Legal Regulation of Currency Circulation in Ukraine

The article deals with statutory regulation of currency circulation in the state while independent Ukraine existing. Attention is drawn to the characteristics of the concept “currency”, which is represented by various interpretations. Thus, the term “currency” is used in three commonly accepted meanings: as a piece of money of a particular country (national currency); as banknotes of foreign countries that are the object of purchase and sale in the foreign exchange market (foreign currency); as an international (regional) monetary unit of account and means of exchange. According to the Law of Ukraine “On Currency and Currency Transactions” the concept “currency” is divided into national currency, foreign currency and banking metals. Unfortunately, this law does not contain the general term “currency” that causes its different interpretation among scholars and practitioners.

Legal regulation of currency circulation began in 1991 when the Law of Ukraine “On Banks and Banking” was adopted. and the list of banking transactions was attributed, including purchasing from organizations and citizens and selling them foreign currency in cash and currency in accounts and deposits. Since 1992, the ruble was suspended in monetary circulation on the territory of Ukraine. For the period prior introducing the national currency of Ukraine, business entities in the territory of Ukraine were granted the right to make payments in freely convertible currency without any special permission. In 1993 the mode of conducting currency transactions on the territory of Ukraine was fixed, the general principles of currency regulation, powers of state bodies and the functions of banks and other financial institutions of Ukraine in the process of regulating currency transactions were determined by the Decree of the Cabinet of Ministers of Ukraine “On the System of Currency Regulation and Currency Control”. Currency circulation in Ukraine has been further developed since the adoption of the constitution of Ukraine and the issuance of the national currency (hryvnia) in 1996. The Law of Ukraine “On Currency and Currency Transactions”, which gave a new impetus to the development of currency circulation in the country was adopted in 2018.