Ukrainian New Construction Classification of Energy Objects

Ukrainian New Construction Classification of Energy Objects Will Enter Into Force on 10 June 2017. The Ukrainian President signed on 8 February 2017 and published on 10 February Law of Ukraine On Amending Some Legislative Acts of Ukraine Regarding Improvement of Urban Planning Activities No. 1817-VIII No. 4733-1 of 17 January 2017 (the “Law).

Please be informed that the Ukrainian President signed on 8 February 2017 and published on 10 February Law of Ukraine On Amending Some Legislative Acts of Ukraine Regarding Improvement of Urban Planning Activities No. 1817-VIII No. 4733-1 of 17 January 2017 (the “Law). The text of the Law is available in Ukrainian at: http://zakon2.rada.gov.ua/laws/show/1817-viii. The Law will enter into force in 4 months on 10 June 2017.

The Law envisions a new approach to urban planning because it eliminates the term “category of complexity”. The system of complexity categories will be replaced with the system of classes of consequences (responsibility).There will be 3 classes of consequences (responsibility) as follows:

• СС1 – Low consequences;
• СС2 – Medium consequences;
• СС3 – High consequences.

These changes were suggested by authors of the Law, first of all, in order to bring Ukrainian legislation in compliance with the established European practice, namely that licensing/permission system should be based on the risk-management principles. Nonetheless, the main driver to adopt the Law was to discourage developers to artificially classify the complexity of their objects down (objects of 4th category are claimed to be of 3rd or even lower) in order to avoid the obligation to submit the documents for consideration of the authorities and have necessary inspections/obtain permits. Thus, СС2 will cover both 3rd and 4th categories of complexity and construction permits will be required for CC2 objects.

The Law does not contain an exhaustive list of characteristics for these categories even though project design organizations and building owners will have to determine it on the basis of criteria in construction norms and provisions of the Law itself. For instance, if the level of material damages or social losses related to decommissioning or loss of integrity of the construction objects exceeds 2500 minimal wages (minimal wage equals to UAH 3200 or a bit more than EUR 100 as of today), then the object cannot be qualified as CC1.

As a result, most of energy objects, including renewable energy plants or gas related infrastructure most likely will be classified as CC2 and CC3 construction objects. The construction of such objects will require construction permits and commissioning will require to obtain a certificate from architectural and construction authorities after respective inspections. Please note that as of today most of the renewable power plants have the 3rd category of complexity and developers commission powers plants using declarations without mandatory inspections or documents (except for registration of declarations). Construction of CC2 and CC3 objects will also require from developers to obtain a construction license or engage a licensed organization in contrast with the current state of affairs.

Construction declarations for the 3rd or lower category of complexity objects registered before the entry into force by the Law will be valid unless cancelled by controlling architectural and construction authorities, in particular if they do not comply with construction norms etc.