With effect from 19 August 2016, the National
Bank of Ukraine (the “NBU”) abolished
the requirement for Ukrainian residents to obtain a price
evaluation act – an approval from State Enterprise
“State Research and Information Centre for Monitoring
International Commodity Markets” (Derzhzovnishinform) –
to make cross-border payments for the purchase of services and IP
rights from foreign residents in the amount exceeding EUR
The reasoning behind price evaluation acts
was that they were supposed to prevent non-productive outflows of
capital from Ukraine in the form of payments for intangible assets,
such as services and IP rights. Where payments exceeded the
regulatory threshold (most recently, EUR 50,000), a Ukrainian payer
was required to apply to Derzhzovnishinform for confirmation (price
evaluation act) that the price of the services or IP rights
purchased under the contract was consistent with their fair market
value. In the absence of a price evaluation act, Ukrainian banks
were prohibited from arranging the payment (subject to several
Issuance of a price evaluation act usually
took around seven business days, but could be delayed if
Derzhzovnishinform requested clarification of any matter. Apart
from being an additional administrative procedure, obtaining a
price evaluation act sometimes caused inconveniences or payment
delays for the contracting parties. Furthermore,
Derzhzovnishinform, a state-owned enterprise, was the only entity
authorised to issue price evaluation acts, which drew criticism
from the Ukrainian antitrust authorities that Derzhzovnishinform
held a “dominant position” in the market.
Abolishment of the price evaluation act
requirement is definitely a positive step in terms of simplifying
cross-border activities of the Ukrainian business. At the same
time, the NBU still maintains control over similar outbound
transfers. In particular, the NBU is currently empowered to review
the underlying documentation and suspend outbound transfers
exceeding USD 50,000.
The NBU also continues its policy of
strengthening financial monitoring procedures and increasing the
level of control by Ukrainian banks over capital outflows. In
particular, the NBU has instructed Ukrainian banks to carry out
detailed analysis of transactions and obtain additional
documentation from clients, where the bank has concerns that the
contractual price of goods, services or assets may be inconsistent
with their fair market value.
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.
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Starting from 25 February 2017, the National Bank of Ukraine (the "NBU") allows Ukrainian individuals (except for those registered as self-employed persons)...
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