Chapter

MOROCCO

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2000
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Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: January 21, 1993.
Exchange Arrangement
CurrencyThe currency of Morocco is the Moroccan dirham.
Other legal tenderCommemorative gold coins with a face value of DH 250 and DH 500, and commemorative silver coins with a face value of DH 50, DH 100, DH 150, and DH 200 are also legal tender.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe exchange rate is determined freely in an interbank foreign exchange market. Bank Al-Maghrib (BAM)—the central bank—intervenes in the market by setting the buying and selling rates applicable to its operations with banks based on a basket of currencies comprising the dollar, the euro, and the pound sterling, weighted in accordance with the geographic distribution of Morocco’s foreign trade and the pattern of currencies of settlement. This quotation system is also based on the observance of the cross exchange rates in the international market. For exchange operations with customers, banks may not exceed the rate limits set by the BAM.



Morocco imposes a levy of 0.2% on foreign exchange transactions, which is paid to the Foreign Exchange Office (FEO) for its services.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange market
Official cover of forward operationsThe official forward foreign exchange cover facility has been suspended since the creation of the foreign exchange market.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payment arrangements
Bilateral payment arrangements
InoperativeArrangements with Mali and Guinea have been inoperative since the 1960s. These arrangements were abolished in 1999.
Regional arrangementsThere is a regional payment arrangement operated by the central banks of Algeria, Libya, Mauritania, Morocco, and Tunisia.
Administration of controlExchange control is administered by the FEO, an agency under the MOF. This office has delegated the execution of the main exchange control measures to authorized banks. Import and export licenses, when required, are issued by the Department of Foreign Trade.
International security restrictions
In accordance with Executive Board Decision No. 144-(52/51)Yes.
In accordance with UN sanctionsMorocco maintains restrictions for security reasons against Iraq and the Federal Republic of Yugoslavia (Serbia/Montenegro) pursuant to UN Security Council resolutions.
Payment arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents may purchase, hold, and sell gold coins in Morocco for numismatic or investment purposes. Ten different types of foreign gold coins are traded on the Casablanca Stock Exchange, which does not, however, deal in gold bars.
Controls on external tradeImports of gold are subject to authorization from the Customs and Indirect Taxes Administration. Each year, the MOF fixes a quota for the importation of gold ingots. The quota is then allocated among jewelers and industrial users of precious metals. Exports of gold are prohibited.
Controls on exports and imports of banknotes
On exports
Domestic currencyThe exportation of domestic banknotes is prohibited.
Foreign currencyVisitors to Morocco are permitted to repurchase foreign exchange against the presentation of exchange certificates up to the amount of the original conversion of foreign exchange into dirhams. Residents may also export foreign banknotes following general or special approval by the Exchange Office.
On imports
Domestic currencyThe importation of domestic banknotes is prohibited.
Foreign currencyNonresident travelers may bring in freely foreign banknotes, traveler’s checks, and other means of payment denominated in foreign currency. Resident travelers may also bring in foreign banknotes in any amount, as well as any other means of payment in foreign exchange but must surrender them within 30 days of their return to Morocco.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyAny Moroccan exporter of goods or services already holding a convertible export promotion account (CCPEX) is allowed to open a foreign exchange account. Those without a CCPEX must receive prior approval from the Exchange Office. Up to 20% of foreign exchange receipts may be credited to these accounts simultaneously, with the sale of the remaining 80% to domestic banks. There is no restriction on crediting foreign exchange accounts either with the proceeds from financial investments held in the accounts or with transfers from another of the holder’s foreign exchange accounts. These accounts may be freely debited for payment of business expenses, as provided for in the exchange regulations, for investing in authorized intermediary banks, for subscribing to bonds issued by the Moroccan Treasury, for crediting another foreign exchange account or a CCPEX held in the exporter’s name, or for surrender of foreign currency to banks.
Held abroadThese accounts are permitted; only foreign nationals do not require authorization.
