The NBU by itsResolution "On Settling the Situation on Ukrainian Currency Market"No. 515 dated 20 August 2014 (the "Resolution No. 515") establishedcompulsory exchange of 100% of receivables in foreign currency from abroad (i)in favor of legal entities (other than banks), individual-entrepreneurs,foreign representative offices (except for official representative offices),(ii) on accounts with banks, opened for conducting joint activity withoutestablishing a legal entity, as well as (iii) on accounts of residents, openedoutside of Ukraine on the basis of individual license of the NBU.

This rule isapplicable to proceeds in foreign currencies of the first group of the NBU’sClassifier of Foreign Currencies and Bank Metals as well as in Russian rubles.

The compulsoryexchange of foreign currency shall be executed by a bank without a client’sinstruction no later than on the business day following the day of creditingsuch proceeds to the clearing account.

The ResolutionNo. 515 also extends the applicability of the reduced term for settlementsunder export/import contracts, which shall be 90 calendar days (instead of 180calendar days prescribed by the Law of Ukraine "On Order of Settlements inForeign Currency").

Thus, in orderto stabilize situation on the Ukrainian currency market, the NBU has tightenedthe requirements of compulsory exchange of receivables in foreign currencywhich previously have been applicable only to 50% of such receivables.

The ResolutionNo. 515 became effective on 21 August 2014 and shall act till 21 November 2014.

We would behappy to answer any of your questions on banking activity in Ukraine, shouldthe need arise.