On the requirement for mandatory sale of 100% of foreign currency proceeds

Resolution No. 515 of the Management Board of the National Bank of Ukraine dated 20 August 2014 (the “Resolution”).

The Resolution establishes a temporary requirement for the mandatory sale of 100% of foreign currency proceeds received from abroad by legal entities, individual entrepreneurs, foreign representative offices (except for official (diplomatic) representative offices).

This requirement applies inter alia to export and import, credit, investment and other cross-border transactions with some exceptions.

In particular, the following foreign currency proceeds are exempt from mandatory sale: sovereign borrowings; financings from IFIs; funds received under international technical assistance projects; funds received under agency agreements that will subsequently be transferred to the owners of such funds etc.

The mandatory sale shall be performed by banks no later than the next business day without the need for any instructions from their clients.

The Resolution also extends the effectiveness of the requirement for settlements under export or import transactions to be made within 90 days. 

The Resolution takes effect on 21 August 2014 and remains valid until 21 November 2014.