Annual Report on Exchange Arrangements and Exchange Restrictions 2005
Chapter

TUNISIA

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2005
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(Position as of March 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: January 6, 1993.
Exchange Arrangement
CurrencyThe currency of Tunisia is the Tunisian dinar.
Exchange rate structureUnitary.
Classification
Managed floating with no predetermined path for the exchange rateThe exchange rate of the Tunisian dinar is determined in the interbank market in which commercial banks, including offshore banks acting on behalf of their resident customers, conduct transactions at freely negotiated rates. There is no limit on the spread between the buying and selling rates. The Central Bank of Tunisia (CBT) intervenes in the market and publishes an indicative interbank exchange rate for foreign currencies and banknotes by the following day. The CBT pursues a real effective exchange rate rule. Resident banks trade freely in foreign currencies in the spot market among themselves, with their foreign correspondents, and with nonresident banks in Tunisia.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketImporters and exporters are authorized to obtain forward exchange cover on the interbank market as of the date the contract is signed or the date on which the foreign commercial paper is domiciled, depending on the arrangements for the product concerned. Forward rates are freely negotiated by the authorized counterpart bank. Forward cover may be established for up to 12 months for imports and up to 9 months for exports. Persons who provide services are eligible for exchange cover for up to 12 months, to be provided within 30 days of the date on which the claim originated. Resident enterprises may purchase, in the forward market, futures maturing in up to 12 months to hedge against exchange risks related to the repayment of their foreign currency loans. They may also sell, for terms of up to 12 months, the foreign currency from drawings on external loans or from foreign currency investments.
Nonresidents may enter into contracts with resident authorized intermediaries for forward purchases of convertible dinars, maturing in up to 12 months. Resident authorized intermediaries may engage in, among themselves or with resident enterprises, foreign currency/convertible dinar swaps, maturing in up to 12 months. They may also engage in foreign currency/convertible dinar swaps with nonresident banks operating in Tunisia, their foreign correspondent banks, and nonresident enterprises operating in Tunisia, to make spot purchases and forward sales of convertible dinars. For the purposes of hedging against foreign currency interest rate risks, forward rate agreements may be signed for terms of 12 months by resident banks with foreign correspondent banks and by resident enterprises with resident banks and nonresident banks operating in Tunisia. Residents contracting such foreign currency loans may also purchase 3-, 6-, and 12-month foreign currency options in dollars or euros. Call options in other currencies may be listed on request. Authorized intermediaries may set the forward exchange rates for foreign currencies against dinars applied to customers’ forward transactions in accordance with the procedures followed in international markets.
Official cover of forward operationsThe national reinsurance company manages this exchange cover mechanism for banks and financial institutions with respect to their borrowing abroad.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements between Tunisia and other countries may be made in any convertible currency (traded in the interbank market) or in convertible Tunisian dinars through foreign accounts.
Payments to Israel are prohibited.
Settlements between Tunisia and Algeria, Libya, Mauritania, and Morocco may be effected through convertible accounts in the national currencies concerned at the respective central banks.
Controls on the use of domestic currencyPayments in dinars may be made abroad through a convertible dinar foreign account maintained domestically in the name of the foreign creditors or of their banks.
For current transactions and paymentsYes.
For capital transactions
Transactions in capital and money market instrumentsYes.
Transactions in derivatives and other instrumentsYes.
Credit operationsYes.
Use of foreign exchange among residentsThe dinar is the currency of account and the currency of payment in transactions among residents, unless otherwise authorized by the CBT, subsequent to approval from the MOF.
Payments arrangements
Regional arrangementsOn July 27, 2004, Tunisia signed the agreement establishing a free trade zone between the Mediterranean Arab States. On December 6, 2004, the agreement establishing a free trade zone between Tunisia and the Syrian Arab Republic was ratified.
Administration of controlExchange control is administered by the CBT. The CBT delegates authority over payments for imports and most invisibles to the authorized banks, whereas the Ministry of Trade (MOT) administers foreign trade control, which entails issuing import and export authorization for the remaining products not covered by the liberalization of foreign trade.
International security restrictions
In accordance with UN sanctionsYes.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeYes.
Controls on external tradeThe CBT has a monopoly over the importation and exportation of monetary gold. Imports and exports of gold in other forms require joint approval from the CBT and the MOT.
Controls on exports and imports of banknotes
On exports
Domestic currencyExports of dinar banknotes and coins are prohibited.