Accounts in domestic currency convertible into foreign currencyExporters of goods and services may open accounts in convertible dirhams at Moroccan banks, which may be credited with the dirham equivalent of 20% of repatriated foreign currency sold to domestic banks. Funds in these accounts may be used to finance expenses incurred abroad and related to the holder’s business activity. Fishing companies may place up to 100% of the dirham equivalent of their repatriated exchange receipts in these accounts. Exporters may choose either a foreign exchange account or a convertible export promotion account, or may hold both kinds, provided the overall percentage of repatriated foreign exchange receipts placed in the accounts does not exceed the 20% limit.
Nonresident Accounts
Foreign exchange accounts permittedTwo types of accounts may be opened. (1) Foreign currency accounts in the names of foreign nationals may be maintained by natural or juridical persons of foreign nationality who are either residents or nonresidents. These accounts may be credited freely with transfers from abroad with foreign banknotes, checks, traveler’s checks, or any other means of payment denominated in foreign currency and with foreign currency withdrawn from domestic banks, following general or special authorization from the FEO. They may be debited freely for transfer abroad in favor of the account holder or to a foreign third party, for the surrender of foreign currency to domestic banks, and for the payment of checks denominated in foreign currency. (2) Foreign currency accounts may be opened by individuals of Moroccan nationality residing abroad in their name. These accounts may be credited freely with transfers from abroad, checks or any other means of payment denominated in foreign currency, foreign currency withdrawn from domestic banks following general or special authorization from the FEO, the return on investments effected on the basis of these accounts, and transfers from another foreign currency account or from an account in convertible dirhams. They may be debited freely for transfers abroad, transfers to another account in foreign currency or in convertible dirhams, foreign currency subscriptions for notes issued by the Moroccan Treasury, and for the surrender of foreign currency to domestic banks.
Domestic currency accountsYes.
Convertible into foreign currencyThese are restricted to resident or nonresident natural and juridical persons of foreign nationality and may be credited freely with generally or specifically authorized transfers, and with dirhams obtained from the sale to banks of foreign exchange, including banknotes. They may be debited freely for payments made in Morocco and for purchases of foreign exchange at banks. There are no restrictions on transfers between foreign accounts in convertible dirhams or on transfers of interest. Holders of these accounts may obtain international credit cards for settlement of all expenses in Morocco and abroad. Convertible dirham accounts may be opened freely in the name of nonresident Moroccans residing abroad. Overdrafts are not allowed, and there are no restrictions on the interest rate payable. These accounts may be credited freely with (1) dirhams from the sale of convertible currencies, including banknotes, to domestic banks; (2) transfers authorized by the FEO; (3) payments of interest accrued on these accounts; (4) transfers from foreign accounts in convertible dirhams; and (5) transfers from term deposits in convertible dirham accounts. They may be debited freely for (1) the purchase of foreign exchange from domestic banks, (2) dirham payments in Morocco, (3) transfers to foreign accounts in convertible dirhams, and (4) transfers to term deposits in convertible dirham accounts.



These accounts may also be debited freely, either for the benefit of the account holder or for other nonresidents, for the purchase of foreign banknotes, traveler’s checks, or other foreign currency-denominated means of payment. Convertible dirham accounts for exporters may be opened by exporters of goods or services with Moroccan banks. These accounts may be credited with the equivalent of 20% of the foreign currency repatriated and surrendered to domestic banks.



Balances on these accounts may be used to finance expenditures contracted abroad and linked to the professional activity of those concerned. Fishing companies may credit to these accounts up to 100% of the foreign currency repatriated. Exporters have the choice of maintaining either foreign currency accounts or convertible dirham accounts. They may also hold both accounts simultaneously, provided that the overall percentage of export earnings to be credited to both accounts does not exceed 20% of foreign exchange earnings. Convertible term accounts are designed to attract funds from nonresident foreigners who are not entitled to guaranteed transfers.



