11.09.2026
Legislative amendments regarding public procurement—specifically concerning the application of the 10% limit when modifying contract prices—have moved far beyond the realm of purely legal debate. The issue is not merely about how contracts should be concluded or amended, but also about how decisions made by contracting authorities years ago, under the rules in effect at the time, will be evaluated today.
This very issue was discussed on September 11 during a working meeting at the Ministry of Economy. At the invitation of Deputy Minister Vitalii Petruk, Oleksandr Kudym, Director of Euro Trade Energy LLC, participated in the meeting on behalf of Energy Club.
In his remarks, he urged the attendees to view the problem through the lens of the human impact caused by legal uncertainty. Oleksandr Kudym highlighted the risks facing officials who had authorized price adjustments in previous years and questioned the wisdom of simply repealing Clause 7 without establishing a clear mechanism to resolve the legal relationships that have already arisen.
His key argument was that a legislative mechanism cannot be removed without offering an alternative way to resolve the issue of legal uncertainty. Consequently, the Energy Club representative proposed that the Ministry of Economy consider alternative models. Which ones? Read on.
Below is the full text of Oleksandr Kudym’s speech:
“On September 3, during a working meeting at the Commercial Cassation Court, we spoke extensively in legal terms—discussing retroactivity, Clause 2 of Part 5 of Article 41, Clause 7 of the Final and Transitional Provisions, the interplay between various legal norms, and judicial practice.
Today, however, I deliberately wish to speak in a somewhat different language. In terms of the human impact.
Because behind terms like “10 percent,” “retroactivity,” “supplementary agreement,” and “Clause 7” lie more than just contracts, millions of hryvnias, and case numbers. Behind them stand real people. Directors of public institutions and municipal enterprises. Heads of education departments and medical facilities. Officials at state-owned enterprises. Authorized procurement officers. Accountants. Lawyers. People who, between 2021 and 2023, made decisions amidst extreme price volatility, guided by the law and the interpretation of it long upheld by the authorized regulatory body itself. Yet, years later, some of these individuals found themselves the subjects of criminal proceedings.
I wish to make a crucial clarification right away. I am not discussing collusion, document forgery, fabricated price fluctuations, deliberate cost inflation, or the actual misappropriation of public funds. If such facts exist, they must be investigated, and those responsible must be held accountable.
We are discussing something else: a situation where the mere fact of a cumulative price increase exceeding 10 percent transforms from a rule of procurement law into a primary material indicator of illegality, financial loss, and—in some instances—criminal wrongdoing. This is precisely the mechanism we observe in the criminal and civil cases under analysis.
And this is no longer just theory. On March 16 of this year, the Industrial District Court of Dnipro considered a motion filed by an investigator—and approved by a prosecutor—to remand an official in custody. The motion arose from criminal proceedings under Part 5 of Article 191 of the Criminal Code, concerning, among other things, changes to electricity prices made via supplementary agreements.
The court did not order detention but instead imposed house arrest.
The same court ruling reveals that a portion of the allegations and the calculation of the purported damages is directly linked to the price increase that exceeded the 10 percent threshold.
And therein lies the true cost of today’s discussion.
For criminal proceedings are not merely an entry in the Unified Register of Pre-trial Investigations. They entail searches and interrogations. They involve lawyers and forensic examinations. They result in personal expenses amounting to tens or hundreds of thousands of hryvnias. They mean years spent living with the status of a suspect or an accused person. They lead to the destruction of professional and personal reputations—damage that sometimes cannot be undone, even after a person has proven their innocence.
And all of this is happening during a protracted war—a time when every hryvnia belonging to the state, a business, or an ordinary family is worth its weight in gold. Funds that people are forced to spend on years of legal defense, expert analyses, and criminal proceedings could instead be used for generators, batteries, repairs, or donations to the army—resources that enable survival through another harsh winter amidst the aggressor’s daily attacks.
At the same time, regarding civil lawsuits filed by prosecutors, the end of this saga is at least beginning to come into view. You are all familiar with the Constitutional Court of Ukraine’s ruling (No. 6-r(II)/2025 dated December 3, 2025) and its conclusions regarding a prosecutor’s representation of state interests; specifically, the window for filing new lawsuits on these grounds is effectively closing at the end of this year.
