The long-awaited Resolution: the NSSMC announces the resumption of capital and commodity markets

In support of the Government’s actions to restore the economy, the NSSMC (National Securities and Stock Market Commission) is removing almost all restrictions on capital and organized commodity market operations that were introduced on February 24, 2022 in connection with an armed Russian attack on Ukraine and the introduction of martial law.

“The step to unblock the capital and commodity markets is timely and balanced, because market participants have confirmed their readiness to develop the financial sector. Even before the full-scale war, we identified the renewal of the stock market as one of the government’s priority initiatives. After our victory, it is the development of capital markets and commodity markets that can become one of the drivers of the recovery of the economy and Ukraine as a whole,” – Prime Minister of Ukraine Denys Shmyhal said.

“During the five months of the war, the capital and commodity markets operated in manual mode. The regulator carefully monitored and analyzed the results of each permitted transaction. In a peaceful time, this is nonsense, but the war dictated its conditions. Thanks to an individual approach and a moderate position, we were able to overcome panic, preserve assets and prevent defaults on a number of securities,” – Ruslan Magomedov, the Chairman of the NSSMC said.

The Head of the NSSMC added that it is worth remembering that the war continues and activity on the capital markets should be carried out as carefully as possible.

We would like to remind you that on February 24, 2022, from 11:00 a.m., the NSSMC introduced the restrictions on transactions on capital markets and organized commodity markets. This was done in order to resist panic actions that could collapse the markets and deprive them of the possibility of their full operation in the future, to preserve data and property rights. Subsequently, the “freezing” of the markets made it possible to find assets related to the aggressors – the Russian Federation and the Republic of Belarus, and to limit the ability of such companies to conduct business in Ukraine.

During the period of martial law, the NSSMC admitted to the markets 20 issues of government bonds (as of 01.08.22) to attract funds to the budget and support the economy. At the same time, during this period, the regulator directed its actions to facilitate the activities of professional participants and support them. In particular, the procedure for identification of persons when purchasing government bonds and the procedure for their purchase for non-residents were simplified. Together with the National Bank of Ukraine unified the approaches to the accounting of securities of residents and non-residents in the aggregated accounts of depository institutions. The NSSMC also extended the terms of validity of certificates of professional participants, postponed the deadlines for fulfilling regulatory requirements, allowed to conduct the general meetings to be held remotely and switched to electronic document management. The Resolution enters into force on August 8, 2022.