Banking and Finance: Legal Alert
With effect from 8 August 2019, the National Bank of Ukraine (“NBU”) lifted the restriction on the purchase of foreign currency with funds borrowed in local currency.[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftn1) Therefore, legal entities and private entrepreneurs are now permitted to buy foreign currency with the proceeds under local currency loans without limitations. This step is expected to give additional flexibility to businesses in buying foreign currency and fulfilling their payment obligations under cross-border transactions.
Moreover, the Resolution No.104 clarifies the procedure for, and imposes on the commercial banks a duty to, carry out the checks on export transactions within five (5) business days after receiving information from the NBU about the change of the account bank in the client’s customs declaration. This intends to avoid double-checking of the customer’s transaction.
In addition, the NBU has streamlined the FX checks required to be made on the export transactions in case of change of the account bank in the client’s customs declarations and
[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftnref1) Please see NBU Resolution No.104 “On Amendments to Certain NBU Regulations“ dated 6 August 2019 (the “Resolution No 104”); Link
With effect from 16 August 2018, collective investment institutions have been allowed to diversify their asset structure by investing in securities floating on the following foreign stock exchanges approved by the National Securities and Stock Market Commission: (1) a network of stock exchanges of Nasdaq, Inc; (2) New York Stock Exchange; (3) European Union Stock Exchanges; and (4) Hong Kong Exchanges and Clearing (NYSE).[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftn1)
[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftnref1) Please see the Decision of the National Securities and Stock Market Commission No. 378 dated July 11, 2019 On approving the List of Foreign Stock Exchanges Eligible on which Foreign-Issued Securities held by Collective Investment Institutions should be listed”
On August 15, 2019 the NBU eased the rules for making payments abroad by individuals and legal entities which are added to the List of Sanctioned Persons and prohibited from transferring capital outside of Ukraine pursuant to the Board Resolution No. 109 “On amending the NBU Board Resolution No. 654 dated October 1, 2015”[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftn1). Specifically, the banks are now permitted to effect overseas payments made by such sanctioned individuals and entities under cross-border contracts provided that: (1) the payment is made for the goods which have already been delivered to Ukraine; and (2) the payment is made with the use of documentary letters of credit and the bank is provided with documentary evidence of shipping.
[[1]](https://www.integrites.com/publications/banking-and-finance-legal-alert/#_ftnref1) Please see NBU Board Resolution No. 109 “On amending the NBU Board Resolution No. 654 dated October 1, 2015”: Link
This publication should not be used as an instruction for taking legal advice in any particular case. If you have any questions, you are welcome to contact us.
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