Chapter

LUXEMBOURG

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2004
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(Position as of December 31, 2003)
Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: February 15, 1961.
Exchange Arrangement
CurrencyThe currency of Luxembourg is the euro.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderLuxembourg participates in the EMU with 11 other members of the EU: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Portugal, and Spain. The ECB may intervene to smooth out fluctuations in the euro exchange rate.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketYes.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payments arrangementsNo.
Administration of controlNo.
International security restrictions
In accordance with UN sanctionsIn accordance with UN Security Council resolutions and relevant EU regulations, certain restrictions are maintained on the making of payments and transfers for current international transactions with respect to Iraq, Myanmar, certain individuals associated with the previous government of the former Federal Republic of Yugoslavia, and Zimbabwe. In accordance with EU Regulation 147/2003, effective January 27, 2003, financing of and financial assistance related to military activities in Somalia are prohibited. Restrictions also apply on transfers with respect to the Taliban and individuals and organizations associated with terrorism.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotesNo.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencyYes.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsAccounts affected by international security restrictions are blocked.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measures
Positive listPayments for imports may be made freely. Individual licenses are required for certain specified imports from all countries (imports from another EU member country do not require licenses), including many textile and steel products, diamonds, weapons, and nontextile products from China. All other commodities are free of license requirements.
Licenses with quotasAlong with other EU countries, Luxembourg applies quotas on a number of textile products from non-EU countries in the framework of the MFA. It also applies a system of quotas on some steel products originating in Kazakhstan, Russia, and Ukraine. A double-checking system (without quotas) is applied to imports of some steel products from the Czech Republic, the former Yugoslav Republic of Macedonia, Poland, and the Slovak Republic. Quotas are applied on a number of products from China, such as ceramics, porcelain, and shoes.
Other nontariff measuresThe EU’s prior surveillance system is in effect on imports of certain iron and steel products originating in non-EU countries.
Import taxes and/or tariffsLuxembourg applies the Common Import Regime of the EU to imports of most other agricultural and livestock products from non-EU countries.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport licenses are required for a few products, mostly of a strategic character, such as arms, dual-use goods, and diamonds. Export licenses are also required for exports to countries under UN embargo.
Without quotasYes.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital transactionsNo.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investmentNo.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsNo.
Controls on personal capital transactionsNo.
Provisions specific to commercial banks and other credit institutionsNo.
Provisions specific to institutional investors
Currency-matching regulations on assets/liabilities compositionThese are applicable only to insurance undertakings.
Other controls imposed by securities lawsNo.
Changes During 2003
Arrangements for payments and receiptsJanuary 27. Financing of and financial assistance related to military activities in Somalia were prohibited.

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