“The VR Committee is preparing the bill on the DGF for the second reading: deputies are submitting amendments, but there is a risk that they will not be taken into accountThe VR Committee is preparing the bill on the DGF for the second reading. Deputies are submitting amendments, but there is a risk that they will not be taken into account.
”, — write: unn.ua
As of today, there is no information in the Committee regarding the revision for the second reading. Why? Because the deadline for submitting amendments has not yet expired. I am preparing amendments myself. Of course, from those pressing issues that did not allow our faction, me personally, to vote in the first reading for this draft law, we will now somehow level these blocks, propose, perhaps, other mechanisms. Although I do not understand why the Deposit Guarantee Fund did not listen to us at the stage of preparing the revised draft law
According to the MP, the draft law still contains unresolved dangerous norms regarding the transfer of assets of banks that are being withdrawn from the market.
“I am trying with my experts to propose some other option for solving the issue, for example, regarding the transfer of assets of a liquidated bank to another bank that is the successor to these assets. That is, how to regulate the issue so that this property, these assets, together with the obligation, are transferred from the very beginning with a clear definition of the price of what is being transferred. So that there is no possibility of simply ruining the accumulated fund of monetary funds, contributions, which, in fact, the deposit guarantee fund covers if necessary and guarantees deposits of individuals. If we now give some norms that reduce these accumulated contributions, then it seems to me that these are the most dangerous norms of the law, voted in the first reading,” Yuzhanina noted.
At the same time, she does not rule out that the document will be prepared in a hurry for the second reading, as the authors of the bill present it as the fulfillment of Ukraine’s international obligations, particularly to the IMF.
In addition, according to Yuzhanina, it is obvious that the Deposit Guarantee Fund for individuals does not plan to take into account the amendments submitted by people’s deputies.
“In fact, no matter what we write, no matter what amendments we submit now, the Deposit Guarantee Fund does not intend to listen and wants to leave everything as voted in the first version. Then it will simply be a waste of effort,” the parliamentarian noted.
Addendum
On August 19, the Verkhovna Rada adopted in the first reading the scandalous draft law on changes in the regulation of the activities of the Deposit Guarantee Fund for individuals 13007-d, which, according to experts, violates the basic principles of current Ukrainian legislation and contradicts the Constitution.
In the explanatory note to the draft law, its initiators, including Danylo Hetmantsev and other MPs, indicate that the document was developed to implement paragraph 58 of the Memorandum of Economic and Financial Policy dated October 4, 2024, which was signed between the Government of Ukraine and the International Monetary Fund.
In its conclusion, the Parliament’s Scientific and Expert Department noted that the explanatory note to the draft law does not contain proper justification for the expected socio-economic consequences of changes to the legislation. Also, it was not assessed whether the provisions of the document comply with Ukraine’s obligations to the IMF, which are mentioned by the authors of the draft law in the explanatory note.
“It should be noted that the accompanying documents to the project, as required by clauses 2, 3 of part 1 of Article 91 of the Rules of Procedure of the Verkhovna Rada of Ukraine, do not provide proper justification for the expected socio-economic, legal and other consequences of applying the law after its adoption, and other information necessary for considering the draft law, which would allow assessing the impact of the proposed innovations for withdrawing an insolvent bank from the market, including on the protection of depositors’ rights from the consequences of bank insolvency, the effectiveness of the procedure for withdrawing insolvent banks from the market, as well as in the context of their compliance with the Memorandum of Economic and Financial Policy dated October 4, 2024, signed between the Government of Ukraine and the International Monetary Fund, which is mentioned in the explanatory note to the project,” the conclusion states.
Cosmetic changes, but systemic threats: what the updated draft law on the activity of the Deposit Guarantee Fund conceals01.07.25, 14:25 • 179070 views
According to experts, the draft law does not contain a complete system of legal regulation for withdrawing banks from the market. According to them, a significant part of the powers is transferred to the Fund itself without clear legislative limits, which creates a risk of abuse and legal uncertainty. There are also problems with the definition of terms, such as “interested person,” which are formulated superficially and contradict other articles of the draft law.
The Scientific and Expert Department paid special attention to the risks associated with the new rules regarding arrested deposits. Experts indicate that the list of deposits not returned to depositors needs to be harmonized with the provisions of Directive 2014/49/EU of the European Parliament and of the Council of April 16, 2014, on deposit guarantee schemes.
The EU Directive clearly distinguishes between deposits that are subject to protection and those that are excluded from the guarantee system. In particular, according to European rules, funds obtained as a result of money laundering are not subject to guarantee. In this regard, experts do not understand whether the new version of the law proposed by Hetmantsev completely excludes such deposits from protection, or whether it only concerns limiting compensation for deposits whose term expired before the bank was withdrawn from the market.
The Scientific and Expert Department emphasized that the current version of the draft law stipulates that the depositor will receive compensation only after providing documents on the lifting of the arrest from the deposit. However, if the arrest is lifted after the liquidation of the bank, the person loses the right to compensation, even if the arrest was illegal. This puts the depositor in an extremely vulnerable position, as the terms for lifting the arrest do not depend on them.
In addition, the draft law proposed by Hetmantsev does not specify which documents will be considered confirmation of the lifting of the arrest, who should submit them to the DGF, and within what timeframe this should be done. Experts emphasize that the mere fact of arrest cannot be a reason for automatic refusal of payment, as it is only a temporary restriction, not an admission of guilt.
Thus, the proposed draft law also violates the basic principle of the Constitution of Ukraine – the presumption of innocence.
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The revised draft law also provides for the transfer of employees from an insolvent financial institution to a transitional bank in case of liquidation without sufficient legal justification and without guarantees for all employees. This may violate the labor rights of employees, narrow the scope of existing guarantees, and contradict the Constitution of Ukraine.
Another violation of depositors’ rights, according to experts, is the innovation that allows the assignment of rights without the debtor’s consent. This contradicts the Civil Code of Ukraine. The revised draft law does not take into account situations where contracts explicitly prohibit such a change of creditor.
The norm regarding the establishment of a 30-day limit for judicial appeal of decisions of the Deposit Guarantee Fund for individuals also seems controversial. Such a norm contradicts the principle of equality in access to justice.
The Scientific and Expert Department indicates that the proposed draft law also creates legal uncertainty regarding the rights of bank shareholders against whom sanctions have been applied, and the mechanisms for transferring residual property to them.
In addition, the authors of the draft law propose to cancel the norm that prohibits transferring part of a corporate investment fund to another legal entity, but they do not explain or in any way justify such a necessity, nor do they talk about the possible consequences. Experts warn that without this prohibition, there is a risk that the fund’s assets may be “diluted” or withdrawn, which will make the fund less attractive to investors and less protected.
Thus, as evidenced by the conclusion of the Scientific and Expert Department of the Verkhovna Rada, the proposed draft law has systemic gaps, violates a number of Ukrainian laws, and also contradicts the Constitution of Ukraine and European legislation. The adoption of the draft law on the new regulation of the activities of the Deposit Guarantee Fund for individuals without deep and systemic revision can lead to a narrowing of the rights of depositors, creditors, and shareholders, as well as to violations of the principles of justice.