Ukrainian arms manufacturers fulfilling state contracts within the framework of defence procurement can now import additional quantities of components destroyed as a result of hostilities, attacks or enemy sabotage, while retaining tax and customs privileges.
On 1 October 2025, the Parliament adopted amendments to Resolution No. 170 of 16 March 2016, which regulate the procedure for defence contractors in the event of loss of imported components during wartime. The BRDO team, together with the Ministry of Defence of Ukraine, participated in the development of these amendments.
The new rules concern VAT and import duty exemptions for components imported or supplied to Ukraine for the production of defence products under state contracts.
These privileges are provided for in paragraph 197.23 of Article 197 of the Tax Code of Ukraine
https://zakon.rada.gov.ua/laws/show/2755-17#n12363
and part 8 of Article 287 of the Customs Code of Ukraine
https://zakon.rada.gov.ua/laws/show/4495-17#n4978
What has changed?
- A list of documents required to confirm the loss of components has been defined: fire report, CCI certificate of force majeure, inspection report of the damaged object, extract from the Unified Register of Pre-trial Investigations, etc.
- The form and procedure for reporting the loss of components has been clarified.
- Destroyed components are not considered to have been used for purposes other than those intended, which makes it possible to retain tax benefits.
- The import of additional components is only possible within the limits of the actual amount lost and until the completion of the state contract.
Why is this important?
The changes reduce the risk of disruption to state orders, support the continuity of arms production, and reduce the financial burden on manufacturers affected by enemy attacks. They create conditions for the stable operation of the defence industry in wartime and increase the predictability of state contract performance, allowing businesses to plan their activities more effectively and without unnecessary barriers.
The regulatory changes were prepared as part of the EU4UA Defence Tech project, which is funded by the European Union and implemented by BRDO in partnership with Brave1.