Moreover, I can now confidently state that our team has developed a defense strategy for such prosecutorial lawsuits—one that we assess as consistently successful. We will soon present this approach to the market.
In other words, the civil aspect of this matter is gradually approaching a resolution. The criminal aspect, however, is not. The Constitutional Court’s ruling regarding a prosecutor’s representation of state interests does not terminate criminal proceedings.
Article 49 of the Criminal Code establishes statutes of limitations—specifically, ten years for grave crimes and fifteen years for especially grave crimes. Therefore, decisions made by an official in, say, 2021–2023 could still be subject to criminal legal assessment for many years to come, depending on how the offense is classified.
At this point, I want us to stop picturing these individuals merely as obscure officials stationed somewhere far from Kyiv. We analyzed supplementary agreements for electricity supply concluded by central government bodies and other central state institutions.
And, naturally, we observed the same pattern: a cumulative price increase of more than 10 percent.
Such supplementary agreements were signed by state secretaries and heads of the Ministry of Justice, the then-Ministry of Economy, the Ministry of Foreign Affairs, the Ministry of Energy, and the Ministry of Social Policy, as well as officials from the State Treasury, the Office of the Prosecutor General, the Anti-Monopoly Committee, the Accounting Chamber, the State Property Fund, the NABU, and other agencies.
I am by no means suggesting that criminal proceedings should be initiated against these individuals. I am arguing the exact opposite. If you proceed now by removing Clause 7, you expose former Ministry of Economy State Secretaries Kostiantyn Mykhailovych Marievych and Tetiana Mykolaivna Halabudska, as well as Deputy Minister Iryna Yuriivna Novikova—who signed supplementary agreements in 2021 increasing the price by 49.4%—to the risk of future criminal prosecution.
In other words, you are creating a vast group of individuals who could potentially face criminal prosecution years down the line—whether due to a shift in investigative approach, audit findings, a report of wrongdoing, or a change in how the law is applied.
Yet, legal certainty is not something a person needs only when an investigator arrives to conduct a search; it is needed today. And here, I wish to address my colleagues at the Ministry of Economy directly.
In 2025 and 2026, officials within the Ministry itself continue to sign supplementary agreements regarding price adjustments—specifically, Ministry of Economy State Secretaries Andrii Andriiovych Pyvovarov and Vitalii Viktorovych Petruk. They are signing these documents today, convinced that they are acting in accordance with current legislation.
Now, let us imagine the year 2030. The Supreme Court has reinterpreted one of the regulations they are currently operating under. That new interpretation is then applied retroactively to the contracts from 2025–2026.
Now your colleague is explaining to an investigator why, four or five years earlier, they signed a particular supplementary agreement. They are hiring a lawyer, commissioning expert analyses, and spending years proving that, at the time the decision was made, they acted in compliance with the rules established by the state itself. How will this person differ in any fundamental way from the officials whose fates we are discussing today?
In my view—not at all.
And that is precisely why the issue of Clause 7 is not about protecting suppliers. It is a question of whether the state can judge a person’s past conduct based on a regulatory standard formulated only later.
Allow me to use a metaphor.
We are all well acquainted with the “10 percent disease.” And let me be clear: in this metaphor, the tumor is not the Prosecutor’s Office, the Supreme Court, the Ministry of Economy, or the business sector. The tumor is years of legal uncertainty. Once a diagnosis has been made, the question is not whether to treat it, but how. One option is surgery—removing the source of the disease and preventing the spread of metastases. Another is prolonged conservative treatment, knowing that the method might work, or it might result in the loss of precious time and a fatal outcome.
Colleagues, I do not think anyone in their right mind, knowing the magnitude of such a risk, would voluntarily choose the second option. That is precisely why Parliament performed the surgery in May. In other words, the operation is already underway; the incision has already been made.
Yet today, the proposed bill asks us to snatch the scalpel from the surgeon’s hands in the middle of the procedure. And crucially, no alternative instrument is offered. The bill essentially boils down to a single decision: delete Clause 7.
At the same time, I see several fundamental issues regarding the Ministry of Economy’s package itself. The explanatory note states that the draft “will have no impact on the market environment” or on the protection of the rights and interests of business entities. Yet, in the Regulatory Impact Analysis, the Ministry identifies 38,105 business entities potentially affected by the regulation, outlines legal risks, disputes, and reduced predictability, and even explicitly states that legal uncertainty demotivates participants and undermines competition.
