Ukraine continues to reform its defence regulatory framework as part of a broader effort to strengthen the domestic defence industry and facilitate international defence cooperation. Following the introduction of the Defence City regime, the Government has now proposed a new mechanism aimed at simplifying export procedures for Ukrainian defence manufacturers while maintaining safeguards necessary to protect national security and domestic defence procurement.
The Cabinet of Ministers has approved a new Procedure governing exports of military and dual-use goods during martial law. Rather than replacing the existing export control system, the Procedure introduces a dedicated fast-track mechanism designed to accelerate exports under the Drone Deal initiative while preserving state oversight over strategically important transactions.
What changes?
The new Procedure establishes a separate export regime alongside the existing licensing framework. It applies to military goods, dual-use items, military and dual-use technologies, including technology transfers and certain intellectual property transactions. Finished military products require an export permit where the contract value reaches UAH 15 million or more, while technologies, components and spare parts remain subject to licensing irrespective of their value.
One of the key practical changes is that eligible transactions will no longer follow the standard export control route in every case. Instead, they may benefit from a simplified procedure administered directly by the State Export Control Service of Ukraine (SECSU), reducing both the number of approval stages and the overall processing time.
Fast-track licensing procedure
Under the new Procedure, SECSU must decide whether to issue an export permit within 30 calendar days, compared with up to 90 days under the ordinary export control framework.
The reform also introduces the principle of "silent consent". If the Ministry of Defence or the competent security and intelligence authorities fail to provide their position within the prescribed statutory deadlines, the relevant approval is deemed to have been granted. This mechanism is intended to eliminate procedural delays while preserving mandatory interagency consultation.
The Interagency Commission will continue to review only a limited category of transactions, including:
exports to countries outside the Drone Deal framework;
exports involving critical military goods or technologies;
transactions where objections are raised by the security or intelligence authorities during interagency consultations.
Drone Deal framework
The simplified export regime forms part of the broader Drone Deal initiative, which establishes a legal framework for long-term defence industrial cooperation between Ukraine and partner countries. Rather than focusing exclusively on exports, the initiative is intended to facilitate joint production, technology transfers and other collaborative defence projects, creating additional opportunities for Ukrainian manufacturers to participate in international supply chains and industrial partnerships.
At the same time, the framework preserves Ukraine's ability to prioritise its own defence needs by ensuring that exports remain subject to national security oversight.
Key safeguards
Although the new regime significantly simplifies export procedures, it retains several mechanisms intended to protect Ukraine's defence capability, in particular:
the Ministry of Foreign Affairs will maintain a list of countries eligible for the simplified procedure;
the Ministry of Defence will maintain a regularly updated list of critical military goods and technologies whose export could threaten Ukraine's defence capability;
exports involving such products, transactions with non-eligible countries, or cases raising national security concerns will continue to require additional scrutiny.
The Procedure also preserves the Government's priority right to procure defence products required for Ukraine's Armed Forces. Where the Ministry of Defence or another defence procuring authority intends to purchase products proposed for export, the permit may be refused unless the exporter provides binding guarantees that domestic defence contracts will be fulfilled.
To balance these powers, the Procedure requires the relevant authority to conclude a procurement contract within 30 calendar days. If no contract is signed within that period, the exporter may submit a new application, and the same ground may no longer be relied upon to refuse the export permit.
New payment mechanism
The Procedure also introduces a new payment mechanism linked to the value of exported products and technologies. The applicable fee amounts to:
20% of the value of finished military or dual-use products;
30% of the value of components;
20% of the value of exported technologies.
An additional payment equal to 20% of the value of manufactured products will apply where transferred technologies are subsequently used to produce goods exported to third countries outside the agreed cooperation framework.
What this means for defence companies?
The proposed reform represents another important step in modernising Ukraine's defence export control framework and aligning it with the needs of a rapidly developing defence industry. By shortening licensing timelines, introducing a more predictable approval process and facilitating international defence cooperation, the new regime is expected to make Ukrainian defence manufacturers more competitive in foreign markets.
At the same time, the reform preserves a comprehensive system of safeguards designed to ensure that exports remain consistent with Ukraine's national security interests and do not undermine the fulfilment of domestic defence procurement needs.