclosure requirements of a company, with 
complementary rules for accounting and financial reporting, and statutory audit. 

The unified electronic state register supports implementation of company law. However, open disclosure 
of  data  from  the  unified  state  register  has  been  suspended  during  martial  law.  Although  the  legislation 
provides for transferring financial statements from the state statistics service to the unified state register, 
at  the  moment,  no  technical  solution  is  available  for  such  transfer.  The  unified  state  register  supports 
conversions, mergers and divisions, but does not cover cross-border operations. 

To align national legal provisions on disclosure of information of  foreign branches with the EU acquis, 
legislative  progress  was  made  with  the  adoption  of  some  amendments  in  July  2023,  followed  in  April 
2024  by  a  resolution  of  the  Cabinet  of  Ministers  and  an  Order  by  the  Ministry  of  Justice  on  related 
procedures  in  a  unified  state  register.  Ukraine  has  started  working  on  legislation  covering  cross-border 
mergers, and encouraging long-term shareholder engagement, in line with EU acquis. Further alignment 
will be needed with regard to the acquis on disclosure of company and foreign branches information, the 
Directive on digital tools and processes, the Directive on cross-border conversions, mergers and divisions, 
the Directive on takeover bids, the Directive on shareholder rights in listed companies, and the Directive 
on encouragement of long-term shareholder engagement.  

Progress was made on the sanctions framework with the adoption of a law amending the legislation on 
state regulation of capital markets and organised commodities markets in February 2024. As the law does 
not  cover  all  sanctions  for  violation  of  corporate  governance  and  information  disclosure  rules,  it  still 
requires improvement. 

In the area of company reporting, 15 national accounting regulations (standards) have been aligned with 
IFRS  for  SMEs.  In  January  2024,  the  Ministry  of  Finance  updated  the  template  and  procedure  for 
country-by-country reports by taxpaying entities belonging to a multinational enterprise group. 

61 

 
 
Ukrainian legislation  requires that individual and consolidated financial statements of all public interest 
entities and limited companies be prepared using IFRS in a single electronic format and submitted to the 
Financial Reporting System. While under the martial law postponement of using this system was allowed, 
247  new  entities  have  registered  (out  of  a  total  of  7 251  reporting entities)  and  2 557  entities  uploaded 
7 671 sets of financial statements in line with IFRS in 2023. 

In the area of statutory audit, several new regulations were adopted on the certification of auditors, the 
conduction  of  inspections,  and  continued  professional  training.  The  updated  Register  of  Auditors  and 
Audit Entities has been also launched. 

Chapter 7 - Intellectual property law 

The EU has to a large extent harmonised rules for the legal protection and enforcement of intellectual 
property rights (IPR), covering notably patents, trade mark and designs, biotechnological inventions and 
pharmaceuticals, trade secrets, (craft and industrial) geographical indications, supplementary protection 
certificates, copyright and related rights. 

On  copyright  and  related  rights,  implementing  legislation  to  the  Law  on  copyright  and related  rights 
specifying the procedures for the protection of these rights was adopted. However, further alignment with 
the EU acquis is needed in particular regarding the term of protection for copyright and related rights, the 
distribution  of  a  fair  remuneration  between  performers  and  producers  of  phonograms,  the  reproduction 
right  and the rights  of  the broadcasting  organisations.  Moreover,  some  aspects  of  the current  copyright 
law  regime  remain  problematic,  for  instance  with  the  collective  rights  management  organisations,  as 
accreditation procedures have been halted for the duration of the martial law and the existing collection 
mechanisms  remain  non-functioning.  Public  broadcasting  organisations  continue not  to pay  royalties to 
performers and phonogram producers. 

On industrial property rights, no progress was recorded vis-à-vis the alignment of the Law on patents 
and some of its implementing rules, including on the patentability. In addition, no progress was recorded 
on the alignment of Ukraine’s trademarks legislation. Moreover, no legislative changes to align with the  
trade secrets directive took place. 

On  intellectual  property  rights  enforcement,  the  shortcomings  vis-à-vis  combating  piracy  and 
counterfeit  products  remain  unaddressed.  The  Ukrainian  National  Office  for  Intellectual  Property  and 
Innovations (NIPO) started publishing consolidated data on IP enforcement. At the judicial level the IP 
Court remains non-operational, pending decision to restart competitions for filling the vacant positions of 
its judges. 

On the institutional framework, no changes have taken place. NIPO has developed a closer collaboration 
with  the  World  Intellectual  Property  Organisation,  as  well  as,  importantly,  with  the  European  Union 
Intellectual Property Office, with which it works on the basis of the work plan signed in October 2023 
and within the framework of the EU4IP project since March 2024. 

 Chapter 8 - Competition policy 

EU  rules  protect  free  competition.  They  include  antitrust  rules  against  restrictive  agreements  between 
companies and abuse of dominant position, and also include rules on concentrations between companies 
which  would  significantly  impede  effective  competition.  EU  rules  also  set  out  a  system  of  State  aid 
control. Governments are only allowed to grant State aid if restrictive conditions are met, with a view to 
preventing distortion of competition. 

Antitrust and mergers 

On  the  legislative  framework,  the  amendments  to  the  law  on  the  protection  of  economic  competition 
entered  into  force  in  early  2024.  It  inter  alia  grants  more  powers  to  the  Antimonopoly  Committee  of 
Ukraine (AMCU) for conducting inspections and for access to information, introduces amendments to the 

62 

 
 
hearing  process  before  the  AMCU,  and  establishes  a  leniency  and  a  settlement  mechanism,  as  well  as 
rules on joint and several liability of undertakings for breaches of competition law. Some provisions of 
the law still need to be further aligned with the EU acquis. 

On  implementation,  there  was  a  significant  increase  in  the  number  of  cases  for  anti-competitive 
concerted actions, abuse of dominant position and mergers in relation to the previous year. The amounts 
of fines imposed by AMCU as a conclusion of these cases also significantly increased. 

State aid 

On the legislative framework,  the State aid law needs to be amended on a number of issues to ensure 
further alignment with the EU State aid rules. According to the Ukraine Plan, Ukraine has committed to 
amend and put into force the updated legislation on State aid, including provisions in relation to Services 
of General Economic Interest (SGEIs), together with the full unsuspension of the application of State aid 
control by AMCU. 

Ukraine  approved  implementing  legislation  on  criteria  for  assessing  the  compatibility  of  State  aid  to 
undertakings. However, it still needs to compile a complete inventory of the State aid schemes, instituted 
before AMCU was established as the responsible State aid authority in Ukraine. 

To align with the EU  acquis on SGEIs and include SGEIs under the scope of the State aid control, the 
Cabinet  of  Ministers  adopted  in  January  2024  a  resolution  that  approves  the  criteria  for  assessing  the 
compatibility of State aid to undertakings for the provision of SGEIs. However, further alignment with 
the State aid acquis and, where necessary, amendments to the Ukrainian legislation are needed, combined 
with a focus on  enforcement. This further includes specific elements, such as separation of accounts in 
undertakings  in  order  to  avoid  cross-subsidization  of  Public  Service  Obligations  (PSOs)  and/or  SGEI-
related  activities  within  the  undertakings  (both  public  and  private)  that  could  distort  the  level-playing 
field. Separation of accounts is an important element for the effective and compliant implementation of 
the State aid acquis in connection with the SGEIs.  

In  terms  of  implementation,  State  aid  control  remains  suspended  under  the  martial  law,  with  no 
obligation  to  notify  to  AMCU  new  or  modified  State  aid  schemes.  This  entails  that  State  aid  granted 
during the period of suspension of the State aid law is considered compatible aid. 

Chapter 9 - Financial services 

EU  rules  aim  at  ensuring  fair  competition  among,  and  the  stability  of,  financial  institutions,  namely 
banking,  insurance,  supplementary  pensions,  investment  services  and  securities  markets.  They  include 
rules on authorisation, operation and supervision of these institutions. 

On  banking  and  financial  conglomerates,  the  latest  Report  on  Resilience  Assessment  of  Ukraine’s 
Banks in 2023 showed that most banks in Ukraine have sufficient capital, and the banking system as a 
whole  has  a  high  safety  margin  against  the  required  NBU  targets.  According  to  the  Financial  Stability 
Report of 2024, the NBU also plans to activate the capital conservation and systemic importance buffers 
in  the  future.  Ukraine  has  to  start  the  preparation  of  an  independent  asset  quality  assessment  of  the 
banking sector to be able to do a detailed and independent asset quality assessment of the banks. 

In  December  2023,  the  NBU  aligned  the  regulatory  capital  structure  of  the  banks  with  EU  norms,  
increased  the  capital  requirements  for  financial  companies,  and  established  requirements  for  a  new 
remuneration  structure  for  banks,  compliant  with  the  principles  of  ensuring  a  bank’s  sustainable 
development, the achievement of its strategic goals, and the operation of a comprehensive, adequate and 
effective  risk  management  system,  and  ensuring  accountability.  It  also  introduced  prudential  liquidity 
ratios for the banking sector on a consolidated basis in January 2024. In June 2024, through a series of 
new Resolutions, the NBU further enhanced capital requirements for banks and banking groups. 

In  June  2024,  the  Financial  Stability  Board  of  Ukraine  approved  the  Lending  Development  Strategy, 

63 

 
 
focussing  on  facilitating  lending  in  priority  areas  under  martial  law  and  development  of  the  legislative 
framework for giving further impetus to lending market. 

On insurance and occupational pensions, the main rules of the new Law on insurance, which aims to 
align  with  the  EU  Solvency  II  Directive,  took  effect  on  1 January  2024.  The  NBU  adopted  related 
implementing legislation  in  December 2023 and  in  February 2024  to  clarify  the  new insurance classes, 
introduce new requirements for solvency capital and minimum capital of the insurer.  In June 2024, the 
NBU  adopted  a  Resolution  on  the  Methodology  for  valuation  of  assets  and  liabilities  for  calculating 
insurers’ regulatory capital. 

Amendments  to  the  Law  on  financial  mechanisms  for  stimulating  exports  concerning  insurance  of 
investments  in  Ukraine  against  war  risks  were  introduced  in  November  2023.  The  Law  expands  the 
activities of the Export Credit Agency in the area of insurance and reinsurance and introduced insurance 
and  reinsurance  of  direct  investments  in  Ukraine  against  political  and/or  war  risks.  The  Law  on  motor 
third  party  liability  was  adopted  in  May  2024.  As  regards  non-bank  credit  services,  the  Credit  Unions 
Law came into force on 1 January 2024. 

Regarding financial market infrastructure, since January 2024, the functions of the supervision and the 
oversight of the central securities depositories, securities settlement systems, central counterparties, and 
trade repositories were split between the National Securities and Stock Market Commission (NSSMC  -  
supervision) and the National Bank of Ukraine (NBU - oversight). Ukraine remains partially aligned with 
the  EU  acquis,  notably  on  settlement  finality  and  OTC  derivatives,  central  counterparties  and  trade 
repositories (EMIR). 

On  the  securities  markets  and  investment  services,  the  Law  on  the  strengthening  powers  of  the 
NSSMC was adopted in February and partially came into force in April 2024 expanding the investigative 
powers, independence and institutional capacity, its cross-border domestic cooperation mandate, and its 
mandate  to  undertake  risk-based  supervision.  The  Law  provides  for  mechanisms  for  proper  state 
regulation and supervision of capital markets and organized commodity markets and combating market 
abuse.  

In April 2024 NSSMC approved the Regulation on the State Register of Securities Issues. 

Regulation on licensing conditions for conducting professional activities on capital markets was adopted 
in  March  2024.  On  19  September  2024,  the  Law  on  Rating  was  adopted,  aiming  at  strengthening 
regulation of credit rating agencies. 

On investment funds, Ukraine is yet to align with AIFMD and UCITS, while taking due account of the 
recent changes introduced to the above mentioned frameworks.  

On  sustainable  and  digital  finance,  the  progress  has  been  limited.  A  new  Regulation  on  bonds  was 
adopted in September 2024, which introduced a framework for green bonds as well.  

Virtual assets remain unregulated as the law adopted on 17 February 2022 has not entered into force. 

Chapter 28 - Consumer and health protection 

EU  rules  protect  consumers’  economic  interests  and  also  ensure  product  safety,  prevent  dangerous 
imitations and establish liability for defective product. The EU also guarantees a high level of protection 
of  public  health  and  in  particular  also  ensures  high  common  standards  for  tobacco  control,  blood, 
tissues,  cells  and  organs,  and  medicines  for  human  and  veterinary  use.  The  EU  also  has  rules  for 
upholding  patients’  rights  in  cross-border  healthcare,  and  in  preparing  for  and  responding  to  cross-
border health threats including communicable diseases.  

Consumer protection 

On  horizontal  aspects,  Ukraine  is  waiting  for  the  end  of  martial  law  to  re-enforce  its  Law  on  the 

64 

 
 
protection of consumer rights. This Law is partly aligned with the latest EU acquis on consumer rights, 
unfair contract terms, unfair commercial practices, and price indications. It also partly aligns with the EU 
acquis on package travel and linked travel arrangements, the sale of goods, digital content and services, 
and  on  representative  actions  and  timeshares.  Since  31 March  2024,  the  NBU  and  the  NSSMC  have 
become responsible for the protection of the rights of consumers in the areas of financial services, capital 
markets and commodity markets. 

On  enforcement  and  redress,  Ukraine  has  a  limited  level  of  alignment  with  the  EU  acquis  on 
cooperation  between  national  authorities  responsible  for  the  enforcement  of  consumer  protection  laws, 
and on consumer alternative dispute resolution. 

On product safety, the national legislation is  partly aligned with the EU acquis on market surveillance 
regulation and is partly aligned on general product safety. Since April 2024, checks and inspections by 
market surveillance authorities on product safety were gradually brought back for selected manufacturing 
products. In the coming year, Ukraine needs to fully restart market surveillance for all product sectors to 
improve safety of products for consumers. 

Health protection 

On  public  health,  Ukraine  is  yet  to  adopt  its  new  National  Health  Strategy  2030,  and  its  2024-2026 
health  action  plan.  A  new  law  on  public  health  entered  into  force  in  September  2023,  but  the 
implementing  legislation  needs  to  be  adopted,  inter  alia,  on  governance  and  coordination  mechanisms 
with  regards  to  readiness  and  response  planning  and  execution.  The  health  sector  does  not  receive 
sufficient resources; staff and salaries have not increased sufficiently despite the increase in health needs. 
On eHealth, Ukraine has a national health information system, but its governance needs to be improved, 
and the electronic health surveillance system needs to be integrated into the main health system. National 
health information strategy indicators also need to be aligned with the European Core Health Indicators.  

On tobacco control, Ukraine has banned the use of flavouring and additives in all types of tobacco and 
nicotine  products,  but  national  compliance  and  enforcement  mechanisms  on  this  still  need  to  be 
established.  Ukraine  needs  to  accede  to  the  World  Health  Organisation’s  Protocol  to  Eliminate  Illicit 
Trade in Tobacco Products. 

There was no substantial progress on alignment with the EU acquis on cosmetic products, on medicinal 
products  for  human  use  or  medicinal  products  for  veterinary  use,  on  blood,  tissues,  cells  and 
organs. On patients’ rights in cross-border healthcare, Ukraine has recently presented a roadmap for 
implementation of the respective EU acquis. There were no significant developments on drug abuse and 
prevention.  Nevertheless,  Ukraine  resumed  market  surveillance  on  medical  devices,  on  in  vitro 
diagnostic medical devices, and on active implantable medical devices and bioimplants.  