How can both statements be correct at the same time?
Furthermore, the explanatory note states: “the draft act does not require public consultations.” However, the Ministry itself prepared a Regulatory Impact Analysis and an M-Test, as is required for a regulatory act. And in its own M-Test, it explicitly noted that consultations with representatives of small and micro-enterprises were not conducted at all. We have all gathered here today precisely because the consequences of this decision require a professional discussion.
There is another issue. Clause 7 has been in effect since June 24. If it is simply removed now, what happens to the legal relationships, court proceedings, and legal assessments that existed while it was in force? The draft provides no answer. The Regulatory Impact Analysis (RIA) merely states that, following the removal of Clause 7, the “general rules regarding the temporal application of regulatory legal acts” will apply.
In other words, we appear to be resolving legal uncertainty by creating a second layer of legal uncertainty.
And finally—alternatives.
The RIA considers three options: removing Clause 7; retaining it while issuing clarifications; or leaving everything unchanged. But why was the most obvious fourth option—amending Clause 7—not considered?
We have already proposed a model to the Ministry of Economy under which doubts are interpreted in favor of lawfulness only if three conditions are met simultaneously: each individual increase does not exceed 10 percent; the increase is proportional to a documented market fluctuation; and the total contract value does not increase.
However, today I would like to propose yet another model.
Let us adopt the regulatory approach that the state itself has already employed in the sphere of state property.
On September 3, alongside the issue at hand, the Supreme Court discussed the application of Part 8 of Article 3 of the Law “On the Privatization of State and Municipal Property.”
In Law No. 4196-IX, regarding related regulations on state property, the legislature explicitly established that the new legal regime applies regardless of the date the company was created, reorganized, or corporatized, or the date the property was contributed to the authorized capital. Regarding Bill No. 6013—from which Law No. 4196-IX originated—both the Ministry of Economy and the Ministry of Justice of Ukraine officially supported this specific aspect during the second reading on January 9, 2025.
In other words, the state is already familiar with this type of legislative technique. So why not follow a similar path here and stipulate, for example:
“The provisions of Point 2, Part 5, Article 41 of the Law of Ukraine ‘On Public Procurement’ No. 922-VIII (as amended by Law No. 4888-IX) shall apply to relevant legal relations in the sphere of public procurement regardless of the date of their inception, including cases where such legal relations arose prior to the entry into force of Law No. 4888-IX.”
This would constitute actual regulation, rather than the mere removal of regulation.
Why is it that when dealing with the property-related legal relations of state-owned companies, the state was able to explicitly state “regardless of the date,” yet when it comes to ensuring legal certainty for over 38,105 officials representing contracting authorities, we want to simply eliminate that protection?
We do not insist that the current wording of Clause 7 is the only possible version. We are open to discussing alternative wording—addressing the presumption of lawfulness, the interpretation of ambiguities, or the “regardless of the date” model.
However, we cannot accept the logic of first eliminating the only legislative mechanism currently resolving the issue of past legal relations, only to leave courts, prosecutors, investigators, and thousands of individuals to grapple once again with that same uncertainty. Therefore, the market’s proposal is quite simple: do not take away the scalpel until we have agreed on the instrument to be used to complete the operation. For this time, the cost of a mistake will not be a matter of percentages, supplementary agreements, or even millions of hryvnias; the cost of a mistake will be human lives.
I would therefore like to conclude with a few very specific questions for the Ministry of Economy.
The issues raised during the meeting clearly extend beyond the debate surrounding a single clause of the law. At stake is a much broader problem: the limits of legal certainty for those who made decisions in accordance with the rules in force at the time.
The ball is now in the court of the Ministry of Economy and the legislature. If Clause 7 truly requires amendment, the market expects not merely its removal, but a clear mechanism that determines the fate of existing legal relationships and does not leave individuals to grapple alone with conflicting interpretations of the rules.
After all, rules can be changed for the sake of the future. It is far more difficult to alter the assessment of the past in such a way that the liability of those who had acted in accordance with the law at the time did not change along with the rule.
