Annual Report on Exchange Arrangements and Exchange Restrictions 2005
Chapter

CÔTE D’IVOIRE

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2005
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(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: June 1, 1996.
Exchange Arrangement
CurrencyThe currency of Côte d’Ivoire is the CFA franc.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderThe CFA franc is pegged to the euro, the intervention currency, at a fixed rate of CFAF 655.957 per €1. Exchange rates for other currencies are derived from the rate for the currency concerned in the Paris exchange market vis-à-vis the euro.
Exchange taxAuthorized banks charge a proportional commission of 0.25% on transfers to all countries outside the WAEMU, which must be surrendered to the treasury, and a fixed commission, which they may set freely. Banks are authorized to charge a maximum commission of 2% on nonelectronic exchange transactions in euros.
Exchange subsidyNo.
Forward exchange marketResidents are authorized to contract foreign exchange cover to settle payments related to imports and exports of goods and services. Forward exchange cover must be in the currency prescribed in the contract. The maturity of the cover may not exceed the import or export payment due date stipulated in the commercial contract.
Arrangements for Payments and Receipts
Prescription of currency requirementsBecause Côte d’Ivoire is linked to the French Treasury through an Operations Account, settlements with France, Monaco, and other Operations Account countries (WAEMU and CAEMC members and the Comoros) are made mainly in euros, but they may also be made in foreign currencies. Settlements outside the Operations Account area are allowed freely for current account transactions. Capital transactions are subject to exchange authorization (which must be filed with the Ministry of State, Ministry of Economy and Finance—MSMEF), except in the following cases: (1) transfers of the amounts required for contractual settlements of debts or for repayments of short-term loans granted for financing commercial and industrial operations; (2) transfers of proceeds from the liquidation of investments or the sale of foreign securities by nonresidents; and (3) payments for purchases of options.
Use of foreign exchange among residentsThe CFA franc is the only legal tender and use of foreign exchange among residents is not permitted.
Payments arrangements
Regional arrangementsAn Operations Account is maintained with the French Treasury that links Operations Account countries. Most purchases or sales of foreign currencies or euros against CFA francs are ultimately settled through a debit or credit to the Operations Account.
Clearing agreementsA clearing agreement exists among the WAMA members and Cape Verde, The Gambia, Ghana, Guinea, Liberia, Nigeria, and Sierra Leone.
Administration of controlExchange control is administered jointly by the Directorate of the Treasury in the MSMEF and the BCEAO. Since the regulations governing external financial relations of WAEMU member countries came into force (on February 1,1999), most of the supervisory authority has been delegated to authorized intermediary banks, which are required to report on the transactions carried out under their supervision. The only transactions that remain subject to the prior authorization of the MSMEF or the BCEAO relate to outward investments by nonresidents and domestic and foreign currency accounts of residents. The BCEAO is specifically authorized to collect, either directly or through intermediary banks, other financial institutions, or the postal administration, any information necessary to prepare balance of payments statistics. It is also authorized to monitor the external position of banks. The maximum amount of transfers that may be effected without supporting documents is CFAF 300,000.
International security restrictions
In accordance withUN sanctions In accordance with the WAEMU regulations and the UN Security Council resolutions, measures have been taken to freeze the funds of persons and entities associated with terrorism.
Payments arrears
OfficialYes.
Controls on trade in gold (coins and/or bullion)
Controls on external tradeImports and exports of gold from or to any other country require prior authorization from the MSMEF except for: (1) imports and exports carried out by the Public Treasury or the BCEAO; (2) imports or exports of articles with small gold content; and (3) imports or exports by travelers of gold articles with a maximum weight of 500 grams.
Controls on exports and imports of banknotes
On exports
Domestic currencyThe export of CFA franc banknotes by travelers is allowed. However, repurchase of exported banknotes by the BCEAO remains suspended. The shipment of BCEAO banknotes between authorized banks and their correspondents located outside the WAEMU zone is strictly prohibited.
