Ukraine’s new PPP law No. 4510-IX explained: parties, tender, contract and investor protection

Ukraine’s parliament adopted the Law “On Public-Private Partnership” No. 4510-IX on 19 June 2025. It entered into force on 31 October 2025, three months after its publication, as Section XI, item 1 provides. A few provisions listed in that same item have their own dates; some of them already applied from 1 August 2025.

The name changed as well. The previous law spoke of “state-private” partnership; the new one says “public-private”, because a business can partner not only with the state but also with a local community or a public-sector company (Art. 10(2)). The 2010 law No. 2404-VI ceased to have effect on the day the new law entered into force (Section XI, item 2).

• Only the public partner may initiate and prepare a project (Art. 10(1)).
• The private partner is always selected through a competition: a restricted tender, an open tender or a competitive dialogue (Art. 13).
• There are two forms of PPP: a concession contract and a PPP contract (Art. 5(1)).
• Public procurement legislation does not apply to selecting the private partner, performing the PPP contract or providing PPP support (Art. 2(3)).
• The contract is signed by a legal entity set up specifically for the project (Art. 1(1)(25)).

The law defines a PPP as cooperation between a public partner and a private partner, carried out on the basis of a contract and meeting the features set out in Article 3 (Art. 1(1)(32)). There are three features:

• the private partner invests: it fully or partly finances, builds or reconstructs the asset and maintains it;
• the partnership is long-term, except for housing construction projects, which may run for less than five years;
• part of the risks of financing, construction, maintenance or operation passes to the private partner.

The practical consequence: every investment project that has these features must follow this law (Art. 3(1)). PPP relations are governed exclusively by it, and by other laws only where it says so (Art. 2(2)).

The law does not limit PPP to a closed list of sectors: it may be used “in all spheres” (Art. 4(1)). Examples include heat and gas supply, transport and infrastructure, water supply and sewerage, healthcare, waste management, electricity, social services, housing (including modular and temporary housing), education and science, electronic communications, IT and cybersecurity. PPP cannot be used where a law expressly restricts or prohibits it (Art. 4(2)).

A PPP contract has two sides: the public partner (or several, if they take part jointly) and the private partner. The law states that the parties have equal rights (Art. 33(1)).

Who acts as the public partner depends on whose property becomes the PPP asset (Art. 10(2)):

• state property — the state, represented by the bodies that manage it, or the Cabinet of Ministers (or a body it authorises) where no such body is designated;
• municipal property — the territorial community of a village, town or city, represented by its council or the council’s executive body (on the council’s decision), as well as district and regional councils;
• property of public-sector companies — the company itself, by decision of its authorised body;
• assets that do not exist yet and must be built — the body that will make payments to the private partner or acquire ownership of the asset.

The private partner is a legal entity created specifically and exclusively to carry out a particular PPP project (Art. 1(1)(25)) — in practice, a project company. Until Ukraine becomes an EU member, that company must be a resident of Ukraine (Section X, item 4). The wording “a resident of Ukraine or of an EU member state” takes effect only from the day Ukraine joins the European Union (Section XI, item 1(4)).

Bidding is open more widely: an applicant may be an individual or a legal entity, resident or non-resident, or a consortium of such persons (Art. 1(1)(24)).

Only the public side can. Article 10(1) leaves no room for doubt: preparation of a PPP project is carried out exclusively on the initiative of the public partner. The new law has no procedure under which a company brings its own proposal to the state or a community and gains an advantage in the tender for it.

So what can an investor do? Watch what public partners publish. They may approve lists of PPP projects and post them on their websites, and they must publish information on their official website about every project for which a concept note is being prepared (Art. 10(2)). The next entry point is the tender announcement (Art. 17).

Transitional rules cover projects that private parties started preparing under the old law where no decision had been taken yet: preparation is completed and the decision is taken under the legislation in force when preparation began, while the tender, the selection of the private partner and the signing of the contract follow the new law’s procedures (Section X, item 1(2)).

Preparation runs in two stages (Art. 10(3)). First, the public partner prepares a concept note on the PPP. Its review must establish that the project is economically justified, potentially commercially viable and can be delivered as a PPP (Art. 10(4)). If the conclusion is positive, a decision is taken to prepare a feasibility study — the second stage.

Projects with an expected value below the equivalent of EUR 5,538,000 (“below-threshold” projects, Art. 1(1)(28)) are prepared in a single stage.

The feasibility study is the basis for an efficiency analysis (Art. 11). It covers the financial model, social and environmental effects, fiscal impact, risks, the form and term of the partnership, and a comparison of the project with and without a private partner. The conclusion is published on the web portal of the Authorised Body for Public Procurement (Art. 11(6)).

1. Concept note and its review (Art. 10).
2. Feasibility study and efficiency analysis (Art. 11).
3. Decision to implement the PPP, or that it is not expedient — within 90 calendar days of submission of the feasibility study; a local council takes it no later than its first session after that period (Art. 12(2)).
4. Competition to select the private partner (Section IV).
5. Completion of the competition, negotiations with the winner and signing of the PPP contract (Arts. 28 and 32).

Once the decision to implement a PPP is taken, the future PPP asset is effectively frozen: without the public partner’s consent, the entity holding it on its balance sheet may not dispose of it, lease it, pledge it or write it off, and such transactions without consent are void. These restrictions last two years from the decision and may be extended (Art. 12(4)).

The private partner is selected competitively through one of three procedures: a restricted tender, an open tender or a competitive dialogue (Art. 13(1)). The detailed procedure is approved by the Cabinet of Ministers (Art. 13(2)).

