IT Ukraine Legal Conference designs new frameworks for the industry

Participants had the opportunity to join:

• up to four panel discussions;
• two parallel streams: Stream#1.Legal and Stream#2.Business;
• sessions by a keynote speaker, partner of Asters, Konstantin Solyar.

As part of the main discussion “Ukraine under martial law: governmental fiscal policy and governmental initiatives for the support of the IT industry”, representatives of business, the Ministry of Digital Affairs, the Ministry of Economy and the Ministry of Defense discussed the mobilization, temporary travel abroad and exchange rate regulation issues.

The main messages of the speakers:

• The mobilization procedure should be adapted to the specifics of the work of IT companies.
• The Ministry of Economy is preparing changes to the reservation procedure in wartime conditions and is developing a new mechanism for submitting a reservation application in electronic format.
• The main risk of digitalization of the reservation procedure is ensuring the protection of personal data.
• On July 13, 2022, up to 2,000 people from the IT industry are reserved.
• A new, not related to reservation, procedure for approval of temporary travel abroad should be developed.
• Business trips abroad and offline contacts with clients are an integral part of the work of national IT companies, a prerequisite for further growth of the IT industry and an increase in foreign exchange earnings from the export of computer services to the national economy.
• Implementation perspectives of the procedure for going abroad depend on reaching a compromise on preventions against the abuse of such a procedure, such as the long history of the company’s market presence, the absence of tax arrears and timely paid taxes. The Ministry of Defense is separately considering the possibility of depositing in the amount of UAH 150 000 as a prevention to an escrow account with the funds transfer for the needs of the Armed Forces in in case of the person not returning from abroad.
• In the near future, adoption of the Cabinet of Ministers of Ukraine resolution on temporary departure is expected.
• The special legal and tax space of Diia.City, which is actively developing under martial law, already includes 283 resident companies with the total amount of 21,000 IT specialists.

The second discussion “Ukraine on the European landscape of IT hubs: ensuring competitiveness” was focused on ways to preserve the competitive advantages of the national IT industry, taking into account existing challenges and business relocation.

The main messages of the speakers were:

• It is necessary to actively work with clients and explain that the business is fully operational, despite the mobilization and other challenges.
• The main problem of mobilization is the impossibility of its forecasting, and reservation is the impossibility of controlling the status of the procedure.
• The possibility of temporary departure of IT-specialists abroad is a very important sign for foreign clients that the business is working.
• It is important to provide the possibility of traveling abroad not only for full-time employees, but also for contractors.
• The dual exchange rate introduced by the National Bank of Ukraine has a negative impact on the development of the IT sphere. Employees lose 20-25% of income on currency transactions, which stimulates the departure of specialists abroad and the outflow of income.
• It is important to compromise between the government and business in order to keep foreign currency inflows to the country.

The third discussion examined carefully the issue of intellectual property and protection of personal data under martial law. The international panel discussion “Perspectives of international partnership in the development of the IT industry” was devoted to planning and defining the integration of the Ukrainian IT industry into the global market perspectives, the specifics of working with international partners in the new military realities.

The main messages of the speakers were:

• Foreign clients and investors believe that the supply of IT services in Ukraine is now complicated due to the War. Therefore, it is necessary to qualitatively communicate to foreign partners and customers about the real state of affairs.
• 70% of workers in the IT industry are men of army recruitment age. There is a great risk associated with the mobilization of critical specialists and project managers.
• On the international market, Ukrainian IT products and services are considered as high-quality and affordable, and therefore retain competitive advantages.

During the keynote session of a speaker, the partner at Asters, the head of tax practice and co-head of private client practice, Kostyantyn Solyar, a topic of forced relocation to EU countries and possible tax consequences was highlighted. Important aspects emphasized by the speaker: 

• It is necessary to determine the concepts and approaches of taxation abroad.
• Obtaining tax resident status in each country is easy, but losing it is difficult.
• Foreign tax residency does not lead to its automatic loss in Ukraine.

