Essence of the Act:
The Resolution approves the conditions for Ukraine to receive a loan from Canada for up to 5 billion Canadian dollars. A distinctive feature of the loan is that its repayment is planned to be carried out primarily from frozen Russian assets, rather than from Ukraine’s state budget. A portion of the funds (200 million Canadian dollars) is directed to a special World Bank Fund for investing in strengthening Ukraine.
Structure and Main Provisions:
1. The Resolution consists of the main text (3 points) and an annex “Basic Conditions” (7 points).
2. The parties to the agreement are defined as Ukraine (represented by the Minister of Finance) and Canada.
3. A mechanism for determining the interest rate is established – using the higher value of two indicators: the average market yield of long-term Canadian Government bonds or the yield of the 30-year zero-coupon curve.
4. Repayment term is 30 years from the date of borrowing.
Key Features for Use:
1. The creditor has limited right to demand repayment from the state budget – only in case Ukraine receives compensation from Russia for armed aggression.
2. Funds are provided in tranches, with 200 million directed through a special World Bank Fund.
3. The interest rate cannot be negative – in such a case, a zero rate will be applied.
