New Resolution No. 718 of the Management Board of the National Bank of Ukraine (“NBU”) dated 22 October 2015 (the “Resolution”) enters into force as of 23 October 2015.
The Resolution amends and updates the existing “anti-crisis” Resolution of the NBU No. 581 dated 03 September 2015. According to the NBU’s press-release, the purpose of the new Resolution is to increase foreign exchange earnings in Ukraine.
The mandatory sale of 75 percent of foreign currency proceeds received from abroad by legal entities (except banks), individual entrepreneurs, and foreign representative offices (except for official (diplomatic) representative offices) no longer extends to:
- Projects which are carried out under agreements relating to Ukraine's participation in the European Union‘s international programs.
- Funds received as grants from international financial organizations (of which Ukraine is a member) in favor of a legal entity-resident, which receives funding from such grants and in the management of which the Government of Ukraine takes part.
- Funds received as cash collateral (guarantee deposit) from a non-resident participant in the auction (bidding) process for the privatization of state property onto the account of the organizer of the auction (bidding.)
The existing prohibitions on registering of amendments to cross-border loan agreements are now not applicable with regard to:
- Changes of the initial lender or the initial borrower due to its liquidation and/or merger.
- A loan which was granted to a resident with participation of a foreign export-credit agency.
- Amendments on early repayment of a loan and/or prepayment of obligations to international financial organizations.
Resolution No. 581 will remain in force until 4 December 2015 inclusively.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
