MORE TRANS­PARENCY, BUT CHANGES IN THE OB­TAIN­ING PRO­CE­DURE.

Kyiv Post Legal Quarterly - - Contents -

On May 23, 2017, the Ukrainian Par­lia­ment voted for the Law of Ukraine “On mak­ing changes to some le­gal acts re­gard­ing re­mov­ing bar­ri­ers for for­eign in­vest­ments”. Ac­cord­ing to the pro­vi­sions of that le­gal act, the whole pro­ce­dure on the le­gal­iza­tion of for­eign­ers will be con­sid­er­ably changed. Cur­rently this act is await­ing the Pres­i­dent’s sig­na­ture. The new rules are aimed at mak­ing the whole pro­ce­dure of ac­quir­ing le­gal sta­tus for for­eign­ers in Ukraine eas­ier and trans­par­ent for the pur­pose of pro­tect­ing the in­ter­ests of in­vestors and mak­ing it less bu­reau­cratic and at the same time more strict lim­i­ta­tions will be in­tro­duced.

NEW RULES FOR THE EM­PLOY­MENT OF FOR­EIGN­ERS

The first sig­nif­i­cant change in the sphere of la­bor reg­u­la­tion for for­eign­ers will be for pri­vate en­trepreneurs (so called “FOP”, “SPD”) to be in­cluded in the list of em­ploy­ers. This mean, that only le­gal en­ti­ties will have the right to em­ploy a for­eign ci­ti­zen. It is worth not­ing that the list of doc­u­ments re­quired for a work per­mit will be re­duced and will con­sist of gen­eral doc­u­ments such as trans­la­tion of pass­port and pho­tos. The re­quire­ments of new doc­u­ments to sub­mit for a Work Per­mit will con­sist of the em­ploy­ment con­tract dra . Crim­i­nal records, univer­sity de­gree and med­i­cal doc­u­ments will no longer be needed. The new va­lid­ity terms of work per­mits will be es­tab­lished as such: a dra of the law says, the work per­mit could be is­sued for the term of the em­ploy­ment con­tract but not more than for 3 years (for IT sec­tor em­ploy­ees, the own­ers of the busi­ness, cre­ative sphere em­ploy­ees and highly paid for­eign pro­fes­sion­als) and up to one year for other for­eign­ers. The work per­mit may be pro­longed with an un­lim­ited num­ber of times. Th­ese changes are pos­i­tive and will se­cure in­ter­ests from both em­ploy­ers and em­ploy­ees and will guar­an­tee a more sta­ble po­si­tion that will re­duce the num­ber of em­ployer`s com­mu­ni­ca­tion and bur­den­some pro­ce­dures with state au­thor­i­ties. Changes to the term for con­sid­er­a­tion of doc­u­ments will be strictly lim­ited to 7 busi­ness days – for the is­sue of a work per­mit and 3 busi­ness days for con­sid­er­ing the ex­ten­sion of a work per­mit va­lid­ity term. One of the most pos­i­tive changes will be the new mech­a­nism that will be im­ple­mented in the sphere of work per­mit is­sue – if the au­tho­rized body finds mis­takes within the doc­u­ments sub­mit­ted, the is­su­ing (or pro­lon­ga­tion) of work per­mit will not be re­fused but will be ‘frozen’ from con­sid­er­a­tion and the em­ployer will be given 7 busi­ness days to cor­rect the mis­take or dis­crep­ancy.

“BEN­E­FITS” AND “POS­I­TIVES” OF THE NEW REG­U­LA­TIONS.

The new law es­tab­lishes the min­i­mum amount for a for­eign em­ploy­ees’ salaries equat­ing to 10X the amount of the min­i­mum salary in Ukraine (2017 = 32000 UAH ). This re­quire­ment is not used for spe­cial cat­e­gories of em­ploy­ees, such as founders

and/or share­hold­ers of Ukrainian le­gal en­tity, grad­u­ates from uni­ver­si­ties that are among world top 100 uni­ver­si­ties in the world rank­ings, for­eign em­ploy­ees of artis­tic pro­fes­sions and It-pro­fes­sion­als whose salary may be es­tab­lished at any level but now less than min­i­mal salary (3200 UAH). One of the amend­ments of the pay­ment for the is­sue of a work per­mit will be in­creased. In the case of is­su­ing a 3 year per­mit, 6X the amount of sub­sis­tence min­i­mum for abled per­sons (2017 = 9600 UAH). The same pay­ments will be re­quired for the pro­lon­ga­tion of a work per­mit which is also not a pos­i­tive change (ac­cord­ing to the act­ing pro­ce­dure, the ex­ten­sion of a term va­lid­ity for a work per­mit is free of charge).

CHANGES IN THE SPHERE OF RES­I­DENCE.

The new ground for ob­tain­ing tem­po­rary res­i­dence per­mit will be added to the list – the in­vestors to the Ukrainian econ­omy in the form of mak­ing a con­tri­bu­tion to the au­tho­rized cap­i­tal of a Ukrainian le­gal en­tity will be able to en­joy the right to ob­tain tem­po­rary

res­i­dence per­mit with no need to be em­ployed in a com­pany. The only re­stric­tion is the amount of the in­vest­ment in the com­pany – not less than 100 000 EUR. Gen­er­ally, the tem­po­rary res­i­dence per­mit shall be is­sued within 10 calendar days (now the term is 15 calendar days) and the ad­min­is­tra­tive fee will be in­creased – up to the amount of 20X non-taxed cit­i­zens` in­come min­i­mum (both for is­sue and pro­lon­ga­tion, in 2017 the amount = 340 UAH). There is one more added sub­stan­tial re­quire­ment for an em­ployed for­eigner: it will be re­quired to prove that your em­ployer has also 3 Ukrainian em­ploy­ees (who started to work at the com­pany not later than in 6 months be­fore pro­lon­ga­tion of tem­po­rary res­i­dence per­mit) OR that he has paid taxes for the amount not less than 50X the min­i­mum salaries within the last full fi­nan­cial year (2017 = 160 000 UAH) in or­der to ex­tend the res­i­dency per­mit of the for­eign em­ployee. To sum up, the changes in leg­is­la­tion in the sphere of em­ploy­ment and res­i­dency of for­eign­ers in Ukraine pro­vide a more clear, trans­par­ent and less bu­reau­cratic pro­ce­dure but with a sub­stan­tially more ex­pen­sive price tag. The law will come into ef­fect within 3 months time from the mo­ment of it's sign­ing by the Pres­i­dent and of­fi­cial pro­mul­ga­tion. It is im­por­tant to note that dur­ing the tran­si­tion pe­riod while the law is not im­ple­mented, that it must be clar­i­fied in terms of specifics for doc­u­ments ob­tained by for­eign­ers prior to the date and ef­fect of the new law.

Te­tiana Yashchenko Lawyer at EXPATPRO Law Firm, PHD stu­dent at Kyiv Taras Shevchenko Na­tional Univer­sity

Va­syl Chered­nichenko Part­ner at EXPATPRO Law Firm

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