On 24 May 2016, the National Bank of Ukraine (the “NBU”) issued Regulation No. 331 (“Regulation No. 331”) amending certain existing NBU’s Regulations, including NBU Regulation “On the Procedure for Residents to Obtain Foreign Currency Loans from Non-Residents and on Residents Providing Foreign Currency Loans to Non-Residents” No. 270 dated 17 July 2004. Regulation No. 331 is part of the on-going liberalisation of capital controls by the NBU ultimately aimed at improving the business environment and promoting investment in Ukraine.
Registration of IFI’s loans simplified
Regulation No. 331 simplified registration of loan agreements entered into by Ukrainian borrowers and international financial institutions (such as the EBRD and IFC) (“IFI Loans”). Servicing banks are no longer required to conduct additional examinations with respect to IFI Loans in order to verify whether these transactions entail risky activity of a servicing bank that may threaten the interests of that bank’s depositors/creditors.
Repatriation of foreign investments simplified
Foreign investors are no longer required to submit to servicing banks the following documents in order to repatriate their investment deposits: (i) a statement (certificate) from a servicing bank evidencing the actual crediting of foreign currency in Ukraine, or (ii) documents confirming that an investment deposit was formed through the reinvestment. It is now possible to repatriate the investment deposits based only on (i) an investment deposit agreement, and (ii) a statement (certificate) from a servicing bank regarding the amount of a deposit and interest credited under an investment deposit agreement.Regulation No. 331 became effective on 25 May 2016.
Legislation: Regulation of the National Bank of Ukraine “On Introducing the Amendments to Certain Regulations of the National Bank of Ukraine” No. 331 dated 24 May 2016.