These funds may be transferred within a maximum period of five years. The holders of such accounts may use the available funds, without prior authorization from the FEO, to fund investments in Morocco; buy treasury bonds; purchase Moroccan marketable securities; settle expenses incurred in Morocco; and, in the case of foreign corporations, provide their Moroccan subsidiaries with current account advances. They may also transfer freely the balances to resident or nonresident foreigners or to Moroccan nationals residing abroad. The beneficiaries of the proceeds of these accounts may use them to cover expenses incurred by foreign companies shooting films in Morocco; to purchase secondary residences under certain conditions; and to finance up to 50% of an investor’s participation in investments in Morocco (the remainder must be financed with funds transferred from abroad). Funds invested with the proceeds of convertible term accounts may be transferred abroad without restriction in the event of liquidation or transfer, except for certain categories that are subject to a three-year waiting period.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Minimum financing requirementsFor all imports, an import certificate lodged with an authorized bank is required to make payments related to goods and incidental costs. Imports used for the production of export goods may be financed directly from the proceeds of foreign exchange claims of the same exporter within the framework of special lines of credit that commercial banks are authorized to contract with their foreign correspondents. Moroccan commercial banks may make advance payments abroad for imports of capital goods up to 40% of their f.o.b. value.
Advance payment requirementsThe maximum rate for advance payments on imports of capital goods is 40% of the f.o.b. value of the imports. Advance payment is limited to the foreign exchange equivalent of DH 20,000 for imported spare parts, consumer goods, and samples with payment effected by resident individuals or legal entities.
Documentation requirements for release of foreign exchange for importsExcept for goods imported by air, insurance policies for imports must be taken out with insurance companies in Morocco. For a limited group of goods, however, insurance policies may be underwritten abroad. This group includes externally funded imports if the financing terms include foreign insurance; capital goods and equipment under turnkey contracts; or duly authorized investment programs in crude oil, gas, cattle, and wood. Imports are subject to a disembarkation inspection.
Domiciliation requirementsYes.
Import licenses and other nontariff measuresOn March 16, 1999, Morocco and Tunisia signed a free trade agreement providing for the immediate liberalization of 2,000 products and for the complete phasing out of tariff barriers between the two countries by December 2007.



Certain items are subject to minimum import prices (reference prices) for antidumping or safeguarding purposes.
Positive listImports of arms and explosives, secondhand clothing, used tires, and chemical products that deplete the ozone layer require licenses.
Negative listImports of products that affect public security, morale, and health may be prohibited.
Import taxes and/or tariffsCustoms duties are levied on an ad valorem basis, with rates ranging from 2.5% to 35% for industrial goods; these tariffs can range up to 300% on certain agricultural products (tariff equivalents). In addition, a 15% levy is applied to imports. However, certain consumer goods not produced in Morocco are exempt from this levy and are subject to a customs duty of 10% only. Imports used for the production of exports are exempt from customs duties and other restrictions.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsAll exporters must sign a guarantee to repatriate and surrender foreign exchange proceeds. Export proceeds collected abroad may be used directly abroad to finance imports of goods and raw materials of goods for export.
Surrender requirementsForeign exchange must be surrendered within one month of the date of payment by foreign buyers specified in the commercial contract; in principle, this date must not be more than 150 days from the date of arrival of the merchandise. This deadline may be extended if warranted by business conditions and approved by the FEO. Residents of Moroccan nationality, including individuals and corporations, must repatriate foreign exchange receipts accruing from all their noncommercial claims and surrender them to an authorized bank. Other residents must surrender noncommercial receipts only if the receipts result from their activities in Morocco. Exporters are authorized to obtain up to 20% of export earnings in convertible dirham or foreign exchange accounts.
Financing requirementsNo.
Documentation requirements
Preshipment inspectionYes.
