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Features of Structuring NGO Activities in Ukraine
Over the past 2 years, the number of registered non-profit organizations, branches, and representative offices in Ukraine has increased significantly.
Two factors are worth noting, which include:
1) extension of the list and scope of humanitarian projects implemented in Ukraine;
2) relocation of regional offices of some international organizations.
The main reason is obvious: the ongoing war in Ukraine. Therefore, at the moment, a separate field has been formed, which requires separate legal regulation and comprehensive legal support for an NGO’s establishment and operation in Ukraine.
The implementation of humanitarian and international aid projects differs. When choosing a legal form for structuring an organization’s presence in Ukraine, the following aspects should be taken into account, in particular:
1) the organizational structure of the international organization itself;
2) the purpose and objectives of the projects, and the required means of their implementation (including sources of funding, human resources, equipment, and their availability/ability to be imported);
3) local tax, migration, and customs regulations.
As of now, several options for registering the presence of international organizations in Ukraine include establishing a charitable organization, public associations, or accreditation of a representative office.
They differ in terms of legal status, requirements for founders, governance procedures and managerial bodies, permitted spheres of activity, opportunities to hire foreign nationals, taxation, disclosure of performance results, restrictions on the use of funds, registration procedures (including amendments and liquidation), and banking operations. We have described key differences in more detail in the table below.
Charity Fund (CF) |
Public Society (NGO) |
Representative Office (RO) |
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Founders |
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At least 1 individual/legal entity. Management resembles a typical corporation, where a founder keeps full control over the organization and all decisions in Ukraine (outside the authority of management bodies) shall be approved by the founder.
Types:
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Organization | Association |
The “founder” of the representative offices is an international NGO. Such a representative office is accredited in Ukraine and does not have the status of a legal entity. The representative office carries out activities on the territory of Ukraine on behalf of an INGO. |
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Only for individuals. At least 2 individuals are required (who are residing legally in Ukraine, therefore Ukrainian citizens are recommended) Usually, the management is carried out by active members (not founders) of an NGO. |
At least 2 private entities (created and operating based on incorporation documents) are required.
Individuals, other legal entities may become members. |
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Management |
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Founders retain control over the key decisions for operations (like appointment of officials, disposition of assets).
In the case of a charitable institution – founders do not participate in the management of its activity. Legally defined managerial bodies are as follows:
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The names of the founders remain in the Registry of legal entities, and they lose their powers from the moment of state registration. After the registration is completed, the Meeting of members becomes a supreme management body. Incorporation documents define other management bodies such as Executive, Supervisory ones etc. |
The activities of the representative office are fully controlled by an INGO and its managerial bodies. The representative office cannot make decisions at its own discretion. An executive body of the representative office (usually a director) appointed by the NGO, acts exclusively on the basis of and in accordance with the power of attorney issued by the NGO. The country director is a body that manages the current activities of the representative office based on the power of attorney. The Ministry of Justice of Ukraine controls the validity of the power of attorney. |
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PERMITTed activities |
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Any type of activity like provision of services, assets, goods, accommodation etc. for free without a commercial purpose, for the benefit of the beneficiaries. Aims/goals of activities shall be defined in the incorporation document. It may carry out its business activity (provide services) and use the gains ONLY to cover the costs of the CF’s activity/fund transfer to the beneficiaries. All funds shall be recorded properly and reported either as a charitable activity or administrative costs. The distribution of dividends is not allowed. |
Any type of activity like provision of services, assets, goods, accommodation etc. for free without a commercial purpose. Aims/goals of activities shall be defined in an incorporation document. It may carry out its business activity (provide services) and use the gains only to cover costs of the NGO’s activity. The distribution of dividends is not allowed. Can be founders of legal entities. |
The representative office (branch, division) represents the interests of the NGO in Ukraine, which includes researching, participating in the meetings, tenders, signing contracts and providing services on behalf of the organization, this is not a separate (an independent legal entity), therefore the RO is not allowed to receive any costs except from the NGO that shall be used only to cover its activities. | ||
Foreigners |
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If an organization is included in the list of Volunteer Organizations, foreigners can be invited by such an organization as volunteers and they can get an immigration visa (type D) as well as a temporary residence permit (for 1 year) as invited volunteers. In the case of labor relations with foreign nationals, a work permit is needed (can be issued for up to 2 years), which is the ground for immigration visa (type D) and temporary residence permit (for the same period as the work permit). | If an organization is on the list of the Volunteer Organizations, foreigners can be invited by such an organization as volunteers and they can get an immigration visa (type D) and a temporary residence permit (for 1 year) as invited volunteers. In the case of labor relations with foreign nationals, a work permit is required (which can be issued for up to 2 years), which is the ground for the immigration visa (type D) and the temporary residence permit (for the same period as the work permit). | ROs are allowed to invite foreign citizens to participate in the RO’s work in Ukraine. A work permit is not required, an immigration visa (type D) and a temporary residence permit (for 1 year) can be received on the grounds of such an invitation. | ||