On  communicable  diseases  and  on  serious  cross-border  health  threats,  Ukraine  established  an 
emergency  response  plan for  the  protection  and  sanitary  and  epidemiological  welfare of the  population 
and  approved  the  procedure  for  informing  the  population  about  biological  safety  and  protection. 
However, more effort is needed to improve the emergency response plans (scope, detail, consideration of 
sub-national  levels,  risk-based  approaches)  to  comply  with  the  EU  regulation  on  serious  cross-border 
health  threats.  Overall,  vaccination  coverage  remains  below  WHO  global  recommendations.  On  non-
communicable  diseases,  Ukraine  adopted  measures  on  cancer  prevention,  early  diagnosis,  and 
treatment, which introduce a monitoring system and educational measures to encourage the use of cancer 
screening  programmes.  The  National  Cancer  Register  is  not  fully  aligned  with  the  eHealth  system  and 
needs  modernisation.  Ukraine  is  prioritising  mental  health  and  psychosocial  support,  strengthened 
mental  health  systems  across  the  country,  established  a  Coordination  Council  for  Mental  Health  as  an 
advisory body to the government and launched the National Mental Health Programme. On nutrition and 
healthy lifestyle, Ukraine adopted a new strategy for the reform of the school nutrition system for 2023-
2027. 

65 

 
 
On  health  inequalities,  Ukraine  adopted  legislation  granting  free  of  charge  medical  examination  and 
emergency medical assistance to refugees and persons in need of protection. Efforts were undertaken to 
improve  the  healthcare  for  the  Roma  community,  especially  by  mass  vaccination  of  children  and 
accompanying  educational  work.  Women  and  adolescents  benefited  from  actions  on  gender-based 
violence and sexual and reproductive health. 

Corruption in the health sector remains a cause for concern. 

CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH 

This cluster covers: digital transformation and media (Chapter 10); taxation (Chapter 16); economic and 
monetary policy (Chapter 17); social policy and employment (Chapter 19); industrial policy (Chapter 20); 
science and research (Chapter 25); education and culture (Chapter 26); and customs union (Chapter 29). 

Chapter 10 - Digital transformation and media 

The EU supports the smooth functioning of the internal market for electronic communications, electronic 
commerce and audiovisual services. The rules protect consumers and support the universal availability of 
modern services. 

On  electronic  communications,  after  amending  Appendix  XVII-3  of  Annex  XVII  to  the  Association 
Agreement/Deep and Comprehensive Free Trade Area (AA/DCFTA), Ukraine has launched a process to 
put  in  place  legislation  relevant  to  EU  roaming  that  would  align  Ukraine’s  legislation  with  the  EU 
roaming acquis. On 22 May 2024, Parliament adopted the Law on amendments to certain legislative acts 
of  Ukraine  regarding  the  implementation  of  European  legislation  on  roaming.  Ukrainian  authorities 
continue the alignment efforts with the work on the implementing legislation. 

In  light  of  current  security-related  constraints  related  to  the  Russian  war  of  aggression,  Ukraine  has 
started preparatory work but has not yet been able to fully implement the acts related to the regulatory 
framework  for  radio  spectrum  policy,  in  particular  the  release  of  the  700 MHz  band  from  TV 
broadcasting for mobile communications. 

Regarding  digital  services,  Ukraine  continues  to  develop  its  well-advanced  e-government  system. 
Ukraine  should  continue  seeking  alignment  with  both  the  European  Interoperability  Framework  (latest 
revision in 2017) and the Interoperable Europe Act (2022). This EU acquis should be taken account when 
Ukraine prepares an Action Plan for digitalisation of public services. 

Ukraine  is  in  the  process  of  drafting  legislation  to  align  with  the  Digital  Services  Act  (DSA).  Ukraine 
should start mapping and engaging with relevant stakeholders and build independent regulatory capacity 
in the field of digital services with a view to develop a roadmap by end 2025 detailing the next steps and 
capacity building for alignment with the DSA. 

Regarding digital trust and cybersecurity, Ukraine has made good progress in the approximation to the 
electronic identification and trust services under the European Digital Identity  Regulation, however some 
gaps  remain  in  order  to  fully  implement  the  EU  acquis  in  the  field  of  electronic  identities  and  trust 
services  and  benefit  from  internal  market  treatment.  The  Ukrainian  Law  needs  to  be  aligned  with  the 
revised European Digital Identity Regulation and Ukraine will need to specify the rules in a number of 
areas  (e.g.  compliance  with  the  GDPR  (or  an  equivalent  level  of  protection  of  personal  data)  and  with 
some  provisions  of  the  NIS2  Directive)  in  order  ensure  mutual  recognition  of  electronic  identification 
schemes from EU Member States in Ukraine according to European standards.  

Ukraine’s  National Security and Defence Council is implementing a national cybersecurity strategy. Its 
computer  emergency  response  team,  CERT-UA,  is  taking  steps  within  overall  framework  of  the  EU-
Ukraine  cyber  dialogue  towards  closer  institutional  cooperation  with  EU  counterparts,  including  the 

66 

 
 
 
European Union Agency for Cybersecurity (ENISA) and CERT-EU. As a result, a Working Arrangement 
document between ENISA, National Cybersecurity Coordination Center (NCCC) and Administration of 
the  State  Service  of  Special  Communications  and  Information  Protection  (SSSCIP)  was  signed  on 
9 November 2023 and is being implemented since. Ukraine needs to continue the implementation of the 
5G Cybersecurity Toolbox measures, including assessing the risk profile of suppliers and putting in place 
appropriate  restrictions  and/or  exclusions  for  high-risk  suppliers.  Moreover,  Ukraine  should  continue 
pursuing alignment with the NIS2 Directive. 

On  media,  Ukrainian  legislation  is  broadly  in  line  with  the  Audiovisual  Media  Services  Directive 
(AVMSD).  Restrictions  are  in  place  for  the  retransmission  of  television  programmes,  in  particular  to 
prevent Russian TV channels from retransmitting audiovisual content and advertising from EU Member 
States to Ukraine, as well as those that systematically violate the requirements of Ukrainian legislation. 
These  restrictions  are  still  considered  necessary  to  protect  Ukraine’s  information  space  in  the  current 
security situation, however, they will need to be addressed after the war. 

Provisions  of  Article 36  of  the  Law  on  media  relative  to  countering  hate  speech  came  into  effect  on 
1 June  2024,  seeking  to  align  Ukraine  with  the  EU  Code  of  Conduct  on  countering  illegal  hate  speech 
online. They provide for more severe penalties for hate speech than for discrimination or harassment. 

On the protection of minors, the regulation on content harmful to children took effect on 31 March 2024, 
providing for time-of-day restrictions on the (in)accessibility of information that may harm the physical, 
mental, or moral development of children. 

Chapter 16 - Taxation 

EU  rules  on  taxation  cover  value  added  tax  and  excise  duties  and  aspects  of  corporate  taxation.  They 
also cover cooperation between tax administrations, including the exchange of information to prevent tax 
evasion. 

On  indirect  taxation,  the  provisions  of  Ukrainian  VAT  law  broadly  correspond  to  the  acquis.  The 
standard VAT rate is 20%, the reduced rates for some types of operations are 0%, 7% and 14%, while 0% 
VAT  is  charged  on  exported  goods.  The  National  Revenue  Strategy  2024-2030  adopted  in  December 
2023 envisages a staged approach to full alignment on VAT: (I) revision of tax incentives (benefits), (II) 
revision of the reduced VAT rates, and (III) revision of VAT administration system. 

Excise taxation is partially aligned with the EU legislation. Ukraine has to work further on excise duties 
structure and on VAT incentives (tax benefits) so as to align them with the acquis. The classification of 
alcohol and alcoholic beverages and the determination of the unit of measurement of the tax base broadly 
correspond to the acquis, with the exception of beer and beer mixes.  As regards excise duties on tobacco, 
the  Ukraine  Tax  Code  is  broadly  aligned  with  the  EU  acquis.  Further  alignment  is  needed  regarding 
manufactured tobacco categories and applicable excise duty rates according to acquis. An amendment to 
the Tax Code to align excise duties on fuel closer to the EU level by 2028 was adopted in July 2024.  

Ukraine needs to bring its tax warehousing system for alcohol, tobacco and energy products in line with 
the EU acquis.  

On direct taxation, concerning personal income tax, no changes occurred. The corporate income tax is 
not yet fully in line with the EU acquis. Ukraine does not have exit taxation rules equivalent to the EU 
ones.  The  preparation  of  the  legal  framework  introducing  general  anti-abuse  rule,  exit  taxation,  also 
revising foreign-controlled company taxation, interest limitation rules and other elements of the Anti-Tax 
Avoidance Directive (ATAD) has started. 

Regarding  administrative  cooperation  and  mutual  assistance,  anti-abuse  provisions  and  loss  of 
benefits  clauses  were  introduced  in  agreements  with  most  of  the  EU  Member  States  that  have  already 
implemented  the  necessary  provisions  in  their  national  legislation;  negotiations  are  ongoing  with 
Germany  and  Spain  and  remain  to  be  initiated  with  Czechia.  Ukraine  has  concluded  double  taxation 

67 

 
 
agreements with all EU Member States. 

In 2024, Ukraine started the first automatic exchange of information on financial accounts. Ukraine does 
not  have  a  central  communication  office  for  information  exchange  with  EU  Member  States.  The 
preparation  of  introduction  of  the  OECD  Model  Rules  for  Reporting  by  Digital  Platform  Operators 
(MRDPI) and the Directive on administrative cooperation in the field of taxation (DAC7) has started in 
2024. 

On operational capacity and computerisation, the State Tax Service (STS) made progress by creating a 
competency framework for HR processes, in view of aligning the STS’s competency framework with that 
of  the  EU.  Further  integration  of  competency-based  people  management  approach  into  selection, 
performance  appraisal  and  professional  development  with  revision  of  current  training  programmes  is 
needed. 

A  dedicated  IT  reform  strategy  for  digitalisation  of  the  STS  remains  to  be  approved.  To  increase  the 
administrative capacity in automation of business processes, IT solutions in various domains have been 
successfully deployed. 

Chapter 17 - Economic and monetary policy 

EU rules require the independence of central banks and prohibit them from directly financing the public 
sector.  Member  States  coordinate  their  economic  policies  and  are  subject  to  fiscal,  economic  and 
financial surveillance. 

In terms of monetary policy, the National Bank of Ukraine (NBU) has been implementing measures to 
normalise monetary and exchange rate policies based on a conditions-based strategy adopted by the NBU 
in  July  2023  for  easing  foreign exchange restrictions,  transition  to  greater exchange  rate flexibility  and 
return to inflation-targeting. 

The NBU transitioned from the fixed exchange rate regime to a managed flexibility of the exchange rate 
in  October  2023.  In  May  2024,  NBU  introduced  the  largest  easing  package  of  foreign  currency 
restrictions.  This  transition  did  not  cause  a  sharp  depreciation  or  significant  losses  to  international 
reserves, marking an important step towards returning to inflation targeting and enhancing the ability of 
the  economy  to  absorb  shocks.  In  September  2024,  the  NBU  updated  the  Key  Principles  of  Monetary 
Policy, reintroducing inflation targeting within a three-year time horizon. 

Overall, the legislative framework, including the laws governing the functioning of the NBU, ensures the 
functional, institutional, personal and financial independence of the NBU and prohibits direct and indirect 
monetary financing of the public sector. Although monetary financing has been possible under the martial 
law, it has been avoided since start of 2023 and 2024. In addition, the law allows mutual consultations 
between the NBU and the government about monetary policy, which is not aligned with the EU acquis, as 
it  provides  third  parties  with  a  mechanism  to  influence  the  decisions  of  the  NBU.  The  legislative 
framework also allows either the President of Ukraine or the Rada to unilaterally remove a member of the 
governing  body  without  judicial  review,  which  weakens  the  protective  measures  against  arbitrary 
dismissals. There is still scope to further streamline the eligibility criteria and experience requirements for 
appointments at the Council and Executive Board.  

On economic policy, the Budget Code sets out the framework for fiscal rules although some important 
provisions were repealed following the implementation of the martial law, in relation to the medium-term 
budgetary framework. However, in line with the commitments under the Ukraine Plan, the government 
reinstated  the  medium-term  budget  framework  with  the  approval  of  the  Budget  Declaration  for  2025-
2027.  In  December  2023  Ukraine  adopted  a  National  Revenue  Strategy  until  2030  to  align  tax  and 
customs  legislation  to  EU  standards,  introduce  regular  spending  reviews  and  reduce  financial 
vulnerabilities  by  introducing  fiscal  risks  management  for  local  budgets.  Ukraine  continues  to  forecast 
economic  and  social  developments  despite  persistent  challenges  that  affect  the  reliability  of  these 

68 

 
 
predictions. These challenges include the ongoing war, which impacts data quality, as well as the limited 
technical  capacity,  including  human  resources,  for  policy  costing  and  budget  forecasting.  Additionally, 
there is no independent fiscal institution to evaluate the forecasts, scrutinize the government's budgetary 
assumptions, or assess the performance of previous forecasts. 

The collection of macroeconomic and financial statistics remains disrupted due to martial law and budget 
reporting is still hampered by security concerns. Data on the execution of public finances is available only 
for  the  state  budget  and  local  government  level,  with  general  government  data  absent.  The  general 
government sector data is not in line with ESA 2010 and not transmitted to Eurostat.  

Chapter 19 - Social policy and employment 

EU rules in the social field include minimum standards for labour law, equality, health and safety at work 
and non-discrimination. They also promote social inclusion and social protection, and social dialogue at 
EU level. 

Regarding  the  labour  law,  significant  shortcomings  in  the  legislation  still  need  to  be  addressed  to 
modernise  it  with  genuine  involvement  of  social  partners,  bringing  it  in  line  with  the  EU  acquis  and 
consistent with the ‘improved functioning of the labour market reform’ of the Ukraine Plan. 

Labour  inspection  needs  strengthening  in  line  with  the  EU  acquis.  Enforcement  by  the  State  Labour 
Service  (SLS)  is  constrained  by  legislative  restrictions  not  consistent  with  International  Labour 
Organization (ILO) Conventions 81 and 129. The SLS law enforcement functions continue to be limited 
due to the martial law. Underfunding and high staff turnover still need to be addressed. 

There was no progress in combating informal employment. 

On  occupational  safety  and  health  at  work  (OSH)  the  current  national  legal  framework  needs 
substantial  improvement.  As  a  first  step,  Ukraine  should  adopt  legislation  aiming  at  aligning  with  the 
OSH Framework Directive 89/391/EEC. 

On  social  dialogue,  the  National  Tripartite  Social  and  Economic  Council  did  not  hold  any  physical 
meetings during the reporting period and there are no systematic consultations between the government 
and social partners. Strengthening the capacities of social partners need to be stepped up. 

On employment policy, under conditions of the martial law, the State Employment Service (SES) still 
provides employment services such as job matching, public works programmes, subsidised schemes for 
employers,  including  for  young  people  and  re-/upskilling  programmes.  A  Unified  Job  Portal  has  been 
created together with SES and leading Ukrainian job search sites. 

Due  to  the  war,  official  data  on  labour  and  employment  is  scarce.  Labour  force  participation  is 
estimated to 56.7% in 2023 and 57.7% in 2022. In 2021 the labour force participation stood at 62.3%. The 
unemployment  rate  in  Ukraine  was  estimated  to  19.2%  in  2023,  down  from  24.3%  in  2022.  In  2021 
unemployment stood at 9.9%. 

The  social  protection  system  and  social  assistance  in  Ukraine  does  not  provide  adequate  levels  of 
protection, in particular for persons in vulnerable situations. Ukraine should as part of the commitments 
under the Ukraine Plan establish a social services purchaser at the state level that will co-finance services 
for parts of the population that are in socially vulnerable situations. Currently a pilot project for procuring 
social services at national level has been established. 

