Ukraine: Ukraine tightens currency control rules

Vladimir Kotenko		Iryna Kalyta

In late August, the National Bank of Ukraine tightened currency controls, trying to keep the volatile Ukrainian Hryvnia afloat.

• Cross-border offsets prohibited: On August 29 2014, the National Bank of Ukraine prohibited cross-border offsets until further notice. Offsets were restricted in practice since December 2013.
• Mandatory sales of currency proceeds: 100% of foreign currency proceeds will be subject to mandatory conversion into local currency (as compared to 50%). This restriction is supposed to be in place temporarily, until November 21 2014.
• 90-day rule extended: National bank extended the rule obliging Ukrainian companies to collect export proceeds and receive prepaid goods, works, and services within 90 days (instead of the regular 180 days). This rule is extended until November 21, but further extensions are expected.

The Ukrainian government is also rumoured to be considering increasing the pension fund levy on purchase of foreign currency for individuals to 2% (as compared to 0.5% currently payable).

Vladimir Kotenko (vladimir.kotenko@ua.ey.com), Iryna Kalyta (iryna.kalyta@ua.ey.com)
EY
Tel: +380 44 490 3000; +380 44 490 3030
Website: www.ey.com/ua

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