Ukrainian companies from the frontline regions — Zaporizhia, Kherson, Donetsk and Luhansk — faced serious problems in carrying out international financial transactions. According to the National Bank of Ukraine (NBU), European banks massively block payments of Ukrainian businesses from these regions, regardless of whether they are located in territories controlled by Ukraine or in temporarily occupied territories.
Foreign banks do not understand where exactly our business is located - in the territories captured by the Russian Federation or in the territories controlled by Ukraine - and wrap payments of exporters/importers indiscriminately. No one explains the official reason for such actions to the companies, but the NBU calls it because the companies failed financial monitoring in the European Union.
The NBU writes about all this in its letter No. 25-0005/59329, which is at our disposal.
In its document, the regulator explains the failure of financial monitoring by the European Union's sectoral sanctions against the uncontrolled territory of Ukraine.
Western banks automatically believe that the business has already been taken over by the Russian Federation, and therefore block all its transactions, without knowing in which part of the front zone it is registered. In the document, the National Bank gives the example of two cities - Kherson and Zaporizhzhia, and calls such an approach unfounded.
“For the most part, foreign banks do not detail the reason for blocking/rejection, citing the requirements of their internal policies and compliance procedures. In the opinion of the National Bank, non-payment may be related to sanctions restrictions (in particular, sectoral sanctions of the European Union regarding territories not under the control of the Ukrainian government in the Donetsk, Kherson, Luhansk and Zaporizhzhia regions), as well as the requirements of international standards and national legislation of other countries on issues financial monitoring, risk management, etc. We believe that such de-risking on the part of foreign banks in relation to Ukrainian business entities is not justified," says the letter No. 25-0005/59329.
As a result, not only this business itself suffers, but also the Ukrainian economy in general. After all, Ukraine does not receive foreign exchange earnings, and our financial market now especially needs dollars and euros. And import deliveries are also being slowed down, as payment for them does not come from Ukraine.
Usually, problems with passing financial monitoring fall on the shoulders of the business itself - when our companies fail it at home, they do not try to help them. But in this case, the NBU demanded from the Ukrainian banks, through which the foreign economic payments of the companies go, to take up the solution of the problem and achieve the unblocking of the exporters/importers' postings. Our financiers are required, first of all, to contact the foreign correspondent bank through which it goes, and to make additional clarifications on each company and prove the legitimacy of its work with the help of relevant data, in particular data of the Ministry of Reintegration, which regularly updates the list of occupied territories (for this purpose, the Ministry has created a corresponding English-language page on the website).
Secondly, Ukrainian bankers must describe in detail each foreign economic payment during its implementation (with all data regarding the place of registration and the situation with the current occupation).
Thirdly, if the blocking of the payment does happen, the Ukrainian bank should contact the Western partner bank, find out the reasons and provide all the information for unblocking. In fact, they made it his duty, which was not the case before.
The NBU demanded that our banks do all this and report to it within the next month with exact details. Namely, with lists of specific Ukrainian enterprises with blocked payments, reasons for blocking and statuses regarding the solution of the problem.