69 

 
 
Ukraine needs to adopt a strategy and its action plan on the implementation of the de-institutionalisation 
reform  of  alternative  care  for  children  (Better  Care  reform)  and  ensure  implementation  of  the  related 
reform.  In  August  2023,  the  Coordination  Centre  for  Family  Upbringing  and  Childcare  Development 
(Better  Care  Reform  Office)  was 
should 
launched. 
strengthening 
continue 
services, 
community-based 
including 
living 
services,  for  all  persons  with 
disabilities.  

supported 

Ukraine 

remains 

Legislation  in  the  area  of  non-
to  be 
discrimination 
further  aligned  for  instance  with 
Directive  2000/78  on 
equal 
in  employment  and 
treatment 
the  equality 
occupation.  On 
between  women  and  men  in 
employment and social policy, a 
National Strategy on Reducing the 
Gender  Pay  Gap for  the period  up  to  2030  and an  Action  Plan  for its implementation  was  approved in 
September  2023,  developed  in  consultation  with  the  relevant  stakeholders.  In  July  2023,  Ukraine 
introduced  changes  allowing  more  options  for  maternity  leaves  and  simplifying  access  to  early 
intervention  services  for  families  with  children  aged  0-4.  The  war  has  diverted  attention  from  gender 
equality as a national priority. 

Chapter 20 - Enterprise and industrial policy 

EU  industrial  policy  strengthens  competitiveness,  facilitates  structural  change  and  encourages  a 
business-friendly environment that stimulates small and medium-sized enterprises (SMEs). 

On  enterprise  and  industrial  policy,  the  key  reforms  defined  in  the  National  Recovery  Plan  and 
National  Economic  Strategy  2030  were  further  elaborated  in  the  Ukraine  Plan  through  dedicated 
measures  to  support  the  business  environment  and  investment  climate.  The  Ukraine  Plan  will  support 
dedicated measures in the area of improvement of regulatory environment, reboot of Economic Security 
Bureau  ensuring  access  to  finance  and  markets  through  implementation  of  stimulus  and  financing 
programmes  for  SMEs,  elaboration  of  mid-term  priorities  for  SME  development  (SME  Strategy  until 
2027), approving the procedure for using budget programme funds for the introduction of industrial parks 
support  as  a  tool  for  attracting  investments  in  the  de-occupied  areas.  Further  business  environment 
reforms include improved and EU-compliant public procurement regulation, harmonisation of legislation 
and  standards  with  the  EU  and  developing  EU-compliant  legal  framework  to  combat  late  payments  in 
commercial transactions for SMEs. 

The Ministry of Economy prepared and adopted the procedure for using budget programme funds for the 
introduction of industrial parks support as a tool for attracting investments in the de-occupied areas. The 
Government  has  approved  the  Strategy  for  the  Recovery,  Sustainable  Development  and  Digital 
Transformation of SMEs until 2027 and the operational action plan for its implementation for 2024-2027. 
It has also adopted a new version of the deregulation action plan containing almost one hundred measures 
for  simplifying  business  conditions  and  creating  a  favourable  business  climate  in  all  sectors  of  the 
economy. 

The 2024 SME Policy Index assessed progress made by Ukraine in implementing the Small Business Act 
(SBA)  for  Europe  over  the  period  2020-23.  The  index  pinpointed  substantial  improvements  in  various 

70 

 
 
areas  of  the  Ukrainian  public  policy  towards  SMEs,  including  institutional  and  regulatory  frameworks, 
access to financing and policies to support innovation activities. Ukraine has demonstrated good progress 
in  the  operational  environment  for  SMEs,  entrepreneurial  education/female  entrepreneurship,  and 
entrepreneurial  skills.  The  main  priority  directions  for  further  improvement  are  development  of  EU-
compliant insolvency framework providing for ‘second chance’, green economy and innovation support 
policy. 

On  enterprise  and  industrial  policy  instruments,  there  has  been  no  progress  with  alignment  of  the 
Ukrainian  legislation  with  the  EU  Directive  on  combating  late  payment  in  commercial  transactions, 
however alignment with this directive has been included as a business environment priority reform to be 
implemented in the framework of the Ukraine Plan. 

The  deregulation  of  economic  activities  and  an  improvement  of  the  regulatory  and  operational 
environment  for  SMEs  remains  a  priority  and  good  progress  has  been  achieved.  An  inter-ministerial 
working  group  (IWG)  reviewed  1 323  instruments  of  state  regulation  of  business  operations  and 
recommended  to  abolish  456  instruments,  amend  or  digitalise  584  tools  and  leave  283  regulations 
unchanged. As of September 2024, 122 instruments were already abolished. Following the review of the 
regulatory  instruments  (mandatory  business  permits  and  licenses),  the  IWG  started  to  analyse  business 
inspections in all spheres of state control of business activity, aiming to reduce administrative burden on 
business and implement risk-based inspections only. 

A comprehensive regulation on the Unified State Electronic System of Permit Documents (ePermit) has 
been adopted by the Government in July 2024, providing legal basis for creating the ePermit platform and 
digitising  the  first  batch  of  5  permits  and  licenses  for  business  using  ePermit.  A  new  law  allowing 
economic activity based on a free declaration, without the need to obtain permits and licenses (except for 
high-risk activities), during the period of martial law was approved by the Parliament in July and became 
effective as of September 2024. Deregulation efforts and digitalisation of permitting procedures to further 
enhance the business environment and investment climate in Ukraine will be continued with the support 
of the Ukraine Plan. 

On  sectoral  policies,  the  overall  priority  sectors  and  sub-sectors  are  defined  in  the  Ukraine  Plan, 
foreseeing sector-specific measures. 

The development of Ukraine’s critical raw materials extraction and processing sector is a key priority in 
its cooperation with the European Union, as outlined in the Memorandum of Understanding on Strategic 
Partnership on Raw Materials. Ukraine continues to lack specific regulations and strategic projects for the 
critical raw materials sector, prompting the need for alignment with EU standards after the adoption of the 
Critical Raw Materials Act. 

Chapter 25 – Science and research 

The EU provides significant support for research and innovation. All Member States can participate in 
the EU’s research and innovation programmes and benefit from them, especially where there is scientific 
excellence and solid investment in research and innovation. 

The  institutional  set-up  and  national  advisory  bodies  for  research  and  innovation  policy  are  in  place. 
The  war,  with  its  destruction  of  infrastructure  and  human  capital,  continues  to  aggravate  the  long-term 
trend  of  underinvestment  in  research  and  innovation,  with  public  investment  in  science  and  innovation 
kept at a minimum level. 

Ukraine is regarded as an emerging innovator, performing at 32.5% of the EU average according to the 
European  Innovation  Scoreboard  2024,  marking  a  marginal  increase  compared  to  2023.  Ukraine’s 
performance is increasing less than the EU, widening the gap between Ukraine and the EU further. 

The  collaboration  between  science  and  business  as  well  as  the  level  of  commercialisation  of  research 
results  remain  limited.  A  draft  law  on  activities  stimulating  technology  transfer,  aiming  to  increase  the 

71 

 
 
commercialisation of research, has been under consideration in Parliament since 2021. 

Spending on research and development remains low standing at 0.33% of GDP in 2022 

As regards EU framework programmes, the Horizon Europe Office in Ukraine became operational in 
December  2023.  The  government  nominated  representatives  to  14  Horizon  Europe  Programme 
Committees,  which  are  supported  by  the  Horizon  Europe  Office.  Principles  on  the  functioning  of  the 
national  contact  points  (NCPs)  for  the  Horizon  Europe  Programme  and their  selection  were adopted  in 
early 2024. NCPs have been officially nominated by the Ministry of Education and Science on 13 June 
2024. As of September 2024, 191 grant agreements with Ukrainian participation have been signed under 
Horizon Europe for a total amount of EUR 53.23 million. In total, 188 unique Ukrainian institutions and 
organisations participate in Horizon Europe projects. 

The Cabinet of Ministers adopted a resolution in August 2023 specifying that the development of regional 
strategies and action plans should be based on principles of state regional policy and carried out using a 
territorially  oriented  approach  and  smart  specialisation.  The  Ministry  of  Economy  has  approved 
methodological recommendations for smart specialisation at the regional level and the design of regional 
strategies  for  smart  specialisation  should  restart  based  on  the  European  Commission  Joint  Research 
methodology. 

Chapter 26 - Education and culture 

The  EU  supports  cooperation  in  education  and  culture  through  funding  programmes  and  the 
coordination of Member State policy through the ‘open method of coordination’. The EU and the Member 
States  must  also  prevent  discrimination  and  ensure  quality  education  for  children  of  migrant  workers, 
including those from disadvantaged backgrounds. 

On  education  and  training,  Ukraine  has  taken  steps  to  improve  data  availability  and  compatibility  of 
education  statistics  in  cooperation  with  the  European  Training  Foundation  and  by  bringing  the  list  of 
fields  of  study  and  programme  subject  areas  in  higher  education  in  compliance  with  the  International 
Standard Classification of Education (ISCED-F 2013). Ukraine works closely with international partners 
to modernise  the education management information system. However, education and training statistics 
are not widely available yet, and data is collected and published with a considerable time lag. 

Ukraine has taken steps to optimise the network of education institutions, especially in higher education 
where several mergers have taken place, but it should continue this process at national and local levels to 
ensure  the  sustainability  and  quality  of  education  in  the  country.  Digital  learning  centres  have  allowed 
some  students  to  resume  their  studies  and  extra-curricular activities.  Further efforts  are needed to align 
digital education with the EU Digital Education Action Plan 2021- 2027. 

The Programme for International Student Assessment (PISA) results indicate that 15-years-old students’ 
proficiency  in  mathematics,  science,  and  reading  has  decreased,  showcasing  the  impact  of  the  learning 
losses  generated  by  COVID-19-related  school  closures  and  the  war.  Disadvantaged  students  have 
experienced greater learning losses than their peers.  In March 2024, a Strategic Plan of the Ministry of 
Education and Science until 2027 was approved. It prioritises reforms of early childhood and preschool 
education, New Ukrainian School reform, out of school education, transformation of vocational education 
and  training,  quality  of  higher  education,  development  of  science  and  innovation,  the  European 
integration of education and science, digital transformation of education and science, as well as inclusive 
education. 

In June 2024, Ukraine adopted the law on preschool education that will put in place measures aligning to 
EU  principles,  focused  on  high-quality  early  childhood  education,  guaranteeing  access  for  children  of 
early and preschool age, fair rules for the functioning of preschool entities, and decent working conditions 
for employees. 

In June 2024, Ukraine also approved the National Strategy for the Development of Inclusive Education 

72 

 
 
for 2024-2029 and its Action Plan for 2024-2026. 

Ukraine  reintroduced  in  the  2024  State  Budget  the  subvention  for  the  implementation  of  the  New 
Ukrainian School reform at the local level. This fiscal transfer is key to continuing investments in schools 
aimed at improving the quality of education and the effectiveness of teaching and learning, in line with 
European best practices.  

However,  further  efforts  are  needed  to  strengthen  the  capacity  of  local  municipalities  for  effective 
planning,  design  and  implementation  of  inclusive  education  strategies,  with  active  community 
involvement in decision-making processes.  

In January 2024, Ukraine joined the Eurydice Network, whose task is to explain how education systems 
are organised in Europe and how they work. 

The  issue  of  national  minorities  in  education  will  continue  to  be  monitored  as  part  of  Chapter  23  on 
judiciary and fundamental rights. 

On  vocational education and  training  (VET),  Ukraine is developing new legislation.  In  line  with the 
Ukraine Plan, the law should set fair rules for the functioning of VET institutions, improve their capacity 
to  provide  formal  and  non-formal  vocational  education  and  regulate  their  relations  with  national/local 
stakeholders for the sustainable development of human capital in Ukraine. 

Ukraine established a working group for the referencing of the national qualifications framework with the 
European  Qualifications  Framework  (EQF)  for  lifelong  learning,  and  an  action  plan  was  approved  for 
establishing a relationship between the levels of the Ukrainian national qualifications’ framework and the 
levels of the EQF. 

To improve the management efficiency of higher education institutions and the use of public funds, the 
procedure and formula for distributing state budget funding for higher education institutions was amended 
in  March  2024,  based  on  their  educational,  scientific  and  international  activities.  Nearly  35  higher 
education institutions have joined the European Universities Alliances as associated partners. 

Ukraine is a member of the European Higher Education Area (Bologna process). 

Ukraine benefits from the international dimension of the 2021-2027 Erasmus+ programme. The country 
is participating in all the European Education Area working groups 2021-2025. 

On youth, the Framework of Entrepreneurial Competences for Youth in Ukraine, published in November 
2023,  aims  to  foster  entrepreneurial  skills  with  a  focus  on  youth.  On  sports,  Ukraine  continued  to 
participate in the European Week of Sport. 

Ukraine  is  drawing  up  a  new  strategy  for  culture.  Ukraine’s  association  to  the  Creative  Europe 
Programme has been upgraded to a full participation during the second quarter of 2024.  

Chapter 29 - Customs union 

All  EU  Member  States  are  part  of  the  EU  customs  union  and  follow  the  same  customs  rules  and 
procedures.  This  requires  legislative  alignment  as  well  as  adequate  implementation  and  enforcement 
capacity, and access to and interoperability with the EU electronic customs environment. 

As  regards  customs  legislation,  the  Ukraine’s  Customs  Code  was  amended  in  November  2023  and  in 
August  2024  to  further  align  it  with  the  Union  Customs  Code  (UCC).  Ukraine  has  also  started  the 
development of a new Customs Code, which aims to fully align it to the UCC.  

Efforts  were  made  to  raise  the  use  of  the  common  transit  procedure  notably  by  abolishing  the  use  of 
national Ukrainian simplifications. Ukraine made progress in smoothening the application of authorised 
simplifications. 54 economic operators were granted authorised economic operator (AEO) authorisations, 
however only 2 of them have received AEO  Security and Safety (AEOS) status. It limits the progress in 

73 

 
 
negotiations with the EU on mutual recognition of AEO.  

Ukraine  started  NCTS  Phase  4  in  October  2022  and  the  transition  to  NCTS  phase  5  was  successfully 
completed in April 2024. Ukraine should further proceed with the extension to NCTS Phase 6.  

On  administrative  and  operational  capacity,  a  customs  decision  management  system  was  developed.  A 
strategic  plan  for  digitalisation  of  the  State  Customs  Service  for  2024-2026  was  approved  by  the 
government in February 2024 in line with the requirements of the Ukraine Plan. It foresees measures for 
implementation of IT systems required for the EU accession. In 2024 Ukraine has make progress in the 
development of the new national customs declaration clearance and risk management IT systems based on 
the  EU  acquis,  the  UCC  Work  Programme,  the  Multiannual  Strategic  Plan  for  Electronic  Customs 
(MACP-C) and best practices. Ukraine has to allocate adequate human and financial resources to ensure 
the implementation of the strategic plan. 

A law criminalising large-scale smuggling of all goods was adopted in December 2023. The Bureau of 
Economic  Security  is  entrusted  with pre-trial  investigation.  It  is important that  the  customs  authority is 
granted  with  adequate  enforcement  powers  and  has  a  capacity  to  be  directly  engaged  in  intelligence 
gathering activities and contribute to pre-trial investigation in cases of smuggling of goods. It is expected 
that the State Customs service, like other law enforcement agencies, will take part in the  comprehensive 
digitisation of pre-trial investigations and prosecutions in criminal cases at national level. 

CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY 

This  cluster  covers:  transport  policy  (Chapter  14);  energy  (Chapter  15);  trans-European  networks 
(Chapter 21); and environment and climate change (Chapter 27). 

Chapter 14 - Transport policy 

The  EU  has  common  rules  on  technical  and  safety  standards,  security,  social  standards,  State  aid  and 
market liberalisation in road transport, railways, inland waterways,  multimodal transport, aviation and 
maritime transport. 

