Banking Activities

October 7, 2010 the Trial Chamber on Civil Cases of the Supreme Court of Ukraine held the generalization of the judicial practice of considering the civil cases arising from the credit relationship (2009-2010) (Excerpts) The summary noted that the legal nature of credit relations settled in the norms of civil-legal institute of obligation ‘loan. Credit. Bank deposit ‘(Chapter 71 Civil Code of Ukraine), the Law of Ukraine “On Banks and Banking Activities’ and other relevant legislation. In particular, the Law of Ukraine “On taxation of profits of the enterprises’ first gave the concept of credit transactions, trade, commercial and financial loans. Loan agreement qualifies as a bilateral, consensual, and compensation. Bank lending is done, which received a license, rather than its structural units (divisions, branches).

However, if it is provided appropriate powers of structural units (status, charter, power of attorney), the latter has the right to enter into loan agreements on behalf of the bank. As a lender may also make insurance companies and credit unions, but they are due to peculiarities of their legal status, have no right to transfer the debt or withdraw the legal requirements under the credit agreement. At the resolution of cases on the recognition of the loan agreement null and void courts must consider the requirements of legislation relating to their power. They are installed as Ukraine’s Civil Code (Art. 1048-1052, 1054) and the Law of Ukraine “On Financial Services and State Regulation of Financial Markets.” In particular, this: the parties to achieve agreement on all essential terms of the contract: the purpose, amount and term of the loan, the conditions and procedure of issuance and maturity types (methods) to ensure the borrower’s liabilities, interest rates, the procedure for payment for credit, how to change and termination of the agreement, the parties responsible for any failure or improper performance of the contract.