#03 March 2016

In focus – Innovation, Technology & IP

The IT sector, considered as asource of innovation and knowledge,has lots of questions regarding unrealizedpromises and ambitious declarationsReforms on protection of intellectualproperty rights are moving notas rapidly as expected

With the support of Tax Regulation

Pursuant to provisions of the TaxCode of Ukraine, the tax control of complianceof the terms and conditions ofcontrolled transactions with the armslength principle shall be exercised bymonitoring such transactions and conductinginspections

Expert Opinion

Not Flexible Enough to Be Agile

Dmytro V. Gadomsky

Information technology nowgenerates 3-5% of UkrainianGDP, which is larger than thechemical and car manufacturingindustry put together.The newly-born industry createdits own business-specific values,management approaches and principleslike Lean startup, Agile, holacracy,wikinomics and the sharingeconomy. If you stay aside of thesenew streams, you will be kicked outof business in the long run

In Re

Patent Protection for the IT Business

Olena O.Vardamatska

Thinking of the benefits of themonopoly of IP rights, one immediatelyrecalls the patent warsbetween tech giants, including ITcompanies, around the globe. Theseare court battles between competitorswhere patents to inventionsor designs (and even trademarks)were used as an attack and defensetool by both parties (e.g. in Sonyvs. Kodak, Microsoft vs. Google).The court claims include compensationfor unauthorized use of protectedtechnologies or designs, a ban onthe sale of a competitors productsin a certain territory or request toconclude a license agreement (andpay a license fee)

Its all About the Data

Ievgen S. Antoniuk

The rise of the digital economyand electronic commerce madelawmakers unaware of the new demandstowards a swiftly changingenvironment and rapid speed in theformation of new business models.Fundraising and investment are nowbased on these two main terms personal information and contentaggregation. The first one providesus with social demand and the secondone with social production.Whoever can redistribute productionto targeted demand rules theeconomy in the digital age

First-of-a-kind Patent Litigation: Biosimilars

Oleksandr S. Mamunya, Nataliya A. Dryuk

Over the past few decades, biologicdrugs have revolutionizedtreatment for many conditions, includingthose that had not respondedto other treatment. Biologic drugscontain active substances of biologicalorigin obtained through productionfrom biological source and onmany occasions can bring more targetedeffect than traditional chemicallyderived small-molecule drugs.No wonder that biological drugslead the charts of best-selling drugsin the world and their sales groweach year. However, while bringinggreat advantages for patients, biologicsare often expensive in termsof cost per dose

News

Deals

Avellum advised UniCredit Group

AEQUO advised George Soross Ukrainian Redevelopment Fund

Integrites legal advisor to Farmak Group

Asters advised EBRD on its USD 5 million loan to V.V. Kischenzi Ltd

AEQUO advised Sberbank>

Construction of a new grain terminal in Ukraines port of Yuzhniy

Nakonechna and Sergiy Kulikov

Asters advised EBRD

Cases

VirnetX has sued Apple for patent infringement

ExxonMobil and BP bring 80-year-long litigation to an end

Oshchadbank won case against Delta Bank

High Court of London noted debt of Viktor Yanukovych claim made by Russia

Supreme Court dismissed petition of 1+1 Studio

Law Digest

Threshold increase to obtain merger clearance

Amendments to the Public Procurement Act

New law aims to make privatization more open

Parliament adopted visa-free Act on special confiscation

Draft

Protecting the rights of consumers of financial services

Introduction of amendments to Criminal Procedure Code

AMCU

Investigation of price collusion in oil products market

AMCU decided to penalize Russias Gazprom

Distort competition in the security services market

Biznews

M&A

Dragon Capital acquired 19.99% of the Ukrainian Exchange

Legal Business

Naftogaz invited bids for legal support abroad

Currency Regulation

Ukrainians will be able to receive e-money from abroad

Banking & Finance

Agreement with the European Investment Bank ratified

Oil & Gas

Act on virtual gas reverse flows from Europe adopted

Chamber News

Investors identified key areas for Ukraines focus in 2016

Summing up 2015 for the business community the American Chamber of Commerce in Ukraine conducted a survey on the investment climate in Ukraine with the participation of 166 Chamber members. Respondents shared their assessments of progress and vision with regard to further development of key sectors of the Ukrainian economy...