In  the  transport  sector,  Ukraine  continues  its  commitment  to  implementing  the  EU  acquis  priority 
transport  rules  as  outlined  in  the  AA.  As  per  its  commitment  in  the  Ukraine  Plan  and  to  give  boost  to 
reforms  in  the  sector,  Ukraine  needs  to  adopt  and  start  implementing  the  revised  National  Transport 
Strategy until 2030 as well as to adopt and start implementing the Strategy for developing and expanding 
the border infrastructure with the  EU Member States and the Republic of Moldova until 2030. 

In  road  transport,  significant  regulatory  reforms  and  legislative  enactments  have  yet  to  materialise, 
including the adoption of a law aligning road transport services with EU standards. The transposition of 
the  social  and  market  rules  for  road  transport  is  key,  so  that  Ukrainian  hauliers  can  compete  on  equal 
footing  with  EU  ones  and  ensure  the  correct  functioning  and  implementation  of  the  road  transport 
agreement between the EU and Ukraine. While implementing the Road Safety Strategy an equal emphasis 
should  be  put  on  the  four  pillars  of  the  Safe  System,  namely  the  safety  of  infrastructure,  the  safety  of 
vehicles,  safe  road  use  and  post-crash  care.  In  June  2024,  the  road  transport  agreement  to  temporarily 
liberalise bilateral and transit road transport between the EU and Ukraine has been extended until 30 June 
2025. The Interbus Protocol on international regular and special regular carriage of passengers by coach is 
in the ratification process. 

As  of  2023,  rail  transport  reform  progress  remains  stalled  due  to  pending  legislation,  despite  partial 
alignment  with  EU  technical  standards.  Ukraine  also  lacks  an  independent  regulatory  body.  Ukraine 
should  adopt  a  new  Law  on  railway  transport  to  create  legislative  conditions  for  the  functioning  of  a 
competitive  market  for  passenger  and  freight  transportation  and  set  up  the  institutional  framework 
(independent  regulatory  body,  independent  national  safety  authority  and  separation  of  infrastructure 

74 

 
 
 
management from rail transport operations) that will enable the implementation of the future rail law. 

Maritime transport has been crucially revived thanks to the Black Sea corridor launched by Ukraine in 
August 2023, following Russia’s withdrawal from the Black Sea Grain Initiative. Progress in harmonising 
legislation  with  EU  maritime  principles,  including  port  state  control  and  vessel  traffic  monitoring,  has 
been minimal. Ukraine’s maritime sector struggles with regulatory compliance and safety standards. 

The development and implementation of inland waterway transport regulations are ongoing, aiming to 
enhance  navigation  safety  and  market  functionality.  Ukraine’s  engagement  in  the  EU  Strategy  for  the 
Danube Region and bilateral agreements with riparian states reflect efforts to facilitate inland navigation. 
Ukraine  should  continue  to  work  on  fulfilling  all  the  necessary  requirements  regarding  the  ongoing 
process of recognition of certificates in inland waterways. 

Civil aviation remains grounded due to airspace closure. While regulatory alignment with EU aviation 
rules is in progress, the revision of the EU-Ukraine Common Aviation Area Agreement transposition list 
has not yet been addressed. 

No progress was made on multimodal transport. 

Concerning passenger rights, Ukraine has to make considerable progress for aligning its legislation with 
EU  passenger  rights  rules,  notably  in  the  fields  of  bus  and  coach,  as  well  as  of  rights  of  persons  with 
reduced mobility. 

Chapter 15 - Energy 

EU energy policy covers energy supply, infrastructure, the internal energy market, consumers, renewable 
energy, energy efficiency, nuclear energy, nuclear safety, radiation protection and nuclear safeguards. 

As regards Ukraine’s strategic framework, Ukraine adopted a National Energy and Climate Plan in June 
2024, which sets the target for Ukraine’s energy sector to achieve climate neutrality by 2050. Next step in 
implementation  is  putting  in  place  a  monitoring  framework.  The  continuous  destruction  of  energy 
facilities will require adapting planning and implementation. In July 2024, Ukraine adopted a Strategy for 
the Development of Distributed Generation until 2035 and an Action Plan for its implementation in 2024-
2026. 

In  terms  of  security  of  supply,  the  synchronisation  with  continental  Europe’s  grid  enabled  a  gradual 
increase in the commercial capacity for electricity imports, reaching up to 1.7 GW in July 2024. Together 
with 250 MW emergency capacity, this aids in balancing Ukraine’s energy system. As of 1 January 2024, 
Ukrenergo is a full member of ENTSO-E, the European Network of Transmission System Operators for 
Electricity.  Ongoing  interconnection  projects  aim  to  enhance  import/export  potential  with  Slovakia, 
Romania,  and  Poland.  Under  the  EU  mechanism  for  demand  aggregation  and  joint  gas  purchasing, 
European operators have stored 2 billion cubic metres of gas in Ukrainian storages. In November 2023, 
Ukraine adopted a law on oil stock reserves based on an industry-related model. The new law is largely 
aligned with the Oil Stocks Directive. Alignment with the gas security of supply Regulation is pending.  

Regarding the internal energy market, Ukraine further aligned its energy legislation with the EU’s third 
energy  package,  though  alignment  with  and  implementation  of  the  electricity  integration  package  is 
delayed. Day-ahead, intraday and balancing markets operate under increased price caps. The debts on the 
balancing  market  remain  high.  Network  tariffs  do  not  reflect  the level  of  investments  and maintenance 
needed  for  energy  and  climate  reforms.  Since  autumn  2023,  Ukrainian  day-ahead  market’s  wholesale 
prices have aligned more closely with neighbouring countries. Progress has been made in aligning with 
the Renewable Energy Directive, facilitating the launch of feed-in premium models and renewable energy 
auctions.  In  2023,  Ukraine  incorporated  the  concept  of  the  ‘active  consumer’  in  its  energy  legislation. 
State  interventions  in  the  gas  market  during  the  war  reduce  the  efficiency  of  operations  and  alignment 
with EU rules; this needs to be addressed as a priority.  

75 

 
 
Ukraine adopted most implementing legislation to implement the REMIT law, which entered into force in 
July 2023; a register for wholesale energy market participants is operational. 

The  independence  of  the  National  Energy  and  Utilities  Regulatory  Commission  (NEURC)  remains 
limited, with unresolved issues regarding its status as a central executive body. Legislative amendments in 
August  2024,  which  exclude  NEURC’s  regulatory  acts  from  state  registration,  are  a  step  in  the  right 
direction. Ukraine should finalise the nomination of one NEURC commissioner in a transparent manner 
without further delay to strengthen trust in the institution and enable its proper functioning. 

In  the  area  of  renewable  energy,  in  August  2024,  the  government  approved  the  2030  National 
Renewable Action Plan setting the target of 27.1% share of renewable energy in the gross final energy 
consumption by 2030. Proper implementation of market-based support schemes for RES, introduced by 
Ukraine  in  June  2023,  is  key  to  deploy  urgently  needed  decentralised  renewable  capacities.  Ukraine 
adopted implementing legislation on guarantees of origin, procedures for active customers and conditions 
for  distribution  systems.  Alignment  with  sustainability  and  greenhouse  gas  emission  saving  criteria  for 
biofuels, bioliquids, and biomass is still missing. Lack of alignment with EU legislation and regulatory 
and  administrative  barriers  keep  preventing  Ukraine  to  utilise  its  large  biomethane  potential  including 
substantial private sector capacity. Ukraine needs to work on separating its renewable energy surcharge 
from the transmission tariff. 

Ukraine’s  energy  efficiency  legislation  is  largely  aligned  with  the  EU  Energy  Efficiency  Directive.  In 
2023, Ukraine adopted over 30 implementing acts enhancing the implementation of its energy efficiency 
legislation.  In  December  2023,  it  approved  the  Strategy  for  Thermal  Modernisation  of  Buildings  until 
2050,  alongside  the  State Targeted  Economic  Programme  to  support  building modernisation  until  2030 
and an Action Plan to implement its long-term building strategy. Work on the development of a national 
building  database  and  certification  procedures  for  energy  efficiency  professionals  is  ongoing.  Ukraine 
also adopted sectoral concepts for state programmes to promote energy efficiency in district heating and 
water  supply  and  sanitation.  Ukraine  needs  to  adopt  rules  to  make  the  district  heating  sector  more 
efficient.  There  was  no  progress  on  the  introduction  of  mandatory  energy  efficiency  criteria  in  public 
procurement. Full alignment with the 2018 Energy Performance of Buildings Directive and enforcement 
of  minimum  energy  performance  requirements  are  particularly  critical  for  Ukraine  with  its  huge 
reconstruction needs. 

The  Energy  Efficiency  Fund  (EEF)  continues  supporting  investments  in  thermal  renovations  of  multi-
apartment  buildings,  and  through  a  new  programme,  the  integration  of  renewables  (photovoltaics  and 
efficient  heat  pumps)  in  housing.  The  EEF  requires  replenishment  of  funds  from  the  state  budget.  In 
January  2024,  the  Decarbonisation  Fund  in  the  budget  was  created,  to  support  energy  efficiency  and 
renewable energy programmes. 

On nuclear energy, nuclear safety and radiation protection, Ukraine further aligned its legislation to 
the  Euratom  acquis  and  adopted  new  radiation  protection  legislation  and  enhanced  nuclear  regulatory 
oversight  procedures.  Ukraine’s  nuclear  operator  Energoatom  was  transformed  into  a  joint-stock 
company,  and  in  June  2024,  the  Cabinet  of  Ministers  approved  all  five  members  of  Energoatom’s 
supervisory  board.  A  new  National  Targeted  Environmental  Programme  for  Radioactive  Waste 
Management was developed to address storage and disposal challenges, including a long-term project for 
deep  geological  disposal.  In  2023,  the  first  operational  complex  of  the  Centralised  Spent  Fuel  Storage 
Facility  (CSFSF)  was  commissioned.  Despite  some  progress  achieved,  both  regulatory  capacities  and 
harmonisation  with  the  EU  legislation  ought  to  be  pursued  further.  Staffing  levels  (33%  of  posts  are 
vacant)  and  inadequate  salary  levels  at  the  nuclear  regulatory  authority  need  to  be  addressed.  In  April 
2024, Ukraine was invited to join the European Community Urgent Radiological Information Exchange 
(ECURIE) system. 

76 

 
 
Chapter 21 - Trans-European networks 

The  EU  promotes  Trans-European  networks  (TENs)  in  the  areas  of  transport,  telecommunications  and 
energy to strengthen the internal market and contribute to growth and employment. 

In  December  2023,  Ukraine  signed  the  High-Level  Understanding  with  the  European  Commission  to 
improve  transport  connectivity.  In  line  with  the  revised  TEN-T  regulation,  four  Trans-European 
transport network TEN-T corridors have been extended to Ukraine: the North Sea - Baltic Sea corridor 
through Lviv and Kyiv to Mariupol; the Baltic Sea - Black Sea - Aegean Sea corridor to Odessa via Lviv 
and Chisinau; and the Baltic Sea - Adriatic Sea and Rhine-Danube corridors as far as Lviv. 

Ukrainian  efforts  focused  on  emergency  repairs,  restoring  lifeline  connections,  and  developing 
connections with Danube ports, EU Member States and Moldova under the EU-Ukraine Solidarity Lanes 
initiative. Administrative capacities and project preparation still need to be significantly strengthened to 
speed  up  the  EU-backed  projects  and  foster    smooth  and  interoperable  cross  border  connectivity.  A 
pipeline of priority projects for cross-border connectivity with the EU based on the TEN-T needs to be 
further  developed  in  the  framework  of the  Single  Projects  Pipeline  Alignment with  EU  TEN-T  acquis, 
especially in technical standards, decarbonisation, and digitalisation, still remains a major challenge. 

Ukraine  should  start  implementing  the  strategy  for  developing  and  expanding  the  border  infrastructure 
with the EU Member States and the Republic of Moldova until 2030 which helps prioritising investments 
in border-crossing infrastructure and traffic throughput via TEN-T related rail and road border-crossing 
points. 

Ukraine  is  integrating  Trans-European  energy  network  (TEN-E)  guidelines  into  its  legislative 
framework  and  preparing  alignment  with  the  revised  TEN-E  Regulation  2022/869  through  the  law  on 
strategically important energy infrastructure projects. Significant damage to Ukraine’s internal electricity 
transmission infrastructure has prompted constant repairs and the necessity to prioritise a more efficient 
use of already existing grids and the lines which are operational. It also prompted a review of potential 
modernisation  of  the  cross-border  electricity  network  with  the  neighbouring  countries  to  enable  higher 
RES integration, improve security of supply, strengthen resilience of the system as well as increase the 
interconnection level. 

Chapter 27 - Environment and climate change 

The EU promotes strong climate action, sustainable development and protection of the environment. EU 
rules  contain  provisions  addressing  horizontal  environmental  issues,  climate  change,  water  and  air 
quality, waste management, nature protection, industrial pollution, chemicals, noise and civil protection. 

Ukraine’s  current  horizontal  environmental  legislation  is  partially  aligned  with  the  EU  acquis.  There 
was limited progress during the reporting period. In December 2023, the EIA procedures were amended, 
enabling  consultations  with  authorities  and  establishing  online  public  hearings,  alongside  the  launch  of 
electronic  EIA  and  SEA  registries  aimed  to  improve  information  accessibility.  Yet  civil  society  faced 
challenges  in  accessing  information  due  to  martial  law  restrictions.  Transboundary  EIA  procedures 
regulated  under  the  Espoo  Convention  were  advanced  by  the  entry  into  force  of  the  Agreements  with 
Romania of 15 July 2023 and Moldova on 15 August 2024. However, further efforts are needed to ensure 
that  EIA  and  SEA  apply  to  all  plans,  programmes  and  projects,  also  in  Ukraine’s  reconstruction.  The 
existing exemptions regime needs to be further limited to align with the EU acquis.  New exemptions to 
EIA and SEA procedures, including in forestry and agriculture, should be avoided. The exclusion of EIA 
from  the  amended  administrative  procedure  laws  is  also  problematic.  Moreover,  it  is  imperative  that 
access to EIA and SEA documentation is granted to all interested stakeholders. 

Environmental monitoring is partially aligned with EU  acquis. A concept for the state environmental 
monitoring  programme  was  approved  in  July  2023.  The  martial  law  regime  however  prevents  the 
implementation of legislation. 

77 

 
 
As  regards  public  access  to  environmental  information,  the  Law  on  national  register  of  pollutant 
emissions and transfers (PRTR) was adopted in October 2023. Implementing legislation on reporting to 
the  register  was  also  adopted  in  March  2024.  Ukraine  should  further  ensure  that  public  access  to 
environmental information meets EU standards. 

Full  alignment  with  the  EU  acquis  is  yet  to  be  achieved  for  legislation  and  institutions  related  to 
environmental liability and crime as well as environmental control. No progress was made during the 
reporting period. 

Air quality legislation is partially in line with EU  acquis. There was limited progress in addressing air 
quality  directives,  with  the  adoption  of  implementing  legislation  on  air  quality  monitoring  and  fuel 
quality,  the  submission  of  the  report  under  the  United  Nations  Economic  Commission  for  Europe 
(UNECE)  Air  Convention  and  approval  of  36  state  air  monitoring  programmes.  Full  alignment  would 
require  for  example  national  emission  ceilings,  control  of  volatile  organic  compound  emissions, 
strengthened compliance monitoring of sulphur in fuels and improved air quality data collection. 

Waste  management  is  partially  in line  with  the  EU  acquis.  There  was  good  progress.  In  July  2023,  a 
framework  waste  management  law  entered  into  force  and  over  20 pieces  of  implementing  legislation 
focused on household waste, preparation of regional and local waste management plans, and operation of 
waste treatment facilities were adopted during the reporting period. Ukraine will have to adopt a waste 
management plan and a circular economy strategy and action plan, as per its commitment in the Ukraine 
Plan as well as continue efforts on full alignment with the EU waste acquis. In addition, 6 000 existing 
landfills need to be closed or brought into compliance with the EU requirements. 

