Legal Alert: Ukrainian central bank liberalizes foreign investment repatriation

May 26, 2016

On May 24, 2016, the National Bank of Ukraine (the NBU) adopted a resolution amending some of its previous normative legal acts and thus improving several rules for the Ukrainian currency market. This regulatory step has been taken in line with the policy of the gradual liberalization of currency regulation and control. It involved a NBU group of professional local and international consultants.

 

Firstly, some procedural aspects of obtaining permits to conduct transactions with foreign currency (loan agreements with foreign nationals, transfer of currency abroad, etc.) have been facilitated. To this end, Ukrainian residents are no longer obliged to file with authorized banks extracts from the Ukrainian Commercial Register (data thereof are publicly available). Next, in the course of such foreign currency transactions, clients do not need to provide banks with a Ukrainian translation of SWIFT messages as well as of bilingual (any foreign language and Ukrainian/Russian) documents. Notably, documents in Russian no longer require a translation into Ukrainian.

 

Moreover, the NBU has taken into consideration proposals of the EBRD and somehow loosened transactions under loan agreements between Ukrainian residents and international financial organizations. As a result, they are no longer subject to a special examination of transactions, participants' activities, etc., conducted by servicing banks.

 

Finally, and most importantly, the repatriation of foreign investments from Ukraine has been liberalized. According to the latest amendments, the requirement to provide a servicing bank with a confirmation of a currency transfer to Ukraine made as an investment in order to repatriate such investment has been abolished.    

 

The above outlined amendments became effective as of May 25, 2016.

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