Ukrainian parliament considers unbundling defense conglomerate Ukroboronprom

A bill calling for the unbundling of the Ukrainian state-owned defense conglomerate Ukroboronprom has been registered in the Verkhovna Rada, Ukraine’s parliament.

Submitted on 24 April, Bill No. 10248 is endorsed by a number of MPs, including Serhiy Pashynskyi, Ivan Vinnyk, Tetiana Chornovol, Vadym Kryvenko, Andriy Levus, Andriy Teterev and Yuriy Bereza.

The bill proposes several amendments to the law “On the nature of governance of state-owned facilities in the defense industry sector”, including the unbundling of Ukroboronprom the placement of its constituent companies under a central oversight of executive government.

The authors remark that at present, “we are observing the ineffective governance of the state enterprises that form part of Ukroboronprom… which gives rise to the inability to meet the needs of the Armed Forces of Ukraine and other military formations with defensive products and the loss of the companies’ investment attractiveness”.

Ukroboronprom was formed from companies that were previously controlled by the Ukrainian Defense Ministry. Many of the companies still retain significant reserves of material assets belonging to the Defense Ministry.

Earlier this year, a group of journalists exposed a scheme in which companies under Ukroboronprom had been buying components smuggled in from Russia at highly inflated prices. Media reports implicated Oleh Hladkovskiy, former vice secretary of the National Security and Defense Council of Ukraine.

  Ukraine, Verkhovna Rada, Ukroboronprom, NSDC