More favorable conditions have been created to encourage foreign exchange inflows into Ukraine’s economy. Today, on October 22, 2015, NBU Board Resolution No.718 On Amendments to NBU Board Resolution No.581, dated September 3, 2015 has been approved to this effect. This Resolution is intended to increase foreign exchange inflows into the country and its banking sector.
To this end, the regulator improves the conditions for cooperation between Ukraine, foreign partner countries, and international institutions by specifying the requirement for mandatory sale of foreign currency proceeds in the interbank market (the surrender requirement). From now on, this requirement shall not apply to proceeds from projects under agreements between the EU and Ukraine involving Ukraine’s participation in the EU-led international programs. The surrender requirement shall no longer apply to funds received by resident legal entities under grants from international financial institutions. This shall notably be applicable to resident entities that are funded through grants and controlled by the Government of Ukraine.
In addition, the Resolution specifies the applicable provision pertaining to the terms and conditions under which nonresidents shall participate in the privatization of state-owned property. The Resolution sets forth that foreign currency received to the accounts of the auction (bidding) organizer as cash security (guarantee contribution) of nonresident’s participation in the auction (bidding) on state-owned property privatization shall not be subject to the surrender requirement.
In response to numerous requests from the business community, the National Bank of Ukraine has established additional exceptions from the ban prohibiting the registration of changes to agreements on granting FX credits/loans to resident borrowers by non-residents arising from the replacement of a creditor or a borrower. This Resolution, inter alia, has permitted the registration in cases when the replacement of the initial creditor (assignor) is related to his liquidation or a merger with a new creditor (assignee). In addition, it shall be permitted to register the respective changes to loan agreements under which a loan has been issued to a resident through participation of a foreign export-and-import agency;
The National Bank of Ukraine has eased the restrictions on domestic currency cash disbursement through cashier’s offices and ATMs. Currently, banks are obliged to limit domestic currency cash disbursement through cashier’s offices and ATMs to UAH 300000 per day per customer. This requirement, inter alia, was applicable to FX operations with individuals. From now on, this requirement shall not apply to the above said operations, thus making it easier for individuals to sell foreign exchange in unlimited amounts.
At the same time, the central bank has specified the requirement governing the exercise of control over export operations, taking into account the specifics of activities of telecommunication companies. Currently, the authorized banks are not allowed to discontinue control over clients’ export transactions for which evidence is available that claims thereunder have been offset against similar counterclaims in foreign currencies that are subject to the mandatory sale. However, from now on, this prohibition shall not apply to operations performed by telecommunication companies to settle bills for international telecommunication services (international roaming services and traffic steering).
The amendments shall take effect from October 23, 2015.