Considering the positive impact of contingency foreign exchange regulation measures taken by the National Bank of Ukraine and the current state of the Ukrainian foreign exchange market, on September 22, 2014, the Board of the National Bank of Ukraine passed  Resolution No. 591 “On Amendments to Some Regulations of the National Bank of Ukraine" (hereinafter – the Resolution).

This Resolution envisages reducing the amount of foreign exchange proceeds subject to mandatory sale from 100% to 75%. The relaxation of this requirement is primarily aimed at creating the appropriate conditions for promoting foreign economic activities and providing economic entities with foreign exchange assets, thus enabling them to settle their current liabilities denominated in foreign currency.

This Resolution has also repealed the requirement that was imposed earlier this year with regard to mandatory conversion into hryvnia of foreign currency remittances from abroad in favor of individuals without opening an account. These measures are expected to boost foreign exchange inflows into Ukraine under current non-commercial operations.

At the same time, given the mounting pressures in the cash segment of the foreign exchange market, the Resolution provides for reducing the maximum amount of foreign exchange cash that one person is allowed to purchase per one business (working) day to an amount not exceeding the equivalent of UAH 3,000. The aforementioned restriction does not apply to purchases of foreign exchange cash by resident individuals for the purpose of repaying obligations denominated in foreign currency under loan agreements entered into with authorized banks.

In addition, this resolution envisages additional contingency measures relating to certain foreign exchange operations (import transactions without physical delivery of the goods to Ukraine, transfers of foreign exchange abroad executed by residents to redeem participatory interests from non-residents, transactions conducted on the basis of individual licenses granted by the National Bank of Ukraine). These measures are preventive and temporary in nature and will be lifted once adverse factors weighing on the foreign exchange market subside.

The resolution comes into force on September 23, 2014.