Chapter

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2006
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ISLAMIC REPUBLIC OF AFGHANISTAN

(position as of December 31, 2005)

Status under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2004 Article IV consultation with the Islamic Republic of Afghanistan states that as of january 4, 2005, based on information available to the IMF, no exchange restrictions and multiple currency practices were in place.
International and/or multiple currency practices.No.
Exchange Arrangement
CurrencyThe currency of the Islamic Republic of Afghanistan is the Afghani.
Exchange rate structure
UnitaryDa Afghanistan Bank (DAB), the CB, maintains a daily official Afghani-U.S.dollar rate based on the average early morning rates in the free market of the money changers.
Classification
Managed floating with no predetermined path for the exchange rate.The CB follows a policy of periodic intervention in the market in the form of a foreign exchange auction twice a week with a view to smooth fluctuations in the exchange rate and in the growth of the money supply.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThere are no arrangements for forward cover against exchange rate risk.
References to legal instruments and hyperlinksLaw of Da Afghanistan Bank (Article 35).
Arrangements for Payments and Receipts
Prescription of currency requirements
Controls on the use of domestic currencyThe Afghani is used for all transactions and settlements of accounts unless the use of another currency is specified by the parties concerned.
Use of foreign exchange among residentsYes.
Payments arrangements
Bilateral payments arrangements
OperativeYes.
inoperativeThere is an agreement with the Russian Federation.
Administration of controlThe DAB is solely responsible for the formulation, adoption, and execution of the exchange rate policy and the exchange arrangements of the Islamic Republic of Afghanistan. Before adopting an exchange rate policy or an exchange arrangement, the DAB is required to consult with the MOF. The DAB acts as the agents for the Islamic Republic of Afghanistan in the administration of all laws relating to exchange control. All returns, statements, accounts, and information required by the provision of any such law are transmitted through the DAB (Article 71, DAB Law).
Payments arrearsn.a.
Controls on trade in gold (coins and/or bullions)
Controls on external tradeImports and reexports of gold are permitted, subject to regulations. Exports of gold bullion, silver, and jewelry require permission from the DBA and the MOF. Commercial exports of gold and silver jewelry and other articles containing small quantities of gold or silver do not require a license. Customs duties are payable on imports and exports of silver in any form, unless the transaction is made by, or on behalf of, the monetary authorities.
Controls on exports and imports of banknotesAny person (1) who leaves or arrives in the Islamic Republic of Afghanistan with, or (2) imports or exports by mail, courier, or otherwise more than Af 1 million in cash or negotiable bearer instruments without first having reported the fact in writing to the relevant authority is guilty of an offense and is punishable on conviction by a fine of an amount equal to the cash held.
On exports
Domestic currencyYes.
Foreign currencyYes.
On imports
Domestic currencyYes.
Foreign currencyYes.
References to legal instruments and hyperlinksAnti-Money Laundering Law; Decree on Usage of Foreign Currency Regulation under DAB Law.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Approval requiredYes.
Held abroadYes.
Approval requiredYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyNo.
Reference to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Approval requiredYes.
Domestic currency accountsYes.
Convertible into foreign currencyNo.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import payments
Foreign exchange budgetAlthough the government projects future foreign exchange requirements, there is no mechanism in place for allocating actual foreign exchange holdings.
Financing requirements for importsNo.
Imports and Import Payments
Foreign exchange budgetAlthough the government projects future foreign exchange requirements, there is no mechanism in place for allocating actual foreign exchange holdings.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measuresTrading licenses are issued by the Ministry of Commerce.
Import taxes and/or tariffsn.a.
State import monopolyn.a.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementNo.
Financing requirementsn.a.
Documentation requirementsn.a.
Export licensesAll exporters must obtain a license from the Ministry of Commerce to engage in export trade.
Export taxesn.a.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersForeign exchange for most private purposes may be acquired in the money bazaar from money changers licensed by the DAB or from licensed commercial banks.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsn.a.
Restrictions on use of fundsn.a.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsControls are applied based on the Investment Law and the Anti-Money Laundering Law.
Controls on capital and money market instrumentsYes.
Controls on derivatives and other instrumentsn.a.
Controls on credit operationsn.a.
Controls on direct investmentn.a.
Controls on liquidation of direct investmentn.a.
Controls on real estate transactionsn.a.
Controls on personal capital transactionsn.a.
References to legal instruments and hyperlinksInvestment Law; Transfer of Property Law; Banking Law; Anti-Money Laundering Law.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsYes.
Open foreign exchange position limitsIndividual currency limitations are ±20% of regulatory capital for convertible currencies and ±5% of regulatory capital for nonconvertible currencies. The overall limitation is ± 40% for all currencies and ±10% for nonconvertible currencies.
Provisions specific to institutional investors
Insurance companiesThe Insurance Law passed by the Cabinet in December 2005 does not contain any currency-matching regulations.
Investment firms and collective investment fundsThe DAB is exclusively responsible for the regulation and supervision of securities service providers in accordance with the objectives specified.
The DAB may supervise securities service providers and may according to regulation (1) subject securities service providers to prudential conditions and requirements under which securities services or any category of such services may be provided, including conditions and requirements designed to facilitate supervision by the DAB of securities service providers and to preserve the safety of the assets entrusted by the public to their care; (2) require securities service providers to report transactions exceeding in value a minimum amount set by the regulation to the Department of Agency of the State, designated by the regulation for that purpose; and (3) require that the funds and securities owed by a securities service provider (other than a bank) to its customers be segregated from the funds and securities credited to the accounts of other customers and from the assets and liabilities of that securities service provider. No such funds of securities may be used to discharge liabilities of other customers or liabilities of that securities service provider.
References to legal instruments and hyperlinksInsurance Law (2005); DAB Law, Chapter 10.
Changes during 2005
No significant changes occurred in the exchange and trade system.

Albania

(Position as of January 31, 2006)

Status under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the sixth review under the Poverty Reduction and Growth Facility Arrangement with Albania states that as of July 25,2005, Albania maintained exchange restrictions under Article XIV in the form of outstanding debit balances on inoperative bilateral payment agreements, which were in place before Albania became a Fund member. These relate primarily to debt in nonconvertible and formerly nonconvertible currencies, which the authorities are working to resolve within 2005 for official creditors and in 2006 for private sector creditors. (Country Report No. 05/267)
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Albania is the Albanian lek.
Exchange rate structureUnitary.
Classification
Independently floatingThe exchange rate of the lek is determined on the basis of supply and demand in the foreign exchange market. The Bank of Albania (BOA) intervenes occasionally in the exchange market only to smooth excessive fluctuations of the exchange rate and to meet foreign currency reserve targets. The BOA calculates and announces the daily average exchange rates for the dollar and 10 other major currencies and the prices of gold and silver. No margins are set between buying and selling rates for the official exchange rate, but commercial banks charge commissions ranging from 0.2% to 2%, depending on the amount, for cashing traveler’s checks. Government transactions are conducted at market rates.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksLaw No. 8269 of December 23, 1997, on the Bank of Albania; Regulation on the Procedure of Intervention of the Bank of Albania in the Domestic Foreign Exchange Market; www.bankofalbania.org.
Arrangements for Payments and Receipts
Prescription of currency requirementsPayment for all merchandise trade is made in convertible currencies. All transactions under bilateral payments agreements were suspended in 1992, and the settlement of clearing accounts is awaiting the outcome of negotiations. All contracts denominated and payable in foreign currencies are valid.
Payments arrangements
Clearing agreementsAlbania maintains outstanding balances under inoperative bilateral clearing agreements in nonconvertible currencies with Bulgaria, Cuba, the Czech Republic, the Democratic People’s Republic of Korea, Poland, Romania, the Slovak Republic, and Vietnam. Albania also maintains outstanding balances under inoperative bilateral clearing agreements in convertible currencies with Algeria, Bulgaria, Cuba, the Czech Republic, Egypt, Greece, the Democratic People’s Republic of Korea, Romania, Serbia and Montenegro, the Slovak Republic, and Vietnam.
Administration of controlThe BOA is vested with the powers to administer exchange controls. The BOA is the only authority that has the right to (1) license, authorize, regulate, supervise, and revoke the licenses of foreign exchange market participants, as well as second-tier banks; (2) define the limits of their activities; and (3) regulate and supervise foreign exchange operations and international payments in order to prevent any participant from dominating the market and undermining the value of the lek through speculation.
In accordance with anti-money laundering legislation, banks are required to maintain records of all cash transactions in excess of the equivalent of lek 2 million and on all other transactions in excess of lek 20 million, and to report these to the authority in the MOF responsible for the prevention of money laundering.
Payments arrears
OfficialAlbania has outstanding debit balances under inoperative bilateral agreements with Algeria, Cuba, Greece, Poland, Serbia and Montenegro, and Vietnam. Arrears with Hungary, the Czech Republic, the Slovak Republic, and Romania have been rescheduled.
PrivateAlbania has incurred private payments arrears with creditors (banks and companies) in Austria, Belgium, the Czech Republic, Denmark, Germany, Greece, Hungary, India, Italy, the Netherlands, Sweden, Switzerland, Turkey, and the United Kingdom. An agreement has been reached to reschedule arrears to private creditors in Germany. Arrears with private creditors in the former Yugoslav Republic of Macedonia have been rescheduled.
Controls on trade in gold (coins and/or bullions)
Controls on external tradeResidents and nonresidents may transfer standardized gold and precious metals to and from Albania only through entities specially licensed by the BOA.
Residents and nonresidents are entitled to transfer nonstandardized gold and precious metals to and from Albania subject to documentary requirements regarding the source; the purpose of the transfer; the quantity; and whether the transfer involves the returning of the precious metals and, if so, the form in which they should be returned. There is no requirement for transfers of jewelry for personal use.
Controls on exports and imports of banknotes
On exports
Domestic currencyNatural and juridical persons are allowed to take out up to lek 50,000 a person in banknotes and coins. The BOA may authorize larger amounts.
Foreign currencyForeign natural persons may take abroad in cash or traveler’s checks foreign exchange in an amount equal to the amount declared when entering the country. Albanian natural or juridical persons are not allowed to export amounts larger than lek 3.5 million or its equivalent. For export of amounts larger than lek 1 million or its equivalent, a declaration on the source is required.
On imports
Domestic currencyNatural and juridical persons are allowed to import up to lek 50,000 in domestic banknotes and coins. The BOA may authorize larger amounts.
Foreign currencyOn entering or exiting Albania, resident and nonresident individuals are required to declare cash, traveler’s checks, precious stones or metals, and antiques valued at lek 1 million or more.
References to legal instruments and hyperlinksRegulation No. 64 on Foreign Exchange Activities, dated July 30, 2003; www.bankofalbania.org.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksLaw No. 8269 of December 23, 1997, on the Bank of Albania; Regulation on the Procedure of Intervention of the Bank of Albania in the Domestic Foreign Exchange Market; www.bankofalbania.org.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Letters of creditYes.
Import licenses used as exchange licensesYes.
OtherFor imports equal to or larger than the equivalent of lek 3.5 million, the following documents must be submitted: (1) an application for carrying out the transaction as well as a declaration specifying in detail the nature of the transaction; (2) a contract and an invoice (or a pro forma invoice) issued by the natural or juridical person supplying the goods; (3) a declaration that the underlying document has not been used to support previous transactions, which is to be issued by the natural or juridical person wishing to carry out the transaction with the bank; and (4) a customs clearance document (within 3 to l2 months, depending on the settlement of the invoice).
Import licenses and other nontariff measures
Positive listYes.
Open general licensesYes.
Licenses with quotasAutomatic licensing restrictions are applied on fuel products to support the implementation of domestic technical standards.
Other nontariff measuresThe import of the following products is prohibited: (1) dangerous waste, such as toxic corrosives, residual waste from explosives, and radioactive materials; (2) military poisons, chemical weapons, and other strong poisons; (3) narcotics and psychotropic substances; and (4) animal products from countries infected with livestock diseases.
Import taxes and/or tariffsExcise taxes on domestic and imported goods are unified. Customs tariffs are applied to the c.i.f. value at rates of zero, 2%, 5%, 10%, and 15%. Effective January 1, 2006, a new customs tariff rate of 8% (previously, 6% effective January 1, 2005) applies to the c.i.f. value.
State import monopolyNo.
References to legal instruments and hyperlinksLaw No. 9461, dated December 21, 2005, for the Nomenclature of Goods and Custom Tariffs; Guideline No.7, dated December 21, 2005, on the Value-Added Tax of the Ministry of Finance.
Exports and Export Proceeds
Repatriation requirementAll private and public companies or individuals operating in the export sector are required to repatriate their foreign exchange receipts.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport bans apply on copper and articles made there of; works of art; arms and ammunitions, as well as parts and accessories therefore; and explosives and pyrotechnic products.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksGuideline No. 3, dated January 30, 2006, on the Value-Added Tax of the Ministry of Finance.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersSupporting documents are required for transactions exceeding the equivalent of lek 3.5 million, including on the reasons for the transfer, the source of funds, and the payment of taxes.
References to legal instruments and hyperlinksRegulation No. 64 on Foreign Exchange Activities, dated July 30, 2003, amended by Decision No. 101, dated December 10, 2003; www.bankofalbania.org.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksRegulation No. 64 on Foreign Exchange Activities, dated July 30, 2003, amended by Decision No. 101, dated December 10, 2003; www.bankofalbania.org.
Capital Transactions
Controls on capital and moneyYes.
Controls on capital and money market instrumentsPurchases of these instruments abroad by residents may be conducted through entities licensed by the BOA, subject to documentary requirements. For prudential reasons and money laundering prevention, the BOA monitors and reviews these transactions.
On capital market securities
Shares or other securities of a participating nature
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participatory nature apply
On money market instrumentsThe regulations governing shares or other securities of a participatory nature apply.
On collective investment securitiesThe regulations governing shares or other securities of a participatory nature apply.
Controls on derivatives and other instruments
Sale or issue locally by nonresidentsYes.
Purchase aboard by residentsYes.
Controls on credit operations
Commercial credits
By residents to nonresidentsYes.
Financial credits
By residents to nonresidentsYes.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsYes.
Controls on direct investment
Outward direct investmentThe regulations governing capital and money market instruments apply.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsThe regulations governing capital and money market instruments apply.
Purchase locally by nonresidentsControls relate only to the purchase of land.
Controls on personal capital transactions
LoanThe regulations governing capital and money market instruments apply.
By residents to nonresidentsYes.
To residents from nonresidentsThese transactions are subject only to anti-money laundering regulations.
Gifts, endowments, inheritances, and legacies
To residents from nonresidentsThese transactions are subject only to anti-money laundering regulations.
References to legal instruments and hyperlinksRegulation No. 64 on Foreign Exchange Activities, dated July 30, 2003, amended by Decision No. 101, dated December 10, 2003; www.bankofalbania.org.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial credits)Lending is subject to capital controls.
Differential treatment of deposit accounts held by nonresidents
Credit controlsYes.
Investment regulations
Abroad by banksYes.
In banks by nonresidentsYes.
Open foreign exchange position limitsThe limit is 20% of the bank’s capital for a single currency and 30% for all currencies.
On resident assets and liabilitiesYes.
On resident assets and liabilitiesYes.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksRegulation on Credit Risk Management, applicable as of august 5, 2004; Regulation on Foreign Exchange Activities; Instruction No. 69 on Reporting of Foreign Exchange Transactions, as of august 23, 2003.
Changes during 2005
Imports and import paymentsJanuary 1. A new customs tariff rate of 6% was applied to the c.i.f. value.
Changes during 2006
Imports and import paymentsJanuary 1. A new customs tariff rate of 8% from 6% of the c.i.f. value.

ALGERIA

(Position as of January 31, 2006)

