In order to ensure further reform and development of the financial sector of Ukraine in accordance with the best international practices and to ensure the implementation of the measures envisaged by the Association Agreement between Ukraine, on the one hand, and the European Union, the European Atomic Energy Community and their Member States, on the other hand, and taking into account the expiration in 2019 of the implementation of the measures of the Comprehensive Program for the Development of the Financial Sector of Ukraine until 2020, the financial sector regulators developed and approved the following The Strategy 2025 contains five strategic directions: financial stability, macroeconomic development, financial inclusion, financial market development, and innovative development. Each direction contains strategic goals and indicators for their implementation. In the next five years, the work of the National Securities and Stock Market Commission to ensure the implementation of capital market reforms, improve corporate governance and protect investors’ rights will be based on the implementation of the measures set out in this Strategy. In particular, Strategy 2025 provides for the following measures to develop capital markets:
- introducing new financial instruments and developing existing ones, as well as mechanisms for securitizing financial and other assets, as conditions for further development of the financial sector and ensuring the inflow of investments into the country’s economy
- ensuring that state regulation of the stock market is carried out at the appropriate level in accordance with international standards, in particular, the requirements of European acts and standards of the International Organization of Securities Commissions (IOSCO), including the need to increase the institutional and financial independence of the Ukrainian stock market regulator;
- Reforming the capital markets infrastructure, including modernization, consolidation and development of the exchange, settlement and clearing infrastructure of organized commodity and capital markets, ensuring improvement of the institution of financial sector intermediaries and rating agencies in accordance with European requirements;
- improving corporate governance.
In order to ensure further reform and development of the financial sector of Ukraine in accordance with the best international practices and requirements of European legislation, as well as to fulfill the obligations undertaken by the Ukrainian Party under the Letter of Intent to the International Monetary Fund and the Memorandum of Economic and Financial Policy dated June 19, 2023, the financial sector regulators approved the Financial Sector Development Strategy of Ukraine (hereinafter – the Strategy). The Strategy includes five goals: macroeconomic stability, financial stability, financial system working for the country’s recovery, modern financial services, and institutional capacity of regulators and the DGF. Each goal has strategic initiatives and measures aimed at achieving it. It is expected that in the coming years, the work of the National Securities and Stock Market Commission to ensure the implementation of reforms in the capital markets and organized commodity markets, improve corporate governance and protect investors’ rights will be based on the implementation of the measures provided for in the Strategy. In particular, the Strategy envisages measures to develop capital markets and organized commodity markets, namely:
- Ensuring an appropriate level of institutional and financial capacity of the domestic capital markets regulator to ensure the functions of state regulation and supervision of capital markets, including the activities of institutions in these markets, in accordance with EU acts and international standards, in particular the standards of the International Organization of Securities Commissions (IOSCO), as well as to ensure compliance with the requirements for Ukraine’s accession to the Multilateral Memorandum of Understanding on Consultation and Cooperation and Exchange and
- building an effective system to combat capital market abuse, including offenses of manipulation and pyramid schemes;
- Improving taxation in the area of capital markets and organized commodity markets, in particular, regulating tax incentives and harmonizing the taxation system for financial instruments;
- improving the efficiency of the capital markets infrastructure in line with European requirements;
- introducing effective mechanisms for the rehabilitation and withdrawal of troubled financial institutions from the market, as well as investor compensation schemes;
- Ensuring the improvement of the institution of financial sector intermediaries, rating agencies and benchmark administrators in accordance with European requirements;
- introducing new financial instruments and developing existing ones, as well as mechanisms for securitizing financial and other assets in accordance with European requirements;
- regulating collective investment activities in accordance with European standards. It is envisaged to introduce a legal framework for the operation of investment funds in Ukraine in accordance with the European requirements stipulated by the EU acts UCITS, AIFs, ELTIFs, EuVECA, MMFs and others;
- introduction of regulation of the virtual assets market in Ukraine;
- introducing a fully functioning mandatory funded pension system in Ukraine and improving non-state pension provision.