Foreign currencyNonresident travelers wishing to reexport the foreign exchange equivalent of amounts equal to, or exceeding D 1,000 must declare to customs the foreign currencies they are importing upon their entry into Tunisia. There is no ceiling on the reconversion of Tunisian banknotes by nonresident travelers. Foreign exchange from dinar reconversion may be reexported upon presentation of a foreign exchange voucher or receipt if the amount to be reexported is less than D 1,000 or if the foreign exchange used in the purchase of the dinars was received abroad in the form of a check, draft, money order, or any other evidence of a claim, or by debiting a foreign account in foreign currency or convertible dinars. The foreign exchange import declaration approved by customs is also required if the amount of foreign exchange from dinar reconversion equals or exceeds the equivalent of D 1,000 and if the dinars derived from the surrender of foreign currencies physically imported from abroad.
On imports
Domestic currencyImports of dinar banknotes and coins are prohibited.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domestically(1) Professional accounts in foreign currency may be opened by (a) any resident individual, (b) any Tunisian legal entity, and (c) any foreign legal entity in Tunisia with foreign currency assets in connection with their activities. These accounts may be credited with (a) effective January 3, 2005, a maximum of 100% (previously, 70%, or up to 100% with CBT authorization) of foreign exchange proceeds from the account holder’s exports and foreign currency loans contracted in conformity with the regulations in force; (b) interest accrued on the balances of these accounts; and (c) transfers from the account holder’s other professional accounts in the same foreign currency or any other foreign currency. The accounts may be debited for (a) payment of any current operation pertaining to the activity for which they were opened, and (b) any other transaction with general or specific authorization. Balances may be offered for sale on the foreign exchange money market.
(2) Special accounts in foreign currency may be opened by (a) individuals of Tunisian nationality changing their normal residence to Tunisia from abroad; (b) resident individuals of Tunisian nationality or Tunisian legal entities for their nontransferable assets legitimately acquired abroad; (c) individuals of foreign nationality residing in Tunisia; (d) foreign legal entities with branches in Tunisia; and (e) Tunisian diplomats and civil servants stationed abroad. Funds legitimately acquired abroad, not from the exportation of goods or services from Tunisia, may be credited to these special accounts. They may be debited for (a) foreign exchange sold on the interbank market; (b) foreign exchange remitted to the account holder, his or her spouse, parents, and offspring to undertake foreign travel; (c) amounts credited to another special account in foreign currency or convertible dinars; and (d) any payments abroad, including those for the acquisition of movable property or real estate located abroad or ownership rights abroad, for foreign claims, and for payments for imports subject to applicable foreign trade formalities.
(3) Residents are free to open foreign currency international trading accounts to make payments related to their international trade and brokerage operations and associated expenses. These accounts may be credited with (a) the proceeds from exports of goods, for which advance payment has been received; (b) profits and/or commissions from international trade and brokerage operations; (c) foreign currency loans contracted to finance trade operations; (d) foreign currency from trade operations repurchased on the exchange market after it has been sold on the market; and (e) interest generated by deposits on the account. They may be debited for (a) payments for purchases made within the framework of international trade operations and associated expenses; (b) settlement of expenses related to international brokerage operations; (c) repayment of foreign currency loans; (d) settlement of current operations carried out in conformity with exchange and foreign trade regulations and any operation carried out with general or special authorization; and (e) sales of foreign currencies in the exchange market.
Approval requiredTo open special accounts, Tunisians must submit a declaration of foreign holdings to the CBT.
Held abroadCBT authorization is required for residents to open accounts abroad. Resident banks may freely open correspondent current accounts abroad.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currency(1) Professional accounts in convertible dinars may be opened by resident individuals or legal entities with resources in foreign exchange, subject to CBT authorization. These accounts may be credited and debited in accordance with the terms specified by the CBT in the authorization to open such accounts.
(2) Special accounts in convertible dinars may be opened by the same individuals and legal entities that may open special foreign exchange accounts. These special accounts may be credited with the dinar proceeds from sales on the interbank market of funds legitimately acquired abroad, but not from the exportation of goods or services from Tunisia. They may be debited for (a) payments of any kind in Tunisia; (b) the acquisition of foreign currencies either for remittance to the account holder, or his or her spouse, parents, and offspring, or for making payments abroad, particularly for the acquisition of movable property or real estate located abroad, ownership rights abroad, or foreign claims, and for payments for imports subject to applicable foreign trade formalities; and (c) amounts credited to another special account in foreign currency or convertible dinars. To open special accounts, Tunisians must submit a declaration of foreign holdings to the CBT.
(3) With CBT authorization, special export earnings accounts in convertible dinars may be opened by Tunisian or foreign individuals residing in Tunisia who earn profits from the exportation of goods or services and/or who are shareholders or partners in a resident company earning profits from the exportation of goods or services. These accounts may be freely credited with (a) 10% of the export earnings realized by the account holder and/or received from companies in which he or she is a shareholder, (b) proceeds from sales on the interbank market of foreign exchange representing income or revenue from assets acquired abroad by debiting the account, and (c) interest on balances in the account.
