“Andikalovsky” the law entered into force: what to expect

The law on regulation of banking activity in Ukraine came into force on Saturday, may 23. The bill, approved by the deputies of the Verkhovna Rada, makes it impossible to cancel the decision on the nationalization or liquidation of the Bank, as well as the return of a financial institution to its former owners.

«Антиколомойский» закон вступил в силу: чего ждать

It is reported portal “Hvilya” with reference to the material of the portal Depo.ua.

The Verkhovna Rada of Ukraine may 13, 270 votes of people’s deputies adopted in the country bill No. 2571-D. His full name sounds like “On amendments to some legislative acts of Ukraine concerning improvement of some mechanisms of regulation of banking activities”. The head of state Vladimir Zelensky signed this decree on may 21, the next day it was published in the edition “Voice of Ukraine” and began the actual effect may 23.

This law guarantees the inevitability of the withdrawal of banks from the market. If the court recognizes illegal the decision of the NBU on the withdrawal of the Bank from the market, the procedure of insolvency or liquidation of the Bank are not terminated. Asset sales and payments to depositors and creditors of the Bank will continue. In fact, the law allows you to remove the “white spots” in legislation, which previously allowed courts to revive the banks, withdrawn from the market due to insolvency. The ability of the courts to return the banks “to life” is limited in many countries, including the European Union.

In addition, the law changes the procedure for appealing decisions of the National Bank and other state bodies in the process of the withdrawal of banks from the market. Courts should not replace the national Bank. They should be able to consider a decision on the legality, but should not question the calculations, the evaluations and conclusions made under the discretionary authority of regulators, and their technical judgment.

Besides, the law refines the procedure of the decision of the national Bank. Specifies the number of rules for “professional judgment” and procedural rights. This legislative initiative will help to identify problematic banks on earlier stages, and, therefore, maintain their assets and withdraw banks from the market with minimal losses.