WHAT IS THE AIM OF THE REGULATION?

The Ukraine Facility has the following aims:

to support Ukraine’s recovery, reconstruction and modernisation;
to support Ukraine in making the reforms needed on its path to European Union (EU) accession;
to support Ukraine’s financing needs to allow the government to deliver uninterrupted public services;
to mobilise investments in Ukraine’s private sector to facilitate a fast economic recovery and reconstruction and lay the groundwork for sustainable growth;
to support the broader Ukrainian society by helping to address the social consequences of the war.

KEY POINTS

The Facility is structured around three pillars:

Pillar I – Ukraine plan:
- direct financial support to Ukraine upon fulfilment of the conditions laid out in the Ukraine plan prepared by the Ukrainian government, setting out its intentions for the recovery, reconstruction and modernisation of the country and the reforms it plans to undertake as part of its EU accession process;
- financial support in the form of grants and loans to the state of Ukraine will be provided based on the implementation of the Ukraine plan, which will be underpinned by a set of conditions and a timeline for disbursements.
Pillar II – Ukraine Investment Framework:
- under the specific investment framework for Ukraine, the EU will provide support in the form of budgetary guarantees and a blend of grants and loans from public and private institutions;
- a Ukraine guarantee will cover the risks of loans, guarantees, capital market instruments and other forms of funding supporting the objectives of the Ukraine Facility.
Pillar III – accession assistance:
- EU accession assistance and other supporting measures helping Ukraine align with EU laws and carry out reforms on its path to future EU membership, along with providing support to its civil society.

The total budget of €50 billion for the Ukraine Facility is split between €33 billion in loans and €17 billion in grants.
A new special instrument above the ceilings of the multiannual financial framework (MFF), the Ukraine reserve, will cover the grants.
Loans will be guaranteed through the own resources headroom – the difference between the EU’s own resources ceiling of the multiannual financial framework and the actual spending.
Ukraine may request, as part of the Ukraine plan, a pre-financing payment of an amount of up to 7 % of the loans under pillar 1 of the Ukraine Facility.

As a precondition for support under the facility, Ukraine must continue to uphold and respect effective democratic mechanisms, including a multiparty parliamentary system, and the rule of law, and to guarantee respect for human rights, including the rights of persons belonging to minorities.
The Ukrainian parliament and civil-society organisations in Ukraine will be duly informed and consulted on the design and implementation of the Ukraine plan, in accordance with the constitutional order of Ukraine.
A Ukraine Facility dialogue will give the opportunity for the European Parliament to invite the European Commission to discuss, at least every 4 months, the implementation of the facility.
A scoreboard will help to easily monitor the progress of various qualitative and quantitative steps, including an overview of the social, economic and environmental elements in the Ukraine plan.