The Verkhovna Rada has adopted Draft Law No. 14412 as a basis. The bill is intended to establish clear rules for distributing powers between local self-government bodies at different levels, and between local self-government and executive authorities. It forms part of Ukraine's EU integration and Ukraine Facility commitments.

The bill aims to eliminate duplication of functions across levels of government, improve governance efficiency, and raise the quality of public services. It is grounded in the principles of subsidiarity and decentralization — meaning powers are to be assigned to the level of government closest to citizens and best placed to exercise them effectively.

Key innovations include a clear distinction between own and delegated powers, criteria for their allocation, and the introduction of a multi-tier governance system (central, regional, sub-regional, and basic levels). The bill also enshrines the principle of alignment between powers, resources, and accountability.

A separate section systematizes core public governance definitions: local self-government autonomy, the delegation mechanism, the scope of government bodies, and the limits of their autonomy and accountability.

Once the law enters into force, the Cabinet of Ministers will have one year to review the legislative framework governing the functions of executive and local self-government bodies, align existing norms with the law's principles, and submit the necessary amendments to ensure consistency with sectoral legislation.

TI Ukraine experts flag several risks: a number of provisions are framework and declaratory in nature, and the bill lacks clear implementation mechanisms, dispute resolution procedures, and accountability for violations of the power delimitation rules. This could perpetuate legal uncertainty and even entrench centralization through vague formulations.

The organization recommends that MPs refine the bill ahead of the second reading, specifically by introducing clear criteria for applying the subsidiarity principle, transparent procedures for resolving competence disputes, and defined liability for breaches of the power delimitation rules.

Without these changes, the law risks remain a formality rather than delivering genuine institutional transformation of public governance. In the best-case scenario, however, this initiative could be an important step toward building a coherent public governance architecture and bringing Ukraine closer to EU standards.