Ukraine Simplifies Underground Construction For Defense Industry Companies

(MENAFN- UkrinForm) Ukrainian Prime Minister Sergii Koretskyi announced this on Telegram, Ukrinform reports.

"The first measure involves engaging private businesses to build underground production facilities for defense needs. In practice, this means that, starting today, private companies can build such facilities and subsequently lease or sell them to companies directly involved in weapons manufacturing," the statement said.

The decision is expected to simplify the process and increase the number of available facilities, particularly amid the intensification of Russian attacks.

The second measure exempts components for weapons production paid for by international partners from import duties and VAT. In addition, inspection and customs clearance procedures for these goods have been simplified and shortened through the introduction of a "single window" system.

The Ministry of Defense provided further details on the decision to simplify underground construction for defense industry companies.

"The government has supported an important initiative that expands opportunities for attracting private investment in the development of underground production facilities and other infrastructure," the ministry said.

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The changes give private investors access to a simplified mechanism for construction and obtaining permits. Developers will therefore be able to build protected production facilities using their own funds and, once construction is complete, transfer them to defense industry companies through sale, lease, or other arrangements for their use.

Construction timelines, terms of use, and transfer procedures will be determined by agreements between investors and defense companies. At least 25% of the floor space must be allocated specifically to the defense sector.

To use this mechanism, developers will need to conclude agreements with, among others, Defence City residents, state contract performers, and companies designated by the Ministry of Defense as critical to the defense industry.

"Russia is trying to destroy our defense production. In response, we must make Ukraine's defense industry more resilient. To achieve this, it is important to move production to protected facilities and preserve our manufacturers' unique capabilities. That is why we are now proposing a more flexible mechanism for attracting additional resources to such projects," Ukrainian Defense Minister Yevhenii Khmara said.

The Ministry of Defense stressed that the adopted changes would make it possible to attract non-budgetary funding for the development of protected defense infrastructure, accelerate the creation and expansion of production capacity, and simplify the relocation of defense industry companies.

Photo: Ministry of Defense of Ukraine

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