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National Bank of Ukraine Issues New Regulation to Alleviate Restrictions

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National Bank of Ukraine Issues New Regulation to Alleviate Restrictions NATIONAL BANK OF UKRAINE ISSUES NEW REGULATION TO ALLEVIATE RESTRICTIONS On 28 March 2014, the National Bank of Ukraine (NBU) issued • Sale / Purchase of Foreign Currency: It is permitted to sell new Regulation No. 172 on Regulation of Financial Institution no more than equivalent of UAH 15,000 in foreign currency to Activities and Hard Currency Transactions, which replaced a one person per business day per banking institution; and to buy equivalent of no more than UAH 15,000 from one person without recent related regulation dated 6 February 2014, and will be in identification documents. effect until 1 May 2014. • Transfer Abroad: Foreign currency transfers by individuals, as The new regulation provides for the following changes: non-commercial transactions, are limited to: • Application: The restrictions are applicable not just to the banks - Equivalent of up to UAH 15,000 per month per person either but to other finance institutions, such as investment funds, credit from individual’s foreign currency bank account or without unions, insurance companies and others. opening a bank account; and • Lifting of Loan Repayment Restrictions: Restrictions - Equivalent from UAH 15,000 to UAH 150,000 per month per regarding acceleration of monetary liabilities of residents to person only from a foreign currency bank account. non-residents under facility (financial aid) agreements, with foreign currency purchased by a resident in the interbank foreign • Withdrawal of Foreign Currency: A person may withdraw exchange market, are cancelled. Residents are now allowed foreign currency cash from current and deposit accounts through to repay such liabilities when due under a contract (including cashiers and ATMs up to UAH 15,000 at the official NBU rate per cases of early performance of obligations by resident (in case of day. Such requirements apply to withdrawals both in Ukraine and amendment agreements) both for the principal amount and for abroad, regardless of the number of accounts held by a client in other payments – e.g. interest, fees, penalties, etc.). one bank. Foreign currency transfers by banks may not be limited. These requirements do not apply to diplomatic missions, consular • Lifting of Restrictions on Investment Abroad: The ban offices, international finance institutions, representative offices of on investment abroad with foreign currency purchased in the international finance institutions and their employees if they are interbank foreign exchange market is lifted. not Ukrainian citizens or do not reside permanently in Ukraine and are accredited by the Ministry of Foreign Affairs of Ukraine. • Reduction of Time for Foreign Currency Purchases: Terms of bank foreign currency purchase transactions in the interbank We will continue to monitor and inform of changes affecting our clients. foreign exchange market on behalf of legal entities, commercial representative offices and individual entrepreneurs is reduced. Contact • Early Return of Deposits: Banks are allowed to return foreign currency deposits early and to early repay savings (deposit) certificates denominated in foreign currency in local Peter Teluk currency at the purchase exchange rate of an authorized bank European Partner on the day of transaction. T +380 44 591 3154 E [email protected] The contents of this update are not intended to serve as legal advice related to individual situations or as legal opinions concerning such situations nor should they be considered a substitute for taking legal advice. © Squire Sanders. squiresanders.com All Rights Reserved 2014 12767/04/14.
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