Date of publication: 18 September 2018
Nina Bets, Lawyer
In summer this year another step was taken to bring the Ukrainian legislation in line with the European standards – the President signed a new Law On Currency and Currency Exchange Transactions. Shortly thereafter the National Bank of Ukraine made public the draft structure of currency regulation, which will come into force after the Law becomes effective, namely, from 7 February 2019. And thus, fifty-six existing regulatory acts will be replaced by seven new ones. The slogan of the new currency regulation regime can be formulated as “everything which is not prohibited by law is allowed”.
What novations are we talking about? The main ones are as follows:
• The currency supervision over the export-import transactions up to UAH 150,000 is canceled;
• The period for settlements within a framework of export-import transactions will be increased from 180 to 365 days;
• The information on loan agreements’ conclusion with non-residents will be collected for statistical purposes only;
• The obligation to obtain individual licenses for investments abroad is canceled;
• The cancellation of the obligation to declare currency values abroad is expected;
• The buying of foreign currency will be permitted online.
The permission to buy foreign currency online applies to individuals only. Such transactions will be subject to the same limit as for the currency buying in cash. Currently this limit is UAH 150,000 per day in the foreign currency equivalent.
However, it should be recalled that earlier Privatbank, unlike other banks, has already allowed for the purchase of foreign currency online. This could have been done via Privat24 Application at any time. In order to take advantage of this opportunity the client of the bank should have had a currency account opened to transfer money thereto.
In May 2014, when the shortage of cash currency in exchange offices was particularly felt, the bank’s clients converted hryvnias on their cards in the amount of about USD 6 million and EUR 1 million. And, starting from 1 September 2017, Privatbank prohibited the sale of foreign currency online, referring to the restriction of the Ukrainian currency legislation. Now, after the currency liberalization is launched, Privatbank will be able to restore this service to its clients.
In fact, these changes are intended to make the life of individuals easier. After all, in order to get some currency on card there will be no need to make a mandatory purchase of currency in cash and then credit this money to the card.
As a result of such changes Ukrainians will be able to pay on the Internet without losing money on double conversion. In addition, taking into account the weakening of currency legislation on investments abroad, it will be further possible to transfer the purchased currency to accounts opened by Ukrainians in foreign banks. However, it is necessary to remember about UAH 150,000 limitation and that the execution of all transactions is closely monitored by banks for countering money laundering and terrorist financing.