Supreme Court: Ukrainians have right to lend money to third persons with interest

Ukrainians have the right to lend money to a third person and obtain interest payments, without having to have financial licenses.

The Supreme Court of Ukraine issued ruling No. 6-79tss12 on July 18, 2012.

The ruling says that if the law on financial services and state regulation of the financial service markets regulates relations only between financial service market players, the requirements of the Civil Code of Ukraine regulate relations between individuals, in particular, regarding lending agreements.

"The lending agreement as a general agreement structure is a basis for the appearance of legal relations, and participants of which are any individual or company. The Civil Code of Ukraine does not contain any exception either regarding the participants of the relations and the right to obtain interest on the sum lent to borrowers, the size and a procedure of their obtaining is defined in the agreement [part 1, Article 1048 of the Civil Code of Ukraine]," reads the ruling of the court.

The court also came to a conclusion that the law on financial service and state regulation of financial service markets is a special legal act regulating relations of special financial service market players, and it does not apply to other companies and individuals who are participants in lending agreements regulated by the requirements of Articles 1046-1048 of the Civil Code of Ukraine.