They may be freely debited for (a) payments of any kind in Tunisia; (b) purchases on the interbank market of foreign exchange to be used for foreign travel by the account holder, or his or her spouse, parents, or offspring; and (c) payments in connection with a current operation or acquisition of rights and interests abroad regardless of whether these are represented by securities, including their related management fees.
(4) Subject to CBT authorization, exchange subagency accounts in convertible dinars may be opened by a resident individual acting on behalf of an authorized intermediary or a resident individual with equity holdings in a resident legal entity acting on behalf of an authorized intermediary. These accounts may be credited freely with (a) 2% of the dinar equivalent of foreign exchange sold to an authorized intermediary by a person acting as a subagency; (b) 2% of the dinar equivalent to foreign exchange sold by a legal entity acting as a subagency, prorated in accordance with the equity of the account holder in such legal entity; (c) the dinar proceeds from the sales of foreign exchange on the exchange market, revenue, or assets acquired abroad by debiting this account; and (d) interest earned on the accounts. These accounts may be freely debited for (a) payments of any kind in Tunisia; and (b) purchases of foreign exchange on the exchange market for (1) travel abroad by the account holder, his or her spouse, parents, and offspring; (2) payments for current transactions, subject to exchange and foreign trade regulations; (3) payments for the purchase of movable or real property abroad, ownership rights abroad, and foreign claims—whether or not represented by securities; and (4) payments for fees for the management of assets legitimately acquired abroad.
Nonresident Accounts
Foreign exchange accounts permittedForeign accounts in convertible currencies may be opened freely by all nonresidents regardless of nationality. These accounts may be credited with (1) receipts in convertible foreign currencies (banknotes must be declared at customs); (2) foreign exchange remitted to the account holder by a nonresident; (3) authorized payments by residents in favor of the account holder; (4) interest payable by the authorized intermediaries on foreign exchange deposits in these accounts, whenever they can use the funds thus deposited at remunerative rates; (5) transfers from other foreign accounts; and (6) the proceeds of cashed checks, traveler’s checks, or drafts denominated in convertible currencies and made out by a nonresident to the order of the account holder. All other credits require prior authorization from the CBT, either directly or by delegation.
These accounts may be debited freely for (1) payments of any kind in Tunisia; (2) transfers abroad or delivery of foreign currency to the account holder, to any other nonresident beneficiary, or to residents with the status of permanent representatives or salaried employees of the account holder; and (3) transfers to other foreign accounts.
Domestic currency accounts(1) Domestic nonresident accounts may be opened by authorized intermediaries in the name of nonresident individuals of foreign nationality residing temporarily in Tunisia. These accounts may be credited without prior authorization from the CBT with the following: (a) transfers of funds from abroad in convertible currencies; (b) revenue of any kind accruing in Tunisia to the holder of the account (in particular the nontransferable part of remuneration for services rendered in Tunisia by the account holder); (c) liquid assets from estates settled in Tunisia; (d) proceeds from the repayment of loans in dinars by debiting the account; and (e) transfers from another domestic nonresident account opened in the name of the account holder. These accounts may be debited for (a) support of the account holder and his or her family in Tunisia, (b) payment of costs of managing property in Tunisia, (c) lending to residents, and (d) transfers to another domestic nonresident account opened in the name of the account holder.
(2) Special dinar accounts may be opened freely by foreign enterprises with contracts in Tunisia. These enterprises are authorized to open for each contract a single special account in dinars, in which they may deposit the portion of the contract price payable in dinars to cover their local expenses. These accounts may also be credited with funds from a foreign account in foreign exchange, or in convertible dinars, the dinar equivalent of any transfer in convertible foreign currency from abroad, and interest accruing on funds deposited in the account. The accounts may be freely debited for enterprises’ contract-related expenses in Tunisia. These enterprises are free to retransfer dinar equivalents credited to their foreign currency accounts, provided that the funds available in the account are sufficient to cover the transfer. Any transfer operations from such accounts must be authorized by the CBT. Interest is paid at the same rates as those applied to resident demand accounts in dinars.
