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Payments Under Contracts

Payments Under Contracts

Ukraine
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From February 24, 2022, under martial law, the banking system operates in a special mode.

Payments within Ukraine

  • Non-cash payments. There are no restrictions on the use of standard accounts. According to the NBU, the electronic payment system (EPS) operates normally. Banks of Ukraine are connected to EPS and continue to operate as usual and without interruptions.
  • E-money. Banks issuing e-money suspended issuance of e-money, replenishing e-wallets with e-money, and e-money distribution. Quasi cash transactions (replenishment of e-wallets, brokerage or forex accounts, payment of traveler's checks, purchase of virtual assets, etc) and P2P transfers are limited to UAH 100,000 (equivalent) per month.
  • Cash.There are restrictions on cash withdrawals: UAH 100,000 per day (excluding wages and social benefits) or the equivalent of up to UAH 100,000 in foreign currency.

Restrictions do not apply to the accounts of enterprises that ensure the implementation of mobilization plans and in bank branches located in areas threatened by Russian occupation (these are probably the areas with the most intense hostilities).

However, many bank branches did not work and, accordingly, did not provide cash for civil transactions. In turn, retail stores that have card payment terminals can issue cash if it is in cash register.​

Foreign economic transactions and other transfers in foreign currency are frozen.

Exceptions (quite wide) are:

  • Operations to carry out mobilization and other activities;
  • Import operations of residents on the purchase of goods of critical imports, approved by the Resolution of the Cabinet of Ministers of Ukraine № 153 of February 24, 2022 (with further additions). These include items of tactical protection, medicines, medical devices, semiconductors, fuel, energy carriers, most groups of food and components, paper products, plant protection products, seed material, electric generator sets, chemical alkalis and acids, sewing material made of cotton and staple, agricultural inputs, raw materials for the production of light industry goods, etc;
  • By special permission of the NBU on the submission of the Cabinet of Ministers of Ukraine.

Foregoing payments are made by banks under a significantly simplified procedure of currency supervision and without restrictions.

Payments on transactions with the aggressor state

Any payments are prohibited:

  • with the use of Russian or Belarusian rubles;
  • with the use of cards issued in the territory of the Russian Federation or the Republic of Belarus or transfers using systems that have participants from these countries;
  • to fulfill obligations to persons who are registered or permanently resident in the Russian Federation or the Republic of Belarus;
  • to fulfill obligations to the business entity, controlled or beneficially owned by persons from the Russian Federation or the Republic of Belarus.

By Igor Krasovskiy, Partner, and Oleh Zahnitko, Partner, Integrites

Ukraine Knowledge Partner

AVELLUM is a leading Ukrainian full service law firm with a key focus on Finance, Corporate, Dispute Resolution, Tax, and Antitrust.

Our aim is to be the firm of choice for large businesses and financial institutions in respect of their most important and challenging transactions.

We build lasting relationships with our clients and make them feel secure in new uncertain economic and legal realities.

We incorporate the most advanced Western legal techniques and practices into our work. By adding our first-hand knowledge, broad industry experience, and unparalleled level of service we deliver the best results to our clients in their business endeavours. Our partners are taking an active role in every transaction and ensure smooth teamwork.

AVELLUM is recognised as one of the leading law firms in Ukraine by various international and Ukrainian legal editions (Chambers, The Legal500, IFLR1000, The Ukrainian Law Firms, and others).

Firm's website: www.avellum.com

 

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