Foreign currencyThe reexportation of foreign banknotes by nonresident travelers is allowed up to the equivalent of CFAF 500,000; the reexportation of foreign banknotes above this ceiling requires documentation demonstrating either the importation of the foreign banknotes or their purchase against other means of payment registered in the name of the traveler or through the use of nonresident deposits at local banks. Residents traveling outside the BCEAO zone are allowed to take out foreign currency up to the equivalent of CFAF 2 million a person. Larger amounts may be exported in the form of traveler’s checks, bank drafts, or other means of payment.
On imports
Domestic currencyImports of domestic currency by resident travelers are permitted freely. The shipment of BCEAO banknotes between authorized intermediaries and their correspondents located outside the WAEMU zone is strictly prohibited.
Foreign currencyResident and nonresident travelers may bring in any amount of foreign banknotes and coins (except gold coins) of countries outside the Operations Account area. Residents bringing in foreign banknotes exceeding the equivalent of CFAF 300,000 must surrender the excess amount to an authorized bank within eight days of their return. Nonresidents bringing in foreign banknotes and traveler’s checks in foreign currency exceeding the equivalent of CFAF 1 million must declare them at the customs office.
Resident Accounts
Foreign exchange accounts permittedResidents may open foreign exchange accounts with local banks or with banks abroad subject to prior authorization from the MSMEF, after the approval of the BCEAO.
Held domesticallyYes.
Held abroadResidents are required to repatriate assets held in these accounts within 30 days of their return.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyNo.
Nonresident Accounts
Foreign exchange accounts permittedNonresidents are allowed to open these accounts with prior BCEAO authorization with authorized intermediaries of Côte d’Ivoire. The authorized intermediaries are permitted to open nonresidents’ foreign exchange accounts in euros with proof of their position and actual residence.
Domestic currency accountsBecause the BCEAO has suspended the repurchase of banknotes circulating outside the WAEMU area, nonresident accounts may not be credited or debited with BCEAO banknotes. These accounts may not be overdrawn without the prior authorization of the MSMEF. Transfers of funds between nonresident accounts are not restricted.
Convertible into foreign currencyNonresidents may freely debit their foreign accounts in CFA francs for the purpose of purchasing foreign currency on the official foreign exchange market.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsImporters may purchase foreign exchange for import payments after establishing bank payment order accounts and submitting supporting documents, but not earlier than eight days before the shipment of goods if a documentary credit is opened, or on the due date of payment if the goods have already been imported.
Domiciliation requirementsA domiciliation requirement, which must be channeled through an authorized bank, applies to all imports from outside the CFA franc zone that exceed CFAF 5 million.
Preshipment inspectionInspection for quality and price is required for imports exceeding CFAF 3 million; imports valued under CFAF 3 million may be subject to random inspection.
Letters of creditLCs are required for goods imported from outside the EU, Operations Account countries, and ACP countries.
Import licenses and other nontariff measures
Positive listImports are classified into three categories: (1) goods requiring prior authorization or the approval of ministries; (2) goods subject to quantitative or other restrictions requiring licenses issued by the Directorate of External Trade Promotions; and (3) freely importable goods.
Negative listImports of certain goods, such as narcotics, are prohibited regardless of origin.
Open general licensesImport licenses for a short list of controlled products are issued by the Directorate of External Trade Promotions in the Ministry of Commerce.
Other nontariff measuresYes.
Import taxes and/or tariffsThe CET of the WAEMU consists of four rates (zero, 5%, 10%, and 20%). A 1% community solidarity fee and a tax of 0.5%, based on the c.i.f. value of imports, are levied on ECOWAS imports. Imports from non-ECOWAS countries are subject to an additional community tax of 0.5%. A statistical tax of 1% is levied on all imports.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsProceeds from exports must be received within 120 days of the arrival of the goods at their destination. Proceeds from exports to WAEMU countries are not required to be repatriated.
Surrender requirementsProceeds must be surrendered to banks within 30 days of the payment due date. The authorized intermediaries must then surrender the foreign exchange to the BCEAO by transfer through the bank of issue.
Financing requirementsNo.
Documentation requirementsAll export transactions require a customs declaration.
Letters of creditYes.
