Publication date: 25.06.2024
Peculiarities of termination and resumption of business activities during the war
Introduction
Military conflicts have a significant impact on economic activity, especially on businesses, which may face serious obstacles in their operations. In this article, we will analyze the legal aspects, challenges and mechanisms for suspending and resuming business operations during wartime, particularly in the context of Ukraine.
Legal basis for the termination of business activities
Laws of Ukraine on martial law:
- The Law of Ukraine "On the Legal Regime of Martial Law" establishes the legal grounds for the introduction of martial law and regulates the rights and obligations of enterprises during this period.
- The Law of Ukraine "On Mobilization Preparation and Mobilization" regulates mobilization measures, which may include the temporary suspension of business operations.
Decisions of the government and local authorities:
- The Cabinet of Ministers of Ukraine and local governments may decide to suspend or restrict the activities of enterprises in the areas of hostilities in order to ensure public safety and economic stability.
Labor legislation:
- The Labor Code of Ukraine provides for the possibility of suspending employment contracts in the event of force majeure, which includes war.
Mechanisms for the termination of enterprises
Conservation of enterprises:
- Businesses may decide to temporarily suspend operations and mothball production facilities to preserve property and equipment.
Ensuring the safety of personnel:
- Evacuating employees from hazardous areas, ensuring their safety and allowing them to work remotely, if possible.
Resource mobilization:
- The use of enterprise resources to support mobilization activities, including the production of military equipment, medical supplies or other goods;
- necessary for the defense of the country.
Resumption of business operations
Legal basis for restoration:
- After the end of hostilities or stabilization of the situation, companies may resume their operations in accordance with Ukrainian law, in particular, on the basis of decisions of the government or local authorities.
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Financial support:
- Government financial support programs, loans and grants can help businesses to resume operations. Such programs may include subsidies, tax breaks, and other forms of government assistance.
Repair and restoration of infrastructure:
- Restoration of damaged infrastructure, including buildings, roads, energy systems and other key elements necessary for the functioning of enterprises.
Attracting investments:
- Businesses can attract domestic and foreign investments to restore and modernize their production facilities.
Challenges during business interruption and resumption
Security risks:
- The constant threat of hostilities and terrorist attacks can complicate the process of restoring businesses.
Economic losses:
- Significant financial losses due to business interruption, property destruction, and reduced markets.
Labor resources:
- Loss of skilled personnel due to evacuation or mobilization, as well as difficulties in returning employees to their jobs.
Legal and administrative barriers:
- The need to comply with numerous legal and administrative requirements can complicate and delay the process of business recovery.
Adaptation and recovery strategies
Developing crisis plans:
- Businesses should have pre-developed contingency plans for military conflicts, including scenarios for evacuation, asset preservation, and business resumption.
Diversification of activities:
- In a time of war, it is important to have several lines of business, which will allow companies to adapt to changes faster and minimize risks.
Cooperation with government agencies:
- Close interaction with government agencies and local governments can speed up the process of obtaining the necessary permits, financial assistance and other resources to resume operations.
Innovations and technologies:
- The use of the latest technologies to improve production efficiency, automate processes, and work remotely can significantly contribute to the rapid resumption of operations.
Employee support:
- Providing social support for employees, including psychological assistance, training and retraining, is an important aspect of maintaining the company's human resources potential.
The role of international assistance
International organizations:
- Organizations such as the UN, the EU, the World Bank and others can provide financial and technical assistance to help rebuild businesses affected by the war.
Bilateral agreements:
- Concluding agreements with other countries to provide assistance in economic recovery, including grants, loans and technical support.
Foreign investments:
- Creating favorable conditions for attracting foreign investors who can help restore and develop the affected businesses.
Conclusions.
The termination and resumption of business operations during the war is a complex and multifaceted process that requires clear coordination of actions at the level of the state, business and international partners. A clear legal framework, effective financial support mechanisms, and innovative approaches to business management are essential for successful recovery.
Businesses that are able to quickly adapt to new conditions, use crisis opportunities and attract the necessary resources will be able not only to resume their operations but also to strengthen their market positions, contributing to the country's overall economic recovery.
