News (#12 December 2018)

DRAFT

Introduction of new financial instruments by banks

Draft Law No.9034, which the relevant Parliamentary Committee recommended to adopt in its first reading, provides for the introduction of a new type of registrable securities issued by banks called bank certificates. Such a certificate combines the features of a bank deposit and a security. It is assumed that bank certificates can be both interest and discount ones. Unlike saving (deposit) certificates, a bank certificate will exist in a non-documentary form. According to the explanatory note, a bank certificate can be sold to another bank or another person (including sale on the stock exchange using mechanisms ensuring the conduct of deals under the principle of delivery of securities against payment), subject to a minor loss of profitability, or alienated in any other way at a convenient time without the necessity to appear in person at the issuing bank and to undergo a significant number of bureaucratic procedures to re-issue the certificate to another person. Moreover, the owner of a bank certificate will receive the repayment amount and the interest in a manner convenient for him/her (on the bank account specified by the owner), as established in the agreement with the depositary institution, without the need to appear in person at the bank that issued the bank certificate.

A Draft Law on Protection of Employees Rights in Case of Employers Insolvency

The Draft Law On Amendments to Certain Legislative Acts of Ukraine to Promote Protection of Employees Rights to Timely and Full Payment of Wages in Case of Employers Insolvency was published for discussion on the website of the Ministry of Social Policy.

The Draft proposes:

to oblige the employer to pay the employee a fine in the amount of the NBU discount rate for each day of delay;

to provide the employee with the right to temporarily suspend the performance of his/her duties in case of delayed payment of wages due to the employer for a period of more than 15 days;

to pay the employee compensation in the amount of 3 average monthly wages (for the last 12 months) in the event of initiation of a bankruptcy case against the employer, or termination of the employment contract in case of the employees dismissal prior to initiation of the said case.

In the event of adoption, the law will come into force on 1 January 2020.

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