(3) Capital accounts may be opened freely in the name of a nonresident individual of foreign nationality or by a nonresident legal entity. Subject to certain conditions, capital accounts may be credited, without the prior approval of the CBT, with the proceeds of sales on the stock exchange, or the contractual or advance redemption of transferable Tunisian securities; with the sales proceeds of real estate through an attorney at the Supreme Court, or of rights to real estate situated in Tunisia; and with funds from another capital account. Irrespective of the account holder’s country of residence, capital accounts may be freely debited for the living expenses in Tunisia of the account holder and his or her family up to D 100 a person a week, provided that total withdrawals from one or more capital accounts in a calendar year do not exceed D 2,000. In addition, a capital account holder traveling in Tunisia between November 1 and March 31 may withdraw from the account an amount equal to the foreign exchange imported for the trip and surrendered to the CBT, an authorized intermediary, or a subagency, provided that total withdrawals for the living expenses of the account holder and his or her family do not exceed D 2,000 a year. Such accounts may also be debited, subject to certain conditions, for expenses connected with the management of Tunisian securities; for the maintenance, repair, and insurance of real estate and all taxes; and for transfer to the credit of another capital account. Balances on capital accounts are freely transferable between nonresidents of foreign nationality, with the exception of legal entities governed by public law. Subject to certain conditions, they may also be debited to assist the account holder’s parents and offspring residing in Tunisia, at a maximum rate of D 50 a person a month. These accounts do not pay interest and may not be overdrawn. Individuals or legal entities of French or Italian nationality holding capital accounts may, with CBT authorization, transfer all funds in their accounts regardless of the date of deposit but subject to the condition, in the case of Italian account holders, that the said funds derived from the sale of real property; no restriction with respect to the origin of funds applies to French account holders.
(4) Suspense accounts may be opened by all nonresidents regardless of nationality and may be used for crediting all proceeds accruing to nonresidents and awaiting utilization. These proceeds may, upon general or specific approval, be used in Tunisia for specific purposes, transferred abroad, or transferred to other nonresident accounts. Suspense accounts may be debited, without the prior authorization of the CBT, for payments to the Tunisian government or public institutions, or payment of the expenses of managing securities deposited in a suspense file opened in the name of the account holder. They may also be debited for settlement of living expenses incurred in Tunisia by the account holder and his or her family up to D 100 a person a week, provided that the total withdrawals in any calendar year from one or more accounts do not exceed D 2,000 a family. In addition, a suspense account holder traveling in Tunisia between November 1 and March 31 of the following year may withdraw from the account an amount equal to the foreign exchange imported for the trip and surrendered to the CBT, an authorized intermediary, or a subagency, provided that total withdrawals for the living expenses of the account holder and his or her family do not exceed D 2,000 a year. Up to D 50 a person a month may be debited to assist the offspring or parents of the account holder. Individuals or legal entities of French or Italian nationality holding suspense accounts may, with CBT authorization, transfer all funds in their accounts regardless of the date of deposit but subject to the condition, in the case of Italian account holders, that the said funds derived from the sale of real property; no restriction with respect to the origin of funds applies to French account holders. These accounts do not pay interest and may not be overdrawn.
Convertible into foreign currencyForeign accounts in convertible dinars may be opened by all nonresidents regardless of nationality. These accounts may be credited freely with (1) the dinar proceeds from sales of foreign currency on the interbank market (banknotes must be declared at customs); (2) proceeds from authorized payments by residents in favor of the account holder; (3) proceeds from the conversion of cashed checks, traveler’s checks, or drafts expressed in foreign currency and made out by a nonresident to the order of the account holder; (4) transfers from other foreign accounts; and (5) interest on balances in these accounts. No other amount may be credited to these accounts without authorization from the CBT, granted either directly or by delegation.
These accounts may be debited freely for (1) payments of any kind in Tunisia, and (2) purchases on the interbank market of foreign currency either for transfers abroad or for delivery to the account holder, to any other nonresident beneficiary, or to residents with the status of representatives or salaried employees of the account holder.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsImporters must receive a customs code.
Domiciliation requirementsYes.
Import licenses and other nontariff measuresImports are free from licensing requirements, except those that have an impact on law and order, hygiene, health, morals, protection of fauna and flora, and cultural heritage, and are effected by an import certificate domiciled with an authorized intermediary. Goods not liberalized need an import authorization granted through the MOT. Imports of raw materials, semifinished products, spare parts, and equipment that are paid for by sources outside Tunisia and do not involve the payment or delivery of foreign currency may be effected by enterprises for their own use without foreign trade formalities up to a value of D 100,000 or equivalent a year. Furthermore, companies exclusively engaged in exporting goods or services; companies established in an industrial park; and holders of permits for exploration, research, the operation of concessions in the hydrocarbons sector, or contractors or subcontractors employed by such companies may import freely, without foreign trade formalities, any goods required for their production process, subject only to customs declaration.
Negative listGoods not covered by the liberalization of foreign trade and those that have an impact on security, law and order, hygiene, health, morals, protection of flora and fauna, and cultural heritage are included in a list issued by decree.