Export licenses
Without quotasOn March 16, 1999, Morocco and Tunisia signed a free trade agreement, providing for the immediate liberalization of 2,000 products, and for the complete phasing out of tariff barriers between the two countries by December 2007. Exports of flour, charcoal, certain animals, plants, archaeological items, and chemical products that deplete the ozone layer are subject to authorization.
Export taxesA 1% quality control tax is levied on exports of foodstuffs.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersAuthorized banks are permitted to make payments and settle expenses incidental to commercial transactions covered by the relevant import or export documents and for travel and study abroad without authorization from the FEO. Moroccan enterprises are permitted to settle in dirhams the expenses incurred by their foreign managers and nonresident foreigners working for or on behalf of these enterprises. Foreign airlines operating in Morocco may transfer, without prior authorization from the FEO, any surplus revenue from the proceeds of ticket sales, excess baggage, and air freight. Transfers with respect to sea and road transportation may be made directly to authorized banks.
Trade-related paymentsTransfers by deep-sea fishing companies for technical insurance and boat management costs are liberalized. There are no restrictions on the payment of unloading and storage costs and administrative expenses.
Indicative limits/bona fide testYes.
Investment-related paymentsThere are no restrictions on the payment of profits and dividends. Information is not available on the payment of amortization of loans or depreciation of direct investments.
Indicative limits/bona fide testThere are indicative limits and bona fide tests on the transfer of interest.
Payments for travel
Quantitative limitsThe maximum allowance for tourist travel is DH 10,000 a person a year. This allowance may be increased by DH 3,000 for a minor child on the passport of the beneficiary parent accompanying said parent at the time of travel abroad. The same allocation may also be granted to Moroccan residents living abroad upon their return to their home country, provided they have not benefited from the 15% allocation on remittances within the previous 12 months up to a limit of DH 20,000. Residents of foreign nationality who wish to travel abroad may be granted the foreign exchange equivalent of all their savings from income. Business travel by exporters of goods and services may be financed without restriction by debiting convertible export promotion accounts or foreign currency accounts maintained with Moroccan banks. In the case of business travel allowances for others, annual foreign exchange allowances are approved by the FEO on the basis of need, with a daily limit of DH 2,000. Banks have been empowered to provide advance allowances of up to DH 40,000 to small and medium-size enterprises and of up to DH 20,000 a year for business travel by individuals not belonging to either of these categories. In all cases, business travel allowances cannot be added to allowances for tourist travel. The FEO grants exemptions as needed.
Indicative limits/bona fide testYes.
Personal paymentsTransfers for family maintenance and alimony payments are approved upon presentation of documentary evidence. Commercial banks are authorized to transfer retirement pensions provided by public and private agencies in favor of retirees residing abroad permanently.
Prior approvalFor medical costs, approval by the Ministry of Health is required.
Quantitative limitsCommercial banks are authorized to sell foreign exchange to Moroccan nationals who must travel abroad for medical treatment up to a maximum allowance of the equivalent of DH 20,000, and to make transfers on patients’ behalf for treatment abroad in favor of hospitals and medical institutions concerned. This limit was raised to DH 30,000 on October 5, 1999. School fees to foreign academic institutions, upon submission of documentary evidence, may be transferred without limit; however, the following limits apply: (1) an annual installation allowance equivalent to DH 20,000 and the same amount for a person accompanying a minor student leaving Morocco for the first time; and (2) an allowance for living expenses amounting to the equivalent of DH 6,000 a month for non-scholarship holders and DH 4,000 a month for scholarship holders. In addition to these funds, banks are authorized to effect the transfer of rent and corresponding charges in favor of the foreign landlord once the student or his or her legal guardian has submitted a lease and a certificate of residence or any other equivalent document. The limit is DH 2,000 a month for foreign nationals residing in Morocco to cover the cost of higher education for a child studying abroad. Foreign retired persons and foreign spouses of Moroccans may transfer all of their income. They may also contribute freely to their retirement or social security fund in their country of origin.