Status under IMF Articles of Agreement
Article VIIIDate of acceptance: September 15, 1997.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of algeria is the Algerian dinar.
Exchange rate structureUnitary.
Classification
Managed floating with no predetermined path for the exchange rateThe external value of the Algerian dinar is determined in the interbank foreign exchange market, where the CB is the main buyer and seller. No margin limits are imposed on the buying and selling exchange rates in this market. However, a margin of DA 0.015 has been established between the buying and selling rates of the Bank of algeria (BA) for the Algerian dinar against the dollar.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketAuthorized banks may provide forward cover to clients. However, they may cover the resulting positions only through foreign currency loans to nonfinancial entities.
References to legal instruments and hyperlinksRegulation on Foreign Investment, June 6, 2005.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with countries with which no payments agreements are in force are made in convertible currencies. Payments under foreign supply contracts may be made in either the currency in use at the headquarters of the supplier or that of the country of origin of the merchandise, except for transactions with Morocco, which may be effected in dollars through special clearing accounts maintained at the CBs of each country.
Payments arrangements
Bilateral payments arrangementsYes.
Clearing agreementsSpecified commercial settlements with Morocco and Tunisia are made through a Moroccan dirham account at the Bank of Morocco and a Tunisian dinar account at the Bank of Tunisia.
Administration of controlThe BA has general jurisdiction over exchange controls. Authority for a number of exchange control procedures has been delegated to commercial banks and the Postal Administration.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullions)
Controls on domestic ownership and/or tradeResidents may purchase, hold, and sell gold coins in Algeria for numismatic purposes. Unworked gold for industrial and professional use is distributed by the Agence nationale pour la distribution et la transformation de l’or et des autres métaux precieux (AGENOR); this agency is also authorized to purchase gold in Algeria and to hold, process, and distribute any other précious metals.
Controls on external tradeAGENOR is authorized to import and export any precious metals, including gold. Gold used by dentists and goldsmiths is imported by AGENOR. Gold and other precious metals are included on the list of items importable by concessionaires.
Controls on exports and imports of banknotes
On exports
Domestic currencyResident travelers may take out up to DA 200 a person.
Foreign currencyNonresident travelers may reexport any foreign currency they declared on entry. Resident travelers may export foreign currency withdrawn from their foreign currency accounts up to the equivalent of €7,622.45 a trip for an unlimited number of trips a year.
On imports
Domestic currencyResident travelers may reimport up to DA 200 a person. Nonresidents are not permitted to bring in Algerian dinar banknotes.
Foreign currencyThere are no restrictions on the importation of foreign banknotes, but residents and nonresidents must declare them when they enter Algeria.
References to legal instruments and hyperlinksn.a.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyThese accounts may be freely credited with book transfers of convertible foreign exchange from abroad through the postal system, or by banks in convertible foreign exchange that was imported and declared by the account holder on entry into the country, or with domestic book transfers from banks to accounts held by individuals. These accounts are remunerated at rates representing the average of the rates observed on the euro-currency market, not including margins between -2% and +1.25%, or for call deposits only at rates representing the average of the overnight rates of either the discount rate or the monetary market rates prevailing in the country of the currency involved. Foreign exchange accounts of commercial banks in the BA are not remunerated. Accounts may be debited freely for book transfers abroad only through the banking system. They may also be debited for purchases of Algerian dinars, book transfers in dinars, and purchases of convertible foreign exchange that will be physically exported by the account holder.
Companies may also open foreign exchange accounts for receiving and making foreign exchange transfers, including the retained portion of their export proceeds. They may transfer funds in these accounts to other foreign exchange accounts, or use them to make payments in Algeria or abroad for goods and services needed for their activities.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyThese accounts are permitted in limited cases, such as for embassies.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be credited with foreign currency banknotes and other means of payment denominated in foreign currency, as well as other Algerian-dinar-denominated funds that meet all requirements for transfers abroad. They may be debited without restrictions to make transfers abroad, to export through withdrawals of foreign banknotes, and to make dinar payments in Algeria. These accounts are remunerated at the same rates as resident foreign exchange accounts. Foreign exchange accounts of commercial banks in the BA are not remunerated. These accounts may not show a debit balance.
Domestic currency accountsEmbassies and foreign firms in Algeria may open accounts without prior authorization for making and receiving payments in relation to other business activity. Accounts pay no interest and cannot be in overdraft.
Convertible into foreign currencyYes.
Approval requiredOutward transfers require individual approval from the BA.
Blocked accountsIndividual suspense accounts may be opened without authorization and may be credited with payments from any country.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsPayments for imports of gold, other precious metals, and precious stones must be made from foreign currency accounts. External borrowing by importers for import financing purposes must be arranged through an authorized intermediary bank.
Advance payment requirementsExcept when otherwise indicated by the BA, down payments for imports may not exceed 15% of the total value of imports. When a public agency, public enterprise, or ministry incurs expenditures for imports deemed to be urgent or exceptional, the bank may effect payment before exchange and trade control formalities have been completed.
Advance import depositsAlthough not mandatory, domiciled banks may require from the importer, as part of their normal commercial operations, a deposit in Algerian dinars up to the full value of the imports.
Documentation requirements for release of foreign exchange for imports
Domiciliation requirementAll imports are subject to obligatory domiciliation at an authorized intermediary bank, which an importer must establish by submitting to an authorized bank a commercial contract or pro forma invoice. Import payments may be made freely but only through the domiciled bank, which effects payments in foreign exchange and debits the importer’s account with corresponding amounts in Algerian dinars valued at the official exchange rate.
Preshipment inspectionYes.
Letters of credit.Yes.
OtherImporters willing to insure merchandise or capital goods transported by air or sea must purchase insurance from authorized Algerian insurers. However, this requirement does not apply to the following: (1) gift items; (2) material and equipment imported under the temporary admission regime; (3) goods, including capital goods, financed by international and regional institutions; and (4) goods imported under an agreement that renders the vendor liable for transportation risks.
Import licenses and other nontariff measures
Negative listThere are no legal restrictions against imports from Israel, but there are no such imports in practice. A small number of imports are prohibited for religious or security reasons.
Other nontariff measuresJuridical and natural persons registered under the Commercial Register (including concessionaires and wholesalers) may import goods without prior authorization.
Import taxes and/or tariffsImports are subject to tariffs of zero, 5%, 15%, and 30%. A temporary additional duty on certain categories of imports was introduced in July 2001, initially at 60% and reduced annually by 12 percentage points starting January 1, 2002. On January 1, 2005, this duty was reduced to 12% and it was eliminated January 1, 2006.
State import monopolyNo.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementFor all exports, excluding hydrocarbons, proceeds must be repatriated within 120 days of delivery date of the goods. Proceeds from hydrocarbon exports are considered to be surrendered when deposited in the BA foreign correspondent banks. The value date of the deposit is the payment due date indicated in the invoice and/or trade contract.
Surrender requirementAll export proceeds from crude and refined hydrocarbons, by-products from gas, and mineral products must be surrendered to the BA. Exporters of other products must surrender 50% of the proceeds to the commercial banks; the remaining portion may be retained in a foreign currency account held in Algeria. Exporters may use the funds in these accounts for imports or other payments pertaining to their business, or they may transfer the funds to another foreign currency account.
Financing requirementsNo.
Documentation requirementsThe requirements are enforced in accordance with the terms of the contract.
Letters of creditYes.
GuaranteesYes.
DomiciliationYes.
Preshipment inspectionYes.
Export licensesAll exports to Israel are prohibited, and certain exports are prohibited for social or cultural reasons regardless of destination.
Export taxesNo.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related payments
Indicative limits/bona fide testYes.
Investment-related paymentsThe transfer abroad of profits is permitted, but only through an authorized intermediary and provided tax obligations have been met. The authorized intermediaries review requests for transfers and execute without delay transfers of dividends, profits, and proceeds from the sale of foreign investments and attendance and percentage fees for foreign directors.
Payments for travelResidents traveling abroad receive an annual foreign exchange allowance, and pilgrims traveling to Saudi Arabia receive an allowance in Saudi Arabian riyals; the amount may be provided in the form of checks that are cashed on arrival for those traveling by air or by sea. Travel tickets purchased by nonresidents for travel abroad must be paid for with imported foreign exchange.
Prior approvalYes.
Quantitative limitsThe limit for nonbusiness trips is DA 15,000 or its equivalent a person a year. For business trips, per diem and transport allowances, respectively, are (1) DA 16,000 and DA 10,000 for executives, (2) DA 12,000 and DA 8,000 for mid-level staff, and (3) DA 10,000 and DA 6,000 for technical staff. Bona fide requests for amounts in excess of these limits are authorized on a case-by-case basis.
Indicative limits/bona fide testYes.
Personal payments
Prior approvalTransfers of alimony payments are permitted provided the arrangement was issued by an Algerian court and is enforceable in Algeria. BA authorization is required for payments relating to family support payments; limits are set on a case-by-case basis.
Quantitative limitsThe limits for medical costs are the equivalent of DA 15,900 for adults and DA 7,600 for children under 15 years of age. The limit for studies abroad is DA 9,000 a month between September 1 and June 30. Bona fide requests for amounts in excess of these annual limits are authorized on a case-by-case basis.
Indicative limits/bona fide testYes.
Foreign workers’ wagesResidents of other countries working in Algeria under technical cooperation programs for public enterprises and agencies or for certain mixed companies may transfer abroad up to 100% of their salaries.
Indicative limits/bona fide testYes.
Other payments
Prior approvalPayments for imports of technical, economic, and scientific magazines and periodicals are made in the context of domiciliation procedures. Payments of subscription fees are made on presentation of a subscription contract at the domiciliation window.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsFifty percent of receipts must be surrendered to banks.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsResidents may transfer capital abroad to finance activities that are complementary to those undertaken in Algeria. The Monetary and Credit Council sets the conditions for implementation of this article and issues authorization.
Controls on capital and money market instrumentsNonresidents may invest in shares or other investment securities. Transfers abroad of proceeds from the sale of these investments on the stock exchange or the revenue generated by these investments are allowed, as long as they are conducted through an authorized intermediary.
On capital market securities
Shares or other securities of a participating nature
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participatory nature apply.
On collective investment securities
Purchase abroad by residentsYes.
Controls on derivatives and other instruments
Purchase abroad by residentsYes.
Controls on credit operationsThere are controls on all credit transactions, guarantees, sureties, and financial backup facilities.
Controls on direct investment
Outward direct investmentYes.
Inward direct investmentFDI is permitted freely except in certain specified sectors, provided it conforms to the laws and regulations governing regulated activities and prior declaration is made to the authorities.
Controls on liquidation of direct investmentEffective June 6, 2005, proceeds from disinvestment following the closing or relocation of a business operation may be transferred abroad through authorized banks and financial intermediaries only up to the verified portion of the foreign investment out of the total liquidated investment.
Controls on real estate transactionsThe regulations governing capital market instruments apply.
Purchase abroad by residentsYes.
Controls on personal capital transactionsn.a.
References to legal instruments and hyperlinksOrdinance on Money and Credit, 2003.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadYes.
Maintenance of accounts abroadYes.
Lending locally in foreign exchangeBanks and financial institutions may on-lend foreign funds borrowed abroad.
Differential treatment of deposit accounts in foreign exchange
Interest rate controlsYes.
Differential treatment of deposit accounts held by nonresidents
Interest rate controlsYes.
Open foreign exchange position limitsBanks and financial institutions are required to meet the following: (l) a maximum spread of 10% between their position (short or long) in each currency and the amount of their equity capital, and (2) a maximum spread of 30% between total exposure (short and long positions, whichever is highest) for all foreign currencies and their equity capital.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksn.a.
Changes during 2005
Imports and import paymentsJanuary 1. The temporary additional duty on certain imports was reduced to 12% from 60%.
Capital Transactions
Controls on liquidation of direct investmentJune 6. Proceeds from disinvestment following the closing or relocation of a business operation were allowed to be transferred abroad through authorized banks and financial intermediaries only up to the verified portion of the foreign investment out of the total liquidated investment.
Changes during 2006
Imports and import paymentsJanuary 1. The temporary additional duty on certain imports was eliminated.

ANGOLA

(Position as of January 31, 2006)

Status under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2004 Article IV consultation with Angola states that as of February 22, 2005, Angola maintained an exchange restriction in the form of limits on the remittances of dividends and profits from foreign investments that do not exceed US $100,000. This is applied under Article 9.3 of Private Investment Law No. 11/3 of May 13, 2003. Angola also maintains the following exchange restrictions under the transitional arrangements of IMF Article XIV, Section 2: limits on the availability of foreign exchange for certain invisible transactions, such as travel, medical, and educational allowances; and limits on unrequited transfers to nonresidents. (Country Report No. 05/228)
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Yes.
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Angola is the Angolan kwanza.
Exchange rate structure ClassificationUnitary.
Classification
Managed floating with no predetermined path for the exchange rateThe exchange rate of the kwanza is market-determined. However, the Banco Nacional de Angola (BNA) intervenes actively in the foreign exchange market, allowing only the sterilization of taxes paid by oil companies. The BNA publishes a reference rate daily, which is computed as the transaction-weighted average of the day’s rates negotiated with commercial banks.
ADs (i.e., banks and exchange bureaus) may deal among themselves and with their customers at freely negotiated rates.
Exchange taxForeign exchange operations are subject to a stamp duty of 0.15%. Transactions between banking institutions or involving banknotes and traveler’s checks are exempt from this duty.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a.
Arrangements for Payments and Receipts
Prescription of currency requirementsTransactions with other countries may be made through bank transfers, LCs, or financing and banking agreements.
Use of foreign exchange among residentsYes.
Payments arrangements
Bilateral payments arrangements
OperativeAgreements with Brazil, China, and Israel are in effect.
InoperativeThere is an agreement with Spain.
Administration of controlThe BNA is the exchange authority and may delegate its powers to other entities that are authorized to engage in foreign exchange activities. All capital transactions and current invisible operations exceeding $500,000 or its equivalent are subject to prior BNA authorization. The BNA has authorized banks and foreign exchange bureaus to carry out certain transactions in the foreign exchange market. Foreign exchange bureaus that are licensed to conduct foreign exchange transactions may deal only in banknotes and traveler’s checks and execute current invisible operations of a private nature.
Payments arrears
OfficialYes.
Controls on trade in gold (coins and/or bullions)
Controls on domestic ownership and/or trade.Residents are permitted to hold and trade gold only in the form of jewelry.
Controls on external tradeImports and exports of gold in coin and bullion form are subject to BNA monopoly.
Controls on exports and imports of banknotes
On exports
Domestic currencyExports of domestic currency are prohibited.
Foreign currencyEffective January 10, 2006, residents may take out up to the equivalent of $15,000 (previously, $10,000) in foreign currency. Amounts exceeding this limit require proof of purchase from a bank, including statements regarding the reason for the purchase. Nonresidents may take out up to $15,000 (previously, $5,000) in foreign currency; amounts exceeding this limit may be taken out only if previously declared on arrival in the country.
On imports
Domestic currencyImports of domestic currency are performed only by the BNA.
Foreign currencyEffective January 10, 2006, residents may bring in up to the equivalent of $15,000 (previously, $10,000) in foreign currency or traveler’s checks. Amounts in excess of this limit may be brought in with proof of the legal nature of the funds. For nonresidents, amounts in excess of $15,000 (previously, $5,000) must be declared to customs on arrival. Banking institutions are free to import banknotes and traveler’s checks, but they must submit a monthly report to the BNA. Nonresidents may bring in any amount on entering the country, but any amount in excess of$15,000 or its equivalent in foreign currency must be declared to customs.
References to legal instruments and hyperlinksDecreto-Lei No. 2/05; Notice 1/06 of January 10, 2006.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyThese accounts may be credited with foreign currency or any other instruments accepted internationally and with accrued interest. These accounts may be debited with the withdrawal or sale of foreign exchange to settle imports of goods and services or capital transactions, as allowed by law. Transfers between these accounts are permitted, but overdrafts are not. Checkbooks may not be issued against accounts of juridical persons.
Held abroadFor natural persons, no approval is required for holding these accounts. With BNA approval, juridical persons are allowed to open foreign exchange accounts abroad that may be credited with their export receipts and may be debited for payments for imports of goods and services and debt-service payments. With BNA authorization, diamond and other mineral companies are allowed to retain escrow accounts in banks abroad as a guarantee against foreign borrowing.
Approval requiredYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be credited with foreign currency imported from abroad, with the accrued interest, or with sums from nonresidents’ type A domestic currency accounts. They may be debited for the withdrawal or sale of foreign currency, payments for foreign currency expenditures, or the repatriation of amounts authorized by the BNA.
Domestic currency accountsNonresidents may open two types of domestic currency accounts: type A and type B. Type A accounts may be credited with the proceeds from sales of funds from foreign exchange accounts and, after obtaining prior BNA authorization, with receipts from the nonresident’s activities in Angola. These accounts may be debited for payments of local expenses and against purchases of foreign currency to be deposited in a foreign currency account held by the same entity.
Type B accounts may be credited only with receipts from the nonresident’s activity in the country (when authorized by the BNA) and may be debited for payment of local expenses.
Convertible into foreign currencyNo.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Preshipment inspectionPreshipment inspection is required in the following cases: (1) imports by government institutions and public companies, as well as any other merchandise selected by the National Directorate of Customs (DNA) for preshipment inspections; (2) imports of new and used cars; light-duty, cargo, and passenger vehicles; yachts and other leisure or sports boats and vessels; any other motorized vehicle as well as their parts and accessories; scrap metal; and receivers and transistors for radiotelephone and radio or television broadcasting; and (3) imports by juridical and natural persons of goods valued at more than the equivalent of $5,000 and $10,000, respectively. Imports of goods valued between $1,000 and $10,000 must be registered with the preshipment inspection company for statistical purposes. Goods valued at less than $5,000 and $10,000 that do not require preshipment inspection may be imported only once every quarter.
Import licenses and other nontariff measures
Negative listThe legal framework lists the goods that may not be imported, which include plants and animals from infected areas, toxic products, and certain drugs. There is a list of goods that require specific licenses from the Ministry of either Health, Industry, or Agriculture. Imports of arms and ammunition are subject to authorization by the Ministry of the Interior. Imports for specific purposes may be exempted from customs tariffs.
Open general licensesImports must be registered under the REM (entry merchandise registration) system for statistical purposes.
Import taxes and/or tariffsThe tariff system consists of eight rates: 1%, 2%, 5%, 10%, 20%, 25%, 30%, and 35%.
Taxes collected through the exchange systemThe stamp tax is collected through the exchange system.
State import monopolyOil products and derivatives may be imported only by the public oil company. Arms and ammunition for warfare may be imported only by the state.
References to legal instruments and hyperlinksDecreto-Lei No. 2/05; Decreto-Lei No. 71/04 of July 9, 2004.
Exports and Export Proceeds
Repatriation requirementYes.
Surrender requirementDomestic oil companies must surrender all their export proceeds to the BNA. Foreign oil companies are allowed to retain their export receipts abroad for payment of imports of goods and services, interest and profits transfer, and the amortization of capital. These companies must use funds from abroad for payment of royalties, taxes, and local expenses. Foreign exchange earnings by the non-oil sector must be surrendered to domestic banks. Diamond companies are allowed to retain in local banks the receipts from exports for payment for imports of goods and services. They may also retain part of their receipts abroad in escrow accounts, with BNA authorization, as a guarantee against foreign borrowing.
Financing requirementsNo.
Documentation requirements
Letters of creditYes.
GuaranteesYes.
DomiciliationYes.
Preshipment inspectionYes.
Export licenses
Without quotasExports are not subject to licenses, but must be registered under the RSM (exit merchandise registration) for statistical purposes. Reexports of goods other than personal belongings are prohibited. Exports of arms, ammunition, and cultural artifacts are prohibited. Special export regimes apply to aircraft, animals and animal products, works of art, and petroleum.
Export taxesExport taxes consist of six rates: 1%, 2%, 3%, 4%, 5%, and 10%.
References to legal instruments and hyperlinksDecreto-Lei No. 71/04 of july 9, 2004.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related paymentsService contracts with nonresidents in excess of $500,000 or its equivalent are subject to licensing.
Prior approvalYes.
Investment-related payments
Prior approvalForeign investors are authorized by the BNA to remit profits and dividends, after payment of taxes and fulfillment of other legal requirements.
Payments for travel
Quantitative limitsResidents may freely purchase foreign exchange from financial institutions and exchange bureaus up to the equivalent of $5,000. Residents may, on presentation of a passport and an airline ticket, purchase foreign exchange from financial institutions or exchange bureaus up to a maximum of $500 a day for up to 30 days for business, health, educational, scientific, or cultural purposes. Residents may transfer a noncumulative amount of up to $15,000 a person a trip for business, health, educational, scientific, or cultural purposes, up to a maximum of $60,000 in a 12-month period.
Personal payments
Prior approvalYes.
Quantitative limitsUp to the equivalent of $15,000 a month may be authorized (with a maximum limit of up to $60,000 in a 12-month period) to Angolans or foreigners residing abroad who are direct descendants of and financially dependent on residents of Angola or are incapable of working.
Foreign workers’ wages
Prior approvalYes.
Credit card use abroadOnly banks may issue credit cards.
Quantitative limitsUse of credit cards abroad is limited to the equivalent of$10,000.
Other payments
Prior approvalYes.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsService earnings must be surrendered to a bank, unless the depositor is authorized by the BNA to retain a certain proportion of the proceeds.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsAll capital transactions are subject to BNA licensing. Capital transactions must be conducted through banks and require BNA approval and issuing of a capital import or export license. Banks may perform private capital transactions, such as those that involve donations or remittances from abroad, without BNA licensing.
Controls on capital and money market instrumentsThere are controls on all capital and money market instruments.
Controls on derivatives and other instrumentsn.r.
Controls on credit operations
Commercial creditsOperations are subject to prior licensing by the BNA for registration purposes only.
By residents to nonresidentsSuppliers’ credits must be reported to the BNA for statistical purposes.
To residents from nonresidentsSuppliers’ credits must be reported to the BNA for statistical purposes.
Financial creditsFinancial credits are subject to licensing from the BNA.
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Guarantees, sureties, and financial backup facilitiesYes.
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Controls on direct investment
Outward direct investmentAngolan citizens are permitted to invest abroad, in accordance with the Exchange Law.
Inward direct investmentForeign investments are subject to the provisions of the Private Investment Law as well as foreign exchange laws and regulations, which are implemented by the Private Investment National Agency. Special laws regulate investment in certain areas, including (l) oil and mineral exploration and (2) financial institutions. Foreign investment is prohibited in the following areas: (1) defense, internal public order, and state security; (2) central banking and currency issue; and (3) other areas reserved for the state.
Controls on liquidation of direct investmentForeign investors are guaranteed the right to transfer abroad the proceeds of the sale of investments, including gains and amounts owed to them after payment of taxes due.
Controls on real estate transactions
Sale locally by nonresidentsYes.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksPrivate Investment Law (2003); BNA Instruction 01/2003 of February 7, 2003.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadYes.
Lending locally in foreign exchangeBanks may lend locally in foreign exchange.
Purchase of locally issued securities denominated in foreign exchangeYes.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsThe reserve requirement for demand deposits in foreign and domestic currencies is 15%. The reserve requirement coefficient is calculated weekly, based on the average deposits held in the previous week. All required reserves must be settled in domestic currency. Up to 20% of the reserve requirement base may be held in treasury bonds of the BNA or in treasury bills with maturities of 91 days or longer. The coefficient of the reserve requirement for central government deposits in local and foreign currencies is 100%.
Liquid asset requirementsThe liquid asset requirement is 50% of the foreign exchange portfolio.
Investment regulations
Abroad by banksYes.
In banks by nonresidentsYes.
Open foreign exchange position limitsBanks may hold daily foreign exchange positions of up to 20% of their own funds. Foreign exchange bureaus may hold daily foreign exchange positions of up to 10 times their capital.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksBNA Notice 06/2003 of February 7, 2003; BNA Notice 15/2003 of October 17, 2003.
Changes during 2005
No significant changes occurred in the exchange and trade system.
Changes during 2006
Arrangements for payments and receiptsJanuary 10. The limits for exports and imports of foreign currency banknotes were increased to the equivalent of $15,000, from $10,000 and from $5,000 for residents and nonresidents, respectively.

