PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN DONETSK OBLAST

Location, area: towns of Artemivsk, Vuhledar, Horlivka, Dzerzhynsk, Dymytrov, Dobropillia, Donetsk, Yenakiive, Zhdanivka, Kirovske, Kostiantynivka, Kramatorsk, Krasnoarmiisk, Krasnyi Lyman, Makiivka, Mariupol, Novohrondivka, Selidove, Sloviansk, Snizhne, Torez, Shakhtarsk as well as Amvrosiiv, Volnovakha, Kostantynivsk, Marinsk and Sloviansk districts, Donetsk Oblast, area – 714,000 ha.
Term of action: 30 years
Effective from: July 21, 1998
Legal basis: Law of Ukraine of December 24, 1998 No. 356 “On special economic zones and special investment regime in Donetsk Oblast” and No. 973 of June 15 1999 “On amendments to some laws of Ukraine on taxation in connection with introduction of special investment regime in Donetsk Oblast”.
Priority type of economic activity: agriculture; fishery; mining; food industry and processing of agricultural products; textile industry and sewing of clothes; production of wood and wooden products; wood-pulp and paper industry; chemical industry; metallurgy and metal working; machine-building and instrument-making; furniture production; production of electric power, gas and water; construction; hotel facilities; transport; research and development in the field of natural and technical sciences; geology and geological prospecting; education and health protection.
Privileges granted to investors:
-income tax rate for the first 3 years – 0%, from the fourth to the sixth year – 50% of the current rate;
-non-resident income tax – in size of 2/3 established rate;
-taxable dividends at the rate of 10 per cent;
-customs duty and value-added tax are not exempted in case of import from outside the limits of customs area of Ukraine of equipment (except for excise goods)for the period of investment project implementation;
-investment sum obtained under the investment project is exempted from taxation;
-fees to the State innovatory fund should not be exempted for the period of time up to 2009;
- exempted for the period of time up to 2009 the fees to the Fund for realization of measures with regard to liquidation of the consequences of Chornobyl accident and social protection of population should be exempted in size of 50%.
Special conditions in which investors receive privileges: if the investments are equivalent no less than USD 1 million, realization of investment projects approved by the Council in priority types of economic activities at newly established enterprises, operating enterprises and their structural subdivisions at which restructuring, reconstruction, modernization or change of production type took place.
Expected results of activity:
-it is envisaged to attract – USD 7.750 million;
-preservation of the former and creation of new work places – 100,000;
State of realization: 122 investment projects were approved at the estimated cost of USD 815 million. Investment raised: USD 372.1 million. Investment fields: metallurgy, coal, processing industry, chemical industry, machine-building, light and food industry, agroindustrial complex, transport and communications, communal facilities. Production realized at UAH 3.1 billion. 5117 new work places were created and 13262 work places were preserved.

PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN THE
AUTONOMOUS REPUBLIC OF CRIMEA

