VENTURE CAPITAL INVESTMENT AND CIVIL LAW: CHALLENGING FOR UKRAINE IN AN INTERNATIONAL PERSPECTIVE

Abstract

The sudden Russian attack in 2022 dramatically affected many facets of the Ukrainian economy as well as the global economy, prompting worry that the war would stop flows of venture capital. Today Ukraine is not only fighting for freedom. Ukraine continues to implement an ambitious reform agenda and look for ways to support investment into our economy. It is important time for economic of innovations and venture investment in Ukraine. To support this, the Ukraine Redevelopment and Recovery plan that was initiated by the Ukrainian Venture Capital and Private Equity Association (UVCA). This plan aims to open the Ukrainian venture capital (VC) market to investors from all sectors and countries of the world who are supporting Ukraine and actively joining projects for the Ukrainian development. It is expected to lay the foundation of the framework of the legal regime fostering fast recovery and economic growth after the war reconstruction. Given the scale of Ukraine’s losses, it`s obvious that Ukraine needs additional help aside from macroeconomic support, among that – joint investments initiated by the private sector in Ukraine. The highly-developed market of VC investment might be critical to the country’s recovery and transformation. The issue of how the correlation between the legal framework that helps attract finance into Ukraine and its leakage out of the country under the current circumstances and previous obstacles to VC investments is an important one, and difficult to regulate. In context of recent legal reforms in Ukraine, our focus on legal framework of VC Investments in the economy of recovery and reconstruction. A vast body of research has been carried out to investigate the legal factors which are conducive to VC Investments, and that may better explain the differences in the degree of development and performance of VC transactions around the world. However, there has only been a limited effort in the legal literature to systematize what is known about the institutional factors that spur VC Investments in Ukraine. This paper tries to close that gap by providing useful legal and actionable insights that might assist to raise VC Investments through understanding current tendency of VC deals in the UK. The base is the empirical research of the existing literature on the institutional and related determinants of VC in the UK. The aim of this paper is also to propose interesting avenues for future research on the VC investment process in Ukraine with an outline of how venture deals can be structured. The article also determines the peculiarities and obstacles of applying the common law to VC Investments under domestic legislation.