Indicative limits/bona fide testApplications for additional amounts must be referred to the FEO for approval, which is granted on proof of need.
Foreign workers’ wages
Quantitative limitsForeigners residing in Morocco and employed in either the private or public sectors or engaged in professions in industry, commerce, and agriculture may transfer all their savings from income.
Credit card use abroad
Quantitative limitsYes.
Indicative limits/bona fide testYes.
Other paymentsThere are no restrictions on the payments for subscriptions and membership fees.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsResidents of Moroccan nationality, including individuals and corporations, must repatriate foreign exchange receipts accruing from all their noncommercial claims and surrender them to an authorized bank. Other residents must surrender noncommercial receipts only if the receipts result from their activities in Morocco. Moroccans working abroad must surrender within one month all foreign exchange in their possession, but on departure from Morocco, they may export without restriction foreign banknotes obtained by debiting their accounts in convertible dirhams. If they do not have such an account, they may take out 15% of foreign exchange repatriated and surrendered 12 months before to Moroccan banks up to a limit of DH 20,000. If these facilities are not available, Moroccan residents living abroad may take advantage of the same DH 10,000 tourist allocation that applies to residents. Resident travelers may bring in foreign banknotes in any amount, as well as any other means of payment in foreign exchange but must surrender them within 30 days of their return to Morocco.
Surrender requirementsExporters of services are required to obtain up to 20% of their export earnings in amounts denominated in foreign currency or convertible dirhams.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Sale or issue locally by nonresidentsThe issuance of capital market securities by nonresidents is prohibited. There are, however, no controls on the sale of Moroccan securities by nonresidents. Proceeds from such sales may also be transferred freely, provided that the relevant purchases are financed by foreign exchange inflows or any comparable means.
Purchase abroad by residentsPurchases of foreign securities by residents of Moroccan nationality and transfers of the funds required for such purchases are subject to the prior approval of the FEO. Residents of foreign nationality are free to purchase securities abroad or, generally speaking, to constitute assets abroad, provided that these purchases are financed from their foreign exchange holdings or holdings of convertible dirhams.
Sale or issue abroad by residentsYes.
Bonds or other debt securities
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
On money market instruments
Purchase locally by nonresidentsWhen the purchase of such instruments or securities is financed by a foreign exchange inflow or by the proceeds of the sale of other securities previously purchased through the surrender of foreign exchange, the transfer of disinvestment proceeds, including capital gains, and of income generated by such investment is free.
Sale or issue locally by nonresidentsThe issuance of these instruments by nonresidents is prohibited.
Purchase abroad by residentsPurchases require the prior authorization of the FEO, which is granted under certain conditions. On the other hand, residents of foreign nationality are free to engage in operations abroad financed with their foreign exchange holdings.
Sale or issue abroad by residentsYes.
On collective investment securities
Purchase abroad by residentsThe same regulations apply as for money market instruments.
Sale or issue abroad by residentsYes.
Controls on derivatives and other instruments
Purchase locally by nonresidentsThese instruments have not been developed in Morocco.
Purchase abroad by residentsResidents of Moroccan nationality may subscribe to such instruments abroad only with the prior approval of the FEO. Authorized intermediaries are allowed to engage in foreign exchange buying and selling operations with foreign banks using foreign currency cash.
Sale or issue abroad by residentsThe issue abroad of these instruments by Moroccan residents is subject to prior authorization by the FEO.
Controls on credit operations
Commercial credits
By residents to nonresidentsMerchandise exporters are free to grant commercial credits to nonresidents for up to 150 days; longer terms may be granted with the approval of the FEO, as required for business purposes.
Financial credits
By residents to nonresidentsThe granting of financial loans by residents to nonresidents is subject to the approval of the FEO.
