The transformative power of foreign direct investment in Ukraine’s market for corporate control

This article analyses the marketization of corporate control in Ukraine. To date, sceptical forecasts have identified Ukraine’s blurred EU accession perspective and the enduring volatility of its socio-economic institutions as the main cause for reluctant marketization. Drawing on a critical institutionalist approach, this article highlights the fact that Ukraine’s market for corporate control has undergone marketization to some extent. It delineates how inherent tendencies of the capitalist mode of production and the specific interplay between the state, transnational and domestic fractions of capital shape the marketization of corporate control in Ukraine. Foreign direct investment of transnational corporations from the Western European capitalist core has made Ukraine’s market for corporate control more active. Foreign investors together with domestic capital fractions successfully advocated a more market-enabling merger control regime, while the state and oligarchic capital fractions have simultaneously hampered these marketization dynamics and opted for the maintenance of market-correcting regulatory elements. A critical institutionalist approach allows us to shed light on mechanisms and dimensions which often go unnoticed in the literature on institutional change on the EU periphery.