DomiciliationAll exports of more than CFAF 5 million, except those to WAEMU countries, must be domiciled with an authorized bank.
Export licenses
Without quotasExports are permitted on the basis of a simple authorization from the Directorate of Foreign Trade, which issues a certificate of origin, as needed. Exports of diamonds, gold, and all other precious metals, however, require prior authorization of the MSMEF, with the exception of articles with only a small gold content, travelers’ personal effects weighing less than 500 grams, and coins (fewer than 10 pieces, irrespective of their face value or denomination).
With quotasExports of lumber are subject to quantitative quotas allocated through an auction.
Export taxesExports of cocoa and coffee are subject to export tax and can be effected only by exporters authorized by the Authority for Regulation of Coffee and Cocoa.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersPayments for invisibles to France, Monaco, and the Operations Account countries are permitted freely; those to other countries are also permitted, subject to documentary requirements. Payments for invisibles related to trade are permitted by a general authorization when the basic trade transaction has been approved or does not require authorization. Bona fide tests are conducted by authorized intermediary banks.
Trade-related payments
Indicative limits/bona fide testYes.
Investment-related payments
Prior approvalThe transfer abroad of funds necessary for the repayment of a loan may be effected freely, but must be made through an authorized bank and reported to the MSMEF for statistical purposes. Payments of depreciation of direct investments are not expressly provided for in the legislation and, as such, require prior MSMEF approval.
Indicative limits/bona fide testYes.
Payments for travel
Quantitative limitsResidents traveling to non-WAEMU countries may carry foreign currency up to the equivalent of CFAF 2 million a person. Amounts exceeding this limit must be in the form of traveler’s checks, bank drafts, or other instruments.
Indicative limits/bona fide testYes.
Personal paymentsThere are no limits on transfers related to studies abroad, family maintenance, or alimony. These payments may be made through an authorized bank upon presentation of the appropriate documentation.
Indicative limits/bona fide testYes.
Foreign workers’ wagesPayments abroad related to wages, salaries, and honoraria; contributions and benefits; pensions and work-related activities; and service contracts are authorized upon presentation of the appropriate documentation.
Indicative limits/bona fide testYes.
Credit card use abroad
Indicative limits/bona fide testYes.
Other payments
Indicative limits/bona fide testYes.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsProceeds from invisible transactions with non-WAEMU members must be repatriated.
Surrender requirementsProceeds from transactions with WAEMU members may be retained. All amounts due from residents of other countries with respect to services and all income earned in those countries from foreign assets must be surrendered within one month of the due date or the date of receipt.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital transactionsCapital inflows to WAEMU member countries are unrestricted, with the exception of direct investment, which is subject to prior declaration, and certain borrowing operations, which require prior authorization.
All investments abroad by residents require prior MSMEF authorization, and at least 75% of the financing of such investments must be effected by borrowing from abroad.
Transfers of capital abroad are subject to controls. In accordance with the new direction of economic policy aimed at attracting foreign investment, foreign exchange laws currently in force in WAEMU member countries do not control capital inflows.
Under the new foreign exchange laws, the term “foreigner” refers to countries that are not members of the CFA franc zone. However, with respect to the local issue and offer for sale of foreign securities, the term “foreigner” means all countries outside the territory of the member country concerned.
Controls on capital and money market instrumentsWith the exception of the issue and sale of foreign securities in Côte d’Ivoire, operations in securities are not covered explicitly by specific laws. By their nature, however, these operations are still subject to the provisions governing foreign investment and lending.
There are no controls on transfers related to the sale of foreign securities by residents and to the proceeds of disinvestments by nonresidents. Foreign investments in WAEMU countries are subject to reporting for statistical purposes.
On capital market securitiesThe prior authorization of the RCPSFM is required for the issuance and marketing of securities and capital assets of foreign entities, as well as for publicity and advertising of investments abroad. Any investment by residents abroad requires the prior approval of the MSMEF.
Shares or other securities of a participating nature
Purchase locally by nonresidentsThere are no controls, provided that a prior declaration is made in the case of direct investment.
