Numerous questions from our clients have become the reason to bring this review to your attention.

The essence of the question is as follows: "Is it possible to fix the cost of goods or services in foreign currency, as a rule, in US dollars or Euro in the contracts concluded between residents of Ukraine".
Binding the cost of goods or services to the currency is most relevant for companies that trade in imported products, as well as for landlords who want to insure their inflation risks. As it happens in our country, everything related to real estate: the cost of a square meter or rent - all this is expressed in U.S. dollars.
Despite the stable exchange rate of the hryvnia to the US dollar for almost five years, the belief in the stability of the national currency has not acquired a stable trend.

SO,
Our answer is unambiguous: "It is possible and necessary".

Legislative basis:
The Civil Code of Ukraine contains 2 articles that allow you to determine the monetary equivalent of the obligation in any currency other than the currency of Ukraine.
Thus, Article 524 of the Civil Code states that the parties to the contract may determine the monetary equivalent of the obligation in a foreign currency.
In addition, according to Article 533 of the Civil Code of Ukraine, a monetary obligation may be performed only in the national currency hryvnias. In this case, if the contract defines the monetary equivalent in a currency other than the currency of Ukraine, the amount to be paid in hryvnias shall be calculated at the officially established exchange rate of such currency on the date of payment, unless otherwise established by contract or law.
The above norms in the aggregate should be understood as granting the right to determine the monetary equivalent in foreign currency, but not as authorization to make payments between residents in such currency in all cases.

At the same time, the norms of the Commercial Code of Ukraine contain not quite unambiguous norms:
Article 198 of the Economic Code assumes that monetary obligations of participants of economic relations must be expressed and payable in national currency. Monetary obligations may be expressed in foreign currency only in cases where the parties to economic legal relations have the right to make settlements between themselves in foreign currency according to the legislation.

Moreover, according to Article 10 of the Law of Ukraine "On Prices and Pricing", prices for goods sold in the domestic market of Ukraine are set exclusively in the national currency.

As we can see, the norms of legislation are very ambiguous in the issue of the possibility of linking the amount of the contract to foreign currency.

In any case, the last instance in the question of legality or illegality of determining the price of the contract in foreign currency will be the Commercial Court.

Judicial practice.

The position of the judicial system, which is competent to resolve economic disputes between business entities, is very unambiguous.
The current position of the Supreme Economic Court of Ukraine, specified in the review letter No. 01-06/767/2013 dated April 29, 2013.
Thus, the Supreme Economic Court of Ukraine in this review letter voiced the opinion that the indication of monetary obligations in foreign currency in the contract does not contradict the current legislation, but makes it impossible to take into account the inflation index calculated by the State Statistics Committee of Ukraine to substantiate claims related to the depreciation of the debt currency.
This is logical, since the official inflation index determines the level of depreciation of the national monetary unit of Ukraine, i.e. a decrease in the purchasing power of the hryvnia, not foreign currency.

Such position is present in many decisions of the Supreme Economic Court of Ukraine.
The courts note that the provisions of the current legislation, although defining the national currency of Ukraine as the only legal tender on the territory of Ukraine, however, do not contain a prohibition to express in the contract monetary obligations in foreign currency, to determine the monetary equivalent of the obligation in foreign currency, as well as to recalculate the monetary obligation in case of changes in the official exchange rate of the national currency of Ukraine against foreign currency. (decisions of the Supreme Economic Court of Ukraine " from 14.03.2013. p. case No. 5011-30/14641-2012,
19.02. 2013 case No. 5011-6/9364-2012, from 16.01.2013 case No. 5011-48/8093-2012)
These conclusions are based on the above norms of the Civil Code and on the norms on the freedom of the parties to conclude contracts.

A similar position is contained in the decisions of the highest judicial instance - the Supreme Court of Ukraine. See the rulings of 27.03.2012 in case No. 55/440, of 04.07.2011 in case No. 12/149, of 26.12.2011 No. 16/23pd/2011, which, as you know, in accordance with Article 111-28 of the Commercial Procedural Code of Ukraine, are binding on all courts of Ukraine.

Practical recommendations.
We offer you some wording which, in our opinion, may well be used in contracts.
Thus, in lease agreements it seems possible to specify the following:
"During the entire term of this lease agreement the lessee shall pay to the lessor a monthly rent in UAH in the amount of UAH 80 00, VAT exclusive, per year, which is equivalent to USD 10 at the exchange rate of the National Bank of Ukraine on the date of conclusion of this agreement". USD at the exchange rate of the National Bank of Ukraine as of the date of conclusion of this lease agreement, excluding VAT.
Payments under the lease agreement shall be made in hryvnias in an amount equivalent to the corresponding amount in U.S. dollars. The amount of any such payment under the agreement shall be calculated using the official exchange rate of hryvnia to US dollar set by the National Bank of Ukraine as of the date of invoice or as of the date of actual payment".

Or as follows:
"4.2 The amount of rent for one calendar month of rent of the premises shall be determined as an amount, in the national currency of Ukraine (hryvnia), and shall be calculated as of the first banking day of each month according to the formula:
AP =AC x PP x K1, where:
AP - rent for the month;
AC - Rental rate (monthly), is 100 UAH per 1 square meter for the entire month of rent;
PP - area of the premises, is 2300 sq.m.
K1-index, is defined as the ratio of official exchange rates set by the National Bank of Ukraine, hryvnia to US dollar on the date of calculation to the rate on the date of signing the contract. As of the date of signing the contract, the NBU exchange rate is $1=7.93 UAH".

For supply (purchase and sale) contracts concluded between legal entities - residents of Ukraine, we recommend to apply the following wording:
"The price of goods is set in hryvnias.
On the date of delivery the price of goods is subject to specification without further agreement by the parties according to the following formula:
C = C dog x ( K post/K dog), where:
С dog - price as of the date of signing the contract;
K post - a coefficient, the amount of which is equal to the official exchange rate of hryvnia to the U.S. dollar, set by the NBU on the date of delivery of goods;
K dog - coefficient, the amount of which is equal to the official exchange rate of the hryvnia to the U.S. dollar, set by the NBU on the date of the contract".