NBU Currency Restrictions: Why a Ukrainian Resident Loses to a Foreign Holding in Overseas Expansion

Today, Ukrainian businesses are increasingly facing a paradoxical situation: a company that has retained its ownership and decision-making center in Ukraine finds itself in a less favorable position than its competitor with a foreign holding structure. The National Bank is justified in protecting the currency market under conditions of a full-scale war; however, the current system of restrictions, introduced by NBU Board Resolution No. 18 of 24 February 2022, has over four and a half years turned into a complex construct of dozens of exceptions, different reference dates, special limits, and individual permits. As a result, a resident that has its own foreign-currency revenue from exports cannot direct even 300,000 euros toward opening a warehouse or service center in Poland, Germany, or Romania, while a company with a foreign holding does so through the dividend repatriation mechanism.

Two Scenarios, One Goal — Different Opportunities

Consider a Ukrainian manufacturer that exports its products to the European Union, earns foreign-currency revenue, pays taxes, and provides jobs in Ukraine. To expand its exports, it needs to open a warehouse, service center, or trading company in the EU. The company has the money — its own foreign-currency revenue, not currency that has to be purchased on the interbank market. Yet under the general rule, it cannot carry out such an investment. Now consider another company with similar production in Ukraine, but whose owner is a holding registered in one of the foreign jurisdictions. The Ukrainian company can pay dividends to the holding within the permitted limit, after which the foreign holding finances the creation of a warehouse or trading network in the EU. The economic goal in both cases is the same — expanding the sales of Ukrainian products — yet the regulatory opportunities are fundamentally different.

The Evolution of Restrictions: From an Anti-Crisis Step to a Multi-Level System

Resolution No. 18 of 24 February 2022 was a necessary anti-crisis measure: at the start of the full-scale war, it was essential to halt the unproductive outflow of capital, protect reserves, and ensure the functioning of the banking system. The issue is not the very existence of currency restrictions — under conditions of war they remain necessary — but how the system has evolved. The National Bank has gradually permitted the payment for imported works and services, the repatriation of dividends for 2023–2025 within an overall limit of 1 million euros per month, and certain operations within the "investment," "loan," and "donation" limits. The "investment" limit is tied to funds attracted from abroad into the authorized capital of a Ukrainian company since May 2025. The "donation" limit is tied to funds transferred to a special NBU account to support the Armed Forces of Ukraine.

The August 2026 Changes: A Step Forward, but Not a Solution

From 11 August 2026, the NBU additionally permitted forming the limit through direct charitable contributions by Ukrainian companies to units of the Armed Forces of Ukraine and the National Guard. Companies also gained the ability to transfer "investment" and "additional" limits to related legal entities within a single business group. These decisions are generally positive; however, they do not eliminate the main contradiction: new foreign capital opens up additional opportunities for a Ukrainian company to make cross-border payments, a foreign loan creates a corresponding limit, and a charitable contribution can become the basis for carrying out certain currency operations. At the same time, the current regime does not give a Ukrainian company the ability to make a productive overseas investment out of its own foreign-currency revenue — even if such an investment is directly necessary to increase Ukrainian exports.

The Regulator's Position: The Third Stage of Liberalization

The National Bank has explicitly noted that the list of operations available within the mechanisms of stimulating currency liberalization after the August changes is not being expanded. Resident investments abroad remain, in the regulator's strategy, among the measures of the third stage of liberalization. Thus, the NBU is effectively confirming that in the near future a Ukrainian company will not be able to direct its own foreign-currency revenue toward overseas expansion. The regulator may deny that a foreign investor and a Ukrainian resident are in different economic situations, arguing that the repatriation of dividends to a foreign owner is linked to the prior or future inflow of foreign capital. However, from the perspective of the competitive environment in the EU market, the outcome for the end consumer and for the export of Ukrainian products is identical.

Contradictory Data

There is a fundamental discrepancy in assessments between the regulator and the business community. The NBU emphasizes that currency restrictions under conditions of war remain necessary to protect reserves and the stability of the banking system, and that liberalization is proceeding in stages — resident investments abroad are assigned to the third stage. On the other hand, business representatives and analysts point out that over four and a half years the system of restrictions has created a distortion: foreign capital and foreign holdings gain access to cross-border operations, while a resident with its own foreign-currency revenue is denied such access. According to data cited in analytical materials, the current regime encourages the offshore-ization of corporate structures, since it is more advantageous for companies to relocate the center of ownership to a foreign jurisdiction in order to gain access to currency operations. The NBU, in turn, does not confirm that the restrictions are a direct stimulus to offshore-ization and insists that each stage of liberalization requires an assessment of risks to the currency market.

A Possible Solution: A Controlled Expansion Limit

In the view of experts, the way out of the current situation is not the full opening of capital flows, but the introduction of a controlled limit on the international expansion of Ukrainian businesses. Such a mechanism would allow a resident to direct a certain share of its own foreign-currency revenue toward creating overseas structures directly linked to increasing exports from Ukraine, without threatening the currency reserves. This would preserve the balance between protecting the market under conditions of war and creating equal competitive conditions for companies with different corporate structures.