OREANDA-NEWS. November 17, 2008. For the first time in Ukraine in the draft law an attempt is made to determine legal grounds of creating a new financial instrument which would ensure investment flows into innovation sectors of economics.

Such an instrument according to Deputy Head of the State Agency of Ukraine for Investments and Innovations (hereinafter – the SIIA) Serhii Moskvin has to become venture funds of innovation development.

The document notably determines that:

The venture funds of innovation development shall invest into corporative rights and promissory notes of innovation enterprises; joint ventures created to implement projects of service yards and scientific yards; enterprises of innovation infrastructure determined as such pursuant to the current normative-legal acts;

Founders and participants (auctioneers) of the venture fund of innovation development shall be physical or juridical person, residents and non-residents as well as the state and territorial communities;

Assets of venture funds of innovation development shall be constituted of corporative rights, promissory notes, immovable property and interests of intellectual property;

Venture funds innovation development shall receive state support in the determined by the draft law forms;

Venture funds of innovation development shall invest into innovation programs and projects, advanced knowledge and intellectual products, plants and processes, industrial and enterprise infrastructure etc.

Putting in action of the law of Ukraine “On venture funds of innovation development” (ukr.) will give new opportunities for the development of venture investment, for wider attracting of investments into the country’s economy and triggering of innovation projects in Ukraine, Serhii Moskvin considers.

The text of the draft Law of Ukraine “On venture funds of innovation development” is placed at the SIIA official web-site http://www.in.gov.ua/index.php?lang=ua&get=118&id=1499.

It should be noted that the draft law is elaborated to comply with the laws of Ukraine “On institutes of joint investing (corporative and shared investment funds)” and “On innovation activity”.

The draft bill takes into account recommendations of the European Venture Capital Association and the EU directives with regards to collective and venture investing.

The national venture capital doesn’t invest into innovation projects for now, as:

Investments into certain branches of traditional economy are characterized by superhigh level of profitability with relatively short terms of investing and under conditions of a low risk level;

Organizational form of the venture funds fulfills a tool function which enables optimization of taxation in a legitimate way.