Law Digest

New special sanctions hit Russian individuals & social networks

President Petro Poroshenko has signed a Decree, which put into effect the Decision of the National Security and Defense Council On Application of Special Personal Economic and other Restrictive Measures (Sanctions).

In particular, sanctions provide for blocking access to the VKontakte and Odnoklassniki social networks. Access is blocked within sanctions imposed on Mail.Ru Group. Moreover, access to Yandex services is also blocked. Internet providers should prohibit access to a number of Yandex resources/services, including Yandex maps (yandex.ua/maps) and other services of both Russian and Ukrainian Yandex.

Economic sanctions also apply to IC, a well-known supplier of ERP-systems as well as a number of other IT companies.

It is important to take into account that the company 1C, a specialist in the distribution, support and development of computer programs and databases for business and domestic purposes, also falls under the sanctions. The software of Parus services, designed to automate the activities of organizations of public and municipal administration, as well as of commercial enterprises, was also banned.

Moreover, the ABBYY, LLC and Abi Ukraine Ltd software development companies were also included in the list.

In particular, the sanctions provide for blocking of assets:  temporary restriction of a person’s right to use and dispose of property, restriction of trade operations, and preventing the withdrawal of capital from Ukraine, suspension of performance of economic and financial obligations.

The presidential decree also provides for limitation or cancellation of telecommunications services provision and public telecommunications networks use.

Companies are prohibited from carrying out public purchases of goods, works and services from legal entities-residents of a foreign state of state ownership and from legal entities, a share in authorized capital of which is owned by a foreign state.

Next step taken towards establishment of National Intellectual Property Office

The Government has authorized the Ministry of  Economic Development and Trade of Ukraine to issue all protection documents (patents, certificates) in the field of intellectual property. The corresponding functions were previously provided by the State Intellectual Property Service of Ukraine.

This decision is the next step towards creation of National Intellectual Property Office (NIPO) in accordance with Plan of Priority Actions of the Government for 2017 and Concept for Reforming the State System of Intellectual Property Legal Protection.

The establishment of NIPO provides for consistent reform of the intellectual property sphere, including gradual institutional restructuring of a national intellectual property protection system.

NIPO will perform the functions of issuing patents (certificates) under the principle of a “single window system” based on the best European and world practices.

The Ministry of Economic Development and Trade will ensure establishment of a unified state policy in the intellectual property sphere, and the corresponding body, whose functions will be performed by Ukrpatent, will be responsible for implementing state policy in this sphere.

New procedure for issuing option certificates

The procedure for issuing option certificates has been changed. In particular, there is no longer a requirement to conclude a preliminary agreement with a depository on servicing securities issue. Furthermore, in case of introduction of changes to the prospectus on an option certificates issue, it will be necessary to submit relevant application and documents to the National Securities and Stock Market Commission and also to register any such changes. Moreover, the global certificate is subject to registration and depositing with the Central Securities Depository.

To register an option certificates issue and prospectus for their issue, the issuer undertakes to submit to the National Securities Commission, in addition to other documents, comprehensive financial statements for the preceding reporting period and the reporting year, certified by signatures and seals of the issuer and auditor. It is also necessary to provide an expert opinion on review of interim financial statements for the reporting period preceding the quarter in which the documents are filed.

NBU eased currency restrictions

The National Bank of Ukraine has eased monetary policy by liberalizing currency regulations.

Thus, the temporary rule, according to which the maximum term for conducting settlements on commodity export and import transactions was reduced to 120 days, was withdrawn. From now on the maximum term for conducting settlements will be 180 days, as established by the relevant law.

Foreign investors will have the opportunity to return funds invested in Ukraine. Until now, it was prohibited to buy and transfer foreign currency to return funds from abroad received by foreign investors from the sale of corporate rights, certain types of securities, due to a decrease in the authorized capitals of legal entities, withdrawal of foreign investors from business entities.

Businesses will have the opportunity to redeem external loans and loans in advance if the obligations of international financial organizations were provided as collateral for conducting settlements under such transactions.

In addition to the liberalization of certain anti-crisis restrictions, the NBU also cancelled restrictions, which made it impossible for an authorized bank to open correspondent accounts in foreign currency of the 1st group of the Classifier in non-resident banks of countries, whose national currency was identified by the NBU as the 2nd or 3rd group of the Classifier.

At the same time, the National Bank has established requirements for the disclosure of information about the ultimate beneficial owners of non-resident creditors.