Under martial law, the stable functioning of commercial and state enterprises is vital for Ukraine’s economy. Uninterrupted work in strategic sectors directly impacts the state’s ability to sustain essential services, maintain key economic sectors, and address complex defense needs.
One primary legal mechanism for business stability is granting formal critical status during special periods. This has immense practical significance, especially for mobilization measures. It is the sole legal basis for reserving employees subject to military service to protect the core workforce from conscription.
At the same time, this status is not automatic. A company must meet specific state criteria and complete a detailed confirmation process. The procedure checks legal compliance, prepares financial documentation, analyzes economic indicators, and proves the company’s value to the sector or community. For many companies, including rapidly growing IT firms, securing this status is a key part of business continuity planning.
The legal framework governing critical status
Rules for deciding which organizations are vital to the economy and for saving jobs at these places are set by specific laws that explain who qualifies and how employees are protected.
Resolution № 76 of the Cabinet of Ministers of Ukraine, dated January 27, 2023, is the key regulation in this area. It sets criteria for determining critical enterprises during a special period and outlines the procedure to reserve employees liable for military service. This resolution sets the baseline that any business must meet to apply for the status.
Compliance with these rules is a required legal step for workforce reservation during wartime. Recognition happens only through a strict administrative process, based entirely on documents. Additionally, beyond the general rules in Resolution № 76, central executive authorities often set industry-specific requirements to address the specific needs of different economic sectors.
General criteria for determining a business as critical
According to Resolution № 76, a business entity must demonstrate financial transparency, market stability, and social responsibility. The enterprise must meet at least three criteria, two of which are absolutely mandatory:
- Tax Compliance: The total absence of overdue national taxes, local taxes, or social payments. The salary level for employees over the last calendar quarter is not less than the minimum wage multiplied by a coefficient of 2.5.
Beyond these basic requirements, the business must meet at least one additional condition that shows it matters to a specific industry or local area. This mixed-method approach uses general economic indicators and sector-specific measures, enabling the state to fairly assess different industries.
Sector-specific requirements: focus on the IT industry
Because the information technology sector is unique, Ukrainian law has special ways to confirm an IT company’s national importance. For IT companies, including those in the “Diia City” legal system, recognition may be based on specific criteria approved by the Ministry of Digital Transformation.
One of the key rules in Resolution № 76 is that a company must have official Diia City resident status. A company with this status must provide certified copies of contracts and the main accounting documents showing that it receives legal business income. The company must prove this income for any three consecutive full months after obtaining resident status, and the total must be at least EUR 20,000.
Additionally, Order № 182 of the Ministry of Digital Transformation sets more requirements. To qualify, the average salary of officially employed staff for the last quarter must be at least EUR 1,200, and there must be at least 9 employees. This order only counts people on labor contracts—gig workers with Diia City gig contracts do not count toward the required staff number, which creates a challenge for flexible startups.
Step-by-step procedure for obtaining the status
A state authority for the relevant economic sector recognizes enterprises as critically important. This authority could be a central executive authority, a regional state administration, or, if the company serves defense needs, the Ministry for Strategic Industries.
In practice, the procedure consists of several consecutive stages:
- Internal Audit: The enterprise carefully checks its financial indicators, salary levels, and tax status to see which criteria it meets.
- Document Preparation: The legal and accounting teams gather the required materials, including tax certificates, salary reports, and contracts.
- Application Submission: The enterprise submits the application and evidence to the competent public authority.
- Review and Decision: Based on the submitted information, the authority decides whether to grant or deny the important status.
A positive decision is the official approval to reserve employees who must serve in the military. Success at this stage depends completely on perfect document preparation.
Employee reservation and ultimate beneficial owners
Obtaining this status opens the legal way to hold individuals liable for military service. Law № 3543-XII (“On Mobilization Preparation and Mobilization”) governs this, ensuring the state’s economic engine keeps running.
Resolution № 76 allows critical enterprises to reserve up to 50% of their military-registered workforce. If a company demonstrates that its activities are vital to national defense or critical infrastructure, the competent authority may approve a higher percentage.
Pay particular attention to reserving ultimate beneficial ownership (UBO). The Ministry of Economy clarified in July 2024 that UBOs liable for military service may be exempted if the enterprise is recognized as critically important, even if they lack a standard labor contract with the company. Paragraphs 5 and 9 of the Procedure explicitly address beneficial owners and stress protection for the strategic leadership underpinning Ukraine’s economic resilience.
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Manimama Law Firm provides legal support for regulatory compliance and interaction with public authorities. We help companies secure critical enterprise status, prepare documents, and communicate with authorities. We also support fintech projects and virtual asset service providers with licensing, KYC/AML, and corporate structuring.
Disclaimer: The information provided in this article is intended for general informational purposes only and should not be considered individual legal advice. For legal assistance tailored to specific circumstances, it is recommended to seek professional counsel.
