CURRENCY CONTROL DURING THE WAR: WHAT BUSINESSES NEED TO KNOW
Under martial law, currency control serves as a key element of the state’s macro-financial policy. Its purpose is to minimize risks of destabilizing the financial system, prevent uncontrolled capital outflow, and maintain the stability of the national currency.
What is currency control?
Currency control is a system of state regulation ensuring that residents and non-residents comply with the currency legislation of Ukraine when conducting foreign currency operations. Its legal basis is the Law of Ukraine “On Currency and Currency Transactions” No. 2473-VIII dated June 21, 2018 (as amended), and regulations of the National Bank of Ukraine (NBU).
During martial law, most foreign currency restrictions were introduced by NBU Regulation No. 18 dated February 24, 2022, “On the functioning of the banking system during martial law.” Courts treat this regulation on the same level as a law and state that it should be applied with priority within the wartime legal framework.
The main currency restrictions are introduced precisely by NBU Regulation No. 18. They include, among others:
1. Settlement deadlines
For export–import operations, a limit of 180 calendar days is set from the date of customs declaration (for exports) or receipt of prepayment (for imports). This applies to transactions conducted from April 5, 2022.
These restrictions do not apply to import of goods (including unfinished settlements) if the transaction amount (based on the NBU exchange rate for the date of transaction) is less than UAH 400,000 (equivalent), except cases of artificial splitting of export or currency transactions.
2. Prohibition of certain foreign currency transactions
Regulation No. 18 prohibits purchasing foreign currency and transferring funds abroad for the purpose of:
– investments outside Ukraine;
– acquisition of securities or corporate rights;
– contributions to authorized capital;
– purchase of real estate abroad.
3. Exceptions for import payments
Foreign currency purchases and transfers abroad are permitted for settlements relating to import of specific goods and services.
4. Currency transactions of individuals
Residents may pay in foreign currency to non-resident accounts only in limited cases (e.g., tuition, accommodation, medical services).
5. Cryptocurrency
Funding electronic wallets with electronic money and circulation of electronic money are restricted.
6. Transactions with residents of the Russian Federation, the Republic of Belarus, and entities associated with the aggressor state
– According to CMU Resolution No. 426 dated April 9, 2022, imports of goods from the Russian Federation are completely prohibited.
– Under Regulation No. 18, banks suspend outgoing transactions from accounts of residents of the Russian Federation/Belarus and legal entities whose ultimate beneficial owners are residents of RF/BY (except banks). However, some exceptions apply.
Impact on business: real examples
Exporters must ensure that foreign revenue is credited within 180 days in accordance with paragraph 14-2 of Regulation No. 18.
Example: A Ukrainian agricultural company exporting goods to the EU must ensure receipt of funds within 180 days from customs clearance. Otherwise, tax authorities will charge a penalty of 0.3% of the unpaid amount per day of delay, but not exceeding the unpaid amount.
Due to temporary NBU restrictions, Ukrainian companies are unable to transfer foreign currency abroad to service debt obligations to foreign creditors.
Example: A resident company received a loan from a non-resident. Due to restrictions, the resident cannot repay the loan in foreign currency. A solution may be opening an account in Ukraine by the non-resident, allowing the resident to repay the loan in the national currency.
Companies planning foreign investments currently cannot transfer foreign currency for such purposes due to the prohibition established by Regulation No. 18.
Adaptation strategies for business
Review contract terms
– Set and monitor settlement deadlines within 180 days.
– Before the deadline expires, apply to the Ministry of Economy to extend the settlement period.
– Before the deadline expires, file a lawsuit to recover debts for delivered goods (penalties are suspended during court proceedings and enforcement).
Optimize payments
– Make payments only for permitted categories of goods/services.
– Control timelines
– Create a monitoring system to avoid penalties.
International settlements
– Cooperate with foreign partners through intermediaries (within legal limits).
Sectoral exceptions and special regimes
Currency restrictions do not apply to settlements for:
– defense goods;
– medical products and equipment;
– humanitarian aid;
– energy equipment.
Regulated by Regulation No. 18.
Conclusion
The National Bank continues to maintain a strict currency regime during martial law, leaving businesses with limited options for international operations.
However, complying with settlement deadlines, structuring contracts correctly, and planning procurement stategically allows businesses to adapt and minimize risks.
Therefore, we recommend contacting LBASE lawyers in advance. We will help properly draft contracts and minimize the risk of penalties for violating settlement deadlines.
07.07.2025
