prohibition on financial institutions to change unilaterally the interest rate on loans already granted, in spite of its validity at the present time, does not deprive the banks the right to do so through the courts, the lawyer thinks the Ukrainian Bar Association Alliance Vladimir Shabelnikov.

"The introduction of such a ban did not deprive the banks the right to require changes in the contract with borrowers unilaterally. However, this can be done only by a court in the event of a material breach by the other party"s terms and conditions or in connection with a substantial change in circumstances, as well as in other cases by law or contract, "- he said the agency" Interfax-Ukraine ", commenting on the law prohibiting the financial institution to unilaterally increase the rate and other payments on loans already granted.

According Shabelnikov if the loan agreement spelled out the Bank"s right to require changes in interest rates in certain instances, upon the occurrence of such circumstances, the financial institution may apply to the court to amend the terms of the contract.

"In this case, the probability of the claim is large enough, because almost all credit agreements contain the circumstances under which the occurrence of a financial institution has the right to demand an increase of interest rates", - said Shabelnikov.

He noted that in practice, the borrower does not often have the right to make their amendments or corrections to the proposed bank loan agreement.

Shabelnikov stressed that the basic rule governing the procedure for amending the treaty, is art. 651 of1000the Civil Code, under which contracts may be modified only by agreement of the parties, unless otherwise stipulated by contract or by law.

This rule, according to a lawyer, makes use of the principle of discretionary (the opportunity to freely dispose of their substantive and procedural law), civil relations, and freedom of contract, under which the parties have the right to independently and voluntarily decide whether the order changes the contract.

As reported, the Verkhovna Rada on January 21 endorsed the overall bill, which prohibits financial institutions to unilaterally increase the interest rate and other payments on loans already granted.

The law states that, along with banks, other financial institutions may not unilaterally increase the rate of interest or other payments provided by the loan agreement or repayment schedule, except as provided by law.

The law also prohibits financial institutions to demand early repayment of the outstanding debt on the loan and terminate unilaterally signed a credit agreement if the borrower disagrees with the suggestion of a financial institution to increase the interest rate or other payment under the loan agreement or repayment schedule.

It also establishes that the proposed law shall apply to all loan agreements that were signed or continue to operate after the entry into force of this Act.

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