Ukraine is completing the "forest" reform: what changes await "Forests of Ukraine"

In Ukraine, the process of transforming the State Enterprise “Forests of Ukraine” into a joint-stock company and establishing a commission for transformation and inventory has begun. This is the final stage of the forest industry reform, which started three years ago. This is reported by UNN with reference to the Ministry of Economy, Environment and Agriculture of Ukraine.

DetailsViktor Smal, Head of the State Forest Resources Agency of Ukraine, signed an order on the transformation of the State Enterprise “Forests of Ukraine” into a joint-stock company and the establishment of a commission for transformation and inventory.

It is noted that this is the final stage of the forest industry reform, which began three years ago.

The corporatization of the State Enterprise “Forests of Ukraine” is envisaged in the Government’s Action Plan for 2025, and it is also part of our obligations to European partners within the framework of the Ukraine Facility. This is harmonization with EU corporate rules and a management model understandable to international investors, which is a condition for attracting investments.

According to Yegor Perelygin, Minister of Economy, Environment and Agriculture of Ukraine, the transformation into a joint-stock company will allow the company to take a more flexible approach to the implementation of investment projects. Also, a joint-stock company has the right to direct funds from the sale of illiquid assets to the development of the company, which strengthens its capabilities and operational efficiency.

Corporatization is an opportunity to continue economic growth through large-scale investments in infrastructure development (construction of forest roads), procurement of new equipment (mechanized harvesting), and implementation of automated production process management systems.

The main conditions for the transformation of the State Enterprise “Forests of Ukraine” into a JSC are as follows:

• the state will remain the owner of forest land used by the State Enterprise “Forests of Ukraine” (the joint-stock company will only be a forest user);
• privatization of forest resources, as before, is prohibited by the law “On Privatization of State and Communal Property”;
• the authorized capital of JSC “Forests of Ukraine” will be formed at the expense of the enterprise’s property (real estate, means of production, etc.);
• 100% of the shares of “Forests of Ukraine” will belong to the state.

The agency added that corporatization will allow “Forests of Ukraine” to update its material and technical base, introduce modern technologies, and increase production efficiency and financial performance.

For referenceThe corporatization process is provided for by Resolution of the Cabinet of Ministers of Ukraine No. 1003 of September 7, 2022, “Some Issues of Reforming Forest Industry Management.”

In addition, at the beginning of 2025, the parliament adopted a law that obliges state enterprises to transform into joint-stock companies or limited liability companies.

SE “Forests of Ukraine” is the largest forest user in the country and one of the largest state forest companies in Europe. The enterprise employs over 22,000 people. And it manages 6.6 million hectares of forest fund.

RecallMinisters of Ukraine and Denmark signed a Memorandum of Cooperation at the UN General Assembly. The document provides for joint projects in bioeconomy, forest restoration, emission reduction and agricultural sector development, as well as support for Ukrainian farmers.

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