To residents from nonresidentsFinancial credits are limited to foreign loans for financing investment operations or foreign trade.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsMoroccan banks may issue or accept in favor of residents sureties issued on behalf of nonresidents in support of the participation of said nonresidents in public or private contracting, the supplying of goods or services, the refund of down payments, and the substitution of guarantee withholdings. Similarly, they may issue sureties on behalf of nonresidents in support of tax liabilities or financial obligations. A counterguarantee from a foreign bank is required for sureties issued by Moroccan banks on behalf of nonresidents. When claims are entered under sureties issued or accepted in favor of residents on behalf of nonresidents, the relevant amounts must be repatriated to Morocco.
To residents from nonresidentsProvisions of guarantees are allowed on the condition that they are contracted through resident Moroccan banks.
Controls on direct investment
Outward direct investmentOutward direct investments are subject to prior approval of the FEO, but residents of foreign nationality are free to invest abroad.
Controls on liquidation of direct investmentThere are no controls on transfers made directly with the banking system of the proceeds of the liquidation or sale of foreign investment, including capital gains. For the liquidation of any investment not falling under the convertibility arrangements, the relevant proceeds must be deposited in a convertible time deposit account denominated in dirhams. Funds placed therein may be transferred over a five-year period in equal annuities.
Controls on real estate transactionsThese operations are subject to the investment regime.
Purchase abroad by residentsYes.
Purchase locally by nonresidentsForeign nationals may not purchase properties outside of urban limits.
Controls on personal capital movements
LoansThese operations are subject to FEO authorization.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsGifts and endowments are subject to prior FEO authorization. However, inheritance transfers may be effected freely if the acquisition of the inherited property is financed with foreign exchange.
Settlement of debts abroad by immigrantsThese operations are subject to FEO authorization.
Transfer of assets
Transfer abroad by emigrantsYes.
Transfer of gambling and prize earningsYes.
Provisions specific to commercial banks and other credit institutions
Borrowing abroadCommercial banks may only borrow abroad to finance foreign trade or investment operations.
Lending to nonresidents (financial or commercial credits)The granting of loans abroad by Moroccan banks is subject to approval by the Exchange Office. However, banks may use cash held in foreign exchange accounts (by foreign nationals, Moroccan citizens residing abroad, and exporters) for granting buyers’ credits to foreign, nonresident customers of Moroccan exporters.
Lending locally in foreign exchangeMoroccan banks may grant foreign exchange loans to residents for the financing of foreign trade operations and investment, within the limits of their respective foreign exchange positions, as authorized by the rules of the foreign exchange market.
Purchase of locally issued securities denominated in foreign exchangePurchases are subject to the prior approval of the FEO.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsConvertible dirham and foreign exchange accounts are excluded from reserve requirements.
Liquid asset requirementsAll deposits are taken into account for the calculation of liquid asset requirements.
Differential treatment of deposit accounts held by nonresidents
Credit controlsDebit balances are not permitted in foreign exchange accounts.
Investment regulations
Abroad by banksThese operations are subject to authorization by the FEO and the monetary authorities.
In banks by nonresidentsThese operations are subject to authorization by the monetary authorities.
Open foreign exchange position limitsOn January 1, 1999, the open foreign exchange position limit for each currency was increased to 10% from 7% of net capital and reserves.
On resident assets and liabilitiesThe assets and liabilities of these accounts are included in the calculation of bank foreign exchange positions.
On nonresident assets and liabilitiesThe same regulations apply as for nonresident assets and liabilities.
Provisions specific to institutional investors
Limits (max.) on portfolio invested abroadPrior approval by the FEO is required for portfolio investment abroad.
Other controls imposed by securities lawsn.a.
Changes During 1999
Exchange arrangementJanuary 1. The euro replaced six of the eight currencies to which the dirham is pegged.
Imports and import paymentsMarch 16. Morocco and Tunisia signed a free trade agreement providing for the immediate liberalization of 2,000 products.
Capital transactions
Provisions specific to commercial banks and other credit institutionsJanuary 1. The open foreign exchange position limit for each currency was increased to 10% from 7% of net capital and reserves.

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