Other nontariff measuresAll imports from Israel are prohibited. Some items, a list of which is drawn up by the MOT, are subject to technical import controls.
Import taxes and/or tariffsIn addition to customs duties, imports are subject to the VAT and, in some cases, to the consumption tax. Certain imports destined for domestic investment projects are eligible for full or partial exemption from import duties.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsExport proceeds must be repatriated within 10 days of the payment due date. If no credit is extended, payment is due within 30 days of the date of shipment. Nonresident companies exclusively engaged in exporting goods or services and covered by the Investment Incentives Code, as well as nonresident international trading companies and nonresident enterprises established in an economic business park are not required to repatriate or surrender their export proceeds.
Surrender requirementsEffective January 3, 2005, resident exporters may retain in their professional accounts up to 100% (previously, 70%) of their foreign exchange export proceeds and their foreign currency loans contracted in accordance with existing exchange regulations.
Financing requirementsNo.
Financing requirements
DomiciliationExports of goods covered by the liberalization of foreign trade must be domiciled within eight days of the date of shipment.
Preshipment inspectionSome products listed by the MOT are subject to export controls.
Export licensesMost exports are free from a licensing requirement, and certain goods may be exported with an authorization issued by the MOT. Tunisia has signed free trade agreements with Egypt, Iraq, Jordan, Libya, Morocco, and Syria and the Mediterranean Arab States, providing for the reduction of tariff barriers.
Without quotasYes.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related paymentsTransfers may be freely effected for payment of freight, storage, and warehousing services; transit and administrative fees; customs duties; commissions; and fees for analyses and controls of materials and products.
Investment-related paymentsIncome from foreign capital invested in accordance with the laws and regulations in force and interest on foreign currency loans contracted by residents in accordance with the regulations in force may be transferred freely.
Rent from real estate owned by nonresidents may be transferred freely.
Payments for travel
Quantitative limitsEffective November 1, 2004, the annual allowance for tourist travel is the equivalent of D 2,000 (previously, D 1,000) an adult and D 1,000 (previously, D 500) a child under 10 years of age. These amounts may be accumulated over a period of two consecutive calendar years. Effective January 3, 2005, the business travel allowance for exporters is 25% (previously, 15%) of export proceeds for the current year, with an annual limit of D 180,000 (previously, D 120,000). Any unused portion of this allowance may be carried forward to subsequent years, provided that the cumulative amount does not exceed the annual limit of D 180,000. Resident individuals or legal entities that have signed service or work contracts with nonresidents that can be fully or partially implemented abroad may receive a business travel allowance (AVA)—for contracts that may be executed abroad—set at 15% of the contracts. Exporters may combine the AVA for contracts executable abroad with the Exporter-AVA. The annual limit for business travel by importers ranges from D 5,000 to D 30,000, depending on the value of the previous year’s imports, and the annual limit for business travel by other professions ranges from D 2,000 to D 20,000, depending on the previous year’s income declared to the tax authorities. Effective January 3, 2005, the travel allowance for promoters of new projects is D 10,000 (previously, D 5,000), and is granted only once for the duration of the project.
Indicative limits/bona fide testYes.
Personal paymentsThere are no restrictions on the transfer of pensions.
Prior approvalAlimony payments to an ex-spouse and child support under a final judgment are freely transferable.
Quantitative limitsEffective November 1, 2004, the annual allowance for expenses related to stays abroad for reasons of health is D 1,000 (previously, D 750) or equivalent. Persons accompanying patients may transfer up to D 250 a trip in the case of medical or paramedical staff and effective November 1, 2004, D 750 (previously, D 500) in all other cases. Effective November 1, 2004, the annual settlement allowance and the monthly living expense allowances for students studying abroad are D 2,000 and D 1,000 (previously, D 1,500 and D 700), respectively. Registration fees and education allowances are freely transferable up to the amount due to a foreign educational institution (previously, a ceiling of D 6,000 a year applied).
Indicative limits/bona fide testThe limit of D 1,000 or equivalent for expenses related to stays abroad for reasons of health may be exceeded if the patient’s condition requires several trips abroad during the same year.
Foreign workers’ wages
Quantitative limitsContractually employed foreign nationals may transfer up to 50% of their earnings. For foreign experts employed by the public sector, limits on transfers are specified in their contracts; otherwise, the restrictions for contractually employed foreign nationals apply.
Indicative limits/bona fide testYes.
Credit card use abroadOnly operators eligible for business travel allowances are authorized to use credit cards abroad.
Prior approvalYes.
Quantitative limitsThose eligible for business travel allowances may use their credit cards abroad only to the extent of their transfer entitlements for these allowances.
Indicative limits/bona fide testYes.
