Lawyer: NBU Resolution Prohibiting Businesses from Converting Foreign Currency Loans into Hryvnia Contradicts the Law
Kyiv • UNN
The NBU's resolution banning the conversion of foreign currency loans for business contradicts the principle of freedom of contract. Attorney Rostyslav Kravets believes that Ukraine's banking system needs to be rehabilitated and foreign capital restricted.
The NBU's resolution banning the conversion of foreign currency loans for business contradicts the norms of the current legislation, as there is freedom of contract. This opinion was expressed by attorney Rostyslav Kravets in an exclusive commentary to UNN.
I believe that this resolution directly contradicts the norms of the current legislation, given that according to the law we have freedom of contract
However, due to this ban, even if the client and the bank agree to convert a foreign currency loan or part of it into hryvnia, the bank cannot do so because of the ban.
The lawyer also explained that it is possible to try to overturn such a ban through the courts, but such an appeal may take years and will not have any effect.
Formally, the banking system in Ukraine today needs to be radically rehabilitated and foreign capital removed so that Ukraine can have independence in choosing financial instruments. I believe that foreign capital in the banking sector should not exceed 5% to ensure national security,
Add
As experts note in comments to UNN, the resolution banning the conversion of foreign currency loans into hryvnia for business does not have to be canceled, but should be eased. In particular, the bank and the client should be allowed to resolve this issue on an individual basis.
Context
Since the beginning of the full-scale invasion, Ukrainian business has demonstrated resilience and readiness to quickly adjust to current challenges.
In the case of the ban on converting foreign currency loans into hryvnia, Ukrainian businesses often resort to unpopular steps to stay afloat and avoid losing everything.
One of the Ukrainian businesses that has a foreign currency loan that dates back to 2006 is the owners of the Gulliver shopping center in Kyiv. By the way, at the time of the loan, the company that received the loan had other owners. The crises of 2008 and 2014 dealt an irreparable blow to businesses that were lent in foreign currency. This led to the fact that the current owners of Gulliver were forced to restructure their debt in 2020. However, they were unable to convert the loan into hryvnia.