Taxes |
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Non-profit status. Grants/aid and services/goods delivered to the beneficiaries for free are exempt from VAT. In other cases, VAT can be applied. In case the costs limit is not observed or the costs of the organization do not relate to the principal non-profit activity, the organization loses its non-profit status and general tax rules are applied (18% net profit tax, 20% VAT). |
Non-profit status. Grants/aid and services/goods delivered to the beneficiaries for free are exempt from VAT. |
The representative office cannot obtain non-profit status because it is not a legal entity. It is necessary to register as a taxpayer in the State Tax Service of Ukraine according to Art. 64.5 of the Tax Code of Ukraine. The representative office is registered at the Tax office in Ukraine simultaneously with the HQ. |
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Cost limits |
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Administrative costs (salaries to regular workers, leasing of premises etc. that are not directly connected to statutory charity activity) shall not exceed 20% of annual turnover. The remaining costs shall relate to primary activity, i.e. charity. | The costs shall be used to cover the expenses for the maintenance of such a non-profit organization, fulfillment of the purpose (goals, tasks) of its activity determined by its incorporation documents. | Costs may be received exclusively from the HQ as representative offices are not permitted to perform business activity. The costs shall be used to cover the expenses of the RO in Ukraine. | ||
Public reporting |
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The information about the structure, amount of income and expenses of charitable organizations, as well as the terms of using their assets for charitable activities, is not confidential information or a trade secret. The reporting of such organizations may contain information about the identity of benefactors or beneficiaries (subject to the consent of benefactors, beneficiaries or their successors or legal representatives), unless otherwise determined by legislation. In the event of a donation process held by the organization taking place, the public announcement of the results of the respective fundraising and use of the costs may be required. |
According to the laws of Ukraine, the information on founders, members of managerial bodies, authorized representatives and ultimate beneficial owners shall not be treated as confidential and subject to disclosure upon receipt of a relevant request. Annual financial reports shall be prepared with detailed analysis of profits and losses.
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There are no special requirements in Ukraine. | ||
Registration |
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Registration by notaries and Public Registrars, takes 2-3 business days. Documents required for the registration are as follows:
All the above-mentioned documents shall be verified by a notary with the Apostille, the translation of those documents is to be submitted for registration;
Documents required in Ukraine:
No state fee, costs for the translation of documents and services of the notary are involved. After the registration is completed, the public organization may apply to a tax office to receive non-profit status and to be included in the list of Volunteer organizations. |
To be registered by Public Registrars (the Ministry of Justice of Ukraine), takes 2-3 business days. Documents required for the registration (from each founder-legal entity) are as follows:
All the above-mentioned documents shall be verified by notary with the Apostille, the translation of those documents to be submitted for registration. Documents required in Ukraine:
No state fee, costs for the translation of documents and services of the notary are involved. After the registration is completed, the public organization may apply to a tax office to get non-profit status and to be included in the list of Volunteer organizations. |
To be registered by Public Registrars (the Ministry of Justice of Ukraine). Terms of registration is 20 business days. The documents required for the registration are as follows: – Decision (Minutes) of the competent Management body of an INGO to create a branch/representative office in Ukraine); – Extract from the Commercial Registry; – Copy of the INGO’s incorporation documents; – Incorporation documents of the Representative office; – Power of attorney to the Head of the representative office; – Power of attorney to a lawyer (to represent the INGO’s interest in the registration process in Ukraine; if the head will take care of the registration process that document will not be required); All the above-mentioned documents shall be verified by a notary with Apostille, translation of those documents to be submitted for the registration. – A registration form and the legal ownership structure (in case of a UBO – a copy of his/her passport), signed by the Head. No state fee, costs for the translation of documents and services of the notary are involved. After the Representative Office is registered, the NGO and the Representative Office shall be registered by the local Tax office. |
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procedure for Taking decisions on INTRODUCING changes |
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A supreme managerial body (usually the General Meeting of members) adopts decisions on introducing changes to the information about the charity fund. Such decisions are expressed in writing, and formalized by the Minutes. The director submits documents to the registrar (usually a notary) for the state registration of changes. Changes are registered within 24 hours. Members of the charity fund can be represented at the General Meeting via proxy. |
A supreme managerial body (usually the General Meeting of members) makes decisions on introducing changes to the information about the NGO. Such a decision is expressed in writing, and formalized by the Minutes. The director submits documents to the registrar for the state registration of changes. (Such changes are registered only by public registrars – territorial bodies of the Ministry of Justice of Ukraine). The terms of registration of changes are within 3 business days. The members shall sign the Minutes in person. |