ANTIGUA AND BARBUDA

(Position as of December 31, 2005)

Status under IMF Articles of Agreement
Article VIIIDate of acceptance: November 22, 1983.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)In accordance with UN Security Council resolutions, measures have been taken to freeze the assets of terrorists and terrorist organizations.
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Antigua and Barbuda is the Eastern Caribbean dollar, which is issued by the ECCB.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderThe Eastern Caribbean dollar is pegged to the U.S. dollar, under a currency board arrangement, at EC$2.70 per US $1.
Exchange taxEffective April 1, 2005, the foreign exchange levy of l% that applied on purchases of foreign currency has been removed.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with residents of member countries of CARICOM must be made either in the currency of the country concerned or in Eastern Caribbean dollars. Exports to Jamaica are settled in U.S. dollars. Settlements with residents of other countries may be made in any foreign currency or in Eastern Caribbean dollars.
Use of foreign exchange among residentsYes.
Payments arrangements
Regional arrangementsAntigua and Barbuda is a member of CARICOM and the OECS.
Clearing agreementsAs a member of CARICOM, Antigua and Barbuda participates in the CMCF.
Administration of controlThe MOF applies controls to all foreign exchange transactions. Effective April 1, 2005, purchases of foreign currency exceeding the equivalent of EC$250,000 no longer require MOF approval.
Payments arrears
OfficialYes.
Controls on trade in gold (coins and/or bullionsNo.
Controls on exports and imports of banknotes
On exports
Domestic currencyExports of domestic currency outside the ECCU are subject to limits prescribed by the ECCB.
Foreign currencyYes.
On imports
Foreign currencyYes.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedExternal accounts may be opened, especially in tourist-oriented industries or in export trade where receipts are primarily in foreign currency and a large number of inputs are imported or financed in foreign currency
Held domesticallyYes.
Approval requiredCommercial banks are required to report external accounts operations to the MOF on a monthly basis.
Accounts in domestic currency held abroadn.r
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedExternal accounts may be maintained in any currency and may be credited with receipts from sales of merchandise (whether from exports or local sales) or from remittances.
Approval requiredCommercial banks are required to report external accounts operations to the MOF on a monthly basis.
Domestic currency accountsYes.
Convertible into foreign currencyNo.
Approval requiredYes.
Blocked accountsn.a.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetn.a.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsPayments for authorized imports are permitted on application and submission of documentary evidence. All bona fide import payments are approved. Effective April 1, 2005, purchases of foreign currency exceeding the equivalent of EC$250,000 no longer require MOF approval.
Domiciliation requirementYes.
Letters of creditYes.
Import licenses and other nontariff measuresCertain goods require individual licenses, unless imported from CARICOM countries. Antigua and Barbuda follows the CARICOM rules of origin.
Open general licensesMost goods may be freely imported under OGLs granted by the MOF and the Ministries of lndustry and Commerce. Non-automatic licensing is applied on products subject to quantitative restrictions.
Licenses with quotasQuantitative restrictions are applied to aerated beverages, beer, stout, ale, and porter. In agriculture, quantitative restrictions are applied, if there is domestic supply.
Import taxes and /or tariifsCustoms duty rates range from zero to 35% for nearly all items. The CARICOM CET is applied. As a result, tariffs on imports from CARICOM countries range from zero to 20%. There are no customs duties on a number of items, including milk and poultry. Some goods, including basic foods and agricultural goods, are exempt from customs duties. Other exemptions for machinery, equipment, and raw materials are granted on a case-by-case basis.
State import monopolyThere is a monopoly on imports of petroleum products.
References to the legal instrument and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementn.a
Financing requirementsn.a
Documentation requirements
Letters of creditYes.
GuaranteesYes.
DomiciliationYes.
OtherYes.
Export licensesNo.
Export taxesReexports are not subject to any tax if transactions take place within the bonded area.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersEffective April 1, 2005, payments for certain categories of invisibles (related to authorized imports) exceeding the equivalent of EC$250,000 no longer require prior MOF approval. Approval is granted for all bona fide payments for invisibles. No controls apply on payments for freight, insurance, unloading and storage costs, administrative expenses, commissions, and profits and dividends.
Investment-related paymentsProfits may be remitted in full after compliance with corporate income tax payments. Verification is not applied in practice; the authorities, however, can decide to undertake such verification
Prior approvalYes.
Quantitative limitsYes.
Indicative limits/bona fide testYes.
Payments for travel
Prior approvalEffective April 1, 2005, MOF approval is no longer required for amounts exceeding the equivalent of EC$250,000.
Quantitative limitsYes.
Indicative limits/bona fide testYes.
Personal paymentsInformation is not available on the transfer of pensions.
Prior approvalPayments related to family maintenance are permitted. Payments for alimony are allowed if provided for by contract.
Quantitative limitsEffective April 1, 2005, for payments related to medical expenses and studies abroad, MOF approval is no longer required for amounts exceeding the equivalent of EC $250,000.
Indicative limits/bona fide testYes.
Foreign workers’ wages
Prior approvalThese remittances are allowed, if provided for in the contract.
Quantitative limitsYes.
Indicative limits/bona fide testYes.
Other payments
Prior approvalPayments for consulting and legal fees are allowed, if provided for in the contract.
Quantitative limitsThe limit for subscriptions and membership fees is EC$10,000 a year.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Controls on capital transactions
Controls on capital transactionsEffective April 1, 2005, foreign exchange transactions exceeding the equivalent of EC $250,000 no longer require MOF approval.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investment
Outward direct investmentLarge transfers abroad for investment purposes may be made in phases over time by the Financial Secretary.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase locally by nonresidentsAn alien landholding license is required, and the purchase must be approved by the cabinet.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsUnder the laws governing offshore financial institutions (1) the International Financial Sector Authority was created, with responsibility for licensing offshore financial institutions; (2) annual inspections of offshore financial institutions are conducted; (3) the minimum capital requirement for offshore banks is the equivalent of US$5 million, of which US$1.5 million is to be deposited in the domestic banking system; (4) all directors of a bank are to be natural persons, at least one of whom must be a national of Antigua and Barbuda; and (5) offshore banks are allowed to extend credit to the Antiguan and Barbudan government.
Lending to nonresidents (financial or commercial credits)MOF approval is required for these transactions. Effective April 1, 2005, loans are no longer subject to a 3% stamp duty.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksn.a
Changes during 2005
Exchange arrangementApril 1. The foreign exchange levy of 1% that applied on purchases of foreign currency was removed.
Arrangements for payments and receiptsApril 1. The requirement for MOF approval of purchases of foreign currency exceeding the equivalent of EC$250,000 was abolished
Imports and import paymentsApril 1. The requirement for MOF approval of purchases of foreign currency exceeding the equivalent of EC$250,000 was abolished
Payments for invisible transactions and current transfersApril 1. The requirement for MOF approval of payments for certain categories of invisibles exceeding the equivalent of EC$250,000 was abolished
April 1. MOF approval was no longer required for amounts exceeding the equivalent of EC$250,000.
April 1. For payments related to medical expenses and studies abroad, MOF approval was no longer required for amounts exceeding the equivalent of EC$250,000.
Capital transactionsApril 1. The requirement for MOF approval of foreign exchange transactions exceeding the equivalent of EC$250,000 was abolished.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsApril 1. The 3% stamp duty applicable to loans to non residents was removed.