IT UKRAINE LEGAL CONFERENCE 2022 became the forum for discussion of the hottest legal and business topics for the IT industry showing the unique resilience in times of War. It attracted more than 500 participants who watched the event live. The issues discussed on the Conference have a direct impact on the work of the IT industry. All the speakers were professionals with credibility. We are obtaining the positive feedback from in-house counsels and other participants, and it gives us the incentive to continue to organize this annual event which became symbolic for the IT Ukraine, as well as to arrange other events in the future,

– Kateryna Oliynyk, Vice President on Legal Affairs, IT Ukraine Association, Partner, Arzinger Law Office, attorney at law, patent attorney of Ukraine, domain dispute resolution panelist.

As part of Stream#1.Legal, our experts discussed the GIS issues in detail – contracts, mobilization and booking procedures, private entrepreneurs taxation and the use of various payment systems, personal finance, initiatives of the NBU on digitalization of the financial sector.

Stream#2.Business covered the topics of business operations under martial law, transformation of business and IT products, due diligence procedures, finding foreign financing for Ukrainian IT companies, legal and practical aspects of importing humanitarian aid, as well as the current state of the labor market in IT, salary level, current market demand for specialists.

We are sincerely thankful to our sponsors for their support: the law firms Asters, SayenkoKharenko and the Ukrainian product IT company LIGA ZAKON, as well as our information partners EmergingEurope, HappyMonday, SPEKA, IT-AssociationVinnytsia, IT DniproCommunity, Kharkiv IT Cluster, IT-clusterKhmelnytskyi, Work.ua.

Special thanks to our speakers and participants of the Conference!

See you next year!

More information about the event is available on the IT UkraineLegalConference 2022  website.

Feedback of our partners and participants:

We are grateful to IT Ukraine Association for the opportunity to join IT Ukraine Legal Conference 2022 and share legal expertise in the field of taxation and labour law. Businesses are forced to relocate, adapt their ongoing processes and strategies to the new reality. We believe that the presentations of Asters’ speakers, Partner KostyantynSolyar and Counsel Anton Sintsov, gave the guidelines on how to deal with these tasks and keep working efficiently both in Ukraine and abroad, 

– Oleksiy Uros, Asters’ Business Development Director

SayenkoKharenko law firm was glad to join IT UkraineLegalConference experts. I hope my speech was interesting and useful. Thank you for the opportunity to share our experience with colleagues, because we are all working for the benefits of our country and for the improvement of business conditions in Ukraine,

– Vitaly Odzhikovskyi, adviser, lawyer, SayenkoKharenko

The War has significantly adjusted all our plans and ideas for the near future. This applies to both business and product strategy. The IT UkraineLegalConference 2022 provided an opportunity to share our transformation story of LIGA ZAKON business and LIGA360 product.

European integration and anti-russian processes have led us to a completely new level of duediligence of existing and potential business partners, customers, and suppliers. Currently it is not enough to check the company in the Ukrainian registers. We need to observe broadly. At Liga360, we are working to add data from international registries of 140 countries around the world, sanctions lists and global media data to improve the product to the level that provides comprehensive verification of companies worldwide.

The War significantly accelerated some processes in the state, among which – the inevitable future turbulence due to the rejection of the “USSR” part of the legislation. We need to put Ukrainian business on the “European path”, accept, understand and learn to work according to new rules. The challenge for the LIGA ZAKON business and the LIGA360 product is to provide simplicity and clarity, analytical and advisory support for business to overcome turbulence and there is no doubt we will do it,

– Yevhen Kosyanchuk, LIGA360 Productmanager

The flow of orders from customers from abroad, the mobilization of male IT specialists, and a fixed exchange rate are the challenges. The consolidation of business and government to ensure efficient and, most importantly, profitable operation of the industry is the solution. Business is currently working by inertia, but if not working on changes now is about challenges turning into problems. The participants of the discussion were optimistic, and we expect that there is hope for strengthening the business-government dialogue,

– Marianna Konina, ChiefPublicEngagementOfficer, TECHIIA

I’m delighted to moderate the session of the Conference, which is dedicated to privacy and intellectual property. The full-scale War in Ukraine underlined the strategic importance of both spheres: it’s about security of Ukrainians and prospects of economic front. I hope that the currentr eforms in both spheres will be facilitated, in particular due to the prospects, which are available from EU-candidate status of Ukraine,

– Tetyana Slabko, CIPP(e), attorney-at-law (UA), PrivacyCounsel, Wargaming