NBU revises a number of currency restrictions

The NBU is updating a number of currency restrictions. The changes will come into effect on July 11, 2024.

First, the changes are aimed at increasing Ukraine's investment attractiveness and attracting private foreign capital. To this end, the NBU

• allowed domestic businesses to reimburse non-residents for expenses incurred due to their participation in the provision of an external loan to a Ukrainian borrower. The condition for such a transaction is that the guarantor, surety or insurer of the external loan must be a foreign export credit agency or a foreign state, or the guarantor or surety of such an obligation is an international financial institution (IFI). These changes will expand the opportunities for Ukrainian companies to attract new external loans and borrowings;
• allowing funds to be transferred to foreign companies whose shareholders include a foreign state to pay insurance premiums under contracts covering military risks in Ukraine. This will be an important signal to investors and donors that they can reduce their investment risks in Ukraine in the event of a full-scale invasion of Russia;
• Enabled residents to transfer funds under guarantees or sureties provided by them to ensure the fulfillment of obligations of resident borrowers under external loans and borrowings (provided that such payments by a resident borrower are permitted by Resolution No. 18). This will have a positive impact on the interest of foreign lenders in resuming credit support to private borrowers from Ukraine;
• regulated the possibility of resident borrowers to purchase foreign currency for its reservation under a loan agreement with an IFI, which will increase the support of Ukrainian business by IFIs;
• introduced clarifying amendments to the May liberalization package, which allowed scheduled interest payments on external corporate debt. The amendments are aimed at unifying approaches to the payment of such scheduled interest (coupons) in cases of different structuring of borrowings.

Second, the NBU continues to take steps to help improve Ukraine's defense capabilities and support the volunteer community. In particular

• the list of defense goods that can be purchased abroad by individual volunteers is being expanded. This list will include components for UAVs (UKTZED codes 8407, 8526, 8529, 8537, 8542, 8543, 8807, 9004, 9013-9015, 9027), as well as thermal blankets and thermal heaters (UKTZED codes 2915, 3824, 3920).

As a reminder, starting from 4 April 2022, individuals have been able to purchase foreign currency within the monthly limit of UAH 400 thousand in equivalent and transfer it abroad to purchase goods from the list determined by the National Bank to contribute to the defense capability of Ukraine. In addition, starting from August 6, 2022, individual volunteers can pay with hryvnia payment cards without restrictions to purchase the relevant goods abroad. The above list already includes thermal imagers, radios, body armor, helmets, helmets, military and tactical uniforms, military and tactical footwear, protective clothing, optical surveillance devices, unmanned aerial vehicles, sleeping bags and first aid equipment;

• in addition to the possibility for non-residents to make charitable contributions in foreign currency in Ukraine, the NBU has allowed them to make corresponding transfers in hryvnia. Such contributions may be made to the accounts of both government agencies and charitable foundations to contribute to Ukraine's defense capabilities and to meet other urgent needs of the population in times of war.

Third, the NBU made other clarifying changes to support households and businesses, in particular

• allowing individuals to return social benefits received in a foreign country. These changes will allow Ukrainians to fulfill their obligations to the authorities of foreign countries, which will prevent the deterioration of the conditions for providing assistance to forced migrants;
• Enabled businesses to pay fees for actions related to the protection of intellectual property rights, including payment for services provided by patent offices of other countries and services of patent attorneys abroad.

Fourth, the NBU has specified the existing limit of UAH 100 thousand per day for the purchase and sale of foreign currency cash for non-cash funds in hryvnia, which corresponds to the limit on cash withdrawals from customers' current accounts. The clarification applies exclusively to non-cash funds, which means that Ukrainians will continue to be able to carry out currency exchange transactions with cash without any limitations on the amount.

These and other clarifying amendments were introduced by Resolution of the Board of the National Bank of Ukraine No. 83 "On Amendments to Resolution of the Board of the National Bank of Ukraine No. 18 dated February 24, 2022" dated July 09, 2024. They will come into force on July 11, 2024.

In addition, the list of transactions on the accounts of foreign companies has been clarified. To this end, on July 9, 2024, the Board of the National Bank of Ukraine approved Resolution No. 82 "On Amendments to the Regulation on Protection Measures and Determining the Procedure for Certain Transactions in Foreign Currency", which also comes into force on July 11, 2024.