Other paymentsSubscription fees for journals and periodicals, membership fees, dues for foreign associations and organizations, and payments for literary and artistic rights, legal proceedings, arbitrage, and attorney fees are freely transferable.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsResidents are required to repatriate all remuneration for services rendered to nonresidents and all proceeds from invisible transactions received from abroad.
Surrender requirementsEffective March 7, 2005, residents providing services abroad are exempt from surrendering foreign currency proceeds, which are earmarked for deposit in a new account called “service provider account.” Previously, such residents could retain in their professional foreign currency accounts up to 70% of the foreign currency earnings and their foreign exchange borrowing contracted in accordance with the exchange regulations in force.
Restrictions on use of fundsForeign exchange deposited in professional accounts must be used in accordance with the rules governing the operation of accounts of this type.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsThere are controls on all transactions in capital and money market instruments.
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsStocks in existing companies in Tunisia may be acquired freely with foreign exchange transferred from abroad by foreign nonresidents. Effective March 14, 2005, the approval of the High Investment Commission (HIC) is no longer required for the acquisition by foreign nationals of Tunisian securities entailing voting rights or shares of companies established in Tunisia. Previously, the acquisition by resident and nonresident foreign nationals of stocks with voting rights was subject to approval by the HIC, if the ratio of foreign equity participation, including the new acquisition was equal to, or exceeded 50% of capital shares, irrespective of whether or not the companies were listed on the stock exchange. Approval was not required from the HIC for acquisitions of Tunisian securities entailing voting rights or shares in existing companies in Tunisia (1) between shareholders in the same company who are foreign nationals; (2) by nonresident individuals or legal entities established in Tunisia, for securities and corporate shares that have already been acquired without exceeding the limit of 50% or more; and (3) provided as a guarantee for management activities of foreign directors in these companies.
Sale or issue locally by nonresidentsNonresidents may sell freely shares of companies established in Tunisia. They may also transfer freely net real proceeds from the sale of shares that were purchased with foreign exchange transferred from abroad for an investment made in accordance with the legislation in force.
Purchase abroad by residentsThe accumulation of assets abroad by residents is subject to authorization. However, effective February 16, 2005, resident exporters may transfer the equivalent of D 60,000 to D 300,000 (previously, D 40,000 to D 200,000) a year to finance equity participation in companies located abroad; non-exporting companies are permitted to transfer funds abroad for equity participation up to D 20,000 (previously, D 10,000) to D 100,000. The holders of special accounts in foreign currency or convertible dinars, special export earnings accounts, or exchange subagency accounts may purchase securities abroad by debiting these accounts.
Sale or issue abroad by residentsYes.
Bonds or other debt securitiesControls apply to all these transactions.
Purchase locally by nonresidentsThe purchase by nonresident foreign nationals of debt securities issued by state or resident companies is subject to approval, with the exception of treasury bills, to which they may subscribe, effective July 1, 2004, up to a limit of 5% each issue.
On money market instrumentsControls apply to all these transactions.
On collective investment securitiesControls apply to all these transactions.
Purchase locally by nonresidentsNonresidents may acquire freely shares of Tunisian mutual funds with foreign exchange transferred from abroad. However, the approval of the HIC is required if the acquisition raises the foreign ownership to more than 50% of the mutual fund’s capital.
Sale or issue locally by nonresidentsNonresidents may transfer freely net real proceeds from sales of Tunisian mutual fund shares acquired with foreign exchange transferred from abroad.
Controls on derivatives and other instrumentsControls apply to all transactions in derivatives and other instruments. Resident banks may engage in (1) foreign currency swaps maturing in up to 12 months with nonresident banks operating in Tunisia, and with foreign correspondent banks; (2) foreign currency/dinar swaps maturing in up to 12 months among themselves and with resident enterprises, provided that the transactions in question back actual commercial or financial transactions; and (3) foreign currency/convertible dinar swaps, by making spot purchases and forward sales of convertible dinars to nonresident banks operating in Tunisia, foreign correspondent banks, and nonresident enterprises operating in Tunisia. For the purposes of hedging against foreign exchange rate risks, resident and nonresident authorized intermediaries may conclude future rate agreements for terms of up to 12 months with resident enterprises, or with their foreign correspondent banks.
Controls on credit operations
Commercial credits
By residents to nonresidentsThese credits require approval from the CBT, except for credits in foreign currency granted on the money market to refinance import or export operations of nonresident industrial enterprises established in Tunisia and short-term credits in dinars to finance the local operating expenses of nonresident enterprises established in Tunisia.
To residents from nonresidentsEffective January 4, 2005, resident financial institutions may freely contract foreign currency loans from nonresidents in maturities of over 12 months without limits (previously, limited to the equivalent of D 10 million a year); other reputable resident companies may contract such loans up to an annual limit of the equivalent of D 10 million (previously, D 3 million).