A bid has two parts, technical and financial-commercial (Art. 20(1)). The winner is the participant whose bid meets all requirements of the tender documents and is found to be the most economically advantageous (Art. 1(1)(16) and (19)).

Results can be challenged. Article 29 provides for appeals under the procedure of the Law “On Public Procurement”, with the Antimonopoly Committee as the review body. However, Article 29(1) enters into force 12 months after the law itself (Section XI, item 1(2)). Until then, tender disputes go to court, with filing deadlines that are mostly 30 calendar days (Section X, item 3).

The contract may not be signed before the deadline for challenging the evaluation results has passed (Art. 32(1)). Within three working days of signing, the public partner sends a copy to the authorised body and publishes the non-confidential part on the web portal of the Authorised Body for Public Procurement (Art. 32(3)).

The law names two forms: a concession contract and a PPP contract (Art. 5(1)). Under a PPP contract the private partner takes on financing (full or partial), construction or reconstruction and maintenance of the asset, with or without the right to operate it or provide services (Art. 1(1)(6)). All or most of its income comes from payments made as PPP support, such as availability payments, which largely depend on its performance or on demand for the services (Art. 5(2)). Mixed contracts combining elements of different contracts are allowed.

The law sets no fixed minimum or maximum term. The term is set for each project at the feasibility-study stage, taking into account the time needed for construction, maintenance, operation and recovery of the investment (Art. 9(1)). It may be suspended, for example because of force majeure, but for no more than five years in total (Art. 9(3)).

• Handing an existing asset to the private partner does not transfer ownership: it remains state, municipal or public-sector company property (Art. 6(3)).
• New real estate built under the contract also belongs to the public side as a rule (Art. 6(4)). Movable property the private partner buys with its own or borrowed funds belongs to it, unless the contract or the law provides otherwise (Art. 6(7)).
• PPP assets may not be privatised or otherwise disposed of during project preparation and for the whole contract term (Art. 6(11)).
• Land is granted to the private partner for use (lease) for the term of the contract under the Land Code (Art. 7(1)).
• The asset is returned to the public partner no later than the last day of the PPP term, except in housing construction projects (Art. 6(12)).

A PPP may be financed with the private partner’s own and borrowed funds, state and local budget funds and funds of public-sector entities, grants, and other sources not prohibited by law (Art. 8).

Concessions have not gone away: the concession contract is one of the two PPP forms (Art. 5(1)), and the Law “On Concession” No. 155-IX remains in force. Law 4510-IX amended it (Section XI, item 3(29)). Among the changes is the same rule as for PPP: preparation of a concession project is carried out exclusively on the initiative of the grantor.

The private partner selection rules of Section IV of the new law also apply to selecting a concessionaire where the concession support in the project equals or exceeds the equivalent of EUR 5,538,000 (Art. 5(3)). The law does not apply to production sharing agreements, which have their own law (Art. 5(4)).

The 2010 law No. 2404-VI ceased to have effect on the day the new law entered into force, 31 October 2025 (Section XI, item 2). Section X sets transitional rules for projects already under way:

• contracts signed before the new law entered into force remain valid until the end of their own term (Section X, item 1(3));
• where the decision to implement the partnership was taken before 31 October 2025, the new private partner selection procedure does not apply to that project, except Article 19(2) (Section X, item 1(1));
• tenders launched before the new law entered into force are completed under the procedure they started with; if the bid deadline had not passed by 31 October 2025, the draft contracts are brought into line with the new law (same provision).

Terminology was updated in other acts too. For example, in the Land Code the words for “state partner” were replaced with “public partner” (Section XI, item 3(1)).

The law contains several mechanisms that investors and lenders usually look at first. This is what it says expressly:

• Governing law. The PPP contract is governed by Ukrainian law. For financing agreements, direct agreements and grant agreements the parties may choose another law, unless Ukrainian legislation provides otherwise (Art. 41).
• Arbitration. The dispute mechanism is set in the tender documents and the contract: mediation, expert determination, national or international commercial or investment arbitration. The seat may be abroad if the private partner or its founder is an enterprise with foreign investment (Art. 42(2)).
• Sovereign immunity. At the request of the private partner or a lender, the public partner may waive sovereign immunity; for projects involving state property or property of public-sector companies, with the consent of the Cabinet of Ministers (Art. 42(3)).
• Stabilisation. For the term of the contract, the legislation in force on the date it was signed applies to it: this law, the acts adopted under it and part of the tax rules. The exception is changes that do not worsen the private partner’s position, such as lower taxes or softer liability: these apply from the day they take effect (Art. 44(3)).
• Martial law. While martial law is in effect, restricting payments to the private partner made as state support is prohibited (Art. 44(1)).
• Early termination. The public partner compensates economically justified investments not yet recovered and/or the value of the asset and, depending on the grounds for termination, damages (Art. 44(5)).
• Support. The state or a community may provide state or local guarantees, co-financing, availability payments, a demand guarantee, a grant and other forms provided by law (Art. 43(1)).
• Lenders. A direct agreement with lenders is possible (Art. 1(1)(30)); property rights under the contract may be pledged with the public partner’s consent (Art. 6(6)); and where financing is raised, the contract may allow replacement of the private partner, including at a lender’s request (Art. 39).

Reconstruction projects get a separate regime. During martial law and for seven years after it ends, a simplified preparation procedure applies to projects included in the state or local lists of PPP projects for the recovery of infrastructure and the economy (Section X, item 2).