The Law of Ukraine "On Agricultural Notes" will come into force next year
President of Ukraine Volodymyr Zelenskyy signed the Law of Ukraine No. 3586-IX "On Agricultural Notes" dated 22.02.2024 .
The Law will come into force on January 1, 2025.
The document introduces a new financial instrument for lending to agricultural production - agricultural notes. However, the new Law does not apply to the relations regulated by the Law "On Agricultural Receipts". Traditional paper agricultural receipts will continue to be used.
Key advantages of electronic agricultural notes:
An agricultural note as a non-issue security is an independent subject of circulation in the capital markets, so the lender will be able to easily sell it and use the proceeds for further lending to farmers under the new electronic agricultural notes.
The law expands both the range of entities that can issue electronic agricultural receipts to include agricultural cooperatives and the types of collateral: livestock and primary processing products.
Simplification and reduction of the procedure for issuing, circulating and terminating electronic agricultural receipts compared to traditional paper receipts. A farmer will be able to issue an electronic agricultural note from his personal e-cabinet in a specially created Register of Agricultural Notes without paying money for notary services.
The law ensures the reliability of the agrarian note. If the debtor fails to fulfill its obligations under the agrarian note, the creditor may obtain a writ of execution for the relevant recovery by applying to the Agrarian Note Register.
The advantage of the document is the expansion of possible pledge options, including the possibility of pledging live animals and products of animal origin, as well as products of their primary processing, which creates conditions for attracting resources to livestock farms.
The law will help agricultural producers gain greater access to credit, increase the number of lenders able to finance the agricultural sector, and reduce the cost of obtaining money.
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