Nearly 150,000 Sole Proprietors Remain Trapped in Ukraine’s Occupied Territories

Entrepreneurship in Ukraine’s Temporarily Occupied Regions

According to Главком: As of July 2026, Ukraine had 146,479 registered individual entrepreneurs (known as FOPs) located in its temporarily occupied territories. The highest concentration is in Donetsk Oblast, with 66,116 such businesses. Under Ukrainian law, these entrepreneurs cannot legally operate, and any transactions involving them are considered void. To continue working, they must re-register their tax address in a government-controlled area.

Luhansk Oblast accounts for 49,517 FOPs-an astonishing 96% of all active entrepreneurs in that region. Zaporizhzhia Oblast has 18,041 FOPs, while Kherson Oblast has 12,805. The share of these entrepreneurs relative to the regional total is 72% in Donetsk, 43% in Kherson, and 28% in Zaporizhzhia.

Entrepreneurial Trends in 2026

After a record wave of FOP closures in early 2025, 2026 has seen a positive shift: new registrations now outpace closures. The strongest growth in new entrepreneurs this year is in the following sectors:

• education
• retail trade
• postal and courier services
• real estate operations
• wholesale trade

However, some sectors have experienced a decline in the number of FOPs, including computer repair, security services, telecommunications, waste collection, and wood processing.

To resume operations, entrepreneurs must update their tax address to a government-controlled area and make changes to the Unified State Register. This requires either changing their personal registration location or providing a new address from an internally displaced person certificate. The address change for a FOP can be done through the Diia online portal or at Administrative Service Centers (TSNAPs). If the entrepreneur changes their tax system or types of economic activity, they must update that information independently. A special registry allows verification of whether a business is registered in a temporarily occupied territory.

The state of entrepreneurship in the occupied territories highlights the harsh economic conditions facing these business owners. Despite legal prohibitions, many FOPs are trying to adapt by registering in Ukrainian-controlled regions.

This process could be a vital step toward reviving economic activity in conflict-affected areas, but it will require additional government support to ensure these businesses can operate legally and stably.

As the entrepreneurial landscape evolves, it's noteworthy that Ukraine has seen a significant increase in new individual entrepreneurs recently. In just six months, nearly 39,000 new FOPs have emerged, indicating a renewed vigor in the business sector despite ongoing challenges. This trend not only highlights the resilience of Ukrainian entrepreneurs but also sheds light on the shifting dynamics within the economy. For a deeper understanding of these developments, explore the full story on the recent surge in individual entrepreneurship.