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Thursday, May 28, 2015

President signed Law on Government's powers to suspend payments on foreign loans

The President has signed Law № 436-VIII of May 19, 2015 "On Peculiarities of Transactions with Public Debt Guaranteed by the State and Local Debt" and Law № 437-VIII on respective amendments to the Budget Code.


The Law authorizes the Cabinet of Ministers and relevant city councils to make decisions regarding the suspension of payments on all or several state foreign loans, foreign loans guaranteed by the state and local foreign loans, as well as regarding the imposition of temporary moratorium on satisfaction of creditors under the obligations of external borrowings subjects on which the Cabinet of Ministers of Ukraine and/or the respective city council adopted an appropriate decision.

Adoption of the Law will change the terms of loans under the state guaranteed debt and local debt and prevent the negative consequences of potential cases of non-fulfillment of obligations, which will release significant funds to support the domestic economy, enhance defense capacity of Ukraine, increase production capacity, create jobs, improve social standards and living conditions of citizens and maintain stability of Ukrainian currency.


The law enters into force on the day following the day of its publication and is valid until July 1, 2016.

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