Ukraine National Commission on Securities and Stock Market approves updated draft rules for OTC transactions in foreign-currency domestic government bonds

The Ukraine National Commission on Securities and Stock Market held an open committee meeting and approved an updated draft decision to regulate over-the-counter transactions in domestically issued government bonds denominated in foreign currency. The proposals reflect an initiative of the National Bank of Ukraine and are referenced in the updated Memorandum of Cooperation between Ukraine and the International Monetary Fund. Feedback from 13 organisations was received and largely incorporated into the revised draft. Key changes include exemptions for banking institutions, on the basis that settlement for transactions involving banks is governed by National Bank of Ukraine regulations, while the Commission also highlighted legal restrictions that prevent legal entities holding foreign-currency domestic government bonds from selling them and linked these constraints to the National Bank’s current regulatory policy. The NSSMC indicated it will re-engage the National Bank to address the issue and advised market participants to direct disputes on currency control and related operations to the National Bank. The revised decision, finalised after the discussion, will be submitted to the Commission for consideration in the near future.