UKRAINE Law and Practice Contributed by: Mykyta Nota and Anton Arkhypov, AVELLUM
2.7 Businesses/Corporate Entities Relevant for the Calculation of Jurisdictional Thresholds Group-Wide Basis All undertakings linked with parties to a concen - tration by control relationships (a group-wide basis) are relevant for the purpose of calculating the jurisdictional thresholds. Therefore, a group- wide basis is based on the concept of control (see 2.4 Definition of “Control” ). Attribution of JV’s Assets/Turnover For purposes of calculating jurisdictional thresh - olds, a JV’s assets/turnover should be evenly distributed among its controlling shareholders regardless of the number of shares/votes they hold. However, the full turnover/value of assets of a co-controlling JV shareholder should be attributed to the JV. Disregard Non-Controlling Interests Turnover or assets figures of non-controlling interests are not taken into consideration when determining the turnover or assets for the pur - pose of jurisdictional thresholds calculation. The Seller May Remain Relevant The selling party’s assets and turnover can only be excluded from the target group’s per - formance if the target possesses no Ukrainian assets, has no current operations in Ukraine, and has not been active there during the two preceding financial years. Yet, the wording of the relevant provisions is vague, so even a one- time operation can be considered an activity in Ukraine, setting the bar for excluding the selling party’s financials quite high. Consideration of Business Structure Changes Changes in the business during the reference period (such as other acquisitions, divestments or business closures) are generally reflected
in the calculation of jurisdictional thresholds. If business entities were sold or closed, they should not be considered in the calculation of the jurisdictional threshold. Similarly, if a party acquired another undertaking during the refer - ence period, the assets and turnover of such an undertaking should be considered for the juris - dictional threshold. 2.8 Foreign-to-Foreign Transactions Foreign-to-foreign transactions are subject to merger control if the parties hit the jurisdiction - al thresholds. Therefore, a transaction with no reasonable nexus to Ukraine (ie, with no local presence, effects, or sales/assets) may still be caught if it meets the jurisdictional thresholds. The only exception during martial law is defence/ military-related transactions. Jurisdictional thresholds do not apply to the concentration if such a deal meets the following conditions: • it is conducted outside Ukraine; • it is aimed at the development of technolo - gies and production of military and dual-use goods; • the final recipients and/or purchasers of the products and technologies are the Armed Forces of Ukraine or law enforcement/military agencies in Ukraine; • the products and technologies are either not developed or produced in Ukraine, or their production levels are insufficient; and • an acquirer is active in the military sector or produces/develops dual-use goods. 2.9 Market Share Jurisdictional Threshold Ukraine does not have a market share jurisdic - tional threshold.
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