ARGENTINA

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: May 14, 1968
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2005 Article IV consultation with Argentina states that as of June I, 2005, Argentina maintained an exchange restriction with respect to Article VIII arising from a freeze on reprogrammed bank deposits (the corralon). (Country Report No. O5/236)
International security restrictions
In accordance with UN sanctionsThe Central Bank of the Argentine Republic (BCRA) has instituted a system for giving effect to sanctions of this type, whereby financial and exchange institutions are required, in accordance with decrees issued by the Argentine Executive Branch pertaining to the UN Security Council decisions on combating terrorism, to abide by the resolutions (and annexes thereto) issued by the Ministry of External Relations, International Trade, and Religious Affairs, once they are published in the Boletin Oficial (Communications A 4218 of September 29, 2004, and A 4273 of January 3, 2005)
Exchange Arrangement
CurrencyThe currency of Argentina is the Argentine peso.
Exchange rate structureUnitary.
Classification
Managed floating with no predetermined path for the exchange rateThe exchange rate of the Argentine peso is determined in the free and unified foreign exchange market (MULC) as a result of the free interplay of supply and demand (Communication A 3471). The BCRA plays an active role in accordance with a prudential objective of accumulating international reserves.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThere are three forward markets; transactions in these markets are settled by netting in domestic currency.
References to legal instruments and hyperlinksCommunication A 3471; www.bcra.gov.ar.
Arrangements for Payments and Receipts
Prescription of currency requirementsTransactions with countries with which there are no payments agreements must be settled in freely convertible currencies.
Use of foreign exchange among residentsForeign exchange may be sold in the MULC for peso banknotes, personal checks from the buyer, or debits to the buyer’s account.
Payments arrangements
Bilateral payments arrangements
InoperativeArgentina has agreements with Cuba, Malaysia, and the Russian Federation. Payments between Argentina and these countries are settled on a voluntary basis through accounts
Regional arrangementsWithin the framework of the multilateral clearing system of the LAIA, payments between Argentina and other LAIA countries are settled voluntarily through payments agreements and a reciprocal credit mechanism
Clearing agreementsYes.
Administration of controlExchange regulations are established by the BCRA in accordance with the policy set by the national executive. All exchange transactions must be carried out through specially authorized entities. These authorized entities include banks, exchange agencies, exchange houses, exchange offices, and financial companies. Each type of institution is subject to separate regulations.
Payments arrearsThere have been no exchange restrictions on the payment of financial debts abroad since May 6, 2003 (Communication A 3944), except for financial institutions that refinanced their debts through a process called “matching” (Communication A 3940).
OfficialYes.
Controls on trade in gold (coins and/or bullions)
Controls on external tradeImports of gold bars are not restricted. Imports of gold by industrial users are subject to a statistical duty of 0.5% and a sales tax. Authorized institutions may export gold coins or bullion to entities abroad with prior BCRA authorization. Proceeds from gold exports must be received in convertible currencies. Exports of coins and precious metals exceeding US$10,000 or its equivalent require BCRA approval.
Controls on exports and imports of banknotes
On exports
Foreign currencyExports of foreign currency exceeding the equivalent of US$10,000 require prior BCRA authorization and must be made through entities subject to supervision by the Superintendency of Financial and Exchange Entities.
On imports
Domestic currencyImports of domestic currency through outward transfers of foreign exchange are subject to BCRA approval if the amount exceeds the equivalent of US$5,000 a calendar month.
Foreign currencyYes.
References to legal instruments and hyperlinksCommunication A 3661; Communication A 3826; Communication A 3940; Communication A 3944; www.bcra.gov.ar.
Resident Accounts
Foreign exchange accounts permittedAuthorized banks may open time deposit accounts in U.S. dollars and euros. Authorized banks may open deposit accounts in foreign currencies other than U.S. dollars with BCRA approval. In addition, they may accept deposits of public and private securities and term investments in U.S. dollars and euros. In all cases, the appropriate identification requirements must be met (among other things, to prevent money laundering). Residents may purchase and deposit on their account foreign exchange up to a monthly limit of the equivalent of US$2 million. This amount may be increased if the peso amount paid by customers to purchase foreign exchange for these various transactions does not exceed the peso equivalent of the sum of export duty payments plus three times the taxes on bank current account credits and debits paid by taxpayers to the Federal Public Revenue Administration during the second to last calendar month before the reporting month.
Held domesticallyYes.
Approval requiredAuthorized banks may open deposit accounts in foreign currencies other than U.S. dollars with BCRA approval.
Held abroadYes.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Non Resident Accounts
Foreign exchange accounts permittedThe regulations governing resident accounts apply.
Domestic currency accountsYes.
Convertible into foreign currencyNo.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsEffective June 23, 2005, for imports of consumer goods and goods for final use included in the annex to Communication A 4372, shipped after June 23, 2005, which were not covered by documentary credits opened by local financial institutions before that date, the exchange market may be accessed to pay for these goods before they are cleared for sale locally or within the 30 days following the date of their clearance through customs or entry into the free zone. (A 4372 and A 4385 are superseded by A 4496 of March 14, 2006).
Effective July 11, 2005, foreign currency financing by local financial institutions of payments for goods imports included in the aforementioned annex, based on the local institution’s foreign liabilities, may not exceed the time limits established for access to the foreign exchange market for payment of these goods.
Imports of other goods may be settled in full through advance, spot, or deferred payments (based on A 3859).
In all cases, there must be evidence that the goods have entered the national economy within 360 days of the advance payment or within 90 days of the spot payment (A 4078 and C 37602).
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measuresImport licenses are required for paper products, toys, washing machines, and footwear.
Negative listRestrictions are in effect for security, hygiene, or public health reasons.
Open general licensesOGLs are required for a limited list of products.
Licenses with quotasTrade with Brazil in the automobile sector is subject to an administered trade agreement. Under bilateral agreements, there are quotas with preferential tariffs for automobile sector products.
Other nontariff measuresNontariff barriers are not applied to intra-MERCOSUR trade. Argentina, however, applies a special regime to sugar imports with the authorization of MERCOSUR, pending agreement on a common regime for this sector. Imports of secondhand clothing, used and retreaded tires, and some used capital goods are prohibited, except by nonprofit organizations.
Import taxes and/or tariffsArgentina and MERCOSUR apply a CET to imports from the rest of the world that encompasses all products. CET rates currently range from zero to 20%. Argentina is following a timetable for convergence with the CET by 2006 for a list of computer and telecommunications products. The national list of exceptions now covers 100 products, with a maximum tariff of 26%.
State import monopolyNo.
References to legal instruments and hyperlinksCommunication A 3859; Communication A 3944; Communication A 4078; Communication A 4372; Communication A 4385; Communication A 4496; Communication C 37602; www.bcra.gov.ar.
Exports and Export Proceeds
Repatriation requirementsExport proceeds must be repatriated and sold in the foreign exchange market within a maximum of 60 to 360 days, depending on the type of products involved (in accordance with the terms stipulated by the Secretariat of Industry, Commerce, and Mines, SICyM). In addition, the BCRA may stipulate a repatriation period of 120 business days. Proceeds from exports of capital and technological goods and turnkey products may be repatriated within up to six years if they are covered by a guarantee from banks abroad in the form of an LC or letter of guarantee, or if the transaction takes place under the LAIA reciprocal payment and credit agreement. No repatriation requirement applies to export proceeds (1) that have received specific exemptions under law or executive decrees; (2) that are to be used to settle export advances or service principal and interest on export financing and prefinancing loans; (3) that have been earmarked to service properly recorded financial contracts that include a guarantee in effect on or since November 30, 2001 (subject to BCRA approval); and (4) that will be used to repay principal on financial liabilities to foreign entities outstanding on November 30, 2001, that have been restructured on terms exceeding five years on average (subject to BCRA approval). Effective September 16, 2005, foreign exchange revenue from goods exports could be used to pay the principal and interest on new financial debts by means of (1) bond issues abroad; (2) financial loans from international organizations, official lending agencies, multilateral banks, and other foreign banks; and (3) foreign currency borrowing from local financial institutions based on external lines of credit or other sources of financing from local institutions, when specifically permitted under the applicable rules, provided the new funds are used by the exporter to finance new investment projects in the country with the intention of increasing the production of goods that, for the most part, will be sold on foreign markets, if all the requirements stated in the rule are met. Effective September 9, 2005, exporters may obtain export advances and prefinancing in foreign currency in the MULC. The main preconditions include requirements regarding documentation on future shipments and time limits by type of product for receipt of the shipment, from which the foreign exchange revenue will be used to pay off the advance of prefinancing.
Surrender requirementsSurrender requirements apply only to operations settled outside the terms established in the exchange regulation, at an exchange rate in effect on the due date of the transaction if that rate is lower than the rate on the day of actual settlement.
Financing requirementsNo.
Documentation requirementsNo.
Export licenses
Without quotasLicenses are required for exports of arms, sensitive goods, and military materials
With quotasThere are quantitative restrictions on exports of protected animal species.
Export taxesExport duties ranging from 5% to 20% apply to all exports, except for some fuels for which tax rates of up to 45% apply, depending on the international oil price.
References to legal instruments and hyperlinksCommunication A 3473; Communication A 3608; Communication A 3978; Communication A 3990; Communication A 4361; Communication A 4404; Communication A 4415; Communication A 4420; Communication A 4443; www.bcra.gov.ar.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Investment-related paymentsAccess to the MULC is permitted (1) for outward transfers of profit and dividend payments, provided these correspond to closed and audited balance sheets, and (2) for payment of interest on the debts of the nonfinancial private sector and financial sector up to 15 days in advance of the due date of each installment or on interest that became due at that time.
References to legal instruments and hyperlinksCommunication A 3859; Communication A 4177; www.bcra.gov.ar.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsProceeds from exports of services must be repatriated and either sold in the foreign exchange market, deposited in a foreign exchange account within 105 business days of receipt, or credited to export accounts
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksCommunication A 3473; Communication A 3944; www.bcra.gov.ar.
Capital Transactions
Controls on capital transactionsResident individuals and legal entities not included in the financial sector may access the MULC, subject to monthly caps, to purchase foreign exchange for the following purposes: real estate investments abroad, loans to nonresidents, direct investment abroad by residents, portfolio investments abroad by individuals, other investments abroad by residents, portfolio investments abroad by legal entities, purchases of foreign banknotes for domestic holdings, and purchases of traveler’s checks, portfolio investments in mutual funds, banknotes from mutual funds, and grants (A 4306).
The monthly ceiling across all financial institutions is currently US $2 million, which may be greater if the peso amount paid by customers to purchase foreign exchange for these various transactions does not exceed the peso equivalent of the sum of export duty payments plus three times the taxes on bank current account credits and debits paid by taxpayers to the Federal Public Revenue Administration during the second to last calendar month before the reporting month (A 4128).
The MULC may be accessed under these rules and limits only if, on the date of access, there are no overdue foreign obligations pending for debt service of any kind. This condition shall not be applicable to purchases of banknotes and traveler’s checks in amounts not exceeding the equivalent of US $10,000 a calendar month (A 4349).
These limits are waived for purchases of foreign assets for (1) external debt restructuring by residents (Communication A 3998-A 4461), (2) cancellation of debts within 360 days of accessing the MULC (A 4178-A 4307), and (3) payment of Argentine imports of goods for consumption and final use included in the Annex of Communication A 4372 (Communication A 4385 suspended by Communication A 4496).
Effective December 31, 2004, the monthly ceiling for purchases of foreign exchange by residents for various transactions, across all financial institutions, was raised to the equivalent of US $2 million from US $500,000 or the peso amount paid by customers to purchase foreign exchange for these various transactions, which must not exceed the peso equivalent of the sum of export duty payments plus three times the taxes on bank current account credits and debits paid by taxpayers to the Federal Public Revenue Administration during the second to last calendar month before the reporting month. The transactions covered are real estate investments abroad, loans to nonresidents, direct investment abroad by residents, portfolio investments abroad by individuals, other investments abroad by residents, portfolio investments abroad by legal entities, purchases of foreign banknotes for domestic holdings, and purchases of traveler’s checks. The exceptions to the ceilings are purchases of foreign assets for use in the restructuring of residents’ external debts or for debt service payments within 90 days of the date of the entry of the foreign assets into the market.
There is no cap on the transactions covered in l,2, 3, 4, and 5. However, when total transactions covered in 6, 7, and 8 exceed the equivalent of US $2 million a month, or those of point 8 exceed US $500,000 a month a nonresident individual or legal entity, prior CB approval is required.
In the cases indicated in 3 -8, proof must be provided that the investment was held in the country for the minimum period, where applicable. For transactions on the MULC since May 26, 2005, the effective date of the Ministry of Economy and Production Resolution 292/2005, the minimum retention period is 365 days.
Exchange transactions with nonresidents not included in the preceding points, which exceed the limit of US $5,000 a month, require prior CB approval (A 3661).
The aforementioned limits do not apply to foreign exchange sales to international organizations (A3944) and official lending agencies (A 4323).
Inward and outward foreign exchange transactions on the domestic market, as well as foreign exchange sales by resident entities, must be registered with the BCRA. Effective May 26, 2005, foreign exchange that enters the domestic market may be transferred out 365 days (previously, 180 days) after its entry, except in the case of foreign trade operations and direct investment. Effective June 6, 2005, all new local market debts denominated in foreign currency and any new debts or rollover of existing debts by residents with external creditors were subject to a retention of 365 days.
Effective June 10, 2005, unremunerated foreign currency deposits (in U.S. dollars) at 365 days must be established covering 30% of the U.S. dollar equivalent of the total amount of the underlying transaction involving the entry of foreign exchange into the exchange market in various instances (Decree 616/05-A 4359).
Operations covered are (1) financial debts of the financial sector and nonfinancial private sector, with the exception of primary issues of debt securities in public offerings listed on self-regulated markets; (2) primary issues of shares of resident enterprises that are not publicly offered or listed on self-regulated markets, provided they do not constitute direct investment funds; (3) portfolio investments of nonresidents to be held in domestic currency and financial assets and liabilities of the financial sector and the nonfinancial private sector, provided they do not underwrite primary issues of debt securities that are publicly offered and listed on self-regulated markets, and/or primary issues of shares in resident enterprises that have been publicly offered and are listed on self-regulated markets; and (4) portfolio investments by nonresidents to acquire secondary market claims to securities issued by the public sector.
Effective June 29, 2005, the following operations are also included: (1) portfolio investments by nonresidents to underwrite primary issues of CB securities; and (2) revenue on the domestic exchange market from sales of foreign assets by private sector residents, in excess of the equivalent of US $2 million a calendar month for all authorized foreign exchange dealers.
Effective November 17, 2005, all receipts on the local market of foreign exchange to be used to underwrite primary issues of securities, bonds, or equity certificates issued by the trustee of a trust, which may or may not be publicly offered and listed on self-regulated markets, when the stated requirements apply to any of the assets of the trust are also covered.
Deposits are not required for the following operations: (1) foreign exchange entering the exchange market through direct investment in the country; (2) inflows from sales of equity in local direct investment enterprises, when these purchases can be equated with direct investment; (3) inflows from investment by nonresidents in purchasing real properly, only if a document is signed transferring ownership to the nonresident at the time the funds are paid; (4) foreign currency payments by residents on foreign currency loans granted by the local lending institution; (5) receipts on the foreign exchange market since June 26,2005 including: (a) debts to multilateral and bilateral lending institutions and official lending agencies listed in the annex of Communication A 4323 directly or through their related agencies; (b) other foreign borrowing by the financial sector and private nonfinancial sector if, at the same time, the borrower uses the funds resulting from the exchange, net of taxes and charges to purchase foreign exchange and amortize the principal of foreign debt and/or establish long-term foreign assets. Only long-term assets directly invested by residents in foreign enterprises will be considered, provided the client provides proof that the funds were actually used to capitalize or purchase businesses abroad, within 180 days of having accessed the exchange market; and (c) other foreign borrowing by the nonfinancial private sector, at contractual or actual settlement terms of no less than two years on average, including principal and interest payments, that is to be used by the private sector for investment in nonfinancial assets; (6) the use by local financial institutions of lines of credit from foreign financial institutions or financial loans from abroad if, within five business days, the funds are used to grant domestic loans to the private sector; (7) foreign financing contracted and paid off at an average term of no less than two years, including payments of principal and interest, by foundations and civil associations, provided they meet all the conditions established in Communication A 4427; (8) financing for goods exports procured by exporters from foreign institutions that meet the requirements established in point 2.f of Communication A 4377; and (9) exchange market receipts from sales of foreign assets by the resident private sector to underwrite primary issues of public securities by the national government, which funds are used to purchase foreign exchange to service the government’s debt.
Effective November 26, 2005, the exemption from the 30% deposit requirement for the primary issuance of trust securities was removed
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Sale or issue locally by nonresidentsUnder the regulations of the National Securities Commission (CNV), foreign and nonresidents Argentine issuers must meet the same requirements to make a public offering of securities in Argentina. Both must establish a permanent representative office and a domicile in Argentina to receive notices. Foreign issuers must state whether the securities are also being offered to the public in their country of origin and specify the initial and periodic information requirements to which they are subject. If the CNV believes that the regulations in the country of origin properly protect local investors and guarantee an adequate flow of information, the CNV may lower the requirements for these issuers. The CNV may authorize foreign issuers on a case-by-case basis to submit only such information as they would periodically submit to the corresponding authority in their jurisdiction of origin.
Issuers of public offerings of securities domestically and abroad must submit to the CNV all information, in Spanish, required by the entities authorizing the public offering and listing abroad.
Purchase abroad by residentsA ceiling of US $2 million a resident applies monthly, which may be increased if the peso amount paid by customers to purchase foreign exchange for these various transactions does not exceed the peso equivalent of the sum of export duty payments plus three times the taxes on bank current account credits and debits paid by taxpayers to the Federal Public Revenue Administration during the second to last calendar month before the reporting month. The exceptions to the ceilings are purchases of foreign assets for use in the restructuring of residents’ external debts or for debt-service payments within 90 days of the date of the entry of the foreign assets into the market.
Bonds or other debt securitiesAll foreign borrowing by the nonfinancial private sector and financial sector in the form of bonds, loans (including securities swaps), and foreign lines of credit must be transacted and settled on the MULC (A 3712 and A 3972).
The issue of debt securities by the private sector (financial and nonfinancial) denominated in foreign currency, for which the principal and interest cannot be paid exclusively in pesos in the country, must be underwritten in foreign currency and the funds obtained must be settled on the local market (A 3820).
The exchange market may be accessed for settlements within the following time limits after the date of disbursement of the funds (A 4142 and 4321): (1) up to 30 consecutive days for disbursements up to the equivalent of US $50 million; or (2) up to 90 consecutive days for disbursements exceeding that amount.
Effective June 10, 2005, new financial debts entering the local exchange market and extensions of foreign debts by resident financial sector and nonfinancial private sector entities (including debts prior to June 10, 2005) must be agreed on and held for a minimum of 365 consecutive days and may not be paid off in advance of that term, irrespective of the method of payment of the obligation abroad or of whether or not the transaction took place on the local exchange market (Decree 616/05-A4359). The above requirements are waived for correspondent account balances of authorized foreign exchange dealers that do not constitute lines of credit and for primary issues of debt securities that are publicly offered and listed on self-regulated markets.
New financing in the form of financial credits to or bond issues by private borrowers must be matched by foreign exchange sales to the MULC.
The prior approval requirement for servicing nonfinancial and financial private debt is applicable only for debts of financial institutions that have opted for the BCRA’s refinancing mechanism (matching). In these cases, the financial institutions must present a restructuring plan for their external liabilities to the BCRA for approval. Once approved, payments may be made in accordance with the schedule agreed to with the creditors without further BCRA approval.
Sales or issues locally by non residentsThe regulations governing the sale or issue of shares or other securities of a participating nature apply.
Purchase abroad by residentsA ceiling of US $2 million a resident applies monthly, which may be increased if the peso amount paid by customers to purchase foreign exchange for these various transactions does not exceed the peso equivalent of the sum of export duty payments plus three times the taxes on bank current account credits and debits paid by taxpayers to the Federal Public Revenue Administration during the second to last calendar month before the reporting month.
On money market instrumentsThe regulations governing the foreign exchange aspects of bonds or other debt securities apply.
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsThe regulations governing domestic issuers also apply. In particular, approval by the CNV is required for public offering. In addition, commercial paper must have a minimum maturity of seven days.
Purchase abroad by residentsThe regulations governing bonds or other debt securities apply
Sale or issue abroad by residentsYes.
On collective investment securitiesThe regulations governing bonds or other debt securities apply
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsApproval by the CNV is required for public offerings.
Purchase abroad by residentsThe regulations governing bonds or other debt securities apply.
Sale or issue abroad by residentsYes.
Controls on derivatives and other instrumentsThere are no limits on the following transactions: (1) purchases of options to hedge variable-yield term deposits that comply with the requirements and modalities stated in point 2.5 of the rules on term deposits and investments, once they meet the approval requirement in point 2.5.3 of these rules; (2) foreign exchange hedging contracts by financial institutions to cover their own long positions in the General Exchange Position (GEP); (3) foreign exchange and interest rate hedging contracts by financial institutions and the nonfinancial private sector to cover foreign liabilities declared and validated in accordance with Communication A 3602 and related provisions; (4) commodity price hedging contracts by local exporters and/or importers providing coverage exclusively for Argentine foreign trade operations; (5) external financing transactions in the form of repos, provided they are arranged at the minimum terms applicable on the date of their negotiation (effective May 26, 2005, the minimum maturity for such transactions was raised to 365 days from 180 days); and (6) hedge contracts between foreign currencies by exporters to cover the risk of shipments pending payment.
The operations may only be executed as follows: (l)in institutionalized markets in international financial centers; (2) with foreign banks that meet the requirements set out in point b of Communication A 3661 and relevant provisions; and (3) with financial institutions authorized under the regulations for this type of operation, if they are controlled by banks that meet the requirements in the preceding point.
Access to the foreign exchange market for futures, forward options, and other derivatives transactions and their subsequent payment is subject to BCRA approval.
One condition for accessing the MULC to pay premiums and/or establish the guarantee margins required in hedging contracts between foreign currencies, interest rates, and commodity prices is that the entity must join the MULC and sell, within the five business days following the close of the operation, the proceeds earned by the domestic customer from such operations or from the release of the established guarantees.
Without approval by the BCRA, authorized foreign exchange dealers may engage in arbitrage and swaps only with foreign banks or holding companies located in a Bank for International Settlements member state and that have at least an “A” rating from one of the rating agencies registered with the BCRA, or with institutions owned by foreign governments, or with branches of Argentine state banks
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsApproval by the CNV is required for public offerings.
Purchase abroad by residentsThe regulations governing bonds or other debt securities apply
Controls on credit operations
Commercial credits
By residents to nonresidentsResidents may make advance payments on imports to their foreign suppliers of up to 360 days. Exporters may allow their customers to pay in installments, provided they comply with the maximum time limits for surrendering foreign exchange, set by the SICyM, based on the type of product, between 60 and 360 days, plus the additional time granted by the BCRA (now 120 business days). In the case of capital goods, technology, and turnkey exports covered, the time limits may be longer than those established by the SICyM, under certain conditions
Financial creditsThe conditions for MULC access by the nonfinancial private sector and the financial sector to service their external debt (principal) are established in Communication A 4177.1n addition, the conditions relevant to bond issue by residents apply.
By residents to nonresidentsResidents may extend credits to nonresidents within the limit for the accumulation of external assets. In particular, the regulations governing bonds or other debt securities apply
To residents from nonresidentsYes.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsNonfinancial private sector residents may provide financial backing within the current limits on accumulation of foreign assets. Financial institutions may resort to the exchange market to pay for financial stand-by arrangements, if the exchange market was used to pay for the transaction these arrangements guarantee.
Controls on direct investment
Outward direct investmentResidents may access the MULC for direct investments within the limits for accumulation of external assets. In particular, the regulations governing bonds or other debt securities apply.
Inward direct investmentThe deposit and minimum retention time requirements do not apply to foreign exchange imported by nonresidents for direct investment in the country. Foreign exchange imported for direct investment covers only those amounts that nonresidents apply to direct investment in the country, and the amounts they use specifically to purchase domestic assets that qualify as direct investment, in accordance with internationally accepted international accounting terms, provided the importing institution can certify that the funds were specifically used in such transactions, based on its documentation.
Controls on liquidation of direct investmentNonresidents may access the MULC to purchase foreign exchange to transfer to their foreign bank accounts the proceeds collected in the country from sales of direct investments in the nonfinancial private sector and the final sale of direct investments in the country in the nonfinancial private sector, without BCRA approval, if the total, including repatriated portfolio investments, does not exceed the equivalent of US $2 million monthly for each nonresident individual or legal entity. Direct investment may be repatriated under these terms, provided it remains in the market for the minimum required period.
If the transaction does not meet the terms stated above, nonresidents may automatically access the MULC to purchase foreign exchange up to US $5,000 a month. This limit does not apply to international organizations or official lending agencies
Controls on real estate transactionsThe rules governing direct investments apply.
Purchase abroad by residentsYes.
Purchase locally by nonresidentsPurchases of real estate in border areas by foreign investors require prior approval for the project from the Border Superintendency of the Ministry of Defense, for national security reasons.
Sale locally by nonresidentsYes.
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
References to legal instruments and hyperlinksCommunication A 3602; Communication A3661; Communication A 3668;

Communication A3712; Communication A 3722; Communication A 3820;

Communication A 3866; Communication A 3940; Communication A 3944;

Communication A 3972; Communication A 3998; Communication A 3999;

Communication A 4026; Communication A 4077; Communication A 4078;

Communication A 4128; Communication A 4129; Communication A 4142;

Communication A 4164; Communication A 4177; Communication A 4178;

Communication A 4236; Communication A 4285; Communication A 4306;

Communication A 4307; Communication A 4321; Communication A 4323;

Communication A 4347; Communication A 4359; Communication A 4361;

Communication A 4363; Communication A 4369; Communication A 4377;

Communication A 4385; Communication A 4386; Communication A 4404;

Communication A 4427; Communication A 4447; Communication A 4461;

Communication A 4496; Communication B 8599; www.bcra.gov.ar.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsInstitutions authorized to trade in foreign currency require the BCRA’s prior consent to perform their own purchases when payment is made against delivery of foreign currency or other external assets comprising the GEP, with the following exceptions: (1) effective October 26, 2005, (a) settlements of repurchase of securities used for external financing through repos, and (b) financial institutions are exempted from previous limits if transactions are performed with funds from their GEP by accessing the domestic foreign exchange market to buy foreign-currency-denominated government or corporate bonds in initial public offerings that are sold in self-regulated stock exchanges involving securities relating to own operation; (2) effective March 7, 2005, transactions performed with funds from an institution’s GEP by accessing the domestic foreign exchange market to meet the institution’s foreign exchange needs through purchases and sales in self-regulated stock exchanges involving securities relating to own operations or to cover resident and nonresident customers’ transactions, insofar as the net foreign exchange purchase on the domestic foreign exchange market to purchase these securities or, in turn, insofar as the resulting net foreign exchange sale, does not exceed in the past three calendar months 5% of the GEP in U.S. dollars at the reference exchange rate, considered in the GEP ceiling for the month under review; and (3) effective March 18, 2005, purchases by local financial institutions of loans granted by foreign financial institutions to nonfinancial private sector residents, insofar as those loans may be applied to the foreign currency deposit lending capacity (Section 2 of regulations on “Lending Policy”).
Borrowing abroadThe regulations governing the nonfinancial sector apply.
Lending to nonresidents (financial or commercial credits)Credits granted by financial intermediaries must be used in the country and must finance investment, production, commercialization, or consumption of goods and services for internal consumption or export.
Lending locally in foreign exchangeRegulations on the allocation of funds in foreign currencies establish that under certain conditions lending capacity from foreign currency deposits, including dollar term deposits to be settled in pesos, must be applied to any one of the following: (1) prefinancing and financing of exports to be made directly or through principals, trustees, or other brokers; (2) financing of investment projects, working capital, or goods that increase the value of or are related to the production of goods to be exported; (3) financing to manufacturers of goods to be exported, as final products or as part of other goods, by third party purchasers, provided such transactions are secured or collateralized in foreign currency by the third party purchasers; (4) financing to commercial borrowers importing capital goods that increase the production of goods to be sold domestically. Borrowers should show a capacity to withstand an exchange rate depreciation in at least two scenarios; (5) debt securities or financial trust participation certificates whose underlying assets are loans made by the above-mentioned financial entities; (6) loans made from one financial entity to another; and (7) foreign currency debt securities or financial trust participation certificates, publicly listed under an authorization by the National Securities Commission, whose underlying assets are securities bought by the fiduciary and guaranteed by reciprocal guarantee companies, in order to finance export transactions
Lending capacity surpluses (exceeding the above-mentioned designations) produce an additional cash requirement in that currency to be held in cash or as deposits with the BCRA..
Purchase of locally issued securities denominated in foreign exchangeThere are limits on the maximum amount of securities a bank may hold from a particular issuer; however, purchases of securities against delivery of assets require prior BCRA approval.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsMinimum cash requirements apply separately to each currency in which liabilities are denominated. The reserve requirement for deposit accounts denominated in foreign currencies is higher than for accounts in domestic currency.
Investment regulations
Abroad by banksTransactions are prohibited by policies on general lending.
Open foreign exchange position limitsThe overall foreign exchange position of financial institutions is made up of all the institution’s liquid foreign assets, namely: gold coins and bullion, foreign currency notes, demand deposits in banks abroad, investments in foreign public securities issued by OECD member countries with a sovereign debt rating of at least “AA,” and banking correspondents’ debit and credit balances. Also included are agreed purchases and sales of such assets pending settlement through exchange transactions with customers at terms of no more than 48 hours.
The upper limit of the overall foreign exchange position is recalculated monthly and the update takes effect on the first business day of each month. The upper limit is set at 10% of the U.S. dollar equivalent of the bank’s net worth at the end of the second to last month preceding the month of the deadline for submission of the foreign exchange to the BCRA, under the rules of the corresponding reporting regime. It will be increased by the U.S. dollar amount equivalent to 5% of the institution’s turnover of foreign exchange purchases and sales to customers in the second to last preceding calendar month, and to 2% of total demand and term deposits established and payable domestically in foreign exchange, excluding deposits held in custody, reported by the institution at the close of the second to last preceding calendar month. If the maximum calculated is less than US $1.5 million, this latter amount will be considered the lower limit of the established maximum.
The absolute value of the overall net position in foreign exchange—as a monthly average of daily balances converted to pesos at the reference exchange rate—may not exceed 30% of the net liabilities of the preceding month.
When the net foreign exchange position is positive, the amount may not exceed that proportion of liquid own resources. Excesses may be subject to a charge of up to the equivalent of twice the nominal annual interest rate resulting from auctions of BCRA instruments in U.S. dollars or twice the 30-day LIBOR for operations in U.S. dollars, as reported for the last working day of the relevant month, whichever is greater.
Provisions specific to institutional investorsThe regulations governing the non financial private sector apply.
Insurance companies
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.
Investment firms and collective investment funds
Limits (max.) on securities issued by nonresidentsMutual funds may invest 25% in publicly offered securities issued by nonresidents; pension funds may invest up to 10%. There is a 25% limit on investment for mutual fund portfolios, but this limit does not apply to MERCOSUR countries and Chile. For diversification, no more than 10% of pension funds may be invested in securities issued by a foreign sovereign or in securities of foreign corporations issued abroad.
Limits (max.) on investment portfolio held abroadYes.
Limits (min.) on investment portfolio held locallyWhen a mutual fund consists of negotiable securities, a minimum of 75% of the investment must be made in assets issued and traded in Argentina, including those issued by MERCOSUR countries and Chile
References to legal instruments and hyperlinksCommunication A 3640; Communication A 3649; Communication A 4047;