Financial creditsResident financial institutions and other resident enterprises may freely contract foreign currency financial loans from nonresidents up to an annual limit of the equivalent of D 10 million and D 3 million, respectively.
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsResident banks may freely grant bid bonds, performance bonds, advance payment bonds, contract holdback bonds, or any other bonds to resident exporters of goods or services to guarantee their obligations to nonresidents. They may also freely grant guarantees for the payment by resident importers of their purchases from nonresident suppliers. The issue and establishment of repayment guarantees for foreign currency loans freely contracted by residents are not subject to approval.
To residents from nonresidentsAt the request and with the counterguarantee of a nonresident bank, resident banks may freely grant the usual bank guarantees required of nonresident service providers by resident transactors in connection with business contracts, work contracts, service contracts, etc.
Controls on direct investment
Outward direct investmentAny direct investment by residents abroad is subject to CBT approval. Effective February 16, 2005, the limit on exporting companies’ annual transfers to finance branches, subsidiaries, and equity participation is raised to the range of D 60,000 to D 300,000 from the range of D 40,000 to D 200,00. For non-exporting companies, the limit on transfers abroad for the same purposes is in the range of D 20,000 to D 100,000 from D 10,000 to D 100,000.
Inward direct investmentForeigners may invest freely in most economic sectors. Effective March 14, 2005, the approval of the HIC is no longer required for the acquisition by foreign nationals of securities with voting rights or shares in Tunisian companies. Previously, the participation of foreigners required the approval of the HIC if such participation equaled to, or exceeded 50% of the capital stock.
Controls on liquidation of direct investmentAll foreign direct investment carried out legitimately in Tunisia with foreign exchange transferred from abroad is guaranteed the right to repatriate the net proceeds from the sale or liquidation of the invested capital, even if the net proceeds exceed the initial value of the foreign exchange invested.
Controls on real estate transactions
Purchase abroad by residentsPurchases require prior approval from the CBT, except for transactions debited to special accounts in foreign currencies or convertible dinars or through special export earnings accounts in convertible dinars or exchange subagency accounts in convertible dinars.
Purchase locally by nonresidentsPurchases by nonresident foreign nationals require prior approval from the CBT.
Sale locally by nonresidentsAuthorization is required for sales other than those made to a resident and involving real estate that is the subject of a land title. These sales are recorded in the Land Registry solely upon presentation of documentation showing that the price was deposited by the buyer in a suspense or capital account maintained in the name of the seller on the books of an authorized intermediary.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsAuthorization is not required to take possession of an inheritance established in Tunisia for the benefit of a nonresident. The transfer of proceeds from gifts, endowments, and inheritances not previously guaranteed is subject to approval.
To residents from nonresidentsAuthorization is not required for gifts from nonresidents to residents, and for taking possession of an inheritance established abroad for a resident. Proceeds from gifts and inheritances must be declared and repatriated.
Settlement of debts abroad by immigrantsYes.
Transfer of assets
Transfer abroad by emigrantsYes.
Transfer into the country by immigrantsNonresident Tunisian nationals returning permanently to the country must declare and repatriate their assets or proceeds and revenue from their holdings abroad.
Transfer of gambling and prize earningsYes.
Provisions specific to commercial banks and other credit institutions
Borrowing abroadResident financial institutions may freely contract foreign currency loans from nonresidents up to a limit of D 10 million or equivalent.
Maintenance of accounts abroadResident banks may freely open correspondent accounts with foreign banks of their choice.
Lending to nonresidents (financial or commercial credits)The approval of the CBT is required for loans granted by resident banks to nonresidents. However, resident banks may freely extend loans on the foreign exchange money market to nonresident industrial enterprises established in Tunisia for operating expenses and to finance their imports and exports. In addition, resident banks may extend dinar loans to offshore companies to finance local (dinar-denominated) operating expenses. Such loans cannot be used to purchase foreign exchange and must be placed in special accounts.
Lending locally in foreign exchangeResident banks may freely finance on the foreign exchange money market the import and export activities of resident entities. They may also lend their foreign currency surpluses to other resident banks and to their correspondent banks in exchange for loans with the same maturity in another currency.
Purchase of locally issued securities denominated in foreign exchangeYes.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsThere is no reserve requirement on foreign currency deposit accounts.
Liquid asset requirementsA liquidity ratio requirement takes foreign currency deposits into account.
Interest rate controlsInterest rates on foreign currency deposits are freely negotiated between the bank and account holders, except that remuneration of the foreign currency accounts of residents may not be more than a half point below the rates of remuneration published by the CBT for foreign currency amounts equal to or higher than, the equivalent of D 10,000.
