Miller Magazine Issue: 121 January 2020

76 ARTICLE MILLER / JANUARY 2020 an annual income limit of up to 5,000,000 UAH. NON-RESIDENT’S PROFIT Dividends shall be distributed from net profit of the company following payment of all mandatory taxes and fees to the budget. While paying dividends in favour of non-residents, LLC shall withhold repatriation tax from non-resident‘s in- come (i.e. tax on non-resident’s income originated from Ukraine). The overall rate shall make up 15%, unless otherwise provided by applicable international double taxation agreements. Despite commencement of currency liberalization, Ukraine still has some restrictions on paying dividends in favour of foreign investors. In particular, currently the National Bank of Ukraine allows purchase/remittance of foreign currency for the purpose of returning divi- dends abroad to a foreign investor for the period till 2018 (inclusive) and within the aggregate amount not exceeding EUR 12,000,000. RESTRICTIONS FOR NON-RESIDENTS Despite the regime, being the same as for the Ukraini- an citizens, in Ukraine there are still left some restrictions for non-residents, for example: foreigners are not entitled to acquire agricultural lands as ownership (an alternative variant may be long-term lease). POSITIVE CHANGES IN CORPORATE LEGISLATION On June 17, 2018, the new Law of Ukraine “On Limit- ed and Additional Liability Companies” entered into force, which is a very long-expected for Ukraine. The new Law re- placed outdated and complex previous legislation and elim- inated the controversial aspects of previous legislation. Im- perative norms (e.g. procedure for convening and holding a general meeting, thresholds of voting, etc.) was replaced by permissive norms, by which doing business became easier. Besides, now founders have opportunity to enter into shareholders’ agreements which are regulated and pro- tected by the legislation of Ukraine. Institution of share- holders’ agreements is well known in the countries of Anglo-Saxon law system, but was almost never used in Ukraine before under the laws of Ukraine. CURRENCY LIBERALIZATION On February 7, 2019, the new law “On Currency and Currency Operations” entered into force, which re- placed the strict currency regulation of previous years. This law is the first step in the course of Ukraine’s cur- rency liberalization and eventually should lead to remov- al of currency restrictions and the simplification of cur- rency transactions.