Communication A 4308; Communication A 4322; Communication A 4363;

Communication A 4369; Communication A 4430; Communication A 4433;

www.bcra.gov.ar.
Changes during 2004
Imports and import paymentsJune 23. For settlements pertaining to goods for consumption and final use included in the annex to Communication A 4372 shipped after June 23, 2005, which were not covered by documentary credits opened by domestic financial institutions at that time, the exchange market must be accessed prior to the shipment date of the goods or within 30 days of their customs clearance or entry into the free zone.
July 11. The foreign exchange financing provided by domestic institutions for imports of the goods included in the annex under reference, based on the local institution’s foreign liabilities, must not exceed the maximum time limit for accessing the exchange market for the payment of those goods.
December 31. Nonresidents’ purchases of foreign exchange were limited to US $2 million a month.
Exports and export proceedsSeptember 9. Communication A4415 and A 4443 specified the various conditions necessary for advances and prefinancing to enter the MULC.
September 16. Communication A 4420 made it possible to use foreign exchange revenue from goods exports to service new financial debts through different debt instruments
Capital transactionsMay 26. The minimum period that nonresident investors must hold incoming capital (excluding foreign trade operations and direct investment) in the country was raised to 365 days from 180 days.
June 6. All new local market debts denominated in foreign currency and any new debts or rollover of existing debts by residents with external creditors were subject to a retention of 365 days.
Controls on capital and money market instrumentsJune 10. A 30% unremunerated deposit requirement of one year was imposed on foreign portfolio investment, excluding initial public offerings, foreign direct investment, and trade finance flows.
June 29. Unremunerated foreign currency deposits must also be placed after (1) portfolio investments by nonresidents to underwrite primary issues of CB securities; and (2) revenue on the domestic exchange market from sales of foreign assets by private sector residents, in excess of the equivalent of US $2 million a calendar month for all authorized foreign exchange dealers.
November 17. All receipts on the local market of foreign exchange to be used to underwrite primary issues of securities, bonds, or equity certificates issued by the trustee of a trust, which may or may not be publicly offered and listed on self-regulated markets, when the stated requirements apply to any of the assets of the trust are also covered.
November 26. The exemption from the 30% deposit requirement for the primary issuance of trust securities was removed.
Controls on derivatives and other instrumentsMay 26. The minimum maturity of external financing transactions in the form of repos was raised to 365 days from 180 days.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsMarch 7. Institutions authorized to trade in foreign currency require the BCRA’s prior consent to perform their own purchases when payment is made against delivery of foreign currency or other external assets comprising the GEP, with the following exceptions: transactions performed with funds from their GEP by accessing the domestic foreign exchange market to meet their foreign exchange needs to be bought and sold in self-regulated stock exchanges involving securities relating to own operations or to cover resident and nonresident customers’ transactions, insofar as the net foreign exchange purchase on the domestic foreign exchange market to purchase these securities or, in turn, insofar as the resulting net foreign exchange sale did not exceed in the past three calendar months 5% of the GEP in U.S. dollars at the reference exchange rate considered in the GEP ceiling for the month under review.
March 18. Institutions authorized to trade in foreign currency require the BCRA’s prior consent to perform their own purchases when payment is made against delivery of foreign currency or other external assets comprising the GEP, with the following exception: purchases by local financial institutions of loans granted by foreign financial institutions to nonfinancial private sector residents, insofar as those loans could be applied to the foreign currency deposit lending capacity (Section 2 of regulations on “Lending Policy”).
October 26. The upper limit of the overall foreign exchange position was raised to 15% from 10%. Also the limit on banks’ U.S. dollar exposure was raised to 15% from 10%.
October 26. Institutions authorized to trade in foreign currency require the BCRA’s prior consent to perform their own purchases when payment is made against delivery of foreign currency or other external assets comprising the GEP, with the following exceptions: (1) settlements of repurchase of securities used for external financing through repos, and (2) financial institutions exempted from previous limits because transactions were performed with funds from their GEP by accessing the domestic foreign exchange market to buy foreign-currency-denominated government or corporate bonds in initial public offerings that were sold in self-regulated stock exchanges involving securities relating to own operation.

ARMENIA

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: May 29, 1997.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Financial transactions are restricted and accounts are frozen if they involve individuals or organizations included in the lists of terrorists maintained pursuant to (1) the relevant UN Security Council resolutions and (2) the list of current terrorist organizations designated by the U.S. Secretary of State.
In accordance with UN sanctionsFinancial transactions are restricted and accounts are frozen if they involve individuals or organizations included in the lists of terrorists maintained pursuant to (1) UN Security Council Resolution No. 1373 (2001) and (2) UN Security Council Resolution No. 1267 (1999).
Exchange Arrangement
CurrencyThe currency of Armenia is the Armenian dram.
Exchange rate structureUnitary.
Classification
Independently floatingEffective January 1, 2006, the Central Bank of Armenia (CBA) pursues a policy of inflation targeting, for which it manages the refinancing interest rate as its operational target and intervenes in the foreign exchange market only for smoothing excessive exchange rate volatility. Foreign exchange transactions take place in the interbank and stock exchange markets. The CBA acts mainly in the stock exchange market.
Purchases and sales of foreign currency may be implemented through foreign exchange entities licensed by the CBA, including banks, foreign exchange dealers, credit institutions, and foreign exchange bureaus; or, in the case of the government, through the CBA itself, which acts as the government’s financial agent. Foreign exchange entities carry out foreign exchange transactions by setting their own buying and selling rates for major currencies against the dram without any restrictions.
The exchange rate of the dram against the U.S. dollar is determined on the basis of exchange rates prevailing in the inter bank and intra bank markets and in the stock exchange on the previous day. The official exchange rate is set as the weighted average of the foreign exchange market buying and selling rates. The official exchange rate is used for accounting purposes and for those treasury operations that are connected with external debt services or create new external obligations. Foreign exchange entities use the official exchange rate of the CBA for bookkeeping and revaluation purposes.
Foreign exchange entities and other business entities determine exchange rates for their operations independently.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketResidents and nonresidents may negotiate freely forward exchange contracts for both commercial and financial transactions in all leading convertible currencies in the domestic exchange market and at major international foreign exchange markets. However, for the time being, the forward exchange market in Armenia is still undeveloped, although some banks sign forward contracts in small amounts. The CBA conducts foreign exchange swaps as a short-term instrument.
References to legal instruments and hyperlinksThe Civil Code of the Republic of Armenia went into effect May 5, 1998; the Law of the Republic of Armenia on Foreign Investments went into effect July 31, 1997; the Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on the Central Bank of Armenia went into effect June 30, 1996; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; the Law of the Republic of Armenia on Credit Organizations went into effect May 29, 2002; Justification for the Adoption of Inflation Targeting Strategy by the Central Bank of Armenia, 2006; CBA announcement on “The Central Bank Operations in Financial Market,” May 1998; Regulation 10,” Licensing, Regulation, and Control of Foreign Exchange Purchase and Sale Operations,” was approved by CBA Executive Board Resolution 436-S on December 20, 2002; Regulation 11, “Licensing, Regulation, and Control of Foreign Exchange Trading in Armenia,” was approved by CBA Executive Board Resolution 69 on March 19, 2002; Regulation 12, “Licensing and Regulation of Foreign Exchange Dealer Trading,” was approved by CBA Executive Board Resolution 437-S on December 17, 2002; www.cba.am; www.parliament.am.
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsEffective June 28, 2005, under the new foreign exchange law, prices of and payments for goods, services, wages, and investments in statutory and share capital of legal entities are quoted and made, respectively, in drams only; prizes are advertised and paid out in drams also. However, the following may be denominated and transacted in foreign currency: (1) gifts, donations, and bequests; (2) non cash payments for non-trade-related transactions; and (3) non cash payments for current and capital account transactions between legal entities, between sole entrepreneurs, and between legal entities and sole entrepreneurs. Nonresident natural persons and residents are prohibited from using foreign exchange as a means of payment within Armenia.
Payments arrangements
Bilateral payments arrangements
InoperativeArmenia maintains agreements with Russia and Turkmenistan.
Regional arrangementsArmenia is a signatory of the 1993 Treaty of Economic Union (with Azerbaijan, Belarus, Kazakhstan, the Kyrgyz Republic, Moldova, the Russian Federation, Tajikistan, and Uzbekistan), which provides for the eventual establishment of a customs union, a payments union, cooperation on investment, industrial development, and customs procedures. Armenia also joined the Agreement on the Establishment of a Payments Union of CIS member countries. Armenia is a member of the Black Sea Economic Cooperation pact, together with Albania, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, the Russian Federation, Turkey, and Ukraine. Bilateral free trade agreements have been signed with Georgia, the Kyrgyz Republic, Moldova, the Russian Federation, Tajikistan, and Ukraine, though only the agreement with the Russian Federation is in operation. Armenia is a European Asian Economic Community observer
Clearing agreementsThere is an arrangement with Turkmenistan for the importation of natural gas. In addition, bilateral clearing agreements with the Baltic countries, the Russian Federation, and the other countries of the FSU exist, but all have become largely inoperative.
Administration of controlThe CBA is the main body that formulates and administers exchange rate policy and issues foreign exchange regulations within Armenia. The CBA also has overall responsibility for currency control, in close collaboration with the Ministry of Finance and Economy (MOFE) and State Tax Service (STS). The CBA is responsible for control over the entities licensed by the CBA, including banks, foreign exchange dealers, credit institutions, foreign exchange bureaus, and other financial entities. The MOFE is responsible for supervision and control over the entities licensed by the MOFE. The STS is responsible for supervision and control over the activities of all other agents.
Payments arrearsNo.
Controls on trade in gold (coins and /or bullions)No.
Controls on exports and imports of banknotes
On exportsIndividuals are authorized to transfer, deliver, and export securities and any cash currency, in both drams and foreign exchange up to the equivalent of $5 million without any restriction. Exports of currency exceeding that amount are permitted through bank transfers
Foreign currencyYes.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the CBA Board Resolution 386-S on Export and Import of Currency Values went into effect July 29, 2005; www.cba.am.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; www.cba.am.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; www.cba.am.
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
Negative listImport licenses from the Ministry of Agriculture and the Ministry of Health are required and granted on a case-by-case basis to import drugs and other pharmaceuticals and pesticides. Imports of weapons, military equipment and parts, and explosives require special authorization from the government.
Import taxes and/or tariffsThere are two rates of customs duties: zero, which applies to most imports, and 10%, which applies to a variety of new materials and manufactured products. Products imported from countries in the CIS are exempt from import tariffs.
State import monopolyNo.
References to legal instruments and hyperlinksThe Customs Code of the Republic of Armenia, Article 102, went into effect July 6, 2000; www.parliament.am; www.customs.am
Exports and Export Proceeds
Repatriation requirementNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport permits are required for medicines, wild animals, and plants. In addition, special government permission is required for the export of nuclear technology, nuclear waste, related non nuclear products, and technology with direct military applications. Minimum threshold prices for the export of ferrous and nonferrous metals and the reexport of foreign-produced goods remain in force.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Customs Code of the Republic of Armenia, Article 102, went into effect July 6, 2000; www.cba.am; www.parliament.am.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; www.cba.am.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; www.cba.am.
Capital Transactions
Controls on capital transactionsExcept for real estate, currently there are no controls on capital transactions. However, the CBA reserves the right to impose capital controls in order to maintain the stability of the financial system, prevent money laundering and terrorist financing, and lower economic risks.
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 transactions
Purchase locally by nonresidentsNonresidents are prohibited by the constitution from acquiring land in Armenia.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksThe Constitution of the Republic of Armenia (with amendments), Article 31, went into effect July 5, 1995; the Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; the Law of the Republic of Armenia on Securities Market Regulation went into effect July 6, 2000; www.cba.am; www.parliament.am.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsEffective June 10, 2005, a uniform 8% (previously, 6%) reserve requirement applies to deposits by residents and nonresidents in both foreign and domestic currency. Effective January 1, 2006, the reserve requirement is remunerated at an annual interest rate of zero (previously, 3%).
Open foreign exchange position limitsEffective April 1, 2005, the following limits apply to the gross foreign exchange position of commercial banks with respect to capital: (1) position in convertible currencies, 20% (previously, 25%); (2) position in nonconvertible currencies, 5%; and (3) position in any currency, 15%. Effective October 1, 2005, the limits on the gross foreign exchange position of the commercial banks are reduced to 15% inconvertible currencies and 10% in any currency relative to capital.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsn.a
References to legal instruments and hyperlinksThe Law of the Republic of Armenia on Currency Regulation and Currency Control went into effect June 28, 2005; the Law of the Republic of Armenia on Banks and Banking went into effect June 30, 1996; the Law of the Republic of Armenia on Insurance Companies went into effect June 11, 2004; www.cba.am; www.parliament.am.
Changes during 2005
Arrangements for payments and receiptsJune 28. Under the new foreign exchange law, prices of and payments for goods, services, wages, and investments in statutory and share capital of legal entities were required to be quoted and made, respectively, in drams only; moreover, prizes were required to be advertised and paid out in drams. Gifts, donations, bequests, and certain non cash transactions were permitted to be denominated and conducted in foreign exchange
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsApril 1. The limit on the gross foreign exchange position of commercial banks in convertible currencies was reduced to 20% from 25% of capital. The limit on the foreign exchange position in any currency was set at 15% of capital.
June 10. A uniform 8% reserve requirement (previously, 6%) was applied to residents’ and nonresidents’ deposits in both foreign and domestic currency.
October 1. The limit on the gross foreign exchange position of commercial banks in convertible currencies was reduced to 15% from 20% of capital. The position in nonconvertible currencies was set at 5% of capital. The position in nonconvertible currencies was set at 5% of capital. The limit on the foreign exchange position in any currency was set at 10% of capital.
Changes during 2006
Exchange arrangementJanuary 1. The CBA began to pursue a policy of inflation targeting, for which it manages the refinancing interest rate as its operational target and intervenes in the foreign exchange market only for smoothing excessive exchange rate volatility.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsJanuary 1. The annual interest rate at which the reserve requirement is remunerated was reduced to zero from 3%.

ARUBA

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIYes.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2005 Article IV consultation with the Kingdom of the currency practices Netherlands-Aruba states that as of April 11, 2005, Aruba maintained a foreign exchange restriction arising from the foreign exchange tax on payments by residents to nonresidents. This tax, which amounts to 1.3% of the transaction value, was introduced when Aruba was part of the Netherlands Antilles, to generate revenue for the government. Aruba adopted it after gaining autonomy (“status a part”) in 1986. Since then, it has served as a source of general tax revenue for the central government of Aruba. (Country Report No. 05/204)
International security restrictions
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Aruba is the Aruban florin.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe florin is pegged to the dollar at Af. 1.79 per $1. The Central Bank van Aruba (CBA), the central bank, deals with local commercial banks within margins of 0.002795% on either side of parity.
Exchange taxA foreign exchange commission of l.3% applies on all payments to nonresidents, including payments made through a foreign bank account or exchange office, checking account transfers in foreign currencies, and payments by a foreign company on behalf of residents settled through inter company accounts. Certain payments, such as those for transactions settled in Netherlands Antillean guilders and payments of certain government-related companies, are exempted from this commission
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsLegal entities that hold a hotel or casino license are allowed to accept and return change in U.S. dollars and Venezuelan bolívares.
Payments arrangementsNo.
Administration of controlThe CBA administers foreign exchange control.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullions)No.
Controls on exports and imports of banknotes
On exports
Domestic currencyThe exportation of domestic banknotes is prohibited.
Foreign currencyThe exportation of foreign banknotes requires a license, except for traveling purposes.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadThe opening of an account abroad must be reported to the CBA. Approval is not required, but holders of accounts abroad must apply to the CBA if they wish to be exempted from the requirement that they collect foreign claims as soon as they fall due and transfer and sell them to a local foreign exchange bank. Unless an exemption has been given, payments to nonresidents in foreign exchange should be made from an authorized bank’s account or from an account of a foreign bank that operates in the country of the transaction or to a nostro account of a nonresident held with the authorized bank.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyThese accounts are not allowed.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyBalances in these accounts are fully convertible.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
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
Licenses with quotasThe importation of eggs may be subject to quotas, depending on the domestic supply situation.
Import taxes and/or tariffsYes.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsUnless specifically exempted, within eight working days, export proceeds must be converted into local currency, credited to a foreign currency account with a local foreign exchange bank, or deposited in a foreign bank account that has been reported to the CBA..
Financing requirementsNo.
Documentation requirementsNo.
Export licensesNo.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Investment-related payments
Prior approvalFor the transfer of dividends and profits, a declaration to the CBA is required.
Indicative limits/bona fide testInterest payments on all types of foreign loans may be effected if a permit has been obtained from the CBA for the loan. As regards profits and dividends, financial statements should be submitted to the CBA indicating the amount involved. In the case of depreciation of direct investments, a special license is required if the amount of the transaction exceeds the authorized ceiling.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsUnless specifically exempted, within eight working days, proceeds must be converted into local currency, credited to a foreign currency account with a local foreign exchange bank, or deposited in a foreign bank account that has been reported to the CBA.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsTransactions of less than Af. 300,000 or its equivalent a year for natural persons and Af. 750,000 a year for juridical persons (excluding commercial banks and institutional investors) may be carried out without CBA authorization. These ceilings are applicable to all capital transactions with nonresidents; a special foreign exchange license issued by the CBA is required for capital transactions exceeding these ceilings.
Controls on capital and money market instrumentsThere are controls on all these transactions.
Controls on derivatives and other instrumentsThere are controls on all these transactions.
Controls on credit operationsThere are controls on all these transactions.
Controls on direct investment
Outward direct investmentThe CBA may require divestment, repatriation, and surrender of proceeds to the CBA..
Inward direct investmentYes.
Controls on liquidation of direct investmentYes.
Controls on real estate transactions
Purchase abroad by residentsYes.
Purchase locally by nonresidentsYes.
Sale locally by nonresidentsYes.
Controls on personal capital transactionsPersonal capital transactions must be effected through the banking system.
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Settlements of debts abroad by immigrantsYes.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial creditsEffective May 1, 2005, a foreign exchange license is required for loans granted by commercial banks to nonresidents exceeding the amount of Af. 1,000,000 a year or its equivalent, as well as for certain transfers or sales of local financial instruments, such as loans, bonds, and notes to nonresidents.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsYes.
Liquid asset requirementsYes.
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsYes.
Liquid asset requirementsYes.
Investment regulations
In banks by nonresidentsThe CBA’s prior approval is required for any investor to hold or acquire a qualified holding in a bank or insurance company.
Open foreign exchange position limits
On resident assets and liabilitiesBanks are not allowed to have a negative foreign exchange position.
On nonresident assets and liabilitiesBanks are not allowed to have a negative foreign exchange position.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on investment portfolio held abroadAccording to the 40%-60% investment rule, a progressive scale is used to determine the required limit on investment abroad. Institutional investors are not allowed to invest abroad more than approximately 60% of their total liabilities for the first Af. 10 million or its equivalent. The limit is 50% for the second Af. 10 million in liabilities and 40% for the remaining funds.
Currency-matching regulations on assets/liabilities compositionNo significant currency exposures are allowed.
Pension funds
Limits (max.) on investment portfolio held abroadThe regulations related to insurance companies apply.
Currency-matching regulations on assets/liabilities compositionNo significant currency exposures are allowed.
Investment firms and collective investment funds
Limits (max.) on investment portfolio held abroadThe regulations related to insurance companies apply.
Currency-matching regulations on assets/liabilities compositionInvestment companies do not yet fall under CBA supervision.
References to legal instruments and hyperlinksn.a.
Changes during 2005
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsMay 1. A foreign exchange license is required for loans granted by commercial banks to nonresidents exceeding the amount of Af. 1,000,000 a year or its equivalent, as well as for certain transfers or sales of local financial instruments, such as loans, bonds, and notes to nonresidents.

