The National Bank of Ukraine (NBU) on Friday informed all banks in the country that, following the launch of a civil court case, it had suspended its regulation – the so-called NBU Regulation No. 482 of 14 October 2004 – that makes it mandatory to settle the cash leg of any foreign investment in the country in on-shore cash.
“The suspended regulation stipulates obligatory on-shore cash settlement for all types of foreign investment as well as other restrictions in respect of foreign investments,” explains Bohdana Vefremova, head of custody at HVB Ukraine in Kiev. “This decision means HVB Ukraine will continue to be able to settle free of payment transactions for its international clients without checking that cash settlement is done in Ukrainian Hryvnia on-shore, at least until further notice by the NBU. T-Bills settlement continues to be possible only against payment in local currency.”
The civil case was initiated by a foreign national to halt the application of the Regulation 482, which is also known as “On the Procedure for foreign investments in Ukraine and repatriation of foreign investment, income, and other revenues received from investment activities in Ukraine.”