On March 7, 2025, the Cabinet of Ministers of Ukraine adopted Resolution No. 279, introducing a legal framework for transferring state-owned defense technology (technical design documentation) to private domestic manufacturers - a strategic move to scale up the production of weapons and military equipment. These new rules will apply throughout the period of martial law in Ukraine.
What is changing?
The resolution enables state-owned defense developers to share their original design documentation with qualified private producers, provided those producers meet strict legal, technical, and security criteria. This shift is designed to ensure Ukraine can respond faster to defense procurement demands during wartime.
How does the transfer process work?
Here's a simplified breakdown:
- Demand exceeds capacity
If a state enterprise (the original holder of the designs) is working at 75–100% capacity and cannot fulfill new orders, the state customer (such as the Ministry of Defense) initiates the process by notifying the Ministry for Strategic Industries (Minstrategprom). - Candidate search & assessment
The Ministry for Strategic Industries shortlists eligible private producers from the state electronic register of participants. These producers must already manufacture similar products. - Verification stage
A 10-day technical and compliance check follows. Candidates must:
- Have relevant production experience
- Hold licenses to handle state secrets
- Be financially and legally sound
- Not be in the process of bankruptcy, termination, or liquidation
- Not be connected with aggressor states or sanctioned entities
- Approval & contract
Upon a positive recommendation from an inter-agency commission, the design holder and the selected producer must sign a technology transfer and support contract within 14 days. This includes terms on confidentiality, IP protection, co-production rights, and financial conditions — including a 3% fee for design supervision. - Implementation
The private producer develops prototypes at its own cost, passes qualification trials, and only then is considered eligible for state supply contracts. If no full-scale production contract is finalized within 18 months, the technical documentation must be returned to its original holder.
Why does this matter?
This resolution empowers Ukraine to scale military production rapidly, drawing on private sector innovation while keeping tight control over sensitive IP and state secrets. It also opens future channels for international cooperation, technology localization, and joint ventures — especially for allies and partners with advanced defense sectors.
Before entering this space, it's important to ensure:
- Eligibility is clearly established, especially regarding ownership and licensing (Due Diligence)
- Communication lines with authorities are open early, to align expectations (Engagement with Authorities)
- Obligations, costs, and compliance risks are fully understood from the outset (Risk Assessment)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
