Despite the fourth year of the ongoing russian full-scale invasion, Ukraine’s dispute resolution institutions continue to consider commercial disputes involving international businesses:

1. International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry registered 373 cases in 2022, 584 in 2023 and 453 in 2024.
2. Commercial courts resolved 164 thousand cases in 2022, 230 thousand cases in 2023, and 190 thousand cases in 2024.

In these circumstances, and with hopes for post-war resilience, Ukraine is moving to modernize and expand its arbitration framework.

On 21 October 2024, draft law No. 12141, expanding the scope of international arbitration as a dispute resolution procedure was registered. The draft law aims to expand the competence of international commercial arbitration, bringing Ukraine closer to international standards, improving the country’s legal system as an arbitration-friendly jurisdiction, and developing Ukraine as a venue for investment arbitration.

On 30 April 2025, the draft law was adopted in its first reading, and on 13 June 2025, the Parliamentary Committee on Legal Policy reviewed it, recommending the updated version for the second and final legislative reading.

The draft law received 37 proposals and amendments before the second reading. Following the reading, the Committee supplemented the draft with various amendments pertaining to, in particular:

1. Expanding the jurisdiction in private disputes. Disputes arising from contractual and other civil legal relations in the course of foreign trade and other types of international economic activity may be referred to international commercial arbitration by party agreement, not only where the place of business of at least one of the parties to the dispute is located abroad, but also if the parties have expressly agreed that the subject matter of the arbitration agreement is connected with more than one country or one of the following places is outside of the state where the parties’ place of business is located:
   a. the place of arbitration, if specified in the arbitration agreement or in accordance with it;
   b. any place where a significant part of the obligations arising from contractual or other civil law relations is to be performed;
   c. the place with which the subject matter of the dispute is most closely connected.
2. Covering the jurisdiction in investor-state disputes.Investment disputes are to be considered and disposed of via international commercial arbitration, including disputes involving an investor and a state (its bodies and institutions) or an intergovernmental organisation in connection with investment activity in Ukraine or another state arising out of an international agreement, a law of Ukraine, or other regulatory legal act or party agreement contained in a contract or other document. As a result, Ukraine will become a seat of investment proceedings for both investor disputes involving Ukraine and investor disputes with other countries.
3. Functioning foreign arbitration institutions in Ukraine. The dispute resolution function can be carried out not only by permanent arbitration institutions – the International Commercial Arbitration Court or the Maritime Arbitration Commission at the Ukrainian Chamber of Commerce and Industry but also by branches (representative offices) of foreign arbitration institutions formally registered in accordance with Ukrainian law.

We expect that the draft law may be adopted shortly. The legislative initiative could open the Ukrainian market to internationally recognised arbitral institutions and is expected to bolster the efficiency of the legal infrastructure, facilitating cross-border dispute resolution and helping to build investor trust. However, only time and the outcome of the war will show whether the necessary legislative framework alone has attracted foreign arbitral institutions to operate in Ukraine.

By Yaroslav Brych and Daria Shylova