In  the  reporting  period,  there  was  some  progress  on  Ukraine’s  legislation  on    water  quality  which  is 
partially aligned with the EU acquis. The implementation of the Water Framework Directive advanced as 
draft  river  basin  management  plans  (RBMPs)  were  published  for  all  river  basins  of  Ukraine.  Changes 
were  made  to  the  Marine  Environmental  Strategy  in  August  2023  to  prepare  action  plans.  Secondary 
legislation  was  adopted  for  determining  surface  water  quality.    In  wastewater  treatment,  the  Law  on 
sewerage  and  wastewater  treatment  of  August  2023  entered  into  force.  In  addition,  implementing 
legislation  on  maximum  permissible  discharge  of  pollutants  into  centralised  sewerage  systems  and 
wastewater treatment before discharge to vulnerable areas was adopted. It remains necessary to address 
issues with cost recovery for water services. 

Ukraine’s nature protection legislation is not in line with the EU acquis. There was some backsliding as 
Ukraine  cancelled  the  earlier  approved  list  of  invasive  tree  species,  but  also  modest  progress  with  the 
approval  of  methodology  for  assessing  the  risks  of  invasive  species,  and  establishing  the  national 
catalogue  of  habitats.    Alignment  with the  acquis  on  birds  and  habitats,  Natura  2000  sites, monitoring, 
biosafety,  as  well  as  zoos,  leg  hold  traps,  access  to  genetic  resources  and  seals  is  yet  to  be  achieved. 
Ukraine needs to adopt a law on the conformation of the sustainable origin of wood and other goods that 
may lead to deforestation and forest degradation. Current legislative efforts regarding forest management 
need to be updated in view of the EU Regulation against deforestation. 

Ukraine’s  legislation  on  industrial  pollution  and  risk  management  is  partially  aligned  with  the  EU 
acquis due to missing legislation and inadequate emission control measures. Some progress was achieved 
with the adoption of the law on integrated prevention and control of industrial pollution in line with the 
Ukraine  Plan  commitment,  and  implementing  legislation  on  reporting  requirements  on  pollutants  from 
stationary sources. However, full alignment with the Directive 2010/75/EU on industrial emissions must 
still be achieved, notably by adopting secondary legislation and implementing measures foreseen in the 
adopted  law  on  industrial  pollution.  EU  Eco-Management  and  Audit  Scheme  and  EU  Ecolabel 
Regulations are to be implemented, and environmental standards to be aligned. 

Legislation  on  chemicals  is  partially  in  line  with  EU  acquis.  There  was  some  progress,  as  the  law  on 
chemical  safety  entered  into  force  in  June  2024  and  several  implementing  decisions  were  adopted. 

78 

 
 
Legislation  prohibiting  the  use  of  asbestos  also  entered  into  force.  Adopting  rules  for  asbestos 
management and establishing a registry on landfills licenced to handle asbestos are necessary next steps. 

The legislation on noise has yet to be aligned with the EU acquis and no progress was made during the 
reporting period. 

On civil protection, Ukraine is a full and active member of the Union Civil Protection Mechanism. While 
the country made significant progress in the area of civil protection, the recommendations from last year 
remain  valid.  Some  areas  of  potential  improvement  would  include  the  further  strengthening  of  disaster 
legislation and disaster prevention and preparedness measures, including national early warning systems, 
the  approval  of  a  national  methodology  for  disaster  risk  assessment,  clarification  of  roles  and 
responsibilities  between  institutions  as  well  as  within  the  civil  protection  system  and  deepened  cross-
border disaster management collaboration with neighbouring countries. Ukraine is encouraged to improve 
disaster  preparedness  and make  use,  when  appropriate,  of  the  scientific  partnership for natural  hazards, 
through the Emergency Response Coordination Centre. 

Climate change 

On  climate  change,  Ukraine  has  made  some  progress.  In  October  2024,  Ukraine  adopted  its  first 
framework  law  on  the  State’s  climate  policy,  harmonising  and  clarifying  objectives  and  competences. 
Crucially,  the  law  aligns  Ukraine  with  the  EU’s  long-term  objective  of  reaching  climate-neutrality  by 
2050.  Although  Ukraine’s  climate  legislation  is  not  yet  in  line  with  the  EU  climate  acquis  this  is  an 
important step to build on. Ukraine should update its long-term low-emission development strategy under 
the  Paris  Agreement  to  reflect  its  long-term  mitigation  goal  and  prepare  and  submit  a  new  Nationally 
Determined Contribution under the Paris Agreement. In addition, further alignment will be needed due to 
the major upgrades of the EU climate policy resulting from the Fit for 55 package.  

As a Contracting Party to the Energy Community, Ukraine adopted its National Energy and Climate Plan 
in  June  2024,  with  a  commitment  to  set  up  a  dynamic  review  process  and  to  revise  the  NECP  by 
December 2025. On the monitoring, reporting, and verification (MRV) of greenhouse gas emissions, in 
November  2023,  Ukraine  adopted  resolutions  partially  implementing  Commission  Implementing 
Regulation (EU) 2018/2066; however, the martial law regime still hinders implementation as reporting at 
installation  level  is  currently  not  compulsory.  In  line  with  its  Ukraine  Plan  commitment,  Ukraine  is 
actively  working  on  establishing  a  national  Emission  Trading  System  (ETS),  which  should  ensure  a 
gradual convergence of its carbon pricing policy to the EU ETS. The country will need a comprehensive, 
standardized, reliable MRV system as a prerequisite.  

Implementing  legislation  was  enacted  on  administrative  procedures  related  to  fluorinated  greenhouse 
gases, but ratification of the Kigali Amendment to the Montreal Protocol remains pending, furthermore, 
alignment  with  the  new  EU  Regulations  on  ozone-depleting  substances  and  fluorinated  gases  requires 
regulatory action. 

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION 

This  cluster  covers:  agriculture  and  rural  development  (Chapter  11);  food  safety,  veterinary  and 
phytosanitary  policy  (Chapter  12);  fisheries  and  aquaculture  (Chapter  13);  regional  policy  and 
coordination of structural instruments (Chapter 22); and financial and budgetary provisions (Chapter 33). 

Chapter 11 - Agriculture and rural development 

The  EU’s  common  agricultural  policy  supports  farmers  and  ensures  Europe’s  food  security.  It  helps 
tackle climate change and the sustainable management of natural resources; maintains rural areas and 
landscapes;  and  supports  the  rural  economy  by  promoting  jobs  in  farming,  agri-food  industries  and 
associated sectors. This requires strong management and control systems. There are also common EU 

79 

 
 
 
rules for marketing standards, quality policy and organic farming. 

On horizontal issues, the draft national strategy for agriculture and rural development is published for 
consultation  and  planned  for  approval  by  the  end  of  2024,  as  envisaged  in  the  Ukraine  Plan.  An 
independent body for the management and control of public support needs to be established. Ukraine is 
encouraged to bring support measures in line with the EU acquis. In this regard, the State fund for farm 
development  has  started  implementing  decoupled  payments  on  a  pilot  scale.  Legislation  on  public 
support to agriculture aligning with the acquis is being developed, in line with the Ukraine Plan. Ukraine 
should proceed with the establishment of an integrated administration and control system (IACS). A land 
parcel  identification  system  (LPIS)  must  be  established.  Inter-operability  of  the  various  elements 
comprising  the  IACS  should  be  ensured.  Advisory  services  are  registered  and  are  issued  a  specific 
certificate  to  provide  agricultural  advisory  services.  A  legal  framework  for  the  establishment  of  an 
agricultural  knowledge  and  innovation  system  was  adopted  in  March  2024.  To  release  mine-
contaminated land for productive use in agriculture and rural development, Ukraine adopted a Strategy 
for mine action until 2033, in line with the Ukraine Plan.  

Regarding the common market organisation (CMO), legislative alignment continued, in particular for 
marketing standards. The Law on the association of agricultural producers, partially aligned, is pending 
parliamentary  adoption.  Ukraine  started  to  establish  a  vineyard  register  and  new  viticulture  zoning.  A 
Law on grapes and viticulture was adopted in August 2024 aligning to the EU acquis in this field. 

On rural development, a partial credit guarantee fund for small farms is operational since January 2024.  

On  quality  policy,  alignment  continued  with  legislation  implementing  the  policy,  including  on 
certification and labelling. Certification authorities still need to be established and administrative capacity 
strengthened. 

On organic farming, Ukraine legislation will need to be further aligned with the EU acquis. As of July 
2024,  over  220  organic  agricultural  operators  were  certified.  The  monitoring  and  control  of  organic 
production and traceability should be further developed. 

Chapter 12 - Food safety, veterinary and phytosanitary policy 

The EU food acquis including hygiene rules for foodstuff production ensure a high level of food and feed 
safety and a high level of protection of consumers’ interests. Animal health and welfare and the safety of 
food of animal origin are safeguarded together with quality of seeds, plant protection material, protection 
against harmful organisms and animal nutrition. 

On  general  food  safety,  the  State  Service  of  Ukraine  on  Food  Safety  and  Consumer  Protection 
(SSUFSCP),  responsible  for  food  safety  control,  achieved  a  staff  reduction  in  line  with  its  functional 
reform  process.  Ukraine  has  yet  to  update  the  multiannual  control  plan  to  2026  and  the  risk-based 
methodology for official controls to reflect legislative, institutional and food safety and animal health risk 
changes.  The  transparency  principle  should  apply  to  official  controls  systems.  Adequate  financial 
resources should support the performance of official controls. 

On  veterinary  policy,  legislative  alignment  with  the  EU  acquis  advanced.  The  government  adopted 
legislation  on  transmissible  animal  diseases  and  animal  welfare  and  transportation.  A  bee  disease 
surveillance system and related monitoring programmes were developed. The number of cases of rabies 
in animals and in human population has increased significantly. Vaccination campaigns continued and the 
SSUFSCP developed a national strategy for the elimination of rabies in Ukraine by 2030.  Production of 
animal products is still not compliant with EU animal welfare rules. 

The  pilot  implementation  of  the  EU  TRACES  has  been  successfully  completed  and  TRACES  New 
Technologies  is  in  use  for  11  certificates  throughout  the  country  since  January  2024.  Pet  animal 
movement  control  has  been  improved  through  the  use  of  microchips,  registered  in  a  newly  created 
database. Official controls to enforce animal registration and identification, including controls of markets, 

80 

 
 
are yet to be aligned with EU legislation. 

A national residue control plan is compiled in line with EU and reference laboratories requirements, but 
the range of analysed compounds and analytical methods’ performance still need improvements. 

For  the  placing  on  the  market  of  food,  feed  and  animal  by-products,  implementing  legislation  on 
products of animal origin was adopted. A risk analysis, assessment and management system is in place. 
Capacity has been strengthened with further staff and the establishment of expert groups, a database and a 
scientific network. Capacity strengthening needs to continue. 

Ukraine  regularly  updates its food  safety  monitoring plan.  For  milk  and  dairy  products  new  legislation 
aligns  Ukraine’s  implementing  measures  with  EU  official  controls.  Ukraine  fully  participates  in  the 
Commission’s rapid alert system for food and feed (RASFF) but is not a member of the network. Official 
controls of imports remain to be fully aligned with the EU acquis. 

On food safety rules and specific rules for feed, new implementing legislation provided for progress in 
labelling  food  contact  materials  and  the  presentation  and  advertising  of  food  products,  including 
nutritional  and  health  claims.  As  regards  specific  rules  for  feed,  there  has  been  no  further  legislative 
developments, but feed additives registered in the EU are not subject to registration in Ukraine anymore. 

On phytosanitary policy, the Ukrainian parliament has yet to adopt the framework law on plant health to 
align with the acquis. Implementing legislation is needed to complete  acquis alignment. Integrated pest 
management principles remain to be aligned with EU legislation and the number of inspectors and their 
administrative  capacity  to  be  increased.  An  information  system  for  phytosanitary  inspection  and  plant 
protection (PHIS) was rolled out throughout Ukraine and supports the work of phytosanitary inspectors, 
including  for  the  issuance  of  phytosanitary  certificates,  plant  protection  and  surveys.  First  certificates 
were already successfully exchanged with Morocco and France. 

The  organisation  and  the  structure  of  the  laboratory  network  is  to  be  adjusted  to  EU  standards.  A 
dedicated  coordination  unit  was  established  at  SSUFSCP  and  a  strategy  for  the  development  of  the 
laboratory network approved, but national reference laboratories remain to be designated and take up all 
their duties. 

On genetically modified organisms (GMOs), Ukraine adopted in August 2023 a law regulating genetic 
engineering activities and establishing GMO authorisation procedures and a system of official controls. It 
is  partly  aligned  with  the  EU  acquis.,  based  on  nine  EU  legal  acts.  The  law  will  enter  into  force  on 
16 September 2026 and requires the adoption of substantial implementing legislation before. 

Chapter 13 - Fisheries and aquaculture 

The common fisheries policy lays down rules on fisheries management, protects living resources of the 
sea and limits the environmental impact of fisheries. This includes setting catch quotas, managing fleet 
capacity, rules on control and inspection, rules on markets and aquaculture and support for fisheries and 
coastal communities. Further, it promotes a sustainable aquaculture. 

On  resource  and  fleet  management,  Ukraine  amended  its  legislation  for  the  governance  of  fisheries, 
conservation  and  rational  use  of  aquatic  biological  resources  and  aquaculture  with  certain  parts  of  the 
fisheries  management  system  now  aligned  to  the  EU  acquis.  It  also  adopted  in  September  2023 
implementing  rules  for  collecting  statistical  data  in  aquaculture,  which  will  allow  the  development  of 
necessary  administrative  and  scientific  capacity.  Ukraine  finalised  a  unified  state  electronic  fisheries 
management  system  (e-Fish)  and  initiated  implementation  in  July  2024.  E-fish  constitutes  a  tool  for 
collecting,  processing  and  analysing  data  on  fisheries  activities  and  gear,  and  will  require  additional 
developments to  meet all EU requirements.  

The  lack  of  effective  inspection  and  control  hampers  Ukraine’s  capacity  to  efficiently  address  IUU 
fishing. Some progress has been made. The law that entered into force in July 2023 includes improved 

81 

 
 
controls  of  fishing  activities  and  of  the  origin  of  aquatic  biological  resources,  the  implementation  of  a 
unified  electronic  management  system  for  fishery  products  and  a  mechanism  for  issuing  permits  in 
electronic  form.  Legislation  has  been  adopted  in  February  2024  to  establish  a  system  of  remote 
monitoring  of  fishing  vessels.  Outstanding  issues  include  adaptation  of  law  on  traceability  and  aquatic 
biological resources. 

On market policy, legislation to enhance transparency on market data was adopted in September 2023. 

On  international  agreements,  Ukraine  has  demonstrated  commitment  to  apply  for  full-fledged 
membership  of  the  General  Fisheries  Commission  for  the  Mediterranean  (GCFM).  The  necessary 
legislation  has  been  prepared  and  financial  resources  to  cover  membership  fee  have  been  provisioned. 
Ukraine participated at regional level with an active stance in the works of the GCFM and the Common 
Maritime Agenda. 

Chapter 22 – Regional policy and coordination of structural instruments 

Regional policy is the EU’s main tool for reducing regional disparities and investing in sustainable and 
inclusive socio-economic growth. It is operating through ‘shared management’ between the Commission 
and  EU  Member  States.  The  implementation  of  cohesion  policy  programmes  requires  appropriate 
administrative capacity on programme and project level, the establishment of systems of sound financial 
management and control and also the fulfilment of other EU acquis elements such as environmental or 
public procurement legislation. 

