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Cross-Border Payments in Hryvnia: NBU Clarifies Rules for Settlements in Hryvnia
Baker & McKenzi, Kyiv, Ukraine, Tuesday, July 17, 2012
On 28 May 2012 the National Bank of Ukraine (the "NBU") amended the procedure for making settlements in Hryvnia ("UAH") between Ukrainian residents and non-residents during cross-border trading activities. Now all such settlements must be made through a UAH correspondent account of non-resident bank opened with a Ukrainian resident bank.
In effect, the NBU clarified the manner in which Ukrainian residents and non-residents of Ukraine can make payments to each other in UAH for goods, works and/or services sold and/or rendered to each other following the changes to the foreign exchange and currency control rules that abolished the need to obtain an individual NBU license for cross-border settlements in UAH.
In particular, the NBU amended the procedure under which a non-resident bank uses a UAH correspondent account opened with a Ukrainian resident bank such that now all settlements in UAH between residents and non-residents of Ukraine during their trading activity may only be carried out through such account. The non-resident bank should be registered in the same jurisdiction as the relevant non-resident.
These amendments were made to the regulation "On the Opening and Functioning of Accounts in Hryvnia and Foreign Currency for Non-Resident Banks at Resident Banks", approved by Resolution No. 118 of the Board of the NBU, dated 26 March 1998, and came into effect on 27 June 2012.
These amendments were adopted in pursuance of the amendments to Decree of the Cabinet of Ministers of Ukraine No. 15-93 "On the System of Currency Regulation and Currency Control", dated 19 February 1993, which allowed residents and non-residents to make payments in UAH during their cross-border trading activities and abolished the need to obtain an individual NBU license for such purposes. By introducing the amendments the NBU clarified the way cross-border payments in UAH for goods, works and/or services are made between non-residents and residents of Ukraine.
Additional notes
This LEGAL ALERT is issued to inform Baker & McKenzie clients and other interested parties of legal developments that may affect or otherwise be of interest to them. The comments above do not constitute legal or other advice and should not be regarded as a substitute for specific advice in individual cases.