AUSTRALIA

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: July 1, 1965.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsPursuant to UN Security Council resolutions and bilateral sanctions regimes, restrictions apply to certain financial transactions.
In accordance with IMF Executive Board Decision No. 144-(52/51)Yes.
In accordance with UN sanctionsPursuant to UN Security Council sanctions, financial restrictions are imposed on certain listed persons or entities with a connection to the following countries: the Islamic Republic of Afghanistan (Al-Qaida and the Taliban), Côte d’Ivoire, Democratic Republic of the Congo, Iraq (Hussein regime), and Liberia. Relevant legislation: Charter of the United Nations Act 1945 and associated Regulations; Iraq (Reconstruction and Repeal of Sanctions) Regulations; Banking (Foreign Exchange) Regulations 1959.
Pursuant to UN Security Council terrorism-related resolutions, Australia has imposed financial restrictions to counter terrorism. The list of entities and persons to which these measures apply can be found on the Consolidated List maintained by Department of Foreign Affairs and Trade (available at www.dfat.gov.au). It is prohibited for persons or entities to hold, use, or deal in those assets or to make assets available to listed persons and entities. Relevant legislation: Charter of the United Nations Act 1945 and Charter of the UN (Terrorism and Dealing with Assets) Regulations 2001; Banking (Foreign Exchange) Regulations 1959.
Australia has also instituted bilateral sanctions (not UN sanctions) against the former Federal Republic of Yugoslavia and Zimbabwe that include financial restrictions against certain entities and individuals. Financial restrictions are administered by the Reserve Bank of Australia (RBA), at the direction of the Australian government. Transactions involving the transfer of funds or payments to, by order of, or on behalf of designated entities or persons associated with the former government of the former Federal Republic of Yugoslavia (Milosevic regime) are prohibited subject to the approval of the RBA on the recommendation of the government. Transactions involving the transfer of funds or payments to, by order of, or on behalf of designated entities or persons associated with the government of Zimbabwe are also prohibited subject to the specific approval of the RBA on the recommendation of the government. Relevant legislation: the Banking (Foreign Exchange) Regulations 1959. The list of sanctions against designated individuals is available at www.rba.gov.au.
Exchange Arrangement
CurrencyThe currency of Australia is the Australian dollar. It also circulates in several other countries, including Kiribati, Nauru, and Tuvalu.
Exchange rate structureUnitary.
Classification
Independently floatingThe exchange rate of the Australian dollar is market-determined. Licensed foreign exchange dealers may deal among themselves, with their customers, and with overseas counter parties at mutually negotiated rates for both spot and forward transactions in any currency with regard to trade- and non trade-related transactions. However, the RBA retains discretionary power to intervene in the foreign exchange market. There is no official exchange rate for the Australian dollar. The RBA publishes an indicative rate of the trade-weighted index for the Australian dollar based on market observation at 9 a.m., noon, and 4 p.m. daily.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketActive trading takes place in forward and futures contracts.
References to legal instruments and hyperlinksReserve Bank Act 1959: www.comlaw.gov.au/ComLaw/Legislation/ActCompilationl.nsf/current/bytitle/C276D47C3215A796CA256F71004DA82A?OpenDocument.
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsResidents generally require an Australian financial services license (AFSL) to purchase or sell foreign currency, except when one of the following conditions is met: (1) the transaction is settled immediately, (2) the person is operating a financial business, or (3) the person is dealing on his or her own account. These exemptions allow retail purchases and sale of foreign currency for personal use. A license is not required by businesses that deal on their own account to manage a financial risk in the ordinary course of business if the dealing is not a significant part of the business. Contracts that are settled within two business days are regulated as foreign exchange contracts, whereas those that have a longer settlement period (that is, three business days or more) are regulated as derivatives.
Payments arrangements
Regional arrangementsEffective January 1, 2005, the Australia-Thailand and Australia-U.S. Free Trade Agreements went into effect.
Administration of controlThe Australian Securities and Investments Commission (ASIC) is responsible for the licensing of all financial service providers, including foreign exchange dealers that deal in foreign currency contracts. Certain exemptions apply where, for example (1) the contracts are settled immediately; (2) the person is dealing on his or her own account and is not operating on a financial services business; or (3) if it is a foreign company that is a counter party to derivatives of foreign exchange contracts, it is dealing or making a market in foreign exchange contracts for professional investors. Effective December 20, 2005, the requirement to hold a license was eliminated for foreign providers who deal or make a market in foreign exchange contracts or derivatives where the service is provided to professional investors.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)If the value of the gold being bought or sold is greater than $A 10,000 or its equivalent, there is an obligation to report the details of the transaction to the Australian Transaction Reports and Analysis Centre.
Controls on exports and imports of banknotesExportation and importation of notes and coins totaling more than the equivalent of $A 10,000 in domestic or foreign currency must be reported to customs for forwarding to the Australian Transaction Reports and Analysis Centre for purposes of countering money laundering and the financing of terrorism.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencConversion is permitted through a licensed foreign exchange dealer. It is also allowed through a person who is not licensed, provided one of the following conditions is met: (1) the transaction is settled immediately; (2) the person is not a dealer in foreign currency; (3) the person is dealing on his or her own account; or (4) it is a foreign company that is a counter party to derivatives of foreign exchange contracts, where it is dealing or making a market in foreign exchange contracts.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyConversion is permitted through a licensed foreign exchange dealer. It is also allowed through a person who is not licensed, provided one of the following conditions is met: (1) the transaction is settled immediately; (2) the person is not a dealer in foreign currency; (3) the person is dealing on his or her own account; or (4) it is a foreign company that is a counter party to derivatives of foreign exchange contracts, where it is dealing or making a market in foreign exchange contracts.
Blocked accountsOnly those accounts affected by international security restrictions or UN sanctions are blocked. If a nonresident is subject to bilateral sanctions by way of the Banking (Foreign Exchange) Regulations 1959 and holds an account in Australia, RBA approval is required for any payment made to or from that account.
References to legal instruments and hyperlinksn.a
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 measuresThere are no import-licensing requirements or quotas on imports other than the tariff quota that applies to certain cheeses and curd.
Negative listFor some products, imports are allowed only if written authorization is obtained from the relevant authorities or if certain regulations are observed. Among the goods subject to control are narcotic, psychotropic, and therapeutic substances; firearms and certain weapons; certain chemicals and primary commodities; some glazed ceramic ware; rough diamonds; and various dangerous goods. These controls are maintained mainly to meet health and safety requirements; to meet certain requirements for labeling, packaging, or technical specifications; and to satisfy certain obligations arising from Australia’s membership in international commodity agreements or to meet obligations under international trade embargoes.
Import taxes and/or tariffsMost agricultural products enter Australia duty free; the simple average applied tariff is 1.3% and the average bound is 5%. A general tariff of 5% applies to many manufactured goods, with the following exceptions. The tariff on passenger motor vehicles and certain automotive components is 10% and is scheduled to be reduced to 5% by 2010. Textiles, clothing, and footwear are subject to tariffs ranging from zero to 17.5%. Under the government’s post-2005 assistance arrangement for the textile, clothing, and footwear industry, tariffs on these products will be reduced to levels of 5% and 10% by January 1, 2010, and to 5% by January 1, 2015. Tariffs for a large range of goods have been abolished.
Tariff concessions are available under the Tariff Concession System (TCS) for most goods subject to a tariff, where it can be substantiated that there is no domestic manufacturer of substitutable goods. There are also a variety of concessions available for specific purposes, such as to accommodate split import consignments and to encourage investment in major projects.
The ANZCERTA establishes free trade in goods between Australia and New Zealand. Australia has other free trade agreements (FTAs) with Singapore, Thailand, and the United States. Under the FTAs, goods originating in Singapore are duty free, while tariffs on goods originating from Thailand and the United States are being phased out over 10 years commencing January 2005. The SPARTECA provides the Forum Island countries with nonreciprocal, duty-free access to most markets in Australia and New Zealand. All goods produced in the least developed countries and Timor-Leste may be imported free of duties and quotas.
State import monopolyNo.
References to legal instrumentsn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport prohibitions and restrictions in effect are designed to ensure quality control, administer trade embargoes, and meet obligations under international arrangements. These prohibitions are also setup to restrict the exportation of certain defense materials; regulate the exportation of goods that involve high technology and have dual civilian and military applications; maintain adequate measures of control over designated cultural property, resources, flora, and fauna; secure conservation objectives; and respond to specific market distortions abroad. Remaining controls on primary products apply mainly to food and agricultural products. Rough diamonds may be exported only to countries participating in the Kimberley Process Certification Scheme.
Export controls apply to uranium and related nuclear materials (including tantalum and mineral sands containing monazite) to ensure compliance with Australia’s nonproliferation policy obligations and safeguards regime. Restrictions also apply to certain other nuclear and related materials. Export permits for uranium and other nuclear and related materials are issued by the Department of Industry, Tourism, and Resources. Export permits are required from the Australian Radiation Protection and Nuclear Safety Agency for the export of high-activity radioactive sources. Licenses are required for exports of unprocessed wood, including wood chips. The Department of Agriculture, Fisheries, and Forestry (DAFF) administers export control powers in relation to regulated dairy products under the provisions of the Dairy Produce Act. The DAFF also administers quotas for beef and sheep meat into the restricted U.S. and EU markets. This system allows the management of exports to some markets where quantitative restrictions apply.
Cattle, sheep or goat meat, and livestock may be exported only by persons or firms licensed by the DAFF. If other countries impose quantitative restrictions on imports of meat or livestock, the DAFF may, in conjunction with industry, introduce measures to control Australian exports to conform with those restrictions. As per Australia’s 2004 WTO state-trading enterprises (STEs) notification, there are also six WTO-notified STEs in Australia that have export control powers; the Australian Wheat Board International (AWBI) is the only national body. The AWBI has veto power over licenses for the export of bulk wheat. There are also five other notified state-level export STEs for agricultural products.
With quotasAustralia has a complete ban on the export of merino ewes, their genetic material, ova, and embryos to any country other than New Zealand. However, merino breeding rams purchased at designated export auctions and semen from rams included in the National Register of Semen Export Donors (administered by the Australian Association of Stud Merino Breeders) may be exported. Sales are subject to DAFF approval and an annual quota of 800 rams a year, with a provision for up to 100 rams to be placed on a semen donor register. No ram nominated for collection of semen for export may be physically exported. The export restrictions do not apply to merino rams intended for slaughter; however, the export of these rams is subject to controls to ensure that they do not enter breeding stocks and to a legal undertaking by the exporter to ensure that these exported merino rams will be slaughtered. There is no restriction on the export of merino rams or reproductive material to New Zealand.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsThe acquisition of shares and other securities of a participatory nature, which may be affected by laws and policies on inward direct investment, may require notification to the Australian authorities. Takeovers and fund raising laws may also apply. Also, a person must have an AFSL granted by the ASIC in order to provide financial product advice; to deal in financial products (including securities, derivatives, and foreign exchange contracts that are not derivatives or a contract to exchange one currency for another that is to be settled immediately); to create a market for a financial product; to operate a registered scheme; or to provide a custodial or depository service. The licensee is subject to specific obligations under the Corporations Act, including the obligation to comply with conditions on the license.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsYes.
Sale or issue abroad by residentsYes.
Bonds or other debt securities
Sale or issue locally by nonresidentsForeign CBs, foreign governments, their agencies, and international organizations are not permitted to issue bearer securities and, when borrowing in the Australian capital market, must advise the Australian authorities of the details of each borrowing after its completion. Subject to certain disclosure requirements, overseas banks may issue securities in the wholesale capital market in amounts equivalent to $A 500,000 or more.
On money market instruments
Sale or issue locally by nonresidentsThe regulations governing bonds or other debt securities apply.
Sale or issue locally by nonresidentsThe regulations governing bonds or other debt securities apply
Controls on derivatives and other instrumentsForeign exchange dealers generally require an Australian financial services license to purchase or sell foreign currency. Certain exemptions are available where, for example (1) the foreign exchange transaction is settled immediately; (2) the person is dealing on his or her own account and is not operating a financial services business; or (3) if it is a foreign company that is a counter party to derivatives of foreign exchange contracts, it is dealing or making a market in foreign exchange contracts for professional investors.
Sale or issue locally by nonresidentsThe regulations governing bonds or other debt securities apply.
Controls on credit operations
Commercial credits
By residents to nonresidentsYes.
Financial credits
By residents to nonresidentsYes.
Controls on direct investment
Inward direct investmentControls apply to (1) investments in banking, real estate, mass circulation and ethnic newspapers, broadcasting (including television), civil aviation, and uranium; (2) proposals falling within the scope of Australia’s Foreign Acquisitions and Take-overs Act 1975, which broadly covers acquisitions of urban land, acquisitions of partial or controlling interests in Australian companies or businesses with total assets valued over $A 50 million and other arrangements relating to foreign control of companies and businesses; (3) proposals to establish new businesses or projects where the total investment is $A 10 million or more; (4) investments by foreign governments or their agencies; (5) investments to the extent that constituent states or territories of Australia exercise legislative and administrative control over such investment; and (6) ownership of Australian flag vessels, except through an enterprise incorporated in Australia.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase locally by nonresidentsControls apply to the acquisition of real estate in Australia except for the acquisition (1) of direct interests in nonresidential commercial real estate valued under $A5 million or $A 50 million where such real estate is not on the heritage list; (2) of interests in time-share schemes where the entitlement of the foreign interest and any associates is less than four weeks a year; (3) of residential real estate by approved migrants, special category visa holders, and other foreign nationals entitled to permanent residence in Australia, including Australian permanent residents not ordinarily resident in Australia and special category visa holders buying through Australian companies and trusts; (4) by nonresident Australian citizens, either directly or indirectly through Australian companies and trusts; (5) of offices and residences by foreign government missions for use as official missions or residences for staff subject to sale to Australians or other eligible purchasers when no longer being used for those purposes; (6) of minority interests in public companies and trusts whose principal assets are comprised of real estate, to the extent permitted by regulations under the Foreign Acquisitions and Take overs Act; (7) of real estate by general insurance companies operating in Australia where the acquisitions are made from the reserves of the companies and are within the prudential guidelines of the insurance commissioner; (8) by life assurance companies, representing investment of their Australian statutory funds, by Australian pension funds of foreign employers, and by foreign-controlled charities or charitable trusts operating in Australia for the primary benefit of Australians; (9) of strata-titled hotel rooms in designated hotels where each room is subject to a long-term hotel agreement; (10) of residential real estate by Australian citizens and their foreign spouses where they purchase as joint tenants; and (11) of Australian urban land by foreign-controlled responsible entities acting on behalf of managed unit trusts and other public investment schemes registered under Chapter 5C of the Corporations Law, when they are investing primarily for the benefit of fund investors or unit holders ordinarily resident in Australia.
Controls on personal capital transactions
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsTransfers may be subject to approval of the authorities in cases where the gift involves a foreign person obtaining an interest in Australian urban land.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionAn AFSL issued by the ASIC is generally required to provide financial products advice, to deal in financial products (including securities, derivatives, and certain foreign exchange contracts), to create a market for a financial product, to operate a registered scheme, or to provide custodial or depository service. The license is subject to specific obligations under the Corporations Act, including the obligation to comply with conditions of the license. Certain disclosure requirements apply in relation to retail clients. Authorized deposit-taking institutions are subject to prudential requirements, e. g., liquidity management and credit concentration.
Investment regulations
In banks by nonresidentsPrior approval from the treasurer is required for any person or group—domestic or foreign—to acquire a 15% or larger share in a financial sector company, including authorized deposit-taking institutions and any nonoperating holding company for these institutions in Australia.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on securities issued by nonresidentsForeign-owned life insurance companies may operate only in the form of locally incorporated subsidiaries unless prescribed by regulation to be able to operate as a branch.
Investment firms and collective investment fundsThe rules of the Australian Stock Exchange require that, to be a participating organization of the exchange, a majority of the directors must be Australian residents. This rule does not prohibit foreigners from owning participating organizations.
References to legal instruments and hyperlinksn.a
Changes during 2005
Arrangements for payments and receiptsJanuary 1. The Australia-Thailand and Australia-U.S. Free Trade Agreements went into effect.
December 20. Some dealers or market makers in derivatives and foreign exchange contracts abroad became exempt from the licensing requirement.

