Capital Markets and Structured Finance in Ukraine
An infrastructure bond structured under English law may attract international investors — but if the underlying Ukrainian assets cannot serve as enforceable collateral under Ukrainian law, the security package is illusory. An SPV designed for bankruptcy remoteness may be effective under its jurisdiction of incorporation — but if Ukrainian courts do not recognize the SPV’s priority over local creditors, the waterfall structure fails.
Capital markets in Ukraine are governed by the Law on Capital Markets and Organized Commodity Markets (2020), with the NSSMC overseeing issuances and market participants. The challenge is whether specific financing structures can be implemented, registered, and enforced under Ukrainian law. This work forms part of our investment framework (→ Investing in Ukraine) and connects to asset-specific financing (→ Structured Asset Finance).
Ukrainian capital markets — regulatory and practical context
Capital markets activity is governed by the Law on Capital Markets (2020), aligned with EU standards:
- NSSMC oversight — regulates securities issuances, prospectus requirements, reporting, and market participant licensing. All placements require NSSMC registration or exemption
- Bond instruments — corporate, municipal, state (OVDPs), project, and green bonds. Corporate bonds require NSSMC registration, credit rating (public), and prospectus
- SPV structures — LLC or JSC formation. Bankruptcy remoteness through governance restrictions and waterfall mechanics — no statutory SPV framework
- Security registration — pledges, mortgages, receivables assignment registered in State Register of Encumbrances and/or Real Property Rights. Unregistered security unenforceable
- IFI participation — EBRD, EIB, IFC, World Bank active through guarantees, co-financing, technical assistance, reconstruction instruments
- PPP and concession — PPP Law and Concession Law provide frameworks for long-term infrastructure financing
This practice covers capital-raising structures — bonds, project finance SPVs, multi-investor models, reconstruction financing. For financing of specific assets (aircraft, engines, equipment) → Structured Asset Finance.
Scope of services
Bond issuances & capital markets
- Corporate bonds — prospectus, NSSMC registration, placement
- Municipal and project bonds — infrastructure & reconstruction
- Green bonds & sustainability-linked instruments
- Private placements — qualified investor requirements
- Coordination with international capital markets documentation
Project finance SPV structuring
- SPV as Ukrainian LLC/JSC with limited-purpose governance
- Bankruptcy remoteness — charter restrictions, independent director
- Waterfall payment — senior, mezzanine, equity tranches
- Cash trap and reserve account mechanisms
- Ukrainian SPV + offshore SPV parallel structures
Reconstruction & infrastructure financing
- Reconstruction bonds — legal framework, IFI backing
- EBRD, EIB, IFC co-financing — compliance, procurement, ESG
- World Bank guarantee instruments — partial risk & credit guarantees
- PPP & concession financing — PPP Law, Concession Law compliance
- Blended finance — concessional IFI + commercial capital
Investor protection in financing
- Security package — pledge, mortgage, receivables assignment
- Intercreditor — priority, subordination under Ukrainian law
- Trustee & security agent — Ukrainian law workarounds
- Step-in rights — contractual mechanisms
- Covenant monitoring & investor information rights
Cross-border financing integration
- Coordination with English law / New York law documentation
- Parallel security — Ukrainian + foreign law layers
- NSSMC + NBU currency control + WHT on interest
- Capital flow structuring — NBU compliance
- International legal & financial advisor coordination
NSSMC regulatory & compliance
- Securities issuance registration
- Prospectus preparation and approval
- Ongoing reporting and disclosure obligations
- Market participant licensing
- NBU coordination for banking elements
Work algorithm
We support the Ukrainian law layer of capital markets and structured finance transactions — from feasibility through implementation to ongoing compliance.
Step 1 — Financing model assessment. We analyze the proposed structure and capital-raising strategy. We identify elements requiring Ukrainian law adaptation and deliver a structured feasibility memo.
Step 2 — Regulatory mapping. We map all NSSMC, NBU, and sector-specific requirements and build them into the implementation timeline.
