On 4 January, the National Bank of Ukraine (the "NBU") approved and published a number of regulations setting out a new legislative framework for Ukrainian currency control. These regulations will come into effect on 7 February 2019, along with a new law titled "On Currency and Currency Operations".
The previous outdated currency control regime was based on the principle that all currency transactions, save for a few exceptions, require a license from the NBU. The new law makes a long-awaited shift to the principle that all currency transactions are permitted unless expressly restricted by law. In parallel, the liberalisation of the currency control regime will, in effect, be replaced by financial monitoring, as well as a tightening of tax legislation, such as through BEPS and similar measures.
This relaxation of currency control will be introduced gradually and with caution, in order to preserve the financial stability of the country. Some of the restrictions will likely be lifted only once Ukraine adopts the contemplated BEPS measures. As a result, some restrictions have already been completely cancelled, some have been modified and significantly simplified, while others have been retained for the time being.
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