The brief breakdown of new regulations.

The updated law outlines a mechanism that allows for foreign-currency credits to be re-dominated in hryvnas easing Ukrainians’ debts burden.

Debt restructuring procedure is implemented upon the written request to a creditor.

Liabilities contractually set in foreign currency now can be converted in Ukrainian hryvnas. The conversion will use an “average exchange rate” that represents two values – the exchange rate at the time a credit was secured and the exchange rate at the time of debt restructuring request.

The regulation also makes possible debt and penalties relief scheme with early covered penalties fees to be used to repay the credit principal and interest.

Debt restructuring is implemented within 60 days upon a written request of a borrower.

According to Verkhovna Rada finance committee proposal, individuals now can apply for debt restructuring on their credits providing (a) a credit was secured through mortgaging their homes (b) their residential property is their sole residence, (b) their home space is no bigger then 150 sq.m (for apartments) and 250 sq.m. (for houses), (c) they face default on their credit, and (d) as of January 1, 2014, their credit record listed no past due payments.

Ukrainian MPs by 272 votes also passed the bill #4399, “On Amending the Tax Code of Ukraine’ that proposed to make Ukrainians exempt from personal income tax in settlement of large debts, and the regulation #4398, “On Amending Certain Legislative Acts of Ukraine on Restructuring Foreign-Currency Credit Liabilities and Adaptation of Insolvency Procedures for Individuals”.