AI in Ukraine
In an era marked by rapid technological evolution and geopolitical complexities, Lawyer Monthly is privileged to present an insightful conversation with the Managing Partner of Sayenko Kharenko, Ukraine's leading law firm - Mr. Nazar Chernyavsky. With a career spanning over two decades, our esteemed guest has navigated the intersection of banking & finance and technology law, advising a myriad of international clients ranging from major investment banks to Forbes 500 companies, and even foreign states. Beyond the firm's high-profile engagements, our guest's role as the Co-Chair of the IBA Technology Law Committee since 2024 underscores a profound journey through global technology law trends and contributions towards shaping new legal frameworks internationally.
The TMT sector has evolved rapidly in the last 10 years and continues to evolve at an ever-increasing rate. How have you been assisting and advising your clients?
Ukraine has always been a hot spot for tech companies and rising tech talent, and our firm has been treating IT sector as one of its priorities for more than 10 years by now. Apart from working with local tech startups, we have also been assisting global technology companies with their operations in Ukraine through setting up offices, acquiring local targets or lobbying for certain legislative changes which would open new business opportunities, like we did for instance when drafting the legislation allowing the use of cloud data storage in the state sector of Ukraine. Our firm has also played a key role in developing the new law which created special legal and tax regime for IT companies in Ukraine (“Diia City”). At the moment, despite the full-scale war and global slowdown in software development industry, we still see a number of M&A transactions involving Ukrainian tech companies. Moreover, we see a number of new product companies arising, especially in the field of defence tech, and we expect to see some unicorns here soon.
How important is the role of technology in the exposition of war crimes in Ukraine?
I have been a great proponent of using technology for fighting corruption and ensuring justice for many years, since the recent revolution in Ukraine, when one of the main demands of the students who started it were transparency and justice. And we have seen in the recent years how using technology and removing human factor helped to eliminate subjectivity and corruption in many routine operations. Ukrainian user case of governmental e-services (Diia) has become an example for many other democratic countries how to become more efficient and people-oriented. Russian invasion which started in 2022 unfortunately created too many cases which required fair investigation, documentation and further trial on a mass scale. And our tech experts have come up with various solutions which were integrated into specific platforms providing, in particular, for uploading images with evidence of Russian crimes (murdered or abused people, pillaged or damaged property, etc.) and locating them on the map. As a result, that data was further used for investigation and prosecuting crimes, including war crimes, as well as for building database of evidence for claiming compensation of damages caused by the military aggression. Given the mass scale of the damage, the group of experts involved is working at the moment on automating the assessment of damages using AI, satellite and photo images before and after the invasion. It would be impossible to accomplish without the use of technology and expertise of the specialists who work on it from the Ukrainian side. I believe it would make lawyers’ work slightly easier when preparing the respective lawsuits against Russia and its war criminals.
What role will Artificial Intelligence (AI) technologies play in Ukraine and is there a roadmap for AI as companies race to integrate AI?
There were a lot of software engineers in Ukraine specialising in AI long before now, and some of them have been later involved in creating LLMs which grabbed everyone’s attention lately. Accordingly, Ukrainian government feels that they need to take use of the existing expertise and create environment for its further growth. As a result, the roadmap for AI development in Ukraine has been announced recently, along with some legislative changes like the copyright protection of AI-generated content. It is critical that Ukrainian startups and large businesses are not hindered in using AI as one of its potential benefits is getting technological advantage over Russia in the course of the war, and we already see that a number of defence tech startups excel in it. At the same time, we should be conscious that Ukraine and its companies do not have enough resources to build powerful data centres which would host their own LLMs, and as a result we see the future in cooperation with developed nations and big tech companies which would create synergies when using Ukrainian technologies.
Concerning client needs in the TMT sector, what new expectations do you see emerging in 2024 and beyond?
I believe that one of the big trends would be cybersecurity and the respective requirements on the clients to ensure their compliance. I also believe that data protection laws would become more relevant in the light of wider use of AI-based systems. I do not believe it would be the case in Ukraine in the near future, but globally we may see more disputes related to “unfair” treatment of consumers caused by various AI-based filters. On top of that, governments will be imposing more regulations and restrictions on big tech companies and it would require more involvement of lawyers to ensure their compliance, as well as to ensure that they may continue their R&D and further growth.
With serious ambitions for chip manufacturing, AI growth, digital transformation and blockchain, Ukraine has a clear technological vision for the future. What are, and what are going to be the key legal challenges facing both private and public sectors?
I believe the biggest challenges would not be legal, but the issues of physical safety and sufficient funding. And given that Ukraine has to factor in those challenges, it must be more flexible on the legal side. This has been the case historically when Ukraine has been testing certain products which legal regulation has not been established globally yet, for example with ICOs, cryptocurrency exchanges, clinical trials, surrogacy, and more recently with AI content and legalisation of medical cannabis. We want to demonstrate to the world that we are dynamic and would like to be the hub for innovation on a global scale to attract investments which can build upon our talent.
About Nazar:
I am currently the Managing Partner of Sayenko Kharenko, the leading Ukrainian law firm. For the last 20 years the firm has been working on the most high-profile projects involving Ukraine, representing predominantly international clients, which include major investment banks, Forbes 500 companies, international financial institutions and foreign states. My primary background has been in banking & finance, which helped me to start working with tech companies – first, on their finance transactions, but later I continued with advising them on various regulatory and IP issues, as well as helping them to structure their operations and deal with data protection and cybersecurity issues. Almost ten years ago, I became an officer of the IBA Technology Law Committee and since 2024 I serve as its Co-Chair – this has become an amazing journey through the latest trends of technology law globally and allowed me to contribute to the shaping of the new legal framework across various countries, given that we have top experts in the field from all continents in the committee who work on landmark projects which set new precedents.
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