AUSTRIA

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: August 1, 1962.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Austria has informed the IMF of certain exchange restrictions that have been imposed under EU regulations and the relevant UN Security Council resolutions.
In accordance with UN sanctionsIn accordance with EU regulations and the relevant UN Security Council resolutions, certain restrictions are maintained with respect to certain individuals associated with Côte d’Ivoire, the Democratic Republic of the Congo, the previous government of Iraq, Liberia, Myanmar, Sudan, the former Federal Republic of Yugoslavia, and Zimbabwe. 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.
Exchange Arrangement
CurrencyThe currency of Austria is the euro.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderAustria participates in a currency union (EMU) with 11 other members of the EU: Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain. The ECB may intervene to smooth out fluctuations in the euro exchange rate.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketForward exchange transactions are permitted.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with all countries may be made either in foreign currencies or through free euro accounts.
Payments arrangements
Bilateral payments arrangements
OperativeThere are no bilateral payments agreements; however, several bilateral agreements exist for the promotion and protection of investments, which include provisions on transfers among the signatories.
Administration of controlExchange transactions are effected through Austrian banks authorized by the Financial Market Authority. (FMA)
Payments arrearsNo.
Controls on trade in gold (coins and/or bullions)No.
Controls on exports and imports of banknotesNo.
References to legal instruments and hyperlinksn.a
Resident Account
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadControls apply to deposits not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be counted as euro-denominated investments.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsAccounts of citizens of certain countries affected by EU regulations and accounts that are blocked by virtue of UN sanctions are treated differently. In the former case, regulations are addressed directly to the credit institutions of the member states, which are then responsible for taking the requisite action. This procedure applies to accounts belonging to certain citizens of Côte d’Ivoire, the Democratic Republic of the Congo, Iraq, Liberia, Myanmar, Sudan, and Zimbabwe; individuals linked to the former Federal Republic of Yugoslavia; the Taliban; and individuals and organizations associated with terrorism. In the latter case, the Austrian National Bank issues official announcements (regulations) to make provisions of the UN sanctions effective under Austrian law. These official announcements are addressed to the Austrian credit institutions. This procedure applies to accounts belonging to terrorists with a residence in the EU.
References to legal instruments and hyperlinksn.a
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 measuresExport and import licenses must be issued by the Federal Ministry for Economic Affairs for industrial products and by the Federal Ministry of Agriculture and Forestry for agricultural products. As a member of the EU, Austria applies all import regulations based on the common commercial policy, i.e., import restrictions for industrial products in the textile and clothing sectors and statistical surveillance for products falling under the scope of the ECSC treaty. There are also regulations based on current EU law with regard to China for imports of some consumer products.
Positive listYes.
Licenses with quotasYes.
Import taxes and/or tariffsAustria applies the Common Import Regime of the EU.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesLicenses for exports must be obtained from the relevant ministry or, at the time of clearance, from the customs authorities. For most exports, licenses are not required. Export licenses are issued with due consideration for the provisions of relevant EU trade agreements, the fulfillment of quotas established in accordance with such agreements, and the needs of the Austrian economy
Without quotasYes.
With quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsIn some cases, there are reporting requirements to the Austrian National Bank.
On capital market securities
Shares or other securities of a participating nature
Purchase abroad by residentsControls apply to assets not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be counted as euro-denominated investments.
Bonds or other debt securities
Purchase abroad by residentsControls apply to assets not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be counted as euro-denominated investments.
On money market instruments
Purchase abroad by residentsControls apply to the purchase (1) by an insurance company of collective investment securities issued by non-EU residents if these assets are to form part of its technical provisions (other than those for unit-linked life assurance contracts); (2) of collective investment securities not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets.
On collective investment securities
Purchase abroad by residentsControls apply to the purchase (1) by an insurance company of collective investment securities issued by non-EU residents if these assets are to form part of its technical provisions (other than those for unit-linked life assurance contracts); (2) of collective investment securities not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets.
Controls on derivatives and other instruments
Purchase abroad by residentsControls apply to purchase of derivatives and other instruments and claims not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be attributed to the euro-denominated investments.
Controls on credit operations
Financial credits
By residents to nonresidentsControls apply to loans granted (1) to nonresidents, or for which the designated collateral is located abroad if the asset in question is to form part of the guarantee funds of a local branch of a non-EU insurance company established in Austria; (2) to residents outside the EU or for which the designated collateral is located outside the EU, if the asset in question is to form part of the cover of the prescribed solvency margin for the local branch of a non-EU insurance company established in Austria or is to form part of the cover of technical provisions of resident insurance companies; and (3) in currencies other than euros by private pension funds that would cause its total assets not denominated in euros to exceed 30% of its total assets.
Controls on direct investment
Inward direct investmentIn the auditing, accounting, engineering, architectural, and legal professions; the transport and electric power generation sectors; and the acquisition of ships, certain controls apply for investments by nonresidents and Austrian residents who are not nationals of one of the countries of the EEA..
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsControls apply to the acquisition of real estate (1) abroad if the asset in question is to form part of the guarantee funds of a local branch of a non-EU insurance company established in Austria; (2) outside the EU if the asset in question is to form part of the cover of the prescribed solvency margin for the local branch of a non-EU insurance company established in Austria or is to form part of the cover of technical provisions of resident insurance companies; and (3) outside Austria by a private pension fund, exceeding 30% of its total assets.
Purchase locally by nonresidentsThe acquisition of real estate is subject to approval by local authorities.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsReserve requirements apply only to deposits held in euros.
Liquid asset requirementsLiquid asset requirements apply only to deposits held in euros.
Open foreign exchange position limitsThe net amount of an open foreign exchange position must not exceed 30% of own funds at the end of any business day; the total sum of all open positions must not exceed 50% of own funds. The euro is not considered a foreign currency.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on securities issued by nonresidentsControls apply to the purchase by an insurance company of collective investment securities issued by non-EU residents if these assets are to form part of its technical provisions (other than those for unit-linked life assurance contracts).
Limits (max.) on investment portfolio held abroadControls apply to (1) the acquisition of real estate outside the EU if the asset in question is to form part of the cover of the prescribed solvency margin for the local branch of a non-EU insurance company established in Austria or is to form part of the cover of technical provisions of resident insurance companies; (2) the acquisition of real estate abroad if the asset in question is to form part of the guarantee funds of a local branch of a non-EU insurance company established in Austria; (3) loans granted to nonresidents, or for which the designated collateral is located abroad, if the asset in question is to form part of the guarantee funds of a local branch of a non-EU insurance company established in Austria; and (4) loans to residents outside the EU or for which the designated collateral is located outside the EU if the asset in question is to form part of the cover of the prescribed solvency margin for the local branch of a non-EU insurance company established in Austria or is to form part of the cover of technical provisions of resident insurance companies.
Limits (min.) on investment portfolio held locallyYes.
Currency-matching regulations on assets/liabilities compositionYes.
Pension fundsThe management board of the Pensionskasse ensures that the investment is performed by persons who are professionally qualified and who have the relevant professional experience, in particular in the areas of portfolio management and risk management, as well as asset liability management, and that appropriate technical resources are available for risk management. The investment must be effected within prudent limits.
The FMA determines by regulation minimum standards. In particular, it specifies minimum standards pertaining to risk management, diversification of risk, reduction of risk, asset liability management, type and content of the statements submitted by the Pensionskasse, substantiating that its risk management complies with said minimum standards and the time limit within which said substantiation shall be submitted. The FMA may order that substantiation be provided at regular intervals.
Limits (max.) on securities issued by nonresidentsControls apply to assets not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be counted as euro-denominated investments.
Limits (max.) on investment portfolio held abroadControls apply to assets not denominated in euros by a private pension fund that would cause its total assets not denominated in euros to exceed 30% of its total assets. If the exchange risk is eliminated by hedging transactions, these investments may be counted as euro-denominated investments.
References to legal instruments and hyperlinksn.a.
Changes during 2005
No significant changes occurred in the exchange and trade system.

REPUBLIC OF AZERBAIJAN

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 30, 2004.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Restrictions have been imposed on financial transactions and accounts held by individuals or organizations associated with terrorism pursuant to UN Security Council resolutions and to the list of current terrorist organizations maintained by the U.S. Secretary of State.
In accordance with UN sanctionsFinancial transactions are restricted and accounts are frozen if they involve individuals or organizations associated with terrorism pursuant to UN Security Council resolutions.
Exchange Arrangement
CurrencyThe currency of Azerbaijan is the Azerbaijan man at. On January 1, 2006, new man at banknotes were introduced, replacing the old currency at a conversion rate of 1 to 5,000. The old banknotes will continue to circulate through the end of 2006.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe exchange rate between the dollar and the man at has stayed within a 2% band and for this reason, on September 1, 2005, the exchange rate was reclassified to the category of conventional pegged arrangement from the category of managed floating with no predetermined path for the exchange rate. Most exchange transactions are effected as customer transactions.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketForward transactions are effected through the Baku Inter bank Currency Exchange. Currently, these transactions involve only dollars, euros, and Russian rubles
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsIn accordance with current legislation, settlements among residents within the country may be effected in foreign currencies only with approval from the Azerbaijan National\ Bank (ANB).
Payments arrangements
Bilateral payments arrangements
InoperativeAgreements with the CIS countries are inoperative.
Clearing agreementsAzerbaijan is a member of the Payment Union of the CIS, which is now inoperative.
Barter agreements and open accountsState-owned enterprises and enterprises in which the state has a major share of the authorized capital must register these agreements with the Ministry of Economic Development (MED).
Administration of controlThe ANB regulates foreign exchange transactions, conducts foreign currency operations, and administers official gold and convertible currency reserve holdings. The ANB also has overall responsibility for issuing licenses to deal in foreign exchange and to open foreign exchange accounts abroad; for regulating foreign exchange operations, including implementing and monitoring compliance with the law; and for establishing prudential rules governing foreign exchange operations. The MED regulates foreign trade, whereas the organization and operation of the customs agencies are regulated under the Law on Customs Services.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)Controls are administered jointly by the Cabinet of Ministers and the ANB.
Controls on external tradeA license from the MED is required to conduct international trade in gold.
Controls on exports and imports of banknotesThe exportation and importation of foreign banknotes are regulated by the ANB and the customs agencies. Banks may import and export foreign banknotes only with ANB approval.
On exports
Domestic currencyMan at banknotes maybe taken out of the country up to the maximum amount of man at 50,000
Foreign currencyResident and nonresident individuals may export up to the equivalent of $10,000 and $1,000, respectively, without documentation, or up to $50,000 in currency that they previously brought into the country.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadResident enterprises may open and use foreign exchange accounts in banks abroad, subject to ANB authorization. Enterprises must repatriate the foreign exchange held in accounts abroad (except the amount used for import payments).
There is no regulation on the opening and use of foreign exchange accounts in banks abroad by individuals.
Approval requiredYes.
Accounts in domestic currency held abroadn.r.
Accounts in domestic currency convertible into foreign currencyNatural and juridical persons may purchase foreign exchange through ADs, and ADs may also purchase foreign exchange in these markets on their own account, in accordance with the regulations of the ANB. These regulations do not set any limit.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedForeign exchange in these accounts may be transferred abroad or sold to the banks for man at. Prior to opening an account, a nonresident legal entity must provide proof of its status issued by the Ministry of justice.
Domestic currency accountsNonresident enterprises may open and operate accounts in man at and use them for domestic transactions only if they have a local branch or office.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsImport payments made more than 365 days prior to the delivery of goods or services require ANB approval; if the relevant goods are not imported, works not executed, or services not rendered, or if the prepayment is not returned within this period, the AD is required to report the transaction to the ANB and submit relevant documents.
Documentation requirements for release of foreign exchange for importsNo
Import licenses and other nontariff measures
Negative listImports of certain listed goods (such as narcotics, explosives, weapons, and nuclear substances and waste) require special approval.
Import taxes and/or tariffsTariff rates of zero, 0.5%, 3%, 10%, and 15% apply. Some capital and input goods are subject to a 5% tariff. Imports of under in voiced goods are subject to specific tariffs.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsResidents are required to repatriate all proceeds from exports within 180 days and transfer them to a licensed bank in Azerbaijan within 10 days of receipt. Expenses, commissions, and taxes paid abroad relating to economic activities may be deducted from the proceeds prior to their being transferred to a licensed bank.
Financing requirementsYes.
Documentation requirementsAll export operations must be secured by a 100% prepayment, an irrevocable LC, or a bank guarantee.
Letters of creditYes.
GuaranteesYes.
Export licenses
Without quotasExports of scrap metal are prohibited.
Export taxesYes.
Other export taxesThe export tax applies to domestic producers’ exports of crude oil and petroleum products. For crude oil, the base of the export tax is the difference between the export price (excluding export costs) and the fixed domestic price of crude oil. For petroleum products, the base is the difference between the export price (excluding export costs) and the ex-refinery price (also referred to as the inter company price) for the products. The tax rate for 2005 was 25%.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Personal payments
Quantitative limitsThese transactions are permitted, subject to documentary requirements. Residents and nonresidents are free to transfer abroad for personal reasons up to the equivalent of $500 a day from accounts with ADs on declaration of purpose. Residents are free to transfer abroad the equivalent of up to $10,000 annually, from accounts with ADs for the maintenance of close relatives (i.e., parents, spouses, children, siblings, and adopted children) on presentation of supporting documents.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsThe domestic circulation of foreign securities is subject to controls and monitoring.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase abroad by residentsThe transfer of resources requires ANB approval.
Bonds or other debt securities
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
On money market instruments>
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
On collective investment securities
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
Controls on derivatives and other instrumentsThese instruments are not currently available, and legislation concerning derivatives has not been formulated.
Controls on credit operationsCredits provided by residents to nonresidents, including financing for projects abroad, for longer than 180 days require ANB approval.
Commercial credits
By residents to nonresidentsYes.
Financial credits
By residents to nonresidentsYes.
Controls on direct investment
Outward direct investmentDirect investment abroad requires ANB approval.
Inward direct investmentEffective January 1, 2005, the minimum authorized capital for existing insurance companies is man at 2.5 billion (previously, man at 2 billion) and for newly established insurance companies, the minimum authorized capital is man at 5 billion. Direct foreign ownership may not exceed 49% of capital; indirect ownership limits are not enforced. Effective January 1, 2005, the minimum authorized capital for existing commercial banks is increased to the equivalent of $3.5 million from $2.5 million; effective January 1, 2006, it is further increased to $5 million.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsThese transactions require ANB approval.
Controls on personal capital transactions
Loans
By residents to nonresidentsLoans to nonresidents with maturities exceeding 180 days and financing for projects abroad require ANB approval.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsThese transactions are permitted, subject to documentary requirements. Residents are free to transfer abroad (1) for personal reasons, up to the equivalent of $500 a day from accounts with ADs on declaration of purpose; and (2) the equivalent of up to $10,000 annually, from accounts with ADs for the maintenance of close relatives (i.e., parents, spouses, children, siblings, and adopted children) on presentation of supporting evidence.
Settlement of debts abroad by immigrantsThese transactions are subject to documentary requirements and must be based on a court ruling.
Transfer of assets
Transfer abroad by emigrantsThese transactions require ANB approval.
Transfer of gambling and prize earnings>Gambling is prohibited in Azerbaijan.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial credits)Credits provided to nonresidents for longer than 180 days and credits to finance projects abroad require ANB approval.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsThere is a 10% reserve requirement on all deposit accounts, regardless of the currency involved. A system of reserve averaging for banks on an intra day basis applies.
Liquid asset requirementsLiquid assets must be equal to at least 30% of current obligations with maturities in the current month, regardless of the currency involved.
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsThere is a 10% reserve requirement on all deposit accounts, regardless of the currency involved, except for deposits with a maturity of over one year. Effective January 1, 2004, a system of reserve averaging for banks on an intra day basis applies.
Liquid asset requirementsLiquid assets must be equal to at least 30% of current obligations with maturities in the current month, regardless of the currency involved.
Investment regulations
Abroad by banksThese transactions are permitted with ANB approval.
Open foreign exchange position limitsThe limit on convertible currencies is 10% for each foreign currency, up to an aggregate limit of 20%. The limit on nonconvertible currencies is 7% for each currency, up to an aggregate limit of l5%.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksn.a
Changes during 2005
Exchange arrangementSeptember 1. The exchange rate was reclassified to the category of conventional pegged arrangement from the category managed floating with no predetermined path for the exchange rate.
Capital transactions
Controls on direct investmentJanuary 1. The minimum authorized capital requirement for existing commercial banks was increased to the equivalent of $3.5 million from $2.5 million.
January 1. The minimum authorized capital requirement for existing insurance companies was raised to man at 2.5 billion from man at 2 billion and for newly established insurance companies, the minimum authorized capital is man at 5 billion.
Changes during 2006
Exchange arrangementJanuary 1. The new manat banknotes were introduced, replacing the old currency at a conversion rate of 1 to 5,000. The old banknotes will continue to circulate through the end of 2006.
Capital transactions
Controls on direct investmentJanuary 1. The minimum authorized capital requirement for existing commercial banks was increased to the equivalent of $5 million from $3.5 million.

