Country Manuals Private Banking
UKRAINE OUT OF BANK’S COUNTRY OF ESTABLISHMENT (Def, RS, BT & RT)
Regulatory Template
Material changes
The Manual has been updated in consultation with our local lawyers to ensure the documents remain up-to-date and in line with the evolving interpretation of the legal and regulatory framework.
On 1 July 2021, the new Law of Ukraine No. 738-IX “On Amending Certain Legislative Acts of Ukraine in relation to Investment Attraction and Introducing of New Financial Instruments” entered into force. In particular, the new law restates entirely the Law of Ukraine “On Securities and the Stock Market” No. 3480-IV dated 23 February 2006 (which was renamed as the Law of Ukraine “On Capital Markets and Organized Commodities Markets”). The new law is aimed at harmonising Ukrainian capital market legal framework with EU legislation on capital markets (e.g. MiFID II, MIFIR, EMIR, SFD, etc.). As a consequence, investment advisory activities relating to securities (issued by Ukrainian and foreign issuers and admitted for circulation on the capital markets in Ukraine) and other financial instruments are now subject to licensing in Ukraine. However, the law is broadly drafted and the National Securities and Stock Market Commission (NSSMC) has not yet issued any specific guidance or clarifications on its interpretation. Therefore, to avoid triggering licensing or other regulatory requirements, it must be assessed on a case-by-case basis whether a foreign bank not licensed in Ukraine may provide such services in Ukraine. It is further recommended that the service does not concern financial products admitted for circulation on the Ukrainian capital markets.
The main changes are reflected as follows:
– General macroeconomic information and research material – In the absence of any official guidance or clarifications from the NSSMC, providing general macroeconomic information, investment research or financial analysis is now considered a “grey zone” if acting on an active or passive basis during occasional on-site visits Ukraine. Providing such information via remote means of communication into Ukraine seems to be permitted, both on the Bank’s and the client’s initiative. However, note the absence of any formal rules or official position from the regulator to this effect.
– Generic or personalised recommendation and personalised investment advice (…)
Implications for business relations with third parties
The answers on business relations with local third parties now take into account that investment advisory services are considered a regulated activity. Other than this, there have been no substantial changes to the answers when a bank co-operates with third parties.
Regulatory Summary
This document has now a more user-friendly layout and reflects the changes contained in the RT.
Behaviour Template
– Several comments have been slightly reworded (without introducing material changes) to reflect the regulatory situation/current interpretation of the regulatory framework more accurately.
– In several instances, the comments for Grey zone/YES have been modified to reflect standardised comments that BRP has adopted as a result of using a new editing platform for the creation of manuals. The underlying reasoning has not changed.
BT Short Comparison
BRP has created a comparison document allowing users to quickly identify the modifications made compared to the previous version of the PB Manual (BT Short Comparison). The BT Short Comparison can be found on BRP’s platform (mybrponline) in the Search tab by entering in the Document Field “CM PB BT SHORT COMP” and “PERU” in the Target Country Field.
The BT Short Comparison should be read as follows:
The first column contains a short description of the activity in question. The second column contains the answers of the previous version of the Country Manual (online until the day of the alert). The third column contains the new answers of the most recent version of the Country Manual. Only the modified answers are displayed (in color). If the answers in the new version are unchanged compared to the previous version, they are shaded in grey.
Best regards,