“The President’s Law on Currency is yet another deceit of business expectations” – Samopomich

The Verkhovna Rada adopted in the first reading the presidential draft law on currency. The faction of Samopomich had submitted its alternative bill, because the presidential law only declares the principles of monetary liberalization, but does not provide for specific mechanisms for its implementation.

MP Tetiana Ostrikova of the Samopomich faction informs, “The President’s bill does not specify how the simplification of currency circulation should be implemented and what exactly will ensure the free flow of capital, as stipulated in the Association Agreement with the EU. It is proposed to determine all these things through the acts of the regulator – the National Bank of Ukraine.

But for many years, the National Bank has already had all the powers to establish the rules for the circulation, purchase and transfer of currency abroad. However, to date, these rules are pro-Soviet, tough, overregulated, while measures for their control are administrative and ineffective. Honest entrepreneurs suffer from such overregulation, while others manage to find the ways to move currency abroad. According to the available statistics, about 11 billion dollars are annually withdrawn from Ukraine to low-tax jurisdictions. Sometimes Ukrainian entrepreneurs are forced to open companies abroad in order to bypass our obsolete Soviet currency restrictions, for example, the terms for the return of currency earnings and the mandatory sale of currency.”

MP Olena Sotnyk of the Samopomich faction adds that another significant drawback of the presidential bill on currency is that it does not specify what kind of liability the business will incur in the event of violations of the currency legislation. “If we really want to compete for human resources and financial capital and to be able to attract significant funds to the economy of Ukraine, we must create relevant conditions.” Any businessman who chooses jurisdiction assesses how comfortable and predictable it is for them. We hear it all the time from various investors that Ukrainian jurisdiction is absolutely unpredictable, it does not protect the right of ownership at all and is uncomfortable to the external investors.”

Olena Sotnyk is convinced, “Unless the systemic shortcomings of the president’s bill on currency regulation are corrected, we will once again end up in a situation when one person who heads an organization decides on the rules of the game for the whole country. And we will definitely lose the chance for development, growth, and well-being.”

Now the draft law will be prepared for the second reading. During this time, the representatives of the Samopomich faction will be introducing the amendments necessary for its effectiveness.

“This law should not be about currency only, this law should give an answer to the question what will make Ukrainian economy grow,” concludes Roman Semenukha. “We are convinced that a real liberal currency law that will allow attracting huge investments will be one of the points of growth along with the construction of infrastructure, introduction of the land market, introduction of the second funded level of pensions. These are the things that could let Ukrainian economy grow in the near future”


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