Leading tech business association Diia.City United has called for significant revisions to the Defence City legislative package before its second reading. According to its members, the current version does not take into account the interests of companies operating in the fields of defence technology, dual-use software and R&D.
Leading tech business association Diia.City United has called for significant revisions to the Defence City legislative package before its second reading. According to its members, the current version does not take into account the interests of companies operating in the fields of defence technology, dual-use software and R&D.
This is stated in a press release of the business association Diia.City United. In particular, the association believes that the benefits provided by the package of draft laws should apply not only to companies that directly produce defense products, but also to developers of dual-use technologies, R&D companies, as well as all residents of Diia.City involved in innovations for the defense sector. To this end, they propose to revise the eligibility criteria, as well as allow companies to choose a tax model depending on business processes, without being limited to only one taxation system.
Industry representatives also emphasize the need to create a clear, digitalized and predictable system of controlled exports for both defense products and software. The current version of the document, in their opinion, contains only general declarations and does not provide practical mechanisms. The presence of a transparent export model will allow Ukrainian business to enter new markets, attract investments and integrate into NATO and EU defense chains. This is especially important against the background of the expected decrease in government orders after the end of the active phase of the war.
Another important requirement is to strengthen the protection of data about defense technology companies. Diia.City United proposes to close information about the managers, owners, and even the locations of such companies not only in the Unified State Register, but also in all open state databases. This will avoid the risks of sabotage, surveillance, and physical destruction of infrastructure facilities.
In addition, the union advocates for simplifying customs procedures for all market participants, regardless of whether they are included in the Defence City register. And to guarantee the stability of the companies' work, it is proposed to introduce a rule according to which the decision to open criminal proceedings against such businesses should be made only by the Prosecutor General.
The Defence City package of bills, adopted in the first reading on July 9, 2025, is designed to create a separate support system for defense manufacturers in Ukraine. At the same time, the expert community, including Diia.City United, criticizes it for not taking into account existing tools, such as the Diia.City regime, as well as for insufficient openness to the broad technology business that works for defense needs.
We previously wrote about how the Verkhovna Rada adopted in the first reading a package of draft laws on a special tax regime for Ukrainian defense enterprises Defence City, but without the ambiguous initiative to decriminalize the failure of orders, which was criticized by experts and public organizations.
