On 26 March 2016 Resolution No. 192 of the Management Board of the National Bank of Ukraine (the “Resolution”) became effective. The Resolution relaxes certain of the anti-crisis currency control restrictions which have been in place for nearly two years.

Early repayment of cross-border loans

The Resolution expands the list of exceptions to the current prohibition on early repayment of cross-border loans.

Pursuant to the Resolution, the National Bank of Ukraine (the “NBU”) will register amendments to cross-border loans which relate to:

changing the frequency of interest payments from yearly to quarterly/monthly or from quarterly to monthly; and/or

acceleration of an interest payment date by not more than 180 days.

In addition, the Resolution permits the early repayment of cross-border loans, or parts thereof, which have been made with the participation of a foreign export credit agency.

We note that the early repayment prohibition does not apply in the case of cross-border loans extended by international financial institutions.

Foreign currency transfer restrictions

In accordance with the Resolution, a Ukrainian bank can now make payments, on the basis of an individual licence from the NBU to the investment account of a foreign investor held with such a bank, provided that both of the following criteria are met:

the money paid into the investment account will be used for purposes of increasing the charter capital of the bank with which the investment account has been opened; and

payments under the individual licence are made during the term of its validity and within the limits set out therein, taking into account any payments which have been made prior to 26 March 2016.

Further intentions of the NBU

The National Bank of Ukraine has stated that it will further relax the existing currency control restrictions if the foreign exchange market and national economy stabilise.

If you would like to receive further information or require assistance in connection with the above, please contact Redcliffe Partners.

Olexiy Soshenko

Olexiy.Soshenko@redcliffe-partners.com

Dmytro Orendarets

Dmytro.Orendarets@redcliffe-partners.com