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Ukraine: Loan Registration Requirement Lifted for IFIs

Ukraine
22/09/2017
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On 13 September 2017, the National Bank of Ukraine (the “NBU”) adopted the Resolution No. 88, which creates a more conducive environment for the financing of projects in Ukraine by international finance institutions (“IFIs”).

The key changes of the Resolution No. 88 only apply to (i) IFIs which Ukraine is a member of, and (ii) IFIs considered as such by law.

The adopted changes relate to loan facilities granted by IFIs to Ukrainian borrowers, namely:

  1. Removal of the obligation to register loan agreements as well as any amendments thereto with the NBU;
  2. Right of IFIs to issue loans denominated in UAH as long as all payments by and to the IFI under the respective loan agreement are made in foreign currency;
  3. Right to purchase and/or transfer foreign currency abroad in favour of the IFI without the NBU registration or licence in order to discharge any payment obligations set out in the loan agreement. This right is granted to the borrower himself and to any other person that substitutes the borrower in performing the obligations of the loan agreement.

These new rules provide IFIs and their Ukrainian clients with more flexibility in drafting and amending the provisions of their loan facilities, which should increase the number and volume of projects financed by IFIs in Ukraine.

Legislation:

Resolution of the National Bank of Ukraine “On Introducing the Amendments to Certain Regulation of the National Bank of Ukraine” No. 88 dated 7 September 2017.

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