Banking law signed by the President on 21 May
On June 12, the Commercial Court of Kiev upheld the statements of PrivantBank on the closing of proceedings in two cases in claims by former shareholders of the bank for invalidating contracts for the sale of shares of a financial institution.
“This is the first real application of banking law number 590-IX by Ukrainian courts,” PrivatBank Press Service told PaySpace magazine.
We are talking about number 910/17630/19 in the lawsuits filed by Revatis LLC against PrivatBank for invalidating agreements made as a result of PrivatBank’s withdrawal from the market, and number in the same lawsuit by KS Group LLC Not on 910/17541/19. These plaintiffs’ funds were converted into the capital of PrivatBank (bail-in) before its nationalization.
After analyzing the contents of the cases, the court concluded that it was necessary to satisfy Privitank’s application and closed the proceedings in both cases.
Specifically, the court found that plaintiffs choose a way to protect their rights – invalidating the transaction, not meeting the requirements of parts 3 and 4 of Art. 5 The Civil Procedure Code of Ukraine, according to which compensation for damages in cash may be the only way to protect the rights of the plaintiff in these cases. As a result, proceedings were terminated on the basis of paragraph 7 of the final and transitional provisions of Law No. 590.
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On 13 May, Verkhovna Rada adopted to read a bill on banking regulation, also known as “anti-Colomian”. According to the explanatory note, the law makes provision for the imperative of the procedure to remove a bank from the market, as the relevant decision of the National Bank cannot be quashed or suspended a court ruling. The “zombie” banks will not be able to return to the market, and the owners will not be able to return themselves to the bankrupt bank.
The document also limits the amount of potential compensation for former owners of banks, as it clearly defines the necessary conditions and procedure for obtaining such compensation. At the same time, as the National Bank notes, the bank’s owner will not become defenseless against the state. He will be able to go to court and, if he proves the illegality of the NBU’s decision, will be able to receive compensation for the loss. To do this, it must be confirmed in court that some capital remained in the bank at the time of withdrawal from the market.
Read: Brought for bankruptcy: court allowed arrest of former owner of scam bank