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In the dynamic world of global finance and cross-border financing, cross-border loans are increasingly pivotal in fostering growth, innovation, and development among domestic companies, particularly during the initial stages of business establishment. With domestic firms frequently collaborating with foreign partners, including related entities, adherence to the regulatory framework set by the National Bank is essential. This framework is designed to ensure transparency, financial stability, and legal compliance.

Domestic companies that have cross-border financing and secure financing from foreign sources through loans are required to notify the National Bank about these transactions. This obligation, aimed primarily at statistical purposes, is outlined in the Law on Foreign Exchange Operations (Article 42 – Notification of Credit Transactions) and further detailed in the Guidelines on the Method and Conditions for Individual Notification of Loans Taken by Non-Residents.

These regulations mandate the submission of a report for all credit transactions with non-residents within 10 days following the conclusion of the agreement or within 5 working days after the full or partial repayment of the loan or any modification to the loan agreement.

It should be noted that these notifications are submitted on special forms (“ND forms”), namely:

  • ND 1 form – Application for a loan taken from a non-resident, which is submitted when reporting a new loan.
  • ND 2 – Realization of funds, which is submitted when reporting the use of funds from the loan, based on previously recorded credit transactions.
  • ND 3 – Repayment realization, which is submitted when reporting principal or interest repayment based on previously recorded credit transactions.
  • ND 4 – Principal repayment plan, which is submitted if the repayment plan outlined in the loan agreement does not have regular periodicity, meaning irregular repayments of the principal have been reported which cannot be calculated according to the basic terms of the loan.

ND 5 – Specification of creditors/beneficiaries, which is used if, according to the loan agreement, several creditors or beneficiaries of the loan are involved.

These forms are appendix to the aforementioned Guidelines and are also accessible via the following link: https://www.nbrm.mk/ns-newsarticle-upatstvo-za-nacinot-i-uslovite-za-poedinecno-izvestuvane-za-kreditite-zemeni-od-nerezidenti-nd.nspx.

Failure to comply with this legal requirement not only breaches the regulatory framework but also subjects the company to potential fines. These fines range from 200 to 3,000 euros in Denar equivalent for the company and from 50 to 300 euros in Denar equivalent for the authorized person of the company.

Note: The above does not constitute legal advice and in no way can be accepted or understood as an instruction to act in a specific case. Each legal situation has its own characteristics that should be reviewed at separately, and for that reason we recommend that you contact a professional – a lawyer – for legal advice.

Vedran Lalicic

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