In 2026, work continues in Ukraine on the draft of the new Civil Code of Ukraine, which is intended to serve as the foundation for a large-scale reform of private law. The need to update civil legislation stems both from the development of modern economic relations and from the need to adapt the Ukrainian legal system to European standards.

The current Civil Code of Ukraine was adopted back in 2003, and despite numerous amendments, some of its provisions no longer fully reflect the current realities of doing business, the digitalization of the economy, and the development of international commerce. The new draft provides for a comprehensive overhaul of approaches to regulating contractual, property, corporate, and digital legal relationships.

This reform is of particular importance to businesses, as civil law governs the rules for entering into and performing contracts, protecting property rights, defining the liability of the parties, structuring commercial relationships, and resolving disputes.

One of the key ideas of the new code is to strengthen the principle of freedom of contract. The draft provides for significantly broader opportunities for the parties to independently determine the terms of their cooperation, the procedure for fulfilling obligations, liability mechanisms, and methods of conflict resolution. This approach is consistent with current European practice, where the contract itself is the primary instrument for regulating relations between market participants.

For businesses, this means greater flexibility when entering into commercial contracts, investment agreements, corporate arrangements, and international treaties. At the same time, the growing importance of contracts increases the significance of high-quality legal work, as the specific wording of the terms will increasingly influence the allocation of risks between the parties.

The draft pays particular attention to issues of good faith on the part of the parties during negotiations. It provides for the introduction of a mechanism of pre-contractual liability, under which a party may be held liable for conducting negotiations in bad faith or for terminating negotiations without cause after reasonable expectations regarding the conclusion of a contract have been established.

In practice, this means that businesses will need to take a more careful approach to the negotiation process, the drafting of correspondence with counterparties, and the signing of memoranda, term sheets, and other preliminary documents. In certain cases, legal risks may arise even before the main contract is signed.

Changes in approaches to contract interpretation are also important. The draft enshrines principles that have long been applied in international and European practice, in particular the possibility of interpreting ambiguous provisions against the party that proposed them. This underscores the importance of precise wording and the legal quality of contractual documentation.

For companies, this means they need to review their standard contracts, internal templates, and approaches to structuring commercial terms. The use of general or vague language can create additional risks in the event of a dispute.

One of the most pressing developments for modern business is the regulation of digital assets and digital rights. The draft of the new Civil Code provides for the formalization of the concept of digital items and the establishment of a more clearly defined legal framework for certain types of digital objects.

For IT companies, e-commerce, technology businesses and startups, this could become an important step toward simplifying the registration of rights to digital assets, the conclusion of relevant agreements and the protection of interests in disputes. In the context of active digitalization of the economy, such changes have significant practical importance for the development of modern business models.

The project also provides for the modernization of mechanisms to protect civil rights. In particular, it proposes measures aimed at improving the enforcement of court decisions and strengthening liability for breaches of contractual obligations. This is expected to contribute to greater legal certainty and better protection of market participants’ interests.

At the same time, this large-scale reform of civil law also poses certain risks to businesses. The new approaches may require a review of existing contractual models, the adaptation of corporate documents, and the updating of companies’ internal policies. In addition, in the first few years following the adoption of the new code, there may be inconsistent judicial practice regarding the application of certain provisions.

Nevertheless, the overall concept of the new Civil Code is aimed at creating a more modern, flexible, and predictable legal environment for business. The reform aims not only to update the legislation but also to establish a more effective model of private law regulation that will be in line with contemporary economic processes and European standards.

If the new code is adopted, companies would be well advised to assess in advance the impact of the upcoming changes on their operations, conduct an audit of their contractual documentation, review their approaches to structuring commercial relationships, and adapt their internal processes to the new legal requirements. It is precisely timely legal preparation that will enable businesses to effectively leverage the benefits of the new regulatory framework and minimize potential risks.

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