Ukraine eases currency and banking restrictions

We remind our Clients that Ukraine has had a number of restrictive measures in place since the start of the war in order to stabilize the economy and prevent capital outflows from the country. The Ukrainian government has now eased those regulations starting this May.

The recent Resolution No. 56 by the National Bank of Ukraine marks a significant relaxation of currency restrictions, representing the most extensive easing since the onset of the Russian Federation’s invasion of Ukraine.

Key alterations include:

  1. Dividend Payments: Effective May 13, 2024, Ukrainian companies can disburse dividends to non-residents, capped at EUR 1 million monthly from profits accrued since January 1, 2024. However, dividends generated before this date remain inaccessible.
  2. Import Payments: Authorization for the settlement of all imports of goods and services.
  3. Foreign Currency Loan Servicing: Businesses can now remit loan interest abroad, limited to EUR 1 million quarterly or 12% annually. The prerequisite period for interest payments has been shortened from 3 years to 1 year.
  4. Leasing and Rental Payments: Unrestricted payments under leasing and rental contracts, extending beyond vehicle-related agreements.
  5. Fund Transfers by Foreign Airlines and Card Payment Systems: Representative offices of foreign airlines and international card payment systems can transfer funds to parent companies, with a ceiling of EUR 5 million monthly.

These adjustments, effective from May 4, 2024, except for dividend distribution which commences on May 13, 2024, signify a large shift in the banking regulations which will make it easier for foreign business to operate in Ukraine.

For any additional questions, please contact us.

Recent Posts

March 14, 2024

Are due diligence services exempt from VAT within the scope of the international technical assistance (ITA) project? 

We use a case example where an audit firm based in Ukraine and a foreign entity entered into an agreement for due diligence services. The…

Continue reading
February 26, 2024

E-invoicing in Ukraine: Key Facts you Need to Know

Benefits from efficiency and security through to saving physical resources make e-invoicing a convenient, cost-effective and eco-friendly option for businesses of all sizes. And with…

Continue reading
February 19, 2024

Ukraine Urges FATF Action Against Russia

In a joint appeal, the Ministry of Finance of Ukraine and the Financial Monitoring Service of Ukraine have called on the Financial Action Task Force…

Continue reading