Sale or issue locally by nonresidentsThe issue of securities and the sale of corporate or foreign securities in Côte d’Ivoire by nonresidents require prior authorization by the RCPSFM.
Securities issued or offered for sale by a nonresident with prior authorization may be purchased freely by a resident. The same applies to payments for these purchases by residents, subsequent to the presentation of supporting documentation.
There are no controls on the sale of securities resulting from the divestiture of investment in the form of a transfer between a nonresident and a resident, subject to the regulations governing the financial settlement of the operation.
Settlement of securities transactions by transfer abroad or by credit to a nonresident account requires an exchange authorization to be submitted to the MSMEF for approval, accompanied by supporting documentation.
Purchase abroad by residentsThese purchases and the transfer abroad of funds associated with them require the prior authorization of the MSMEF.
Sale or issue abroad by residentsResidents may sell local corporate securities abroad. If these operations result in foreign control of Ivoirien corporations, foreign investors are required to make a prior declaration to the MSMEF. The sale of securities to liquidate an investment abroad is subject to prior declaration to the MSMEF. The proceeds in foreign exchange from the sale or liquidation must be surrendered to an authorized intermediary bank.
Residents may also issue securities abroad, except for those constituting a loan. Issuance of the latter to nonresidents must be made through an authorized bank and must be reported to the MSMEF for statistical purposes.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participating nature apply.
On money market instruments
Purchase locally by nonresidentsNonresidents may acquire money market instruments through local banks.
Sale or issue locally by nonresidentsThe sale or issue by nonresidents of money market instruments on the local market is subject to prior authorization by the MSMEF. The transfer of the proceeds from these operations is unrestricted if the issue itself has received prior authorization, and must be effected through an authorized bank and reported to the MSMEF for statistical purposes.
Purchase abroad by residentsPrior MSMEF authorization is required.
Sale or issue abroad by residentsThere are no controls on the sale of money market instruments abroad by residents. Sales to liquidate an investment must be declared in advance. The proceeds in foreign exchange of the sale or liquidation must be surrendered to an authorized intermediary bank. The issue by residents of money market instruments abroad is governed by the provisions pertaining to borrowing.
On collective investment securitiesThe regulations governing money market instruments apply.
Controls on derivatives and other instrumentsResidents may purchase or sell options abroad freely.
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Controls on credit operations
Commercial creditsThe issue of a loan in the form of securities requires prior MSMEF approval. Such approval is not required, however, for loans contracted by authorized intermediaries or for those that comply with specific conditions as to amount and interest rate. Foreign borrowing by residents is subject only to reporting for statistical purposes.
By residents to nonresidentsGranting of these credits is subject to two provisions. First, claims resulting from exports of goods must be collected and the corresponding amounts repatriated through the BCEAO within 30 days of the payment due date stipulated in the commercial contract. Generally, the period allowed for payment must not exceed 120 days following the arrival of the merchandise at its destination. Second, claims resulting from payments for services must also be collected and surrendered to an authorized intermediary or the BCEAO no later than one month after the payment due date.
To residents from nonresidentsThese credits may be freely granted. Repayment is usually authorized, subject to the presentation of the relevant proof of the execution of the commercial transaction or the provision of the service, as well as the payment due date.
Financial credits
By residents to nonresidentsThe granting of financial credits requires the prior authorization of the MSMEF. To transfer funds abroad to service these facilities, an exchange authorization must be submitted with the required documentation to the MSMEF.
To residents from nonresidentsThese facilities may be freely granted, and the funds to service them must be transferred from abroad by an authorized intermediary, but they must be reported to the Directorate of the Treasury.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsThe granting of these facilities requires the prior authorization of the MSMEF.
To residents from nonresidentsThe regulations governing financial credits apply.
Controls on direct investment
Outward direct investmentPrior MSMEF approval is required. At least 75% of such investments must be financed by foreign loans. The investor must submit a written request indicating the authorized intermediary charged with making the payment. Whether the funds are transferred abroad or deposited to a foreign account in CFA francs, the payment may not be made before the end of the period agreed to by the parties.
