Essentially
Currency regulation. Relaxed the rules of the game
Currency regulation. Relaxed the rules of the game
Legal event:
The resolution of the NBU Board dated on December 4, 2015 № 863 "About the settlement of the situation on the monetary and currency markets of Ukraine" entered into force on 5 December and will be valid until 4 March 2016.
Impact on business:
The saved document requirements such as mandatory sale of proceeds in foreign currency in favor of legal entities in the amount of 75%, the settlement of transactions of exports and imports of goods for up to 90 days, a ban on early repayment by residents of credits, loans in foreign currency under contracts with non-residents and others.
At the same time, the mandatory sale of 75% now does not apply to loans granted to the resident-borrower with the participation of foreign export credit Agency to fulfill the obligations under import contract to a nonresident. This applies only to those cases where the foreign creditor transfers the funds under the import contract of the borrower directly to the account of the non-resident exporter, i.e. without crediting those funds to the account of the resident borrower.
Also mandatory requirement no longer applies to the sale of financial support (guarantee, collateral, Deposit), which provides for resident participation in the competitive bidding in public procurement. This should facilitate the access of nonresidents to government procurement.
In addition, earlier banks were allowed not to implement the mandatory sale of proceeds that are returned at the initiative of the foreign beneficiary Bank within 2 days after their listing. New NBU Resolution increases this period from 2 to 7 days.
The National Bank also liberalizes its calculations of individuals outside Ukraine, which are implemented with the use of electronic means of payment. The changes relate to rules that allowed to make transfers from current account in foreign currency in the amount that does not exceed 150 000 UAH per month. Now this restriction does not apply to non-cash transactions performed using electronic payment instruments for payment of goods and services for own consumption of individuals.
The decision weakened the ban on the purchase of foreign currency for subsequent transfer of funds abroad, received by foreign investor from the sale of securities of Ukrainian issuers. Henceforth, this prohibition shall not apply to funds received from the sale of state bonds of Ukraine not only on the stock exchanges, as it was before, but also beyond.
To support the Mission of the International Committee of the Red Cross in Ukraine was made an exception on the restriction of cash from the cash of the Bank. Now the maximum amount of cash from the cash per client per day in UAH 300,000 UAH - according to the Resolution, this limit does not apply to the statutory activities of the Mission.
The Regulation is aimed at tightening financial discipline of banks and their clients:
1.As for the right to buy foreign currency on behalf of a resident customer, the funds of which are on accounts in foreign currency, yet an authorized Bank had no right to buy foreign currency on behalf of the client-resident (excluding natural persons) that has currency funds on current and Deposit accounts.
Now the Bank will not be able to buy it and for the clients whose funds posted on the balance sheet 2602 "Funds in the calculations of economic entities". This applies to funds that are accounted for as cash collateral (coverage) in the foreign currency of the customer under the guarantee, counter-guarantee or standby letters of credit in this and (or) other authorized banks. The Bank may buy foreign currency only for those customers resident in which the total amount of monetary funds deposited on current and Deposit accounts and in the balance sheet 2602, less than $ 25,000 USD. This move should encourage banks ' clients to use their own funds in foreign currency to meet its foreign exchange liabilities.
2.National Bank is given the right not to confirm the purchase or transfer of foreign currency, if there are signs of risky activities of banks.
This right is also granted in cases where the regulator came to the conclusion that the nature or potential consequences of financial transactions indicate the use of the Bank for the purpose of legalization (laundering) of proceeds from crime, financing of terrorism or funding of proliferation of weapons of mass destruction.
However:
It should be noted that the relaxation of the conditions, still has a point nature.
Legal event:
The resolution of the NBU Board dated on December 4, 2015 № 863 "About the settlement of the situation on the monetary and currency markets of Ukraine" entered into force on 5 December and will be valid until 4 March 2016.
Impact on business:
The saved document requirements such as mandatory sale of proceeds in foreign currency in favor of legal entities in the amount of 75%, the settlement of transactions of exports and imports of goods for up to 90 days, a ban on early repayment by residents of credits, loans in foreign currency under contracts with non-residents and others.
At the same time, the mandatory sale of 75% now does not apply to loans granted to the resident-borrower with the participation of foreign export credit Agency to fulfill the obligations under import contract to a nonresident. This applies only to those cases where the foreign creditor transfers the funds under the import contract of the borrower directly to the account of the non-resident exporter, i.e. without crediting those funds to the account of the resident borrower.
Also mandatory requirement no longer applies to the sale of financial support (guarantee, collateral, Deposit), which provides for resident participation in the competitive bidding in public procurement. This should facilitate the access of nonresidents to government procurement.
In addition, earlier banks were allowed not to implement the mandatory sale of proceeds that are returned at the initiative of the foreign beneficiary Bank within 2 days after their listing. New NBU Resolution increases this period from 2 to 7 days.
The National Bank also liberalizes its calculations of individuals outside Ukraine, which are implemented with the use of electronic means of payment. The changes relate to rules that allowed to make transfers from current account in foreign currency in the amount that does not exceed 150 000 UAH per month. Now this restriction does not apply to non-cash transactions performed using electronic payment instruments for payment of goods and services for own consumption of individuals.
The decision weakened the ban on the purchase of foreign currency for subsequent transfer of funds abroad, received by foreign investor from the sale of securities of Ukrainian issuers. Henceforth, this prohibition shall not apply to funds received from the sale of state bonds of Ukraine not only on the stock exchanges, as it was before, but also beyond.
To support the Mission of the International Committee of the Red Cross in Ukraine was made an exception on the restriction of cash from the cash of the Bank. Now the maximum amount of cash from the cash per client per day in UAH 300,000 UAH - according to the Resolution, this limit does not apply to the statutory activities of the Mission.
The Regulation is aimed at tightening financial discipline of banks and their clients:
1.As for the right to buy foreign currency on behalf of a resident customer, the funds of which are on accounts in foreign currency, yet an authorized Bank had no right to buy foreign currency on behalf of the client-resident (excluding natural persons) that has currency funds on current and Deposit accounts.
Now the Bank will not be able to buy it and for the clients whose funds posted on the balance sheet 2602 "Funds in the calculations of economic entities". This applies to funds that are accounted for as cash collateral (coverage) in the foreign currency of the customer under the guarantee, counter-guarantee or standby letters of credit in this and (or) other authorized banks. The Bank may buy foreign currency only for those customers resident in which the total amount of monetary funds deposited on current and Deposit accounts and in the balance sheet 2602, less than $ 25,000 USD. This move should encourage banks ' clients to use their own funds in foreign currency to meet its foreign exchange liabilities.
2.National Bank is given the right not to confirm the purchase or transfer of foreign currency, if there are signs of risky activities of banks.
This right is also granted in cases where the regulator came to the conclusion that the nature or potential consequences of financial transactions indicate the use of the Bank for the purpose of legalization (laundering) of proceeds from crime, financing of terrorism or funding of proliferation of weapons of mass destruction.
However:
It should be noted that the relaxation of the conditions, still has a point nature.