The Cabinet of Ministers of Ukraine approved a resolution that establishes the procedure for providing partial compensation for property of business entities destroyed or damaged as a result of the armed aggression of the Russian Federation, as well as partial compensation of insurance premiums under insurance contracts against war risks.
This decision creates a legal framework for launching a new state support mechanism for businesses that combines two components:
- direct compensation for losses for enterprises in frontline regions,
- compensation of a portion of the insurance premium for businesses across the entire territory of Ukraine.
The approved decision opens the possibility for the practical launch of a new support instrument.
According to the Government, the mechanism of direct compensation for losses will operate for entrepreneurs in high-risk territories — in the Dnipropetrovsk, Donetsk, Zaporizhzhia, Mykolaiv, Odesa, Poltava, Sumy, Kharkiv, Kherson and Chernihiv regions. Businesses will be able to receive partial compensation for the value of damaged or destroyed property — buildings, warehouses, equipment, and more.
The maximum amount of compensation will be up to 10 million UAH, but not more than the actual damage. If a business has already received compensation or assistance from the state or local budget, the amount of compensation will be reduced by the amount previously received.
Regarding partial compensation of the insurance premium, in territories where companies are ready to provide the service of business insurance against war risks, the enterprise independently selects such a company, signs a contract with it, and pays the insurance premium (the cost of the policy).
Who can use the mechanism:
Individual entrepreneurs and private-sector legal entities.
Cannot participate in the program:
state and municipal enterprises, non-residents of Ukraine, companies under sanctions or connected to the Russian Federation or Belarus, enterprises with tax debts or in bankruptcy.
The Federation of Employers welcomes this Government resolution as an important component of the joint initiative of the Ministry of Economy and the FEU — “Industrial Ramstein”, aimed at facilitating the large-scale modernization of Ukraine’s industry.
The initiative supports the renewal of the production base of destroyed and damaged enterprises by financing, on favorable terms, the supply of critically needed equipment to replace what was lost.
The FEU is convinced that following the Government’s recent introduction of grants for the restoration of damaged production facilities, this initiative will become another effective instrument for reviving industries destroyed by the war.