New Criteria for Classification of Enterprises

On 04 February 2026, the Cabinet of Ministers of Ukraine submitted Draft Law No. 15001 to the Verkhovna Rada of Ukraine, which provides for changes to the classification system for business entities.

In particular, the Draft Law provides for amendments to the Law of Ukraine “On the Development and State Support of Small and Medium-Sized Enterprises in Ukraine” and to the Law of Ukraine “On the Specifics of Regulating the Activities of Legal Entities of Certain Organizational and Legal Forms During the Transition Period and Associations of Legal Entities.”

The main goal of the changes is to bring the definition of small and medium-sized enterprises into line with European Union requirements, with the aim of promoting a competitive environment among businesses and deepening Ukraine’s European integration.

Unlike the current regulation, which uses two indicators, the Draft Law provides for the application of three criteria:

  • average number of employees;
  • annual net income;
  • balance sheet total.

To be classified in a certain category, an enterprise must meet the criterion for the average number of employees and at least one of the financial indicators, namely:

  • microenterprises – no more than 9 employees, and annual income or balance sheet total not exceeding EUR 2 million;
  • small enterprises – no more than 49 employees, and annual income or balance sheet total not exceeding EUR 10 million;
  • medium-sized enterprises – no more than 249 employees, and annual income or balance sheet total not exceeding EUR 43 million;
  • large enterprises – business entities that do not meet the above criteria.

As a result of these changes, some businesses may be reclassified into a different category. A business’s status determines its access to grants, benefits, and funding programs, so a change in category may affect these opportunities.

We will closely monitor further developments in this area, in particular regarding the status of this Draft Law, and report on them in the future Legal News.