The Government, in response to the Ministry of Defence’s initiative, has expanded the conditions for payment and adjustments in the cost of defense contracts under state guarantees

The Cabinet of Ministers of Ukraine has adopted amendments to the defense procurement procedure that will optimize payments to defense suppliers.

Under the amendments to Resolution of the Cabinet of Ministers of Ukraine No. 779 dated October 26, 2016, purchasers will be allowed to settle the full cost of a consignment immediately after its shipment without having to wait for the fulfillment of the entire contract. This will enable companies to repay loans ahead of schedule and generate profit from the delivered products.

Additionally, the amendments include updating terminology to align with the Law of Ukraine “On Defense Procurement.”

Amendments to Resolution of the Cabinet of Ministers of Ukraine No. 1275, dated November 11, 2022, allow contract parties to adjust contract values to account for changes in interest rates on loans secured under state guarantees for programs aimed at strengthening the country’s defense and security.

These amendments aim to enhance the efficiency of budgetary expenditures and improve the terms of cooperation with defense manufacturers.

The adopted decision will help expedite the supply of essential products for defense needs and ensure more flexible conditions for state contracts in the defense sector, which are fulfilled through loans secured by state guarantees.

According to Deputy Defence Minister of Ukraine Dmytro Klimenkov, this marks a significant step in supporting the domestic defense business, as concluding contracts under state guarantees fosters both the stable growth of Ukraine’s defense industry and the enhancement of national defense capabilities. “Such changes provide a foundation for long-term production planning, modernization investments, and the integration of cutting-edge technologies that comply with current standards. This ensures Ukrainian manufacturers feel secure in stable partnerships, while the Armed Forces of Ukraine benefit from timely and high-quality supplies,” he stated.

“This year, the Ministry of Defence has already secured contracts with Ukrainian defense industry manufacturers under state guarantees exceeding UAH 6.5 billion. Next year, the military will receive modern special armored vehicles, medical evacuation vehicles, and fuel tankers, utilizing these funds. Ukrainian factories have gained the opportunity to plan their production cycle during the war,” added Glib Kanevskyi, Director of the Defence Ministry's Procurement Policy Department.