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Ukraine will allow the issuance of "green" bonds

Ukraine / Business and Finance

The Verkhovna Rada Chancellery has registered a bill that provides for the introduction of "green" bonds in Ukraine.

Ukraine will allow the issuance of "green" bonds

The Parliament of Ukraine has registered the bill No. 2284 dated October 17, 2019, which provides for the introduction of green bonds in Ukraine and the establishment of rules for participants in this market.

Certain provisions of the draft law concerning the legal framework for issuing green bonds in Ukraine have been developed by the State Energy Efficiency Agency in cooperation with experts from the GIZ project "Consulting enterprises on energy efficiency" and the National Commission on Securities and Stock Market.

In particular, Article 22 of the draft law provides:

  • the concept of "green" bonds and environmentally friendly projects (with the definition of specific areas to which funds raised from the issue of such bonds can be directed);
  • circle of green bond issuers (with the definition of a legal regime for those who implement or finance green projects);
  • principles of information disclosure by issuers, reporting procedures and use of proceeds that will be attracted from investors to finance and /or refinance costs of environmentally friendly projects;
  • protecting the rights of investors who invest in green bonds.

As world practice shows, the launch of the green bond market gives countries access to a large pool of investors and contributes to the fulfillment of goals and international commitments in clean energy, energy efficiency and the environment in general.

In order to stimulate the development of such a market in Ukraine and increase its investment attractiveness, State Energy Efficiency has also prepared a draft order of the Cabinet of Ministers of Ukraine "On Approval of the Concept for the Implementation of the Green Bond Market in Ukraine and Approval of an Action Plan for its Implementation", is being worked out with the Ministry of Energy and Environmental Protection environment of Ukraine.

In particular, the draft act defines the conceptual vision of the organization and development of the market for "green" bonds in Ukraine, and also provides grounds for the development of other regulatory legal acts in this area and the implementation of certain organizational measures.

In the near future, the above concept and action plan will be submitted for public discussion.

Earlier it was reported that Rinat Akhmetov's energy company, DTEK Renewables B.V., intends to issue green bonds in the US and EU, and has already passed the preliminary examination of Sustainalytics.

It was also reported that DTEK plans to place five-year "green" bonds in euros. All funds raised will be directed to the company's existing and future projects in renewable energy, as well as to refinance previously received funds from banks and a shareholder.

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