In terms of the legislative framework, the amended State Strategy for Regional Development  provides 
guidance on the development of multi-level governance, including approximation to EU procedures; the 
promotion of cooperation across municipalities and regions; and the development of capacities territorial 
communities  and  regions.  The  Strategy  now  needs  to  be  translated  into  practical  action  steps,  with 
adequate resources. The law on principles of state regional policy remains to be fully implemented. The 
concept  for  updating  the  architecture  of  planning  documents  aimed  at  simplification  of  the  current 
planning system for regional and local development policy should be completed, aligned with spatial and 
budgetary planning, and integrated with PIM roadmap. Progressive alignment of the legislation with the 
EU regional policy should be demonstrated. The potential of establishing links to European groupings of 
territorial cooperation in different policy instruments is not being fully exploited so far. Groupings can be 
used  for  integrated  territorial  (multi-level)  governance  facilitating  the  implementation  of  Interreg 
cooperation programs. 

In terms of the institutional framework at central level, after a prolonged period of vacancy, the Minister 
of  Communities  and  Territories  Development  of  Ukraine  was  appointed.  Ukraine  should  continue 
building Ministry’s capacity in the Ministry, including adequate staffing for regional development. 

The legal and regulatory process to establish the Agency for Restoration (SARDI) as a transparent, and 
accountable  institution  with  adequate  implementation  capacity,  as  well  as  its  internal  administrative 
reform should be completed. As part of the implementation of the PIM action plan, it will be important 
that Ukraine defines the recovery planning process and ensures that funding is allocated according to a 
transparent  prioritisation  methodology  with  substantial  involvement  of  sub-national  authorities.  Public 
oversight over public procurement practices needs to be strengthened. 

On administrative capacity, the coordination framework within regional policy is yet to be set up, with 
a  central  role  of  the  government,  preferably  based  on  a  re-activated  Inter-ministerial  Coordination 
Commission, and a strengthened and systematic participation of regional and local stakeholders, including 
local self-government associations in designing, implementing and monitoring processes. 

Locally,  some  authorities  have  created  specific  units  focused  on  economic  development,  strategic 
planning  and  project  management.  A  high  turnover  of  staff,  due  to  military  mobilisation,  internal 
displacement and migration remains a serious challenge. 

82 

 
 
On  programming,  the  requirement  of  the  Ukraine  Facility  to  allocate  an  adequate  support  to  the 
recovery, reconstruction and modernisation needs of Ukraine’s sub-national authorities, in particular local 
self-government,  should  be  implemented  in  line  with  the  principles  of  cohesion  policy,  in  particular 
subsidiarity, efficiency, accountability and decision-making role of sub-national authorities on the use of 
support.  Budget  allocation  should  be  linked to  local,  regional  development  and  sectoral  strategies,  take 
account of the need for mid-term budget planning and ensure a robust expenditure tracking and reporting 
system. 

There were no significant developments on financial management, control or evaluation systems. On 
monitoring, the digital restoration ecosystem for accountable management (DREAM) should be further 
rolled out. 

The internal and external audit functions are in place, but they have yet to deliver audits in accordance 
with  international  standards.  The  State  Audit  Service  which  is  the  national  controller  for  Interreg 
programmes,  should  develop  detailed  arrangements  to  ensure  timely  and  efficient  controls  and  enable 
quick disbursements of EU funding to Ukrainian beneficiaries. The Accounting Chamber of Ukraine has 
still no mandate to audit local budgets, other than resources transferred from the central budget. 

Ukraine has expanded participation in the Interreg cooperation programmes and is also part of the EU 
Macro-regional  Strategy  for  the  Danube  Region.  Ukraine  should  continue  to  benefit  from  these 
frameworks to gain experience in EU cohesion policy implementation and shared management practices, 
including  on  matters  linked  to  programming,  sound  financial  management,  project  selection  and 
contracting. 

Ukrainian sub-national authorities have also stepped-up participation in peer-to-peer initiatives with EU 
counterparts.  The  adopted  amendments  to  laws  on  improving  local  self-government  participation  in 
interterritorial and cross-border cooperation aim to clarify the underlying framework. 

Chapter 33 - Financial and budgetary provisions 

This chapter covers the rules governing the funding of the EU budget (‘own resources’). These resources 
mainly  consist  of:  (i)  contributions  based  on  the  gross  national  income  of  each  Member  State;  (ii) 
customs  duties;  (iii)  the  non-recycled  plastic  resource  and  (iv)  a  resource  based  on  value  added  tax. 
Member States must have the appropriate administrative capacity to adequately coordinate and ensure 
the correct calculation, collection, payment and control of own resources. 

Despite  limited  progress  with  regard  to  the  recommendation  last  year,  Ukraine  progressed  in  the 
underlying  policy  areas  indirectly  affecting  the  own  resources  system  (for  progress  in  these  areas,  see 
Chapters 16 - Taxation, 18 - Statistics, 29 - Customs union, and 32 - Financial control). 

On  traditional  own  resources,  Ukraine  has  implemented  most  of  the  fundamental  principles  in  the 
policy areas that affect the own resources system. In the reporting period, the Customs Code underwent 
several amendments to further align with the UCC. 

Ukraine applies a single VAT system that is largely, but not fully, aligned with the European system. No 
changes to the VAT legislation were introduced since the previous reporting. 

National  accounts  and  gross  national  income  (GNI)  data  in  Ukraine  partially  comply  with  European 
System of Accounts 2010 standards. Ukraine does not submit the data to Eurostat. 

On  administrative  infrastructure,  the  Ministry  of  Finance  initiated  an  assessment  of  measures  to  be 
taken to start building capacity to contribute to the EU budget. Ukraine has yet to set up an own resource 
coordination body and raise awareness on requirements. 

CLUSTER 6: EXTERNAL RELATIONS 

83 

 
 
 
This cluster covers: external relations (Chapter 30); and foreign, security and defence policy (Chapter 31). 

Chapter 30 - External relations 

The  EU  has  a  common  commercial  policy  towards  third  countries,  based  on  multilateral  and  bilateral 
agreements and autonomous measures. There are  also EU rules on humanitarian aid and development 
policy. 

On the common commercial policy, Ukraine continued to coordinate its positions and align its policies 
closely  with  those  of  the  EU,  including  within  the  World  Trade  Organisation  (WTO)  and  its  Dispute 
Settlement Body. During the reporting period Ukraine also accepted WTO Protocol of the Agreement on 
Fisheries Subsidies.  

On  dual-use  goods,  Ukraine  has  a  solid  legal  framework  in  place  on  export  controls  of  goods  and 
technologies,  including  on  dual  use.  Ukraine  is  a  member  of  Australia  group  and  Wassenaar 
Arrangement,  and    has  adopted  and  maintained  a  consolidated  list  of  dual-use  goods  and  technologies 
based on the EU acquis. 

On bilateral trade agreements, Ukraine has notified to the WTO preferential bilateral trade agreements 
with  17  partners,  eight  of  which  do  not  have  a  preferential  trade  agreement  with  the  EU.  Ukraine  is 
negotiating further preferential trade agreements with several partners. In relation to this, Ukraine should 
continue to coordinate closely with the EU on international trade negotiations, in particular to ensure that, 
when it joins the EU, its commitments are compatible with those of the EU and ensuring integration of 
EU accession linked expiration clause in the provisions of bilateral free trade and investment agreements. 

Ukraine has 66 bilateral investment treaties in force, 21 of which are with EU Member States. Ukraine 
has also signed seven treaties that have not yet entered into force. Ukraine continued benefiting from a 
generalised system of preferences granted by several countries, including the United States. 

Ukraine has a legal framework in place to provide  humanitarian aid to other countries. While Ukraine 
has  yet  to  develop  its  development  cooperation  policy in line  with  the relevant  EU framework,  it  has 
been engaging in provision of development aid by contributing to global food security efforts. 

Chapter 31 - Foreign, security and defence policy 

Member States must be able to conduct political dialogue under EU foreign, security and defence policy, 
align with EU statements, take part in EU actions, and apply agreed sanctions and restrictive measures. 

Ukraine  continued  intense  political  dialogue  on  foreign  and  security  policy  with  the  EU  and  the  EU 
Member States. This was also confirmed during the EU  - Ukraine Foreign Affairs Ministers meeting in 
Kyiv in October 2023. The EU and Ukraine held two Political Consultations (July 2023, May 2024) and a 
Security  and  Defence  dialogue  (December  2023).  The  9th    EU-Ukraine  Human  Rights  Dialogue  took 
place in April 2024.  

The  institutional  framework  enabling  Ukraine’s  participation  in  the  CFSP  and  common  security  and 
defence policy (CSDP) is in place. 

Ukraine’s alignment with CFSP (statements by the High Representative on behalf of the EU and Council 
decisions on sanctions) was 89% in 2023. As of 30 September 2024, its alignment rate increased to 95%. 
This represents a clear political intention to align with CFSP.  

Ukraine  continues  to  align  with  EU  restrictive  measures.  Ukraine  has  mechanisms  in  place  to  ensure 
effective  implementation  of  EU  sanctions.  The  Criminal  Code  still  needs  to  be  amended  by  the 
introduction of a new article criminalising circumvention of restrictive measures, as sanctions evasion is 
still not a criminal offence in Ukraine. The rights and obligations of participants in the sanctions process 
should be more clearly defined in Ukraine’s legislation. 

84 

 
 
Ukraine  intensified  its  diplomatic  engagement  with  global  partners  through  enhancing  bilateral 
cooperation in Africa, Middle East, Latin America and Indo-Pacific. A strong feature of Ukraine’s global 
outreach  is  the  Peace  Formula  process  building  international  support  to  Ukraine’s  vision  of  just  peace 
based on the UN Charter. The Summit on Peace hosted in June 2024 by Switzerland, at Ukraine’s request, 
was an important milestone in building international support for a comprehensive, just and lasting peace 
in  Ukraine  based  on  the  principles  of  the  UN  Charter  and  international  law,  in  line  with  the  Ukraine’s 
Peace Formula. 

In this context, the Ukrainian authorities have sought to maintain and prioritise effective cooperation with 
EU Member States, and signed  bilateral security agreements with a majority of them. These bilateral 
agreements are complementary to the EU-Ukraine joint security commitments.   

Ukraine’s  cooperation  with  international  organisations  is  strong  and  constructive,  including  with  the 
UN, the Council of Europe, the Organization for Security and Co-operation in Europe (OSCE) and the 
Organisation  for  Black  Sea  Economic  Cooperation.  Ukraine  is  also  aspiring  to  become  a  member  of 
NATO.  One  of  the  main  strands  of  ongoing  strategic  cooperation  is  to  achieve  full  defence 
interoperability with NATO. 

Ukraine continues to enhance cooperation with the ICC Prosecutor’s Office to strengthen investigation of 
military  and  other  international  crimes.  To  this  end,  in  September  2023  a  Field  Office  of  the  ICC  was 
opened in Kyiv. On 21 August 2024, the Rada passed a law on the ratification of the Rome Statute of the 
International Criminal Court (ICC) and its related instruments. The adopted ratification law will need 
to  be  complemented  with  a  law  aligning  Ukraine’s  Criminal  Code  with  the  Rome  Statute  provisions, 
before the actual ratification can be processed.  

Ukraine is party to and has ratified the main non-proliferation and disarmament agreements to which 
all EU Member States are State Parties, including the Treaty on the Non-Proliferation of Nuclear 
Weapons,  the  Biological  and  Toxin  Weapons  Convention,  the  Chemical  Weapons  Convention 
and  the  Anti-Personnel  Mine  Ban  Convention.  Ukraine  complies  with  its  international  obligations 
under  international  export  control  regimes.  The  fight  against  illicit  firearms  and  small  arms  and  light 
weapons is part of the EU-Ukraine dialogue on disarmament, non-proliferation and arms export control 
(last meeting held in July 2024). Ukraine is encouraged to ratify the Arms Trade Treaty as soon as the 
circumstances will allow.  

As regards security measures (classified information), the EU and Ukraine have a security information 
agreement in force for the exchange of classified information. 

On CSDP, Ukraine has continued to seek its involvement in EU defence initiatives and civil and military 
crisis  management,  including  Permanent  Structured  Cooperation  (PESCO)  and  the  European  Defence 
Fund  (EDF).  Given  the  context, military  and security  cooperation between  Ukraine  and  the  EU  and its 
Member  States  was  significantly  enhanced  in  particular  within  the  framework  of  the  European  Peace 
Facility (EPF) and through the EU Military Assistance Mission in support of Ukraine (EUMAM Ukraine) 
and the EU Advisory Mission for Civilian Security Sector Reform in Ukraine (EUAM Ukraine). 

The  EU  and  Ukraine  continue  to  cooperate  in  the  area  of  countering  cyber  threats.  Ukrainian 
cybersecurity  authorities  (National  Cybersecurity  Coordination  Centre  at  the  National  Security  and 
Defence Council and State Service for Special Communication and Information Protection) have signed a 
Working Arrangement with the European Union Agency for Cybersecurity (ENISA) in December 2023.  
The third iteration of a dedicated cybersecurity dialogue took place in Brussels in July 2024. 

The  EU  and  Ukraine  have  expanded  cooperation  in  the  area  of  countering  hybrid  threats  (including 
disinformation). The bilateral security agreement signed on 27 June 2024 includes measures of countering 
foreign information manipulation and interference and build information resilience.  

85 

 
 
 
ANNEX I – RELATIONS BETWEEN THE EU AND UKRAINE 

After  the  start  of  Russia’s  war  of  aggression  against  Ukraine,  Ukraine  applied  for  EU  membership  on 
28 February 2022, and was granted European perspective and candidate country status in June 2022. In 
December  2023,  the  European  Council  decided  to  open  negotiations  with  Ukraine.  The  first  inter-
governmental conference opening the negotiations took place on 25 June 2024. 

The  EU-Ukraine  joint  security  commitments  signed  in  June  2024  stated  that  security,  resilience  and 
defence  support,  as  well  as  Ukraine’s  EU  accession  process,  support  to  reforms,  macro-financial, 
humanitarian  and  reconstruction  assistance  reinforce  each  other.  For  its  part,  Ukraine  committed  to 
continue undertaking reforms in line with its EU path, including in the security, defence and intelligence 
sectors. 

As  part  of  the  Association  Agreement  (AA)  between  the  EU  and  Ukraine,  the  Deep  and 
Comprehensive  Free  Trade  Area  (DCFTA)  has  been  applied  provisionally  since  1 January 2016  and 
has proved effective in creating the right conditions for closer economic and trade relations. Since 2016, 
bilateral trade between the EU and Ukraine has increased by more than half, and Ukraine has significantly 
advanced in its regulatory approximation to the EU acquis in trade-related areas. 

During the pre-accession period, the AA/DFCTA will remain the legal basis for the EU’s relations with 
Ukraine. It will apply up to the day Ukraine accedes to the EU. The mutual obligations in the AA/DCFTA 
will continue to guide the trade relationship, Ukraine’s seamless integration into the EU single market and 
the  implementation  of  reforms  in  areas  such  as:  public  procurement,  telecommunication  and 
digitalisation,  maritime  and  international  transport,  the  financial  sector,  accounting,  financial  reporting 
and auditing, customs, competition policy and State aid, sanitary and phytosanitary measures, intellectual 
property  rights  and  geographical  indications,  standardisation  and  other  areas  regulated  by  the  DCFTA. 
Ukraine has showed a steady progress in implementing DCFTA commitments, including by completing 
phases 1 and 2 of the DCFTA indicative timeline for institutional reform, legislative approximation and 
market access in the area of public procurement. However, work on phases 3-5 are behind the indicative 
timetable. 

Under the DCFTA, the EU has fully liberalised trading in the vast majority of products and maintained 
tariff rate quotas and a minimum price system for only a few selected agricultural products. Since 2022, 
autonomous trade measures (ATMs) have temporarily suspended these remaining restrictions, making it 
possible  for  Ukraine  to  step  up  agricultural  product  exports  to  EU  markets.  Article 29  of  the  DCFTA 
provides  for  the  possibility  of  permanent  and  reciprocal  liberalisation  of  trade  in  agricultural  goods. 
Discussions  have  been  launched  to  replace  ATMs,  when  they  expire  in  June  2025,  with  a  permanent 
solution under DCFTA Article 29, linking further trade liberalisation and reforms to alignment with EU 
norms and standards. 