The NGO makes decisions on introducing changes to the information about the Representative Office in Ukraine. Such a decision is expressed in writing, and formalized in the Minutes, verified by a notary and apostilled. The director of the Representative Office submits documents to the registrar of the Ministry of Justice of Ukraine for the state registration of changes. Changes are registered within 20 business days. |
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liquidation procedure |
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A supreme managerial body (usually the General Meeting of members) decides on the voluntary termination of the charitable fund activity at any time. Such a decision is expressed in writing, and formalized by the Minutes (can be signed by a person by proxy). A liquidator submits this to the registrar (a notary public). The record of the members’ decision on liquidations of the charitable fund is made within 24 hours. This stage is followed by verifications by state bodies, transfer of documents to an archive, obtaining an archival certificate and the registration of the liquidation of the charitable fund (final stage). The assets of the charitable organization that remain after the liquidation procedure shall be transferred either to the accounts of other charitable funds or to the state budget of Ukraine. Such procedure is not legally restricted, and usually lasts for at least 2 months. |
A supreme governing body (usually the general meeting of members decides on the voluntary termination of activity of a public organization through self-dissolution at any time. Such a decision is expressed in writing, and formalized by the Minutes. The members shall personally sign these Minutes. A liquidator submits respective documents to the Ministry of Justice of Ukraine. The record of the members’ decision on NGO liquidations shall be made within 3 working days. Assets remained after the liquidation procedure shall be transferred to the proper organization in accordance with incorporation documents. This stage is followed by state bodies (Tax office) verifications, transferring documents to an archive, obtaining an archival certificate and the registration of the NGO’s liquidation (final stage). Such procedure is not legally restricted, and usually lasts for at least 2 months. |
An NGO makes a decision on termination of the Representative Office’s activity in Ukraine, which shall be notarized and apostilled. The appointed liquidator submits the documents to the registrar of the Ministry of Justice of Ukraine for state registration of the termination. This stage is followed by inspections (by the Tax office) along with verification by state bodies, transfer of documents to an archive, the deregistration of the representative office in all state registrars. Such procedure is not legally restricted, and usually lasts for at least 3 months. |
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Bank transactions |
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A charitable fund can open bank accounts to receive funds and run up expenses.
Thus, charity funds can receive on their accounts:
Charitable funds can perform expenditure operations within the limits of their statutory activities (defined by statutory documents) and make payments for administrative expenses in the amount of 20% per year of all income (wages, rent, etc.). |
An NGO can open bank accounts to receive funds/make expenses. The law does not provide restrictions on limits for administrative expenses for the NGO. Restrictions on receiving income do not exist. The organization is allowed to perform the business activity that will help to achieve the constitutional goals of the organization). Donations, member contributions are also permitted. The costs incurred by the organization shall be related to its activity and achievement of the constitutional goals of the organization.
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A Representative Office can open bank accounts to receive funds and make expenses related to the functioning of such a representative office in Ukraine. As the transactions shall be associated exclusively with the functioning of the representative office in Ukraine, incoming costs are only allowed from the NGO itself. |
We can see that NGO structuring forms in Ukraine vary greatly, which can have a decisive impact on the success of projects and the achievement of their goals. Therefore, prior to registration, it is necessary to analyze the organization’s request in detail and carry out thorough preparatory work. It will enable setting up administrative processes efficiently from the very beginning and focus on the main objectives of the NGO.
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Tetiana Yashchenko
PhD, Partner, EXPATPRO Law Firm
Tetiana Yashchenko specializes in corporate law and business administration.
Head of Corporate BA, Accountancy. Tetiana deals with most issues related to employment, work permits for foreigners in Ukraine. She specializes in legal consulting on mergers and acquisitions, business registration, reorganization and structuring (both internal and international) as well as providing legal support for the current business activity of clients in Ukraine (specifically for the Digital and IT sphere).
Tetiana Yashchenko graduated from Taras Shevchenko National University of Kyiv; Law department; Master of Law, Ph.D. in Law.

Address:
48 Vozdvyzhenska Street, Office 7,
Kyiv, 04071, Ukraine,
Tel.: +380 44 339 9881
E-mail: welcome@expatpro.co
Web-site: www.expatpro.co
EXPATPRO is a leading boutique law firm in Kyiv that focuses on immigration to Ukraine and offers personalized, top quality legal services for expats. Our clients are foreign individuals, businesses and investors pursuing business, employment or personal opportunities in Ukraine. Through comprehensive knowledge of legal, political and business areas, our migration experts will walk you through the jungle of Ukrainian law.
Our team provides professional legal solutions on how to relocate, and reside, and how to start your own business in Ukraine in the readiest way, the applicable Ukrainian legislation. We strive for close communication and cooperation with our clients and continue to support them in their daily business activities and if their needs in Ukraine evolve. Whether you are considering relocating to Ukraine, starting a business there, or simply seeking advice on a work permit, visa, and residency issues, or have other expat-related legal needs, you can count on EXPATPRO.
In addition to immigration and corporate law, EXPATPRO’s practice areas include Ukrainian employment law, legal support for business, real estate due diligence and transactions, dispute resolution and litigation. So, whether you are an employer or employee who needs legal support in Ukraine, a real estate investor who is looking into options in Kyiv, or you have a private or business matter and need court advocacy in Ukraine, EXPATPRO looks forward to assisting you.