- Status
- Closed
Background
In the frame of the Memorandum of Understanding signed in December 1995 between Ukraine, G-7 Countries and the European Commission concerning the closure of Chernobyl, the K2R4 Project aimed at the completion, rehabilitation and modernization to acceptable safety level of the Khlmenitsky 2 and Rovno 4 units under construction.
Since 1994, the European Commission (EC) had provided extensive support to this project through the TACIS programme. In this context a Project Management Group (PMG) was set up in Kiev, composed of Ukrainian experts from the Goscomatom of Ukraine (EA) and Western experts. It had established all technical information needed by the potential lenders in the frame of their due diligence.
The further step of the Project's development was the negotiation of all technical contracts and the preparation and negotiation of loan agreements.
The overall financing package was estimated to approximately 1,500 million US dollars to be financed by Ukraine, by EURATOM, the EBRD, Export Credit Agencies and Russia. EA or the Ukrainian State would be the borrower. Assembling a funding package of this scale was a major undertaking. Given the complexity of the deal, it was the EC's view that the State of Ukraine and EA should benefit from the services of a qualified consulting firm (""the Legal Advisor"") who would assist in the legal aspects of the financial arrangements with the lenders.
Moreover it was the EC's intention to solicit from financial advisory services in respect of the preparation and negotiation of the loan agreements for the K2R4 Project.
Objectives
On the basis of the documentation prepared by EA, the PMG, Ukrainian Authorities and the lenders, the Legal Advisor provided support for:
- Assisting EA and Ukrainian Authorities with the analysis and negotiation of loan agreements which are to be part of the contractual framework of the Project.
- Enhancing the reliability and enforceability of the relevant part of the contractual framework.
Results
The project was carried out according to the objectives stated above. Specifically the Legal Advisor:
- Collected, reviewed all documents and marked-up documents in respect with loan agreements (including security package) provided by lenders, EA, Ukrainian Authorities, the PMG or any third party involved in the Project.
- Examined the compliance of all above mentioned documents with the applicable laws and checked overall legal coherence.
- Assisted and provided advice to EA, the State of Ukraine and the PMG for the negotiation with regard to the above mentioned contractual documents, and revised the relevant documents accordingly.
The Legal Advisor provided the following documents:
- Interim report: The Interim Report commented the results of the analysis performed by the Legal Advisor regarding all the documents to be reviewed and revised by the Legal Advisor. The Interim Report was issued four months after the coming into force of the Terms of Reference.
- Final Report: The Final Report completed the Interim Report as to give a final analysis of the documents reviewed by the Legal Advisor and the main legal items discussed during the negotiations of each loan agreement, the arguments given and the resulting draft proposed by the legal Advisor. The Final Report specified the legal items finally negotiated that could present a legal risk for EA or the Ukrainian Authorities.