In 2023, the EU and Ukraine put in place a Priority Action Plan for DCFTA implementation. The purpose 
of  Priority  Action  Plan  for  2023-2024  is  to  identify  a  set  of  concrete  actions  to be  undertaken  by  both 
sides by the end of 2024. The revised Priority Action Plan will serve as a roadmap for speeding up and 
monitoring  full  implementation  of  the  DCFTA,  providing  Ukraine  with  further  access  to  the  single 
market. Each action has been designed in such a way that it can realistically be completed within a short 
timeframe, with concrete measures that are readily actionable and for which there is a clear procedure. 

Regular  political  and  economic  dialogue  between  the  EU  and  Ukraine  has  continued  through  the 
AA/DCFTA  structures.  Regular  subcommittee  meetings  were  held  throughout  the  period.  The  8th  EU-
Ukraine  Association  Committee  in  Trade  Configuration  took  place  on  30  November  2023;  the  9th 
Association  Council  was  held  on  20 March 2024 in Brussels.  The  Association Committee  did  not meet 
during the reporting period. 

The EU has continued to support implementation of the Solidarity Lanes initiative with new rail, road 
and inland waterway logistics corridors firmly established between Ukraine and the EU, covering trade in 

86 

 
 
both directions. Solidarity lanes continue to play a crucial role in ensuring critical imports and exports; 
they  also  play  a  vital  role  in  contingency  plans,  ready  to  be  used  in  case  of  disruptions  to  Black  Sea 
routes. On 20 June 2024, the EU and Ukraine decided to prolong and update their current Road Transport 
Agreement, aimed at helping Ukraine to access world markets by facilitating transit through EU countries 
and further developing its links with the EU market. 

Citizens  of  Ukraine  have  enjoyed  visa-free  travel  to  the  Schengen  area  since  11 June 2017.  An 
agreement on readmission between the EU and Ukraine has been in force since 2007. 

in  stable,  predictable  and  flexible  support  for 

Regarding bilateral financial assistance, since the Russian invasion, the EU, its Member States and the 
European  financial  institutions  have  stepped  up  their  support  in  a  Team  Europe  approach,  mobilising 
almost  EUR 122 billion  for  Ukraine’s  overall  economic,  social  and  financial  resilience  in  the  form  of 
emergency  macro-financial  assistance,  budget  support,  emergency  assistance,  crisis  response, 
humanitarian  aid  and  military  assistance  as  well  as  support  for  people  fleeing  the  war.  This  support 
includes EUR 15.6 billion mobilised so far under the Ukraine Facility, of which EUR 12.4 billion already 
disbursed.  The  Ukraine  Facility  has  been  operational  since  1 March 2024  and  is  providing  up  to 
EUR 50 billion 
the  period  2024-2027.  The 
EUR 38.27 billion Ukraine Plan financed under the Ukraine Facility is the main instrument for ensuring 
Ukraine’s recovery, reconstruction and modernisation, while implementing reforms designed to underpin 
the country’s accession process. The Plan envisages an ambitious growth-enhancing reform agenda aimed 
at  facilitating  structural  transformation  while  supporting  Ukraine’s  path  towards  EU  membership.  The 
Plan  is  complementary  to  the  EU  accession  process  as  it  has  the  potential  to  accelerate  Ukraine’s 
economic convergence upon successful completion, while simultaneously increasing alignment with the 
EU acquis in key areas. The EU and its Member States have also mobilised EUR 43.5 billion in military 
support  for  Ukraine,  including  EUR 6.1 billion  under  the  European  Peace  Facility.  To  implement  the 
commitment  by  G7  Leaders  to  provide  approximately  EUR  45  billion  worth  of  loans  to  Ukraine  to  be 
serviced  and repaid  by future flows  of extraordinary revenues  stemming  from  the  immobilised  Russian 
sovereign assets, Regulation (EU) 2024/2773 establishing the Ukraine Loan Cooperation Mechanism and 
providing exceptional macro-financial assistance to Ukraine in the context of Russia’s military aggression 
entered into force on 29 October 2024. In light of the confirmed contributions of G7 partners, ensuring 
fair  burden  sharing  through  a  proportionate  support  to  the  size  of  their  respective  economies,  the  EU 
expects to provide an MFA loan of approximately EUR 18 billion as its contribution to the initiative. 

In  2023,  the  EU  budget  has  enabled  EUR 19.5 billion  in  assistance  for  Ukraine,  including  an 
unprecedented  support  package  of  EUR 18 billion  in  concessional  loans.  This  was  on  top  of 
EUR 11.6 billion provided in loans and grants in 2022. As of October 2024, the EU budget has already 
enabled EUR  16.7 billion in financial and  humanitarian assistance in 2024, including EUR  15.6 billion 
under  the  Ukraine  Facility.  This  brings  the  total  support  enabled  by  the  EU  budget  since  the  start  of 
Russia’s invasion to EUR 47.8 billion. 

Ukraine  is  associated  to  14  EU  programmes:  Horizon  Europe,  EURATOM  Research  and  Training, 
Digital  Europe,  Fiscalis,  Customs,  Creative  Europe,  EU4Health,  Life,  Single  Market,  Union  Civil 
Protection  Mechanism,  Connecting  Europe  Facility,  Union  Anti-Fraud,  Justice,  and  Citizens,  Equality, 
Rights  and  Values.  Organisations  and  individuals  from  Ukraine  can  also  benefit  from  certain  actions 
under the Erasmus+ and European Solidarity Corps programmes. Ukraine participates in several Interreg 
programmes  and  is  a  member  of  the  EU  macro-regional  strategy  for  the  Danube  region.  Ukraine’s 
financial obligations for its participation in EU programmes have been suspended owing to the war. 

Participation in the programmes has brought a number of tangible benefits: Ukrainian law enforcement 
staff attended digital forensic and analyst training and course on strengthening cooperation with OLAF; 
Ukraine secured access to crucial EU IT customs systems to facilitate trade flows, notably the common 
secure customs network, to which access is needed for applying the New Computerised Transit System; a 
Horizon Europe Office was set up in Ukraine providing Ukrainian researchers with support in preparing 

87 

 
 
competitive applications and finding suitable partners. 

In  2014,  the  European  Union  Advisory  Mission  for  Civilian  Security  Sector  Reform  Ukraine  (EUAM 
Ukraine) was created. Following the Russian aggression, the EU established the EU Military Assistance 
Mission (EUMAM Ukraine) on EU soil in support of Ukraine in October 2022. 

88 

 
 
 
ANNEX II – STATISTICAL DATA 

STATISTICAL DATA (as of 5/09/2024) 
Ukraine 

Basic data 
Population (thousand) 
Total area of the country (km²) 

National accounts 
Gross domestic product (GDP) (million national currency) 
Gross domestic product (GDP) (million euro) 
GDP (euro per capita) 
GDP per capita (in purchasing power standards (PPS)) 
GDP per capita (in PPS), relative to the EU average (EU-27 = 100) 
Real GDP growth rate: change on previous year of GDP volume (%) 
Employment growth (national accounts data), relative to the previous year (%) 
Labour  productivity  growth:  growth  in  GDP  (in volume)  per  person employed,  relative  to 
the previous year (%) 
Unit labour cost growth, relative to the previous year (%) 
**3 year change (T/T-3) in the nominal unit labour cost growth index (2015 = 100) 
Labour productivity per person employed: GDP (in PPS) per person employed relative to 
EU average (EU-27 = 100) 
Gross value added by main sectors 
Agriculture, forestry and fisheries (%) 
Industry (%) 
Construction (%) 
Services (%) 
Final consumption expenditure, as a share of GDP (%) 
Gross fixed capital formation, as a share of GDP (%) 
Exports of goods and services, relative to GDP (%) 
Imports of goods and services, relative to GDP (%) 
Gross fixed capital formation by the general government sector, as a percentage of GDP 
(%) 

Note 

1) 2) 

Note 
3) 
3) 
3) 4) 

3) 
5) 
3) 4) 

3) 
3) 
3) 
3) 
3) 
3) 
3) 
3) 
3) 4) 

2011 
45 598 i 
603 548 w 

2018 
42 217 i 
603 549 w 

2019 
41 984 i 
603 549 w 

2020 
41 733 i 
603 549 w 

2021 
: 
603 549 w 

2022 
40 998 i 
603 549 w 

2011 
1 349 178 w 
121 638 w 
2 661 w 
: 
: 
5.4 w 
0 iw 
5 w 

2018 
3 560 302 w 
110 765 w 
2 620 w 
: 
: 
3.5 w 
1 iw 
2 w 

2019 
3 977 198 w 
137 373 w 
3 269 w 
: 
: 
3.2 w 
1 iw 
2 w 

2020 
4 222 026 w 
137 133 w 
3 285 w 
: 
: 
-  3.8 w 
-  4 iw 
0 w 

2021 
5 450 849 w 
168 710 w 
4 077 w 
: 
: 
3.4 w 
-  2 iw 
6 w 

2022 
5 239 114 w 
154 173 w 
: 
: 
: 
-  28.8 w 
: 
: 

: 
: 
: 

9.4 w 
25.2 w 
3.5 w 
61.9 w 
85.5 w 
18.4 w 
49.4 w 
55.4 w 
: 

: 
: 
: 

12.0 w 
24.8 w 
2.7 w 
60.5 w 
90.2 w 
17.7 w 
45.2 w 
54.0 w 
3 w 

: 
: 
: 

10.4 w 
23.2 w 
3.1 w 
63.3 w 
93.2 w 
17.6 w 
41.2 w 
49.3 w 
3 w 

: 
: 
: 

10.8 w 
20.9 w 
3.3 w 
65.0 w 
92.6 w 
13.4 w 
38.8 w 
40.3 w 
3 w 

: 
: 
: 

12.7 w 
23.8 w 
3.2 w 
60.3 w 
86.8 w 
13.2 w 
40.7 w 
41.9 w 
3 w 

: 
: 
: 

9.7 w 
18.9 w 
1.5 w 
69.9 w 
104.4 w 
11.9 w 
35.4 w 
51.9 w 
: 

Business 
Industrial production volume index (2015 = 100) 
Number of active enterprises (number) 
Birth rate: number of enterprise births in the reference period (t) divided by the number of 
enterprises active in t (%) 

Note 
3) 4) 6)  
3) 
3) 

2011 
135.2 w 
: 
: 

2018 
108.7 w 
1 618 543 w 
11.2 w 

2019 
108.2 w 
1 706 428 w 
12.1 w 

2020 
103.0 w 
1 729 058 w 
9.6 w 

2021 
105.4 w 
1 719 536 w 
: 

2022 
66.7 w 
1 532 287 w 
: 

89 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Death rate: number of enterprise deaths in the reference period (t) divided by the number 
of enterprises active in t (%) 
People  employed  in  SMEs  as  a  share  of  all  persons  employed  (within  the  non-financial 
business economy) (%) 
Value added by SMEs (in the non-financial business economy) (EUR million) 
Total value added (in the non-financial business economy) (EUR million) 

3) 

3) 

: 

: 

: 
: 

6.3 w 

10.5 w 

10.5 w 

: 

63.0 iw 

63.9 iw 

64.0 iw 

64.3 iw 

33 936 iw 
68 917 w 

47 334 iw 
90 454 w 

48 221 iw 
86 283 w 

: 
: 

: 

: 

: 
: 

Inflation rate 
Consumer price index (CPI), change relative to the previous year (%) 

Note 
3) 7)  

2011 
8.0 w 

2018 
10.9 w 

2019 
7.9 w 

2020 
2.7 w 

2021 
9.4 w 

2022 
20.2 w 

Balance of payments 
Balance of payments: current account total (million euro) 
Balance of payments current account: trade balance (million euro) 
Balance of payments current account: net services (million euro) 
Balance of payments current account: net balance for primary income (million euro) 
Balance of payments current account: net balance for secondary income (million euro) 
Net  balance  for  primary  and  secondary  income:  of  which  government  transfers  (million 
euro) 
**3 year backward moving average of the current account balance relative to GDP (%) 
**Five year change in share of world exports of goods and services (%) 
Net balance (inward - outward) of foreign direct investment (FDI) (million euro) 
Foreign direct investment (FDI) abroad (million euro) 
of which FDI of the reporting economy in the EU-27 countries (million euro) 
Foreign direct investment (FDI) in the reporting economy (million euro) 
of which FDI of the EU-27 countries in the reporting economy (million euro) 
**Net international investment position, relative to GDP (%) 
Year  on  year  rate  of  change  in  gross  inflow  of  remittances  (in  national  currency)  from 
migrant workers (%) 

Public finance 
General government deficit / surplus, relative to GDP (%) 
General government gross debt relative to GDP (%) 
Total  government revenues, as a percentage of GDP (%) 
Total government expenditure, as a percentage of GDP (%) 

Note 
3) 
3) 
3) 
3) 
3) 

3) 

3) 
3) 
3) 8) 
3) 
3) 8) 

3) 

Note 
3) 
3) 9) 
3) 
3) 

2011 
- 7 350.7 w 
- 12 952.2 w 
5 664.8 w 
- 2 726.8 w 
2 663.6 w 
-  404.5 w 

2018 
- 5 464.2 w 
- 10 848.4 w 
1 143.0 w 
1 148.7 w 
3 092.5 w 
-  754.0 w 

2019 
- 3 696.3 w 
- 12 770.8 w 
1 567.6 w 
1 710.2 w 
5 796.7 w 
- 1 135.0 w 

2020 
4 735.0 w 
- 5 867.8 w 
3 845.7 w 
3 174.1 w 
3 583.0 w 
- 1 183.4 w 

-  3.3 iw 
: 
5 039.1 w 
137.9 w 
129.6 w 
5 177.0 w 
3 939.1 w 
-  24.7 w 
1.1 iw 

2011 
-  2.2 w 
35.1 w 
41.3 w 
43.5 w 

-  3.3 iw 
: 
4 111.9 w 
-  107.5 w 
-  133.1 w 
4 004.4 w 
2 727.4 w 
-  20.2 w 
0.7 iw 

2018 
-  1.9 w 
60.9 w 
39.5 w 
41.5 w 

-  3.6 iw 
: 
4 619.8 w 
751.7 w 
485.2 w 
5 371.4 w 
4 149.3 w 
-  17.9 w 
0.6 iw 

2019 
-  1.9 pw 
50.2 w 
39.4 w 
41.2 w 

-  1.4 iw 
: 
-  50.8 w 
19.3 w 
-  39.4 w 
-  31.5 w 
-  731.1 w 
-  14.1 w 
0.7 iw 

2020 
-  5.4 w 
60.4 w 
39.6 w 
45.0 w 

2021 
- 3 369.7 w 
- 5 689.0 w 
3 368.9 w 
- 4 961.0 w 
3 911.4 w 
- 1 278.8 w 

-  0.4 iw 
: 
6 351.5 w 
-  167.3 w 
-  149.5 w 
6 184.2 w 
4 599.3 w 
-  13.0 w 
1.0 iw 

2021 
-  3.3 w 
49.0 w 
37.0 w 
40.3 w 

2022 
7 644.5 w 
- 14 130.5 w 
- 10 736.5 w 
8 147.7 w 
24 363.8 w 
15 843.7 w 

2.2 iw 
: 
202.7 w 
327.4 w 
-  89.5 w 
530.1 w 
-  66.6 w 
-  1.7 w 
1.0 iw 

2022 
-  15.5 w 
77.8 w 
50.1 w 
65.4 w 

Financial indicators 
Gross external debt of the whole economy, relative to GDP (%) 
Gross external debt of the whole economy, relative to total exports (%) 
Money supply: M1 (banknotes, coins, overnight deposits, million euro) 
Total credit by monetary financial institutions to residents (consolidated) (million euro) 