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsThe dinar deposits of nonresidents are included in the calculation of the reserve requirements ratios.
Liquid asset requirementsThe liquidity ratio requirement takes nonresidents’ deposits into account.
Interest rate controlsInterest rates on dinar and convertible dinar deposits of nonresidents are freely negotiated, except in the case of demand accounts, on which there is a cap of 2%. The remuneration on foreign currency accounts is freely negotiated with banks. Dinar balances in suspense accounts and capital accounts do not earn interest.
Investment regulations
Abroad by banksYes.
In banks by nonresidentsApproval is required for any acquisition of capital in a bank or other financial institution and, in all cases, for the acquisition of a proportion of the voting rights equal to or exceeding 10%, as well as of any instrument that may result in the transfer of a significant proportion of the assets, potentially changing its financial structure or the focus of its activities.
Open foreign exchange position limitsNet open positions of banks operating in the foreign exchange market resulting from both spot and forward transactions are limited to 10% of banks’ net own funds in each currency, with a global limit of 20% for positions in all currencies.
On resident assets and liabilitiesYes.
Provisions specific to institutional investors
Limits (max.) on securities issued by nonresidentsYes.
Limits (max.) on investment portfolio held abroadYes.
Other controls imposed by securities lawsAny acquisition on the stock exchange of a twentieth, tenth, fifth, third, half, or two-thirds of the capital of a company that is involved in public deposit-taking must be declared to that company, to the Financial Board, and to the Securities Exchange.
Changes During 2004
Arrangements for payments and receiptsJuly 27. Tunisia signed an agreement establishing a free trade zone between the Mediterranean Arab States.
December 6. Tunisia ratified the agreement establishing a free trade zone between Tunisia and the Syrian Arab Republic.
Payments for invisible transactions and current transfersNovember 1. The annual allowance for expenses related to stays abroad for reasons of health was raised to D 1,000 from D 500. In the case of medical or paramedical staff accompanying the patient, the allowance for living expenses was raised to D 750 from D 500 a trip.
November 1. With respect to students abroad, the annual settlement allowance was raised to D 2,000 from D 1,500; the monthly living expenses allowance was raised to D 1,000 from D 700; and the ceiling on direct transfers due to foreign educational institutions was raised to D 1,000 from D 750.
November 1. The annual allowance for tourist travel was raised to D 2,000 from D 1,000 an adult, and to D 1,000 from D 500 a child under 10 years of age.
Capital transactions
Controls on capital and money market instrumentsJuly 1. The amount of treasury bills that could be purchased by a nonresident foreign national was limited to 5% of each issue.
Changes During 2005
Resident accountsJanuary 3. The amount of foreign exchange proceeds from the account holder’s exports and foreign currency loans that could be credited to the account holder’s professional accounts in foreign currency was raised to 100% from 70%.
Exports and export proceedsJanuary 3. The amount of foreign exchange proceeds from exports and foreign currency loans that exporters were allowed to retain in their professional accounts was increased to 100% from 70%.
Payments for invisible transactions and current transfersJanuary 3. The travel allowance for promoters of new projects was raised to D 10,000 from D 5,000.
January 3. The business travel allowance for exporters was raised to 25% from 15% of export proceeds for the current year, with the annual limit raised to D 180,000 from D 120,000.
Proceeds from invisible transactions and current transfersMarch 7. Residents providing services abroad were exempt from surrendering foreign exchange proceeds, which were earmarked for deposit in a new account called “service provider account.”
Capital transactions
Controls on capital and money market instrumentsFebruary 16. Resident exporters were allowed to annually transfer the equivalent of D 60,000 to D 300,000 from D 40,000 to D 200,000 to finance equity participation in companies abroad; nonexporting companies were permitted to transfer the equivalent of D 20,000 (previously D 10,000) to D 100,000.
March 14. The requirement of approval of the HIC was lifted with respect to acquisition by foreign nationals of Tunisian securities entailing voting rights or shares of companies established in Tunisia.
Controls on credit operationsJanuary 4. The restriction on the amount foreign currency loans from nonresidents that reputable resident financial institutions were permitted to contract was lifted (previously, a limit of D 10 million a year applied). The amount foreign currency loans that reputable resident companies may contract was raised to D 10 million from D 3 million.
Controls on direct investmentFebruary 16. The limit on exporting companies’ annual transfers to finance branches, subsidiaries, and equity participation was raised to the range of D 60,000 to D 300,000 from the range of D 40,000 to D 200,000. The limit on nonexporting companies’ annual transfers for the same purposes was raised to the range of D 20,000 to D 100,000 from D 10,000 to D 100,000.

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