UBA News

Challenges and Realities of the Legal Market

The XII UBA Annual Legal Forum Development of Legal Services Market in Ukraine-2016 was held in Kiev on 26 February 2016. This year the organizers of this traditional gathering introduced an innovation and offered new interactive discussion formats during the event. Moderators of the first session, Armen Khachaturyan, senior partner of Asters,together with Iryna Khymchak, BD director ofRedcliffe Partners, presented an overview of the results of the previous year and gave participants an opportunity to predict the trends and to make forecasts about the markets development in 2016...

Cover Story

Multi-protection Levels

The current difficult times and European choice of development arepushing businesses for more precise attention towards management ofintellectual property. Rights holders are more creative in using availablemeasures at local level, and handle outbound activity with care. Globalizationhas its practical dimension, and we see this with the example ofthe IP protection industry, which naturally develops into multiple levels.These and many other issues formed the subject of our strategic sessionwith the partners of Doubinsky & Osharova Patent and LawAgency, one of the pioneers of the Ukrainian legal market

Global Legal Update

General Overview of the FATCA Compliance Program

Artem V. Narodenko

On 30 July 2014 the U.S.Foreign Account TaxCompliance Act (FATCA)came into force.The goal of FATCA is toimplement a mechanism aimed atpreventing tax evasion by personsassociated with the USA (U.S. citizens,U.S. owned foreign entities,and some others) outside the USA.Even though FATCA is aimed atU.S. tax residents, adoption of thislaw affected banking and financialsector worldwide, establishing reportingand withholding requirementsfor foreign financial institutions(the FFIs)

Crux

Insightful Views

Legislative activity in the Ukrainian Parliament has in the main been criticized of late. Since a lot of professional lawyershave become MPs, we observe some speeding up in legislative drafting and, traditionally, we offer some insights on thelatest initiatives

Serhiy Yaroshenko

Backhaul provides for reservingvirtual transmission capacity andvirtual reverse flow of natural gas.It enables the economizing of gastransmission costs, using the gasinfrastructure on borders in full and,importantly, ensuring efficient gassupply. Based on interconnectionagreements, it requires the exchangeof information on different indices.These include gas flows, directions,capacity, schedules, customers, andrecipients

Arseniy Herasymiv

On 14 February 2015, the governmentsof the USA and Ukraine signedthe Air Transport Agreement. Let meexpress cautious pessimism aboutthe signing of this document and itsimpact on the aviation services marketin Ukraine for the following reasons

Alexander Tretiakov

The adoption of Act of Ukraine On Amending the Act of Ukraine On Protection of EconomicCompetition (regarding improvement of the efficiency of merger control system), No.2168awill definitely have an impact onUkrainian law firms. Since the maingoal of the Act is to increase the financialthreshold in cases when theconcentration will need a permit, thiswill doubtless decrease the numberof potential clients for law firms. Takinginto account the comparativelylow number of M&A transaction inrecent years, the competition for anypotential client in this sphere will befierce

Oleg Malskyy

I believe that it is necessaryto bring all legislation on privatizationinto line both legislation andregulations. State-owned Ukrainianenterprises are attractive to foreigninvestors, but the investor understandsthat there are so many risksthat nobody can appreciate them tooppose

Oleksandr Mamunya

For quite a few years now copyrightholders suffering significantlyfrom infringements in the Internetand intellectual property professionalsprotecting the former have beentalking about the necessity to establishclear rules for copyright protectionin the said domain. Moreover,the community has realized that tomake the protection process reallyeffective intermediaries like Internetservice providers (including hostingproviders) (ISPs) should also besomehow engaged into the said protection

Mykyta Polatayko

The Draft Act On Amendmentsto Certain Legislative Acts of Ukraineregarding the Copyright and RelatedRights, No.3692 substitutesDraft Acts No.1812-1 and No.2447,which have been the subject of discussionsin legal periodicals. It alsoresolves the conflict between theCivil Code and the Copyright and RelatedRights Act regarding the ownershipof copyright of works for hire

Tetiana Kheruvimova

Draft Act No.2696 was tailoredto ensure the harmonization withthe EUUkraine Association Agreementas the latter provides for an opportunityfor a rights holder to lodgeobjections against applications fortrademark registration. Clearly, tofile an objection, one should first beinformed about the issue. Thus, theDraft prescribes the obligation tomaintain an electronic database andmake the information about the trademarkapplications publicly available

Ihor Konopka

Currently, the On Protection ofRights in Marks for Goods and ServicesAct establishes the principleof exhaustion of rights, but at thesame time it does not determinethe type of such principle internationalor national. This results indifferent interpretations of the rulestated in paragraph 6 of Article 16of this Act

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