Note 
3) 10) 
3) 10) 
11) 

2011 
80.5 iw 
163.0 w 
30 204.4 w 
: 

2018 
90.4 iw 
199.6 w 
21 166.7 w 
: 

2019 
79.4 iw 
192.2 w 
29 144.0 w 
: 

2020 
74.6 iw 
192.4 w 
30 226.3 w 
: 

2021 
67.8 iw 
165.6 w 
41 433.7 w 
: 

2022 
80.5 iw 
225.8 w 
40 342.0 w 
: 

90 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
**Annual change in financial sector liabilities (%) 
**Private debt, consolidated, relative to GDP (%) 
Interest rates: day-to-day money rate, per annum (%) 
Euro exchange rates: average of period (1 euro = … national currency) 
Trade-weighted effective exchange rate index, 42 countries (2015 = 100) 
**3 year change (T/T-3) in the trade-weighted effective exchange rate index, 42 countries 
(2015 = 100) 
Value of reserve assets (including gold) (million euro) 

: 
: 
4.70 w 
11.092 w 
133.1 w 
- 0.2 iw 

: 
: 
16.30 w 
32.143 w 
85.4 w 
- 0.1 iw 

: 
: 
15.00 w 
28.952 w 
94.6 w 
0.0 iw 

: 
: 
7.10 w 
30.788 w 
93.2 w 
0.1 iw 

: 
: 
6.78 w 
32.309 w 
91.5 w 
0.1 iw 

: 
: 
11.11 w 
33.982 w 
88.5 w 
- 0.1 iw 

12) 
12) 

3) 10) 

24 668.3 w 

18 177.1 w 

22 682.2 w 

23 711.1 w 

27 294.4 w 

26 751.2 w 

External trade in goods 
Value of imports: all goods, all partners (million euro) 
Value of exports: all goods, all partners (million euro) 
Trade balance: all goods, all partners (million euro) 
Terms of trade (export price index / import price index * 100) (number) 
Share of exports to EU-27 countries in value of total exports (%) 
Share of imports from EU-27 countries in value of total imports (%) 

Demography 
Crude rate of natural change of population (natural growth rate): number of births minus 
deaths (per thousand inhabitants) 
Infant mortality rate deaths of children under one year of age (per thousand live births) 
Life expectancy at birth: male (years) 
Life expectancy at birth: female (years) 

Labour market 
Economic activity rate for persons aged 20–64: proportion of the population aged 20–64 
that is economically active (%) 
*Employment rate for persons aged 20–64: proportion of the population aged 20–64 that 
are in employment (%) 
Male employment rate for persons aged 20–64 (%) 
Female employment rate for persons aged 20–64 (%) 
Employment rate for persons aged 55–64: proportion of the population aged 55–64 that 
are in employment (%) 
Employment by main sectors 
Agriculture, forestry and fisheries (%) 
Industry (%) 
Construction (%) 
Services (%) 
People employed in the public sector as a share of total employment, persons aged 20–
64 (%) 
People employed in the private sector as a share of total employment, persons aged 20–
64 (%) 

91 

Note 
3) 
3) 
3) 
13) 

Note 

Note 
3) 
14) 
3) 4) 

3) 4) 
3) 4) 
3) 4) 

3) 4) 5) 
3) 4) 5) 
3) 4) 5) 
3) 4) 5) 

2011 
58 219 iw 
48 559 iw 
- 9 660 iw 
104.1 iw 
: 
: 

2018 
48 423 iw 
40 080 iw 
- 8 343 iw 
99.6 iw 
: 
: 

2019 
54 310 iw 
44 712 iw 
- 9 599 iw 
99.9 iw 
: 
: 

2020 
47 490 w 
43 053 w 
- 4 438 iw 
105.0 iw 
: 
: 

2021 
61 824 w 
57 718 w 
- 4 106 iw 
118.9 iw 
: 
: 

2022 
52 595 w 
41 752 w 
- 10 843 iw 
: 
: 
: 

2011 
-  3.6 

9.0 
66.0 
76.0 

2018 
-  6.0 

7.1 
68.1 
78.0 

2019 
-  6.5 

7.1 
68.4 
78.3 

2020 
-  7.8 

6.8 
: 
: 

2021 
: 

7.2 
: 
: 

2022 
: 

: 
: 
: 

2011 
72.1 w 

4) 

2018 
71.8 w 

2019 
72.9 w 

2020 
72.0 w 

2021 
71.9 w 

2022 
: 

66.5 w 

65.6 w 

66.9 w 

65.2 w 

64.8 w 

72.1 w 
61.5 w 
39.7 w 

20.3 w 
19.1 w 
6.5 w 
54.1 w 
: 

70.5 w 
61.0 w 
39.5 w 

14.9 w 
17.8 w 
6.5 w 
60.8 w 
: 

72.7 w 
61.6 w 
41.9 w 

13.9 w 
17.8 w 
7.1 w 
61.2 w 
: 

70.8 w 
60.0 w 
42.1 w 

14.1 w 
17.8 w 
7.0 w 
61.1 w 
: 

70.8 w 
59.3 w 
41.1 w 

14.1 w 
18.2 w 
7.0 w 
60.7 w 
: 

: 

: 

: 

: 

: 

: 

: 
: 
: 

: 
: 
: 
: 
: 

: 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unemployment rate: proportion of the labour force that is unemployed (%) 

Male unemployment rate (%) 

Female unemployment rate (%) 

Youth unemployment rate: proportion of the labour force aged 15–24 that is unemployed 
(%) 
Long-term unemployment rate: proportion of the labour force that has been unemployed 
for 12 months or more (%) 
Unemployment rate for persons (aged 25–64) having completed at most lower secondary 
education (ISCED levels 0-2) (%) 
Unemployment  rate  for  persons  (aged  25–64)  having  completed  tertiary  education 
(ISCED levels 5-8) (%) 

Social cohesion 
Average nominal monthly wages and salaries (national currency) 

Index  of  real  wages  and  salaries  (index  of  nominal  wages  and  salaries  divided  by  the 
inflation index) (2016 = 100) 
GINI coefficient 
Poverty gap 
*Early leavers from education and training: proportion of the population aged 18–24 with 
at most lower secondary education who are not in further education or training (%) 

Note 
3) 
4) 
16)  17) 
18) 
18) 

3) 4) 
3) 4) 

Standard of living 
Number of passenger cars relative to population size (number per thousand population) 
Number of mobile phone subscriptions relative to population size (number per thousand 
population) 
Mobile broadband penetration (per 100 inhabitants) 
Fixed broadband penetration (per 100 inhabitants) 

Note 

3) 

3) 
3) 

: 
7 w 

Infrastructure 
Density of railway network (lines in operation per thousand km²) 

Length of motorways (kilometres) 

Education, innovation and research 
Public expenditure on education relative to GDP (%) 
*Gross domestic expenditure on R&D relative to GDP (%) 
Government  budget  appropriations  or  outlays  on  R&D  (GBAORD),  as  a  percentage  of 
GDP (%) 
Percentage of households who have internet access at home (%) 

92 

Note 
1) 2) 3) 

2011 
35.9 iw 

3) 4) 

15 w 

Note 
3) 
3) 
3) 19) 

2011 
5.9 iw 
0.71 iw 
0.30 w 

3)  4)  5) 
15) 
3)  4)  5) 
15) 
3)  4)  5) 
15) 
3) 4) 

7.9 w 

8.8 w 

6.8 w 

8.8 w 

10.0 w 

7.4 w 

8.2 w 

8.5 w 

7.9 w 

9.5 w 

9.8 w 

9.1 w 

9.8 w 

9.5 w 

10.1 w 

18.6 w 

17.9 w 

15.4 w 

19.3 w 

19.1 w 

3)  4)  5) 
15) 
3) 4) 

1.5 w 

7.4 w 

1.9 w 

1.0 w 

2.0 w 

2.4 w 

14.2 w 

13.9 w 

16.3 w 

15.3 w 

3) 4) 

5.7 w 

7.2 w 

6.5 w 

7.4 w 

8.5 w 

: 

: 

: 

: 

: 

: 

: 

2011 
2 633 w 

2018 
8 865 w 

2019 
10 497 w 

2020 
11 591 w 

2021 
14 014 w 

2022 
14 847 w 

: 

134 w 

147 w 

158 w 

175 w 

24 w 
20.5 w 
: 

24 w 
20.4 w 
: 

2011 
151.3 iw 
1 222.5 w 

2018 
: 
1 279.5 w 

25 w 
21.2 w 
: 

2019 
: 
: 

: 
: 

2019 
32.8 iw 

15 w 

2019 
5.4 iw 
0.43 iw 
0.20 w 

25 w 
21.2 w 
: 

2020 
: 
: 

: 
: 

2020 
32.8 iw 

15 w 

2020 
5.4 iw 
0.40 iw 
0.20 w 

24 w 
21.7 w 
: 

2021 
: 
: 

: 
: 

2021 
32.7 iw 

15 w 

2021 
5.1 iw 
0.38 iw 
0.16 w 

47.5 w 
13 w 

2018 
32.7 iw 

15 w 

2018 
5.3 iw 
0.47 iw 
0.20 w 

: 

: 
: 
: 

2022 
: 
: 

: 
: 

2022 
: 

: 

2022 
: 
0.33 iw 
0.21 w 

4) 

26.8 w 

61.5 w 

65.8 w 

79.2 w 

82.7 w 

: 

3) 
20) 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Environment 
*Index of greenhouse gas emissions,  CO2 equivalent (1990 = 100) 
Energy  intensity  of  the  economy  (kg  of  oil  equivalent  per  1 000  euro  GDP  at  2015 
constant prices) 
Electricity generated from renewable sources relative to gross electricity consumption (%) 
Road share of inland freight transport (based on tonne-km) (%) 

Energy 
Primary production of all energy products (thousand TOE) 
Primary production of crude oil (thousand TOE) 
Primary production of solid fuels (thousand TOE) 
Primary production of gas (thousand TOE) 
Net imports of all energy products (thousand TOE) 
Gross inland energy consumption (thousand TOE) 
Gross electricity generation (GWh) 

Agriculture 
Agricultural production  volume index of goods and services (at producer prices) (2015 = 
100) 
Utilised agricultural area (thousand hectares) 
Livestock numbers: live bovine animals (thousand heads, end of period) 
Livestock numbers: live swine (thousand heads, end of period) 
Livestock numbers: live sheep and live goats (thousand heads, end of period) 
Raw milk available on farms (thousand tonnes) 
Harvested crop production: cereals (including rice) (thousand tonnes) 
Harvested crop production: sugar beet (thousand tonnes) 
Harvested crop production: vegetables (thousand tonnes) 

Source: Eurostat and/or the statistical authorities in Ukraine 

Note 

3) 

3) 4) 

Note 

(3) 

Note 
3) 

1) 2) 
3) 
3) 
3) 
3) 
3) 
3) 
3) 

2011 
48.0 ew 
222.0 dw 

5.9 ew 
30.3 w 

2011 
82 106 
3 407 
36 596 
15 530 
47 684 i 
126 864 
194 948 

2011 
94.1 w 

2018 
40.0 ew 
179.0 dw 

10.3 w 
42.7 w 

2018 
60 886 
2 341 
14 338 
16 487 
32 347 i 
93 851 
159 796 

2018 
112.5 w 

2019 
39.2 ew 
166.0 dw 

9.4 w 
41.4 w 

2019 
60 355 
2 478 
14 186 
16 261 
32 976 i 
89 641 
154 012 

2019 
114.1 w 

2020 
34.9 ew 
167.0 dw 

11.5 w 
42.3 w 

2020 
57 121 
2 476 
12 690 
15 856 
29 487 i 
86 583 
148 264 

2020 
102.6 w 

2021 
37.5 ew 
: 

10.6 w 
43.0 w 

2021 
: 
: 
: 
: 
: 
: 
150 042 w 

2022 
: 
: 

: 
: 

2022 
: 
: 
: 
: 
: 
: 
: 

2021 
119.4 w 

2022 
89.6 w 

41 265.8 w 
4 425.8 w 
7 373.2 w 
1 739.4 iw 
11 086.0 w 
56 255.8 iw 
18 740.0 w 
9 944.3 w 

41 259.9 w 
3 332.9 w 
6 025.3 w 
1 268.6 iw 
10 064.0 w 
69 101.9 iw 
13 967.7 w 
9 543.0 w 

41 138.4 w 
3 092.0 w 
5 727.4 w 
1 204.5 iw 
9 663.2 w 
74 425.2 iw 
10 204.5 w 
9 801.9 w 

41 144.2 w 
2 874.0 w 
5 876.2 w 
1 140.4 iw 
9 263.6 w 
64 333.4 iw 
9 150.2 w 
9 747.5 w 

41 144.2 w 
2 644.0 w 
5 608.8 w 
1 094.3 iw 
8 713.9 w 
85 329.9 iw 
10 853.9 w 
10 038.3 w 

41 144.2 w 
2 307.1 w 
4 948.3 w 
941.4 iw 
7 767.7 w 
53 529.6 iw 
9 941.5 w 
7 579.4 w 

: = not available 

d =  definition differs 

e = estimated value 

p = provisional 

i = Eurostat estimate 

w=  data  supplied  by  and  under  the  responsibility  of  the  national  statistical  authority  and  published  on  an  "as  is"  basis  and  without  any  assurance  as  regards  their  quality  and 
adherence to EU statistical methodology 

93 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
* = Europe 2020 indicator 

** = Macroeconomic Imbalance Procedure (MIP) indicator 

Footnotes: 

Data of the State Service of Ukraine for Geodesy, Cartography and Cadastre. 

Data are given according to the new Classification of Land Types. 

Data for 2014-2022 exclude the temporarily occupied territories of the Autonomous Republic of Crimea, the city of Sevastopol and the parts  of the Donetsk and Luhansk regions 
which are temporarily occupied. 

Data on Ukraine for the years 2021-2022 is limited due to exemption under the martial law from mandatory data submission to the State Statistics Service of Ukraine, effective as 
of 3 March 2022. 

Persons aged 15-70 years. 

Adjustment for the effect of calendar days of the dynamic series of indices to the average monthly value of the base. (2016)  year is carried out using the DEMETRA+ program, 
using the TRAMO/SEATS method activity. 

Consumer price inflation. 

FDI Data were recalculated taking into account EU-27 Member States, excluding the United Kingdom. 

State and state guaranteed debt. 

Assets and debt converted from US dollars to euro using cross rates at the end of the reporting year. 

Monetary aggregate M1 includes: certain liabilities of resident deposit-taking corporations vis-a-vis resident sectors of the economy except general government and other deposit-
taking corporations; currency in circulation outside the deposit-taking corporations; and transferable deposits in national currency. 

Nominal effective exchange rate index of the hryvnia (2015=100), 39 countries, from 2022 - 37 countries. 

Index based on the previous year. 

From 2019 data for economically active population is based on the Labour Force Survey. 

Persons aged 15 years and over. 

Data refer to enterprises and their independent divisions with 10 or more employees. Data from before 2010 should not be compared with data from 2010 onwards. 

Excluding employees of small enterprises and employees of natural persons as entrepreneurs. 

The  disclosure  of  information  will  be  resumed  after  the  completion  of  the  deadline  for  submission  of  statistical  and  financial  reports  established  by  the  Law  of  Ukraine  "On 
Protection of Interests of Subjects of Reporting and Other Documents during Martial Law or War". 

The share of R&D expenditure from the government budget in GDP. 

Share of persons who used the internet at home. 

94 

1) 

2) 

3) 

4) 

5) 

6) 

7) 

8) 

9) 

10) 

11) 

12) 

13) 

14) 

15) 

16) 

17) 

18) 

19) 

20) 

 
 
 
 
 
 
 
 
95