Foreign Investments Proceeds Exempted From Mandatory Conversion Into Hryvnia And Other Exchange Control Changes Introduced

The National Bank of Ukraine (the "NBU") continues its piecemeal relaxation of the temporary exchange control measures introduced in 2014.

With effect from 11 May 2016, the NBU abandoned the requirement to convert 75% of foreign investments proceeds into Ukrainian hryvnia. According to the NBU's informational letter, the new exemption applies regardless of the way an investment is made – either through a foreign investor's Ukrainian investment account or through a direct payment to a Ukrainian resident. As a result, the change equally benefits foreign investors' Ukrainian counterparties who in many cases prefer to keep their cash funds in foreign currency and are no longer required to convert the proceeds from an investment transaction.