Peculiarities of currency regulation in Ukraine
Introduction
Currency regulation is a key element of the financial system of any country, as it defines the rules for foreign currency circulation, foreign exchange transactions, as well as related restrictions and requirements. In Ukraine, currency regulation is aimed at ensuring the stability of the national currency, preventing financial crises and maintaining international financial relations. In this article, we will review the main provisions and peculiarities of currency regulation in Ukraine.
Legal framework
The Law of Ukraine "On Currency and Currency Transactions":
- The main regulatory act governing foreign exchange transactions establishes the rights and obligations of foreign exchange transactions, as well as the powers of state authorities in the field of foreign exchange regulation.
Resolutions of the National Bank of Ukraine (NBU):
- The National Bank of Ukraine issues regulations detailing the procedure for conducting foreign exchange transactions, requirements for market participants, and standards to be observed.
The Civil Code of Ukraine:
- Regulates certain aspects of foreign exchange transactions, including the conclusion and execution of foreign exchange contracts.
Main provisions of currency regulation
Liberalization of the foreign exchange market:
- In recent years, Ukraine has been pursuing a policy of liberalizing the foreign exchange market, which involves lifting restrictions on foreign currency circulation, simplifying foreign exchange transactions and reducing the administrative burden on market participants.
Currency transactions:
- Currency transactions are divided into current and capital transactions. Current transactions include payments under export-import contracts, transfers of salaries, dividends, etc. Capital transactions include investments, loans, and other transactions related to the movement of capital.
Currency control:
- The National Bank of Ukraine monitors compliance with currency legislation. Banks and other financial institutions also act as currency control agents, verifying the legality and validity of their clients' currency transactions.
Currency restrictions:
- In certain cases, the NBU may impose temporary currency restrictions to stabilize the economic situation, prevent capital outflows, and support the national currency.
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Peculiarities of currency regulation
Investing abroad:
- To make investments outside Ukraine, residents must obtain an individual license from the NBU. However, these requirements have been gradually liberalized recently.
Mandatory sale of foreign currency earnings:
- In certain periods, the NBU may impose a requirement to sell a portion of the foreign exchange earnings received by exporters to support the foreign exchange market.
Limits on currency transactions:
- Setting limits on certain types of currency transactions, including transfers abroad by individuals without opening an account.
Declaration of currency values:
- Residents of Ukraine are required to declare currency valuables and other property located outside the country.