Inward direct investmentThese investments, including their transfer between nonresidents, are subject to prior declaration to the MSMEF for statistical purposes.
Controls on liquidation of direct investmentProceeds may be freely transferred abroad or credited to a foreign account in CFA francs upon presentation of the required documentation to an authorized intermediary responsible for payment. The liquidation of investments abroad by a resident requires a declaration to the MSMEF for information purposes. The reinvestment of the proceeds of the liquidation is subject to the prior authorization of the MSMEF. If the reinvestment has not been authorized, the proceeds of the liquidation must be repatriated within one month through an authorized intermediary.
Controls on real estate transactions
Purchase abroad by residentsReal estate investment abroad by a resident is subject to prior approval by the MSMEF. The investor must submit a written request indicating the authorized intermediary charged with making the payment. Whether the funds are transferred abroad or deposited to a foreign account in CFA francs, the payment may not be made before the end of the period agreed to by the parties.
Purchase locally by nonresidentsThere are no controls on purchases, except in the case of direct investment in an enterprise, branch, or corporation.
Sale locally by nonresidentsProceeds from the sale of real estate may be freely transferred abroad or credited to a foreign account in CFA francs upon presentation of the required documentation to the authorized intermediary responsible for payment.
Controls on personal capital transactionsPersonal capital transactions between residents and nonresidents must be effected through the BCEAO, the postal service, or an authorized bank, unless prior authorization is obtained from the MSMEF.
Loans
By residents to nonresidentsThese transactions require prior MSMEF authorization. The individuals concerned may not engage in such operations as a professional occupation without first being licensed and included in the list of financial institutions.
To residents from nonresidentsThese transactions are permitted freely, but, for statistical purposes, they must be reported to the MSMEF when they are contracted and repaid.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsExcept for inheritances and dowries, for which payments are generally authorized, payments pertaining to other operations require prior authorization of the MSMEF.
To residents from nonresidentsNo.
Settlement of debts abroad by immigrantsImmigrants who have obtained resident status must obtain prior authorization from the MSMEF to settle debts incurred abroad while they were nonresidents.
Transfer of assets
Transfer abroad by emigrantsUpon presentation of emigration documents, the parties concerned may, without prior authorization, transfer up to CFAF 300,000 a person. Amounts in excess may be transferred with MSMEF authorization.
Provisions specific to commercial banks and other credit institutions
Borrowing abroadAuthorized intermediaries may borrow freely abroad, but these transactions must be reported to the MSMEF for statistical purposes.
Maintenance of accounts abroadBanks and financial institutions are not permitted to hold liquid assets outside the WAEMU, except to cover current operations.
Lending to nonresidents (financial or commercial credits)These transactions are permitted, but are subject to prior authorization by the MSMEF and the BCEAO in the case of loans, financial credits, or the purchase of securities issued abroad.
Lending locally in foreign exchangeDomestic lending denominated in foreign exchange or purchases of foreign currency–denominated securities issued in Côte d’Ivoire require prior authorization by the MSMEF with the approval of the BCEAO.
Purchase of locally issued securities denominated in foreign exchangeThese purchases require the prior approval of the MSMEF if their issuance or sale in WAEMU member countries has not been authorized by the RCPSFM.
Differential treatment of deposit accounts held by nonresidents
Credit controlsAny overdraft or advance granted to a nonresident requires the prior authorization of the MSMEF with the approval of the BCEAO.
Investment regulationsThe regulations governing direct investment apply.
Abroad by banksYes.
In banks by nonresidentsYes.
Open foreign exchange position limitsThere are no prudential ratios; open positions result from special dispensations.
Provisions specific to institutional investorsControls are imposed by the Insurance Code of the Inter-African Conference on Insurance Markets.
Limits (max.) on securities issued by nonresidentsYes.
Limits (max.) on investment portfolio held abroadYes.
Limits (min.) on investment portfolio held locallyYes.
Currency-matching regulations on assets/liabilities compositionYes.
Other controls imposed by securities lawsNo.
Changes During 2004
No significant changes occurred in the exchange and trade system.

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