Law Digest (#03 March 2015)

LAW DIGEST

Deregulation of business

The Resolution of the CMU On Some Issues of Deregulation of Business of 28 January 2015, No.42 became effective on 11 February 2015. In particular, the Resolution is aimed at simplifying the procedure for state registration of food products, control of pesticides, agrochemicals, at abolition of the mandatory monitoring of the implementation of special terms of using mineral resources, as well as at simplifying employment of foreigners and persons without citizenship. The Resolution cancels examination of the quality of special food products. It introduces a clear procedure for issuance of registration certificates of plant protection products and permits to import plant protection products for the purpose of official testing, and it also sets specific deadlines for some stages of the process. The document cancels the mandatory quarantine certificates for grains and oilseeds, derivative products, wastes and residual products of the food industry, and the term of issuance of phytosanitary certificates is reduced down to 24 hours after cargo unloading. Furthermore, it introduces an abridged procedure for obtaining permits for IT sector employees and graduates of prestigious universities in some instances specified in the document.

 

Currency restrictions

The Resolutions of the National Bank of Ukraine (the NBU) On Peculiarities of Certain Foreign Currency Transactions of 23 February 2015, No.124 and On Amendment of Certain Normative Acts of the National Bank of Ukraine of 24 February 2015, No.130 introduced a number of additional currency control restrictions and prohibitions. The resolutions are reported to be aimed at preventing further capital outflows from Ukraine and to stabilize the situation on the foreign exchange market.

The NBU has prohibited use of any proceeds of UAH loans obtained from Ukrainian banks in order to purchase foreign currency funds. This restriction does not apply to individuals who are entitled to purchase foreign currency for the purposes of repaying their consumer loans.

Banks are prohibited from making down payments in foreign currency under import contracts for the amount exceeding USD 50,000 (or equivalent in other currency) without approval from the NBU. This restriction does not apply to payments with letters of credit. Approved payments may be processed by authorized banks not sooner than the fourth day after submitting information about such payments in the register.

All foreign currency transactions under import contracts exceeding USD 500,000 (or equivalent in other currency) must be made using letters of credit. Such letters of credit must also be confirmed by banks ranked not lower than investment grade.

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