Location, area: towns of Yalta, Alushta, Sudak, Feodosia, Krasnoperekopsk, Armiansk, Krasnoperekopsk and Lenin districts of the Autonomous Republic of Crimea, area– 611,000 ha.
Term of action : 30 years
Effective from: January 01, 2000
Legal basis: The Decree of the President of Ukraine of June 27, 1999 No. 740 "On priority development areas with special investment regime and special economic zone “The Port of Crimea” in the Autonomous Republic of Crimea ".
Priority type of economic activity: health protection, sanatorium and health resort services, hotel economy, forestry economy, fish economy, agriculture, mining industry, food industry, and processing of agricultural production, textile industry and sewing of clothes, chemical production, machine-building and instrument-making, research and development in the field of natural and technical sciences, production of electric power, gas and water, construction, transport.
Privileges granted to investors:
-during the first 3 years income tax rate – 0%, from the fourth to the sixth year – 50% of the current rate;
-value-added tax is not exempted in case of import from the outside limits of Ukraine’s customs area of equipment, ;
-customs duty is not exempted in case of import from the outside limits of Ukraine’s customs area of raw material, materials, equipment, complete sets (except for excise goods) for realization of investment projects but no more than for 5 years;
-investment sum obtained according to the investment project is exempted from taxation;
-foreign currency earnings are exempted from compulsory sale;
-cancellation of land payment for the period of development of land lots but no more than for 5 years;
-cancellation of fee to the State innovatory fund for the period of for realization of investment projects but no more than for 5 years.
Special conditions in which investors receive privileges: realization by the entities of entrepreneurial activity registered on priority development areas, according to the agreement (contract) concluded with local self-government body, of investment projects in priority types of economic activity at the estimated rate of not less than:
USD 100,000 – in activity preservation of historical and natural heritage, on research and development in the sphere of informatization, in the sphere of culture and sports, in sphere of services for population, on cleaning of territories, in forestry economy, in production of spots and fancy goods, toys, souvenirs;
USD 200,000 – in activity on health protection, agriculture and fish economy, food, textile industry and agricultural production processing industry, production of furniture, wood and products of wood (marginal estimated cost of these investment projects is reduced in two times if investment project envisages creation of anew entity of business activity and in the period of time from October 1 to April 1 of each year monthly average list number of workers is not less than 10 persons and a size of their wages paid – is not less than average size in the Autonomous Republic of Crimea;
USD 500,000 – in activity of sanatorium and health resort establishments, hotels and restaurants, transport and communications, in construction, waste products processing, rendering services in the sphere of tourism, rest and entertainments;
USD 1million – in mining, processing industry, in production of electric power, gas and water.
Expected results of activity:
-it is envisaged to attract – USD 850 million;
-preservation of the former and creation of new work places – 28,000;
State of realization: 21 investment projects of totaling estimated cost of USD 51.2 million were approved. Investments raised USD 19.8 million. Investment fields: construction, hotels and restaurants, collective public and personal services, transport, agriculture, hunting and forestry, fishing, food industry. Products were realized for a sum of UAH 20.3 million. 826 new work places were created and 1353 work places were preserved.

PRIORITY DEVELOPMENT OF SPECIAL INVESTMENT REGIME AREAS IN LUHANSK OBLAST

Location, area: towns of Brianka, Krasnodon, Sverdlovsk, Pervomaisk, Stakhaniv, Krasnyi Luch as well as Antratsyt, Kreminne and Krasnodon districts’ Lugansk Oblast, area – 519,000 ha.
Term of action: 30 years
Effective from: February 04, 1999
Legal basis: Laws of Ukraine No. 970 of July 15,1999 “On priority development of special investment regime areas in Lugansk Oblast”, No. 971 of July 15, 1999 “On amendments to some laws of Ukraine on taxation in connection with introduction of priority development of special investment regime areas in Lugansk Oblast ”. Priority type of economic activity: agriculture, mining, food industry and processing of agricultural products, textile industry and sewing of clothes, production of wood and wooden products, wood-pulp and paper industry, chemical production, metal working and machine-building, production of electric power and coke, construction, transport.
Privileges granted to investors:
-income tax rate for the first 3 years – 0%, from the fourth to the sixth year – 50%;
-investment sum obtained under the investment project is exempted from taxation;
-customs duty is not exempted in case of import from outside the limits of customs area of Ukraine of raw material, materials, equipment (except for excise goods) for investment project implementation but no more than for 5 years;
-value-added tax is not exempted in case of import from outside the limits of customs area of Ukraine of equipment (except for excise goods) for investment project implementation but no more than for 5 years;
-exemption from fees to the State innovatory fund for population employment promotion for the period of time up to 2009;
-exemption from payment for land in the period of development of land lot but no more than for 5 years.
Special conditions in which investors receive privileges: realization by the entities of entrepreneurial activity registered on priority development areas, on the ground of the agreement with local self-government body, of investment projects at the estimated cost of not less than:
USD 500,000 – investment project implementation in the fields of agriculture, processing industry and health protection;
USD 700,000 – investment project implementation in the fields of construction and transport;
USD 1 million – investment project implementation in the fields of mining industry, production of electric power and coke, chemical production and machine-building.
Expected results of activity:
-it is envisaged to attract – USD 1269 million;
-preservation of the former and creation of the new work places – 17,000;
State of realization: 20 investment projects were approved at the estimated cost of USD 52.9 million. Investment raised: USD 23.5 million. Fields of investments – coal, processing, light, food industries, transport. Production realized to the amount of UAH 151 million. 968 new work places were created and 8225 were preserved.

