Law of Ukraine

"On Amendments to Certain Legislative Acts of Ukraine to Simplify the Procedure for State Registration of Termination of Entrepreneurial Activity of Natural Persons Entrepreneurs Using the Declarative Principle"

Date of entry into force:
July 7, 2014

The Law envisages considerable simplification of procedures used during termination of entrepreneurial activity of natural persons entrepreneurs.

The Law amends Article 166-6 of the Code of Ukraine on Administrative Offences to exclude part 7, which established administrative liability for violating the procedure of terminating entrepreneurial activity of a natural person entrepreneur (fine of UAH 1,020 to UAH 1,360 paid by the natural person entrepreneur).

According to the new version of Article 59 of the Economic Code of Ukraine, termination of a business entity is carried out according to law.

The Law amends the Economic Code of Ukraine to exclude Articles 60 and 61, which established:
  • the general procedure for liquidating a business entity;
  • the procedure for settlement with creditors in case of a business entity liquidation.

The Law amends the Civil Code of Ukraine to exclude Article 50-1, which determined the obligations of a natural person entrepreneur pertaining to liabilities related to termination of their entrepreneurial activity.

The new version of Article 47 of the Law of Ukraine "On State Registration of Legal Entities of Natural Persons Entrepreneurs" establishes the following:
  • to carry out state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision, the natural person entrepreneur or their authorized person submits (sends) a registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision, to the state registrar;
  • a registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision is received as per checklist; a copy of the checklist is issued (sent by mail with a list of enclosures) to the applicant on the day of document receipt, with a note of such document receipt
  • the date of receipt of the registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision is noted in the registration activity log;
  • the state registrar leaves the registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision without consideration if: 1) the registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision was submitted at the incorrect place of state registration of termination of entrepreneurial activity by a natural person entrepreneur; 2) the registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision does not satisfy the requirements of the Law of Ukraine "On State Registration of Legal Entities and Natural Persons Entrepreneurs";
  • if a registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision is left without consideration, the state registrar issues (sends by mail with a list of enclosures) an appropriate notice to the applicant, on the day of document receipt, stating the reasons why the document was left without consideration and enclosing the original document;
  • if there are no reasons to leave a registration card for state registration of termination of entrepreneurial activity by a natural person entrepreneur by own decision without consideration, the state registrar must make an entry to the Single State Register about state registration of termination of entrepreneurial activity by a natural person entrepreneur, no later than the working day following the receipt of the document, and, on the same day, issue (send by mail with a list of enclosures) a notification about such entry to the applicant.

Amendments to Article 49 of the Law of Ukraine "On State Registration of Legal Entities and Natural Persons Entrepreneurs" clarifies the procedure for state registration of termination of entrepreneurial activity of a natural person entrepreneur by a court ruling not related to bankruptcy of the natural person entrepreneur.

The Law amends the Law of Ukraine "On State Registration of Legal Entities and Natural Persons Entrepreneurs" to exclude Article 49-1, which establishes the order for simplified state registration of termination of entrepreneurial activity of a natural person entrepreneur by the state registrar.

The Law amends Article 50 of the Law of Ukraine "On State Registration of Legal Entities and Natural Persons Entrepreneurs", which determines the procedure for state registration of termination of entrepreneurial activity of a natural person entrepreneur by a court ruling that declares the natural person entrepreneur bankrupt.

According to the Law, de-registration of an insurer is carried out by territorial bodies of the Pension Fund, on the basis of the registration card data provided by the state registrar; de-registration of insurers who are natural persons entrepreneurs, on the basis of the registration card data provided by the state registrar, following inspections of the insurer provided for by the legislation, and final settlement of accounts; de-registration of insurers not subject to the Law of Ukraine "On State Registration of Legal Entities and Natural Persons Entrepreneurs", on the basis of their application, following inspections of the insurer provided for by the legislation, account reconciliation, and final settlement of accounts (amended Article 15, part 6 of the Law of Ukraine "On Mandatory State Pension Insurance").

The Law amends Article 5, 6, and 9 of the Law of Ukraine "On Collection and Registration of the Single Contribution for Mandatory State Social Insurance" as follows:
  • de-registration of payers of the single contribution who are natural persons entrepreneurs is carried out on the basis of the registration card data provided by the state registrar, following inspections of the payers provided for by the legislation, and final settlement of accounts;
  • if reports are sent by mail, they is considered submitted on the day when the postal service department receives the post package containing the reports from the payer of the single contribution;
  • in case of state registration of termination of entrepreneurial activity of a natural person entrepreneur, such natural person exercises the rights, fulfills obligations and bears liability provided for the payer of the single contribution in the part pertaining to the activity they carried out as a natural person entrepreneur;
  • in case of state registration of termination of entrepreneurial activity of a natural person entrepreneur, the last reporting period is the period beginning on the last day of the previous reporting period and ending on the day of state registration of termination of entrepreneurial activity of such natural person.

Amendments to the Law of Ukraine "On Restoring the Solvency of a Debtor or Declaring Them Bankrupt" clarify the provisions on restoring the solvency of a natural person entrepreneur or declaring them bankrupt.

According to amended Article 1 of the Law of Ukraine "On Restoring the Solvency of a Debtor or Declaring Them Bankrupt", a debtor is a legal person entrepreneur, or a natural person, with liabilities that a natural person incurred in relation with entrepreneurial activity, that is unable to meet their monetary liabilities within three months after their due date, as confirmed by a court ruling that took legal effect and a resolution to open executive proceedings, unless otherwise provided for by this law.

The Law amends Article 91 of the Law of Ukraine "On Restoring the Solvency of a Debtor or Declaring Them Bankrupt" to exclude part 9, according to which state registration of a natural person as a private entrepreneur becomes void once an economic court passes a ruling to declare a natural person entrepreneur bankrupt and to initiate the liquidation procedure; licenses to carry out certain types of entrepreneurial activity issued to such natural person are also annulled

According to new part 11 of the Article 91 of the Law of Ukraine "On Restoring the Solvency of a Debtor or Declaring Them Bankrupt", if the Single State Register of Legal Entities and Natural Persons Entrepreneurs contains no information about termination of the debtor's entrepreneurial activity, an economic court makes a ruling to terminate the debtor's entrepreneurial activity after the completion of the liquidation procedure.
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