Step 3 — SPV and structure design. We design the Ukrainian law vehicle — SPV formation, waterfall mechanics, security package, and bankruptcy remoteness provisions.
Step 4 — Security package implementation. We implement the Ukrainian law security — pledge registration, mortgage notarization, receivables assignment — coordinating with overall documentation.
Step 5 — NSSMC registration. We prepare and submit registration documentation for securities issuances, manage the approval process, and establish compliance systems.
Step 6 — Documentation integration. We review and adapt international financing documentation from a Ukrainian law perspective — ensuring consistency between foreign and Ukrainian law layers.
Step 7 — Ongoing monitoring. We monitor the financing throughout its lifecycle — regulatory changes, covenant compliance, waterfall calculations, and restructuring support.
Who we work with
We act as Ukrainian Local Counsel for capital markets and structured finance transactions — typically as part of a team led by an international law firm or IFI.
Our clients include:
- Project sponsors structuring capital-raising for infrastructure, energy, and reconstruction
- International financial institutions (EBRD, EIB, IFC) needing Ukrainian Local Counsel
- International law firms leading cross-border financing with Ukrainian elements
- Bond issuers and arrangers entering Ukrainian capital markets
- PE and institutional investors in structured financing
Typical situations we handle:
- Infrastructure bond issuance backed by Ukrainian assets — NSSMC registration, security, IFI coordination
- EBRD co-financing a reconstruction project — Ukrainian law compliance, PPP, security implementation
- International law firm needs Local Counsel for project finance SPV — bankruptcy remoteness, waterfall
- Municipal bond issuance — regulatory approvals, NSSMC, investor protection
- PE fund in mezzanine tranche — intercreditor analysis, priority, enforcement
Key experts
Doctor of Laws — International investment structuring, cross-border financing, capital markets, IFI coordination
Doctor of Laws — International commercial arbitration, enforcement of financing arrangements, investor-state disputes
PhD — Regulatory compliance, NSSMC coordination, capital markets licensing, securities registration
FAQ: Capital Markets & Structured Finance in Ukraine
What types of bonds can be issued in Ukraine?
Ukrainian law provides for: corporate bonds (most common), municipal bonds (local authorities for infrastructure), state bonds/OVDPs (sovereign debt), project bonds (linked to specific projects), and green/sustainability-linked bonds. All issuances require NSSMC registration. Public placements additionally require a credit rating and approved prospectus.
Is securitization possible under Ukrainian law?
Classical securitization is limited — there is no dedicated statute. However, alternative structures achieve similar outcomes: assignment of receivables to an SPV, project bond issuances backed by revenue streams, and trust management arrangements. We design structures that replicate securitization economics within available Ukrainian law.
What role do IFIs play in Ukrainian capital markets?
EBRD, EIB, IFC, and the World Bank are actively involved — particularly for infrastructure and reconstruction. Instruments include: direct lending and co-financing, partial risk and credit guarantees, technical assistance, equity participation in funds and SPVs, and trade finance. IFI participation requires specific compliance frameworks — procurement, environmental standards, governance.
How are security interests registered and enforced?
Pledges over movables: State Register of Encumbrances (registration establishes priority). Mortgages: notarization + State Register of Real Property Rights. Receivables: contractual assignment mechanisms. Enforcement can be out-of-court or through court.
What is the reconstruction financing framework?
Ukraine’s reconstruction combines: state guarantees and sovereign backing, IFI co-financing and guarantee instruments, private capital through bonds and SPVs, PPP and concession models, and blended finance (concessional + commercial). Legal framework includes PPP Law, Concession Law, and specific reconstruction legislation.
How does capital markets financing differ from asset-based financing?
Capital markets focuses on raising capital from multiple investors through market instruments — bonds, SPV tranches, structured products. Emphasis on investor protection, waterfall mechanics, and NSSMC compliance. Asset-based financing focuses on specific assets as collateral.
Related practices
Ready to proceed?
We will assess your financing structure and ensure it is workable, registered, and enforceable in Ukraine.