SPECIAL INVESTMENT REGIME AREA IN ZAKARPATTIA OBLAST

Location, area: Zakarpattia Oblast, area –1,280,000 ha.
Term of action: 15 years.
Effective from: January 29, 1999
Legal basis: Law of Ukraine No. 357 of December 24, 1998 “On special investment regime in Zakarpattia Oblast”
Priority types of economic activity: plant-growing, mining industry, food industry and processing of agricultural products, textile industry and sewing of clothes, production of wood and wooden products, electric power production, construction, hotels, transport, health protection, operation of sports structures.
Privileges granted to investors
-during the first 2 years income tax rate – 0%, from the third to the fifth year – 50% of the current rate;
-exemption from taxation of the investments sum obtained under the investment project;
-cancellation of customs duty and value-added tax in case of import from outside the limits of the customs area of Ukraine of equipment (except for excise goods) for investment project implementation, but no more than for 5 years;
- cancellation of fees to the State innovatory fund for 2 years.
Special conditions in which investors receive privileges: implementation by the entities of entrepreneurial activity, on the ground of the agreement with local state administration, of investment projects in priority types of economic activity if investment is equivalent not less than USD 250,000.
Expected results of SEZ activity:
-it is envisaged to attract – USD 550 million;
-preservation of the former and creation of new work places – 50,000;
State of realization: 56 investment projects were approved at the estimated cost of USD 202.6 million. Investments raised USD 48.2 million. Investment fields – construction, power engineering, instrument-making, woodworking industry, furniture production, health protection. Production realized to the amount of UAH 177.8 million. 3038 new work places were created and 5608 work places were preserved.

PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN SHOSTKA TOWN,
SUMY OBLAST

Location, area: Shostka town, Sumy Oblast, area – 3,500 ha.
Term of action: 30 years
Effective from: January 01, 2000
Legal basis: The Decree of the President of Ukraine No. 726 of July 27, 1999 “On special investment regime in Shostka town, Sumy Oblast ".
Priority types of economic activity: chemical industry, metallurgy and metal working, machine-building, waste processing, electric power production, construction.
Privileges granted to investors:
-for the first 3 years income tax rate – 0%, from the fourth to the sixth year – 50% of the current rate;
-exemption from taxation of investment sum obtained under the investment project;
- exemption from customs duty incase of import from outside the limits of Ukraine’s customs area of raw material, materials, equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
-exemption from value-added tax in case of import from outside the limits of Ukraine’s customs area of equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
- exemption from payment for land during the period of land lot development but 5 years maximum.
Special conditions in which investors receive privileges: realization by the entities of business activity registered in Shostka town area, of investment projects in priority types of economic activity at the estimated cost of minimum:
USD 200,000 – in food industry and agricultural production processing industry, production of timber and wooden products, health protection sphere;
USD 500,000 – construction, waste processing, production of electric power at the thermal electric power stations, heat production and distribution;
USD 1 million – production of machinery and equipment, power metallurgy and chemical production, oil-processing.
Expected results of activity:
-it is envisaged to attract – USD 95 million;
-preservation of the former and creation of new work places – 2,500;
State of realization: preliminary negotiations with investors are being conducted.

PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN ZHYTOMYR OBLAST

Location, area: Berdichiv, Korosten, Novohrad-Volynskyi towns as well as Luhyn, Narodychi, Ovruch, Olevsk, Malyn, Yemilchynsk, Volodarsk-Volyn districts of Zhytomyr Oblast, area – 1,554,000 ha.
Term of action: 30 years
Effective from: January 01, 2000
Legal basis: Laws of Ukraine No. 127 of December 03, 1999 “On special investment regime on priority development areas in Zhytomyr Oblast” and No. 1278 of December 03, 1999 “On amendments to some laws of Ukraine on taxation in connection with introduction of special investment regime on priority development areas in Zhytomyr Oblast ”.
Priority types of economic activity: agriculture, mining, food industry, production of timber and wooden products, cellulose and paper industry, production of other nonmetal mineral products, machine-building, construction.
Privileges granted to investors:
- during the first 3 years income tax rate – 0%, from the fourth to the sixth year – 50% of the current rate;
- exemption from taxation of investment sum obtained under the investment project;
- exemption from customs duty incase of import from outside the limits of Ukraine’s customs area of raw material, materials, equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
- exemption from value-added tax in case of import from outside the limits of Ukraine’s customs area of equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
- exemption from payment for land during the period of land lot development but 5 years maximum.
Special conditions in which investors receive privileges: realization by the entities of business activity registered in the area according to the agreement with local body of self-government, of investment projects in priority types of economic activity at the estimated cost of minimum:
USD 200,000 in agriculture, food industry, textile industry, woodworking and production of wooden products, cellulose -paper industry, production of furniture, sewing of clothes and furs, health protection, education;
USD 300,000 – in construction;
USD 500,000 – in mining industry, chemical production, production of goods of minerals, production of machinery and equipment, transport.
Expected results of activity:
-it is envisaged to attract – USD 140 million;
-preservation of the former and creation of new work places – 28,000;
State of realization: 15 investment projects at the estimated cost of USD 25.8 million were approved, investments raised USD 2.7 million. Investment fields – production of other non-metal mineral products, food industry. Production realized to the amount of UAH 13.4 million. 295 new work places were created and 224 work places were preserved.

PRIORITY DEVELOPMENT AREA WITH SPECIAL INVESTMENT REGIME IN KHARKIV CITY

Location, area: Kharkiv City, area – 31,000 ha.
Term of action: 30 years
Effective from: January 01, 2000
Legal basis: Laws of Ukraine No.1714 of May 11, 2000 “On special investment regime in Kharkiv City area".
Priority types of investment activity: food industry and processing of agricultural products; textile and light industry; production of leather and leather footwear; cellulose-paper industry, polygraphic activity; chemical production, machine-building, production of electric power, water; construction, transport, communications, research and development in the field in natural and technical sciences, sewage disposal and waste processing.
Privileges granted to investors:
-for the first 3 years income rate – 0%, from the fourth to the sixth year – 50% of the current rate;
-exemption from taxation of investment sum obtained under the investment project;
- exemption from customs duty incase of import from outside the limits of Ukraine’s customs area of raw material, materials, equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
-exemption from value-added tax in case of import from outside the limits of Ukraine’s customs area of equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
- exemption from payment for land during the period of land lot development but 5 years maximum.
Special conditions in which investors receive privileges: implementation according to the executive committee of the Kharkiv municipal council by entities of business activity registered in the Kharkiv City area, of investment projects in priority types of economic activity at the estimated cost of minimum:
USD 500,000 in food industry and processing of agricultural products, textile industry and sewing of clothes, production ready-made clothes, furs, leather and leather footwear, pharmaceutical production, sphere of education, health protection and social aid;
USD 700,000 – in construction, production of building materials, transport, sphere of sewage disposal and waste processing;
USD 1 million – in the sphere of research and developments in the field of natural and technical sciences, production of electric power, gas and water;
USD 3 million – in metallurgy and metal working, production of machinery and equipment, electrical, electronic and transport equipment.
Expected results of activity:
-it is envisaged to attract – USD 1,539;
-preservation of the former and creation of new work places – 52,000;
State of realization: 32 investment projects were approved, of total estimated cost of USD 92.8 million, investments raised USD 10.7 million. Investment fields – food, pharmaceutical, perfumery, polygraphic industries, construction, transport. Production realized to the amount of UAH 73.1 million. 2237 new work places were created and 183 work places were preserved.

PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN CHERNIHIV OBLAST

Location, area: Horodnianskyi, Korukivskyi, Novhorod-Siverskyi, Rypkinskyi, Semenyvskyi, Chernihivskyi, Schorskyi districts of Chernihiv Oblast, area – 1.218,000 ha.
Term of action: 30 years
Effective from: January 01, 2000
Legal basis: The Decree of the President of Ukraine No.729 of June 27, 1999 “On special investment regime on priority development areas in Chernihiv Oblast".
Priority types of economic activity: agriculture; mining industry; food and processing industry; textile industry; wood processing; cellulose-paper industry; production of other non-metal mineral products.
Privileges granted to investors:
-for the first 3 years income tax rate – 0%, from the fourth to the sixth year – 50% of the current rate;
-exemption from taxation of investment sum obtained under the investment project;
-exemption from customs duty incase of import from outside the limits of Ukraine’s customs area of raw material, materials, equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
-exemption from value-added tax in case of import from outside the limits of Ukraine’s customs area of equipment and complete sets( except for excise goods) for investment project implementation but no more than for 5 years;
-exemption from payment for land during the period of land lot development but 5 years maximum.
Special conditions in which investors receive privileges: realization by the entities of business activity registered in the area according to the agreement with local body of self-government, of investment projects in priority types of economic activity at the estimated cost of minimum:
USD 200,000 – in agriculture, food, processing, light, cellulose-paper industry, wood processing, production of wood products and furniture, in the sphere of health protection, education and culture;
USD 300,000 – in construction, tourist-recreational sphere;
USD 500,000 – in mining industry, production of machinery and equipment, production of non-metal mineral products, chemical production, transport.
Expected results of activity:
-it is envisaged to attract – USD 1,200 million;
-Preservation of the former and creation of new work places – 15,000;
State of realization: 5 investment projects were approved of total estimated cost of USD 14.6 million, investments raised USD 2.8 million. Investment fields – agriculture, cellulose-paper industry. Production realized to the amount of UAH 6.4 million. 40 new work places were created.

PRIORITY DEVELOPMENT AREAS WITH SPECIAL INVESTMENT REGIME IN VOLYN OBLAST

Location, area: t. Novovolynsk and settlement Zhovtneve, Volyn Oblast, area – 1,700 ha.
Term of action: 30 years
Effective from: January 01, 2000
Legal basis: The Decree of the President of Ukraine No. 730 of June 27, 1999 “On special regime of investment activity on the territories of priority development in Volyn Oblast.
Priority types of economic activity: mining industry, food and processing industry, textile and light industry, wood processing and production of wooden good, chemical industry, machine-building, production of electric power, gas and water, construction, communications.
Privileges granted to investors:
-during the first 3 years income tax rate – 0%, from the fourth to the sixth year – 50% of the current rate;
-investment sum obtained according to investment project is exempted from taxation;
-the fee to the State innovatory fund is not exempted for the first 2 years from the beginning of the investment project realization;
-customs duty and value–added tax are not exempted in case of import from outside the limits of Ukraine’s customs area of equipment and complete sets except for excise goods) for realization of investment project but no more than for 5 years.
Special conditions in which investors receive privileges: realization of the investment projects at the estimated cost of not less than USD 250,000 registered on the territory by the entities of entrepreneurial activity on the ground of the agreement concluded with Novovolynsk town council.
Expected results of the activity:
-it is envisaged to attract – USD 47 million;
-preservation of the former and creation of new work places – 3,600;
State of realization: 5 investment projects at the estimated cost of USD 4.1 million were approved, investments raised USD 1.4 million. Field direction – food and processing industry, wood-working industry. Production realized volume – UAH 7.5 million. 129 new work places were created and 8 work places were preserved.