THE BAHAMAS

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: December 5, 1973.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of The Bahamas is the Bahamian dollar.
Other legal tenderCommemorative gold coins in denominations of B$10, B$20, B$50, B$100, B$150, B$200, B$250, B$1,000, and B$2,500 and silver coins denominated B$10 and B$25 are legal tender but do not circulate. The U.S. dollar circulates concurrently with the Bahamian dollar.
Exchange rate structure
DualIn addition to the official exchange market, there is a market in which investment currency may be negotiated among residents through the Central Bank of the Bahamas (CBB); the current premium bid and offer rates are 20% and 25%, respectively. The use of investment currency is prescribed for the purchase of foreign currency securities from nonresidents and direct investments outside The Bahamas. In certain circumstances, the CBB may also permit residents to retain and use foreign currency from other sources to make such outward investments. Certain external investments (including investment in foreign stocks by company-based retirement funds) may be effected at the official exchange rate without paying the investment currency premium.
Classification
Conventional pegged arrangementThe Bahamian dollar is pegged to the U.S. dollar, the intervention currency, at par. Buying and selling rates for the pound sterling are also officially quoted, with the buying rate based on the rate in the New York market; the selling rate is 0.5% above the buying rate. The CBB deals only with commercial banks. For transactions with the public, commercial banks are authorized to charge a commission of O.50% buying and 0.75% selling per US $1, and 0.50% buying or selling per £1.
Exchange taxA stamp tax of 1.5% is applied to all outward remittances.
Exchange subsidyNo.
Forward exchange marketCommercial banks may provide forward cover for residents who are due to receive or must pay in foreign currency under a contractual commitment. Commercial banks may not, however, sell foreign currency spot to be held on account to cover future requirements without the CBB’s permission. ADs may deal forward in foreign currency with nonresidents without prior approval from the CBB. Commercial banks may execute forward deals among themselves at market rates, but they must ensure when carrying out all forward cover arrangements that their open spot or forward position does not exceed the equivalent of B $500,000 long or short.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsThe exchange control system of The Bahamas makes no distinction among foreign territories. Settlements with residents of foreign countries may be made in any foreign currency or in Bahamian dollars through an external account. Foreign currency is defined as all currencies other than the Bahamian dollar.
Payments arrangements
Regional arrangementsThe Bahamas is a member of CARICOM, but it does not participate in the common market.
Administration of controlExchange control is administered by the CBB, which delegates to ADs the authority to approve allocations of foreign exchange for certain current payments, including payments for imports up to the equivalent of B$500,000. The approval authority for cash gifts up to the equivalent of b$10,000 a year is delegated to authorized banks.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents, other than ADs, are not permitted to hold or deal in gold bullion. However, residents who are known users of gold for industrial purposes may, with the approval of the CBB, meet their current industrial requirements. There is no restriction on residents’ acquisition or retention of gold coins
Controls on external tradeADs are not required to obtain licenses for bullion or coins, and no import duty is imposed on these items. Commercial imports of gold jewelry do not require a license and are duty-free, although a 10% stamp tax is required. A 1.5% stamp tax payable to customs is also required on commercial shipments of gold jewelry from any source.
Controls on exports and imports of banknotes
On exports
Domestic currencyA traveler may export banknotes up to a total of B$200.
Foreign currencyBahamian travelers need CBB approval to export foreign banknotes.
On imports
Domestic currencyImportation is subject to CBB approval.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedPermission from the CBB is required to open and hold these accounts. Permission is normally granted to persons earning substantial amounts of foreign exchange who make regular payments abroad.
Held domesticallyYes.
Approval requiredYes.
Held abroadYes.
Approval requiredYes.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be credited with payments in foreign currency from residents of The Bahamas with the specific permission of the CBB, payments in foreign currency from nonresidents, and foreign currency receipts arising from dealings between nonresidents and ADs. These accounts may be interest-bearing. Accounts may be debited for payments to residents or nonresidents, for payments to other foreign currency accounts, and for payment of foreign currency costs involved in dealings between nonresidents and ADs.
Approval requiredYes.
Domestic currency accountsWith the prior approval of the CBB, authorized banks may also open external accounts in Bahamian dollars for nonresident companies that have local expenses in The Bahamas and for nonresident investors. Authorized banks may freely open external accounts denominated in Bahamian dollars for winter residents and for persons with residency permits who are not gainfully employed in The Bahamas. Foreign nationals who have been granted temporary resident status are treated in some respects as nonresidents but are not permitted to hold external accounts in Bahamian dollars. External accounts in Bahamian dollars are normally funded entirely from foreign currency originating outside The Bahamas, but income from registered investments may also be credited to these accounts with the approval of the CBB.
Convertible into foreign currencyYes.
Approval requiredNonresidents may maintain external Bahamian dollar accounts with ADs with CBB permission.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsPrior approval from the CBB is required to make payments for non-oil imports exceeding the equivalent of B$500,000, irrespective of origin, except in the Family Islands, where this authority is delegated to clearing bank branches. This approval is normally given automatically on submission of pro forma invoices or other relevant documents proving the existence of a purchase contract.
Import licenses and other nontariff measures
Negative listThe importation of certain commodities is prohibited or controlled for social, humanitarian, or health reasons. For all imports of agricultural products, a permit must be obtained from the Ministry of Agriculture. All other goods may be imported without a license. Customs entries are subject to a stamp tax of 7%.
Import taxes and/or tariffsImport duties vary from zero to 210%. The tariff rate on most goods is 35% and the average tariff rate is 31%. Stamp duties on imports vary from 2% to 7%. There is no import duty on certain tourist-related goods, but these goods are subject to stamp duties ranging from 8% to 20%.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsThe proceeds of exports must be offered for sale to an AD as soon as the goods have reached their destination or within six months of shipment; alternatively, export proceeds may be used in any manner acceptable to the CBB.
Financing requirementsNo.
Documentation requirementsNo.
Export licenses
Without quotasExport licenses are not required, except for craw fish, conch, and arms and ammunition.
Export taxesYes.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersThere are no restrictions on current payments. However, there are limits on the approval authority delegated to commercial banks by the CBB. ADs may make payments to nonresidents on behalf of residents for certain services and other invisibles, such as commissions, royalties, education, and non-life insurance premiums, within specified limits. CBB approval is required for payments in excess of those limits or for categories of payments not delegated. A CBB-issued “Personal Allowance” card must be presented to ADs to record foreign currency purchases.
Trade-related payments
Prior approvalCBB approval is required for transactions over B$25,000 for unloading and storage costs and commissions.
Indicative limits/bona fide testYes.
Investment-related payments
Prior approvalFor all investments with approved status, permission is given upon application for the transfer.
Payments for travel
Prior approvalYes.
Quantitative limitsADs may provide up to B$10,000 or its equivalent a person a trip for tourism and other personal travel. The limit on travel for educational purposes is B$10,000 a person a trip. For business or professional travel, the limit is B$50,000 a person a year. The allowance for tourist travel excludes the cost off areas and travel services, which is normally paid in Bahamian dollars to a travel agent in The Bahamas. Foreign exchange obtained for travel and any unused balance must be surrendered within one week of issue or, if the traveler is still abroad, within one week of returning to The Bahamas.
Indicative limits/bona fide testYes.
Personal payments
Quantitative limitsADs may provide up to B$25,000 or its equivalent for education payments to institutions (B$2,500 a transaction if paid to the student), family maintenance, and alimony payments. CBB approval is required for amounts exceeding this limit. There is no limit for medical expenses.
Indicative limits/bona fide testYes.
Foreign workers’ wages
Prior approvalYes.
Quantitative limitsThe limit is 50% of wages and salaries.
Indicative limits/bona fide testIf commitments outside The Bahamas are more than 50% of wages and salaries, additional amounts may be remitted. Temporary residents may also repatriate all of their accumulated savings resulting from their employment in The Bahamas.
Credit card use abroad
Prior approvalApproval is required for residents to hold an international credit card with a limit exceeding the equivalent of B$25,000. Cards may not be used to pay for life insurance premiums and capital items.
Indicative limits/bona fide testCredit card transactions are subject to bona fide tests.
Other payments
Prior approvalPrior approval from the CBB is required for payments exceeding the equivalent of B$25,000 for professional services charges, subscriptions, membership fees, royalties, registration of patents, serial rights, and advertising.
Quantitative limitsYes.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsResidents are obliged to collect all proceeds without delay.
Surrender requirementsAll foreign currency proceeds must be offered for sale to an AD upon receipt.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsAll outward capital transfers require exchange control approval, and outflows of resident-owned capital are restricted. Inward transfers by nonresidents, which are encouraged, are required to be processed through the exchange control approval procedure, although the subsequent use of the funds in The Bahamas may also require authorization.
On capital market securitiesThe Mutual Funds Act and a regulation that provides for licensing of mutual fund administrators and the registration of mutual funds are enforced. The Securities Industry Act authorizes the Securities Commission to regulate the stock exchange and stock exchange operations.
Shares or other securities of a participating nature
Purchase locally by nonresidentsIn principle, inward investment by nonresidents is unrestricted. However, the consent of the CBB is required for the issue or transfer of shares in a Bahamian company to a nonresident and for the transfer of control of a Bahamian company to a nonresident. The extent of such approvals generally reflects the government’s economic and investment policy guidelines.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsResidents employed by offshore and foreign-based institutions in The Bahamas may invest in employee stock option/share purchase plans through the official exchange market up to the equivalent of B$10,000 a person a year, on a noncumulative basis for contributory plans. Otherwise, residents are not permitted to purchase foreign currency securities with official exchange, export proceeds, or other current earnings; payment must be made with investment currency. All purchases, sales, and swaps of foreign currency securities by Bahamian residents require permission from the CBB and are normally effected through authorized agents, who are free to act on behalf of nonresidents in relation to such transactions without any further approval from the CBB, at a 25% premium. All foreign securities purchased by residents of The Bahamas must be held by, or drawn to the order of, an authorized agent.
Sale or issue abroad by residentsSale proceeds from resident-held foreign currency securities that were registered at the CBB prior to December 31, 1972, are eligible for sale in the investment currency market. Unregistered securities may be offered for sale at the official rate of exchange.
Bonds or other debt securities
Purchase locally by nonresidentsNonresident buyers of Bahamian dollar–denominated securities must fund the acquisition of such securities from foreign currency sources. Interest, dividends, and capital payments on these securities may not be remitted outside The Bahamas, unless the holdings have been properly acquired by nonresidents.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
On money market instrumentsThe regulations governing shares or other securities of a participating nature apply.
On collective investment securitiesThe regulations governing shares or other securities of a participating nature apply.
Controls on derivatives and other instrumentsThe regulations governing shares or other securities of a participating nature apply.
Controls on credit operations
Commercial credits
By residents to nonresidentsA resident company wholly owned by nonresidents is not allowed to raise fixed capital in Bahamian dollars, although approval may be granted to obtain working capital in local currency. If the company is partly owned by residents, the amount of local currency borrowing for fixed capital purposes is determined in relation to residents’ interest in the equity of the company. Banks and other lenders resident in The Bahamas must have permission to extend loans in domestic currency to any corporate body (other than a bank) that is also resident in The Bahamas but is controlled directly or indirectly by nonresidents. However, companies set up by nonresidents primarily to import and distribute products manufactured outside The Bahamas are not allowed to borrow Bahamian dollars from residents for either fixed or working capital; instead, they must provide all their financing in foreign currency. Foreign currency loans are normally permitted on application.
To residents from nonresidentsResidents other than authorized banks must obtain permission to borrow foreign currency from nonresidents, and ADs are subject to exchange control direction of their foreign currency loans to residents. Residents must also obtain permission to pay interest on, and to repay the principal of, foreign currency loans by conversion of Bahamian dollars. When permission is granted for residents to accept foreign currency loans, it is conditional upon the currency being offered for sale without delay to an AD, unless the funds are required to meet specifically authorized payments to nonresidents.
Financial credits
By residents to nonresidentsYes
To residents from nonresidentsYes
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsYes
To residents from nonresidentsYes
Controls on direct investment
Outward direct investmentThe use of official exchange for direct investment abroad is limited to B$1 million a person or entity, with an overall limit of B$5 million a transaction, which may be met once every three years. This limit is in respect to investments from which the additional benefits that are expected to accrue to the balance of payments from export receipts, profits, or other earnings within 18 months of the investment will at least be equal to the total amount of investment and will continue thereafter. Investments abroad that do not meet the above criteria may be financed by foreign currency borrowed on suitable terms, subject to individual approval from the CBB; by foreign currency purchased in the investment currency market; or by the retained profits of foreign subsidiary companies. Permission is not given for investments that are likely to have adverse effects on the balance of payments.
Inward direct investmentCBB approval is required. Foreign investments in domestic insurance companies and pension funds are not permitted.
Controls on liquidation of direct investmentIn the event of a sale or liquidation, nonresident investors are permitted to repatriate the proceeds, including any capital appreciation, through the official foreign exchange market.
Controls on real estate transactions
Purchase abroad by residentsResidents require the specific approval of the CBB to buy property outside The Bahamas; such purchases, if for personal use, may be made only with investment currency, and approval is limited to one property a family. Incidental expenses connected with the purchase of property for personal use may normally be met with investment currency. Expenditures necessary for the maintenance of the property or arising directly from its ownership may, with permission, be met with foreign currency bought at the current market rate in the official foreign exchange market.
Purchase locally by nonresidentsForeigners intending to purchase land for commercial purposes or property larger than five acres in size must obtain a permit from the Investments Board. If such an application is approved, payment for the purchase may be made either in Bahamian dollars from an external source or in foreign currency. Nonresidents wishing to purchase property for residential purposes may do so without prior approval but are required to obtain a Certificate of Registration from the Investments Board on completion of the transaction.
Sale locally by nonresidentsApproval from the CBB is required.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
Settlement of debts abroad by immigrantsYes.
Transfer of assets
Transfer abroad by emigrantsThe maximum amount an emigrant may transfer abroad is the equivalent of B$125,000 a family a year. Excess amounts may be approved by the CBB on an individual basis.
Transfer of gambling and prize earningsResidents are not allowed to remit funds earned from gaming.
References to legal instruments and hyperlinksn.a.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadYes.
Lending to nonresidents (financial or commercial credits)Prior exchange control approval is required if local real estate is offered as a security.
Lending locally in foreign exchangeExchange control approval is required to make loans to residents.
Open foreign exchange position limitsThe limit is B$500,000 or its equivalent for both long and short positions.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksn.a.
Changes during 2005
No significant changes occurred in the exchange and trade system.

KINGDOM OF BAHRAIN

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: March 20, 1973.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Measures have been taken to combat the financing of terrorists and terrorism, including the freezing of assets of certain individuals and organizations, pursuant to UN Security Council resolutions, and the Bahrain Monetary Agency (BMA) has required all licensed banks to ensure diligence in examining their financial dealings with certain persons and organizations.
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of the Kingdom of Bahrain is the Bahrain dinar.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe dinar is pegged to the dollar at the rate of BD 1 per $2,659. The BMA provides daily recommended rates to banks for transactions involving amounts up to BD 1,000 in dollars. The BMA does not deal with the public. In their dealings with the public, commercial banks are required to use the BMA’s rates for dollars. The banks’ rates for other currencies are based on the BMA’s dollar rates and the New York market rates against the dollar.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThe BMA monitors the forward exchange transactions of commercial banks through the open position of banks’ monthly returns.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsAll settlements with Israel are prohibited. Otherwise, no requirements are imposed on exchange payments or receipts.
Payments arrangements
Bilateral payments arrangements
OperativeA free trade agreement was signed with the United States on January 11, 2006.
Regional arrangementsBahrain is a member of the GCC Customs Union.
Administration of control. There is no exchange control legislation.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on external tradeImports of gold jewelry are subject to a 5% customs duty, but gold ingots are exempt. Brokers doing business in gold and other products must obtain BMA approval before they can register with the Ministry of Commerce.
Controls on exports and imports of banknotesThe Directorate General of Customs maintains records on detections of imports and exports of currency or negotiable instruments exceeding the permitted limits and forwards the information to the BMA for further investigation.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Domiciliation requirementsIf such documents are not available, imported goods may be released with a written promise to submit the documents at a later date.
Import licenses and other nontariff measures
Negative listLicenses are required for imports of arms, ammunition, and alcoholic beverages. All imports from Israel are prohibited. Imports of a few commodities are prohibited from all sources for reasons of health, public policy, or security. Imports of cultured pearls are prohibited.
Other nontariff measuresMandatory government procurements give preference to goods produced in the Kingdom of Bahrain and member countries of the GCC, provided the quality and prices of these goods are within specified margins of the prices of imported substitutes (10% for goods produced in Bahrain and 5% for goods produced in member countries of the GCC).
Import taxes and/or tariffsAll imported goods, with the exception of vegetables, fruits, fresh and frozen fish, meat, books, and magazines, are subject to a customs duty of 5%. Ad valorem rates of 100% apply on tobacco products and 125% on alcoholic beverages, although evaluations based on quantity or weight may result in higher specific duties.
State import monopolyNo.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsIn accordance with the GCC Common Customs Law, exports of goods are subject to documentation requirements.
Export licensesAll exports to Israel are prohibited.
Export taxesNo.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsProceeds from invisibles from Israel are prohibited.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo exchange control requirements are imposed on capital receipts or payments by residents or nonresidents, but transactions in money market instruments are regulated to prevent and prohibit money laundering. Payments may not be made to or received from Israel.
On capital market securities
Shares or other securities of a participating natureGCC nationals are allowed to own up to 100% and non-GCC nationals up to 49% of the listed shares of a Bahraini joint-stock company. The percentage of ownership by non-GCC nationals may be increased, subject to approval from the Minister of Commerce and Industry. However, non-GCC nationals may purchase, sell, or own up to 100% of the shares of the following seven companies: Arab Banking Corporation, Bahrain International Bank, Investcorp Bank, Bahrain Middle East Bank, Taib Bank, Shamil Islamic Bank, and Arab Insurance Group. Purchases, sales, and ownership of shares are subject to the requirements of the Anti-Money Laundering Law.
Sale or issue locally by nonresidentsAlthough residency in Bahrain is not required, local sales and issues by nonresidents are subject to BMA regulations, the Commercial Companies Law, the Bahraini Stock Exchange (BSE) Law, and the law on prevention and prohibition of money laundering.
Purchase abroad by residentsThere are no restrictions on these transactions, provided that the regulations of the foreign jurisdiction concerned are satisfied.
Sale or issue abroad by residentsThe regulations governing purchases abroad by residents apply.
Bonds or other debt securitiesThe issuance of bonds and other debt securities is subject to BMA regulations and the Commercial Companies Law. Sales of listed bonds and other debt securities are subject to the BSE Law.
Sale or issue locally by nonresidentsThe regulations governing the sale or issue locally of shares or other securities of a participating nature by residents apply.
Purchase abroad by residentsThe regulations governing the purchase abroad of shares or other securities of a participating nature by residents apply.
Sale or issue abroad by residentsYes.
On money market instrumentsControls apply to all transactions in money market instruments.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investmentDirect investments are regulated in accordance with the Commercial Companies Law, BMA regulations, the BSE Law (subject to the field of investment), and the Anti-Money Laundering Law.
Inward direct investmentGCC nationals are allowed to own up to 100% of the shares of domestic enterprises. Non-GCC nationals are allowed to own up to 100% of the shares of domestic (locally incorporated) companies and branches of foreign incorporated companies, with the exception of a small number of activities contained in the “negative list,” and those restrictions that apply to the ownership of publicly listed companies. Disclosure standards require listed companies to notify the BMA of developments or changes in their paid-up capital, including (1) when one holder’s ownership of the issued and paid-up capital reaches 5% or more, (2) when ownership reaches 10% or more (this requires prior BMA approval), or (3) when ownership reaches 10% or more and the holder wishes to purchase more shares (this also requires prior approval and is subject to a limit of 20%).
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase locally by nonresidentsThere are no restrictions on ownership of real estate by GCC nationals (either natural or juridical persons). Nonresidents (both natural and juridical persons) are allowed to own buildings and property only in locations specified in Council of Ministers Regulation No. 5/2001, which include most of the prestigious and tourist areas. Commercial, tourism, and industrial companies, as well as banking and financial institutions that are licensed to operate in Bahrain, may own real estate without restriction.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsBanks are subject to special rules regarding the payment of dividends and the remittance of profits without exchange control restrictions. Licensed offshore banking units may engage freely in transactions with nonresidents, although transactions with residents are not normally permitted.
Lending to nonresidents (financial or commercial credits)Yes
Differential treatment of deposit accounts in foreign exchangeYes.
Reserve requirementsYes.
Differential treatment of deposit accounts held by nonresidentsYes.
Reserve requirementsYes.
Open foreign exchange position limitsBanks are allowed to set their own individual limits.
Provisions specific to institutional investorsNo.
References to legal instruments and hyperlinksn.a
Changes during 2005
No significant changes occurred in the exchange and trade system.
Changes during 2006
Arrangements for payments and receiptsJanuary 11. A free trade agreement was signed with the United States.

BANGLADESH

(Position as of March 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: April 11, 1994.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2005 Article IV consultation with Bangladesh states that as of June 7, 2005, Bangladesh maintained a restriction on the convertibility and transferability of proceeds Of current international transactions in nonresident taka accounts. (Country Report No. 05/241)
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Banks and other financial institutions have been instructed to block all capital transfers and to freeze financial assets of individuals, groups, and organizations associated with terrorism, pursuant to the relevant UN Security Council resolutions.
In accordance with UN sanctionsIn accordance with the relevant UN Security Council resolutions, all settlements with the Taliban and the former government of Iraq are prohibited.
Exchange Arrangement
CurrencyThe currency of Bangladesh is the Bangladesh taka.
Exchange rate structureUnitary.
Classification
Managed floating with no predetermined path for the exchange rateThe Bangladesh Bank (BB) intervenes in the foreign exchange market to limit undue fluctuations in the exchange rate.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketADs may buy and sell foreign-currency forwards in accordance with international practices. Effective February 25, 2004, currency swaps and forward exchange transactions are permitted only against approved commercial transactions. Also, these transactions must comply with the “Guidelines for Core Risks Management” prescribed by the BB. Effective January 4, 2005, ADs are required to cover at least 50% (previously, 100%) of their forward sales by forward purchases. The remaining portion may be covered by interbank forward purchases and spot purchases of export bills. Also, forward sales associated with swap transactions are not required to be covered by forward purchases. However, outstanding swap transactions are limited up to the open foreign exchange position limit designated for the transacting ADs.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements normally take place in convertible currencies and, in some cases, through nonresident taka accounts. Settlements with ACU member countries must be effected through the ACU and in units denominated in AMUs (equivalent in value to the dollar). Payments for imports may be made to any country (with the exception of countries from which imports are prohibited). They may be made (l)in taka for credit in Bangladesh to a nonresident bank account of the country concerned, (2) in the currency of the country concerned, or (3) in any freely convertible currency. Export proceeds must be received in freely convertible foreign exchange or in taka from a nonresident taka account.
Controls on the use of domestic currency
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 residentsYes.
Payments arrangements
Bilateral payments arrangements
OperativeThere is an operative bilateral payments arrangement with Myanmar.
Regional arrangementsBangladesh is a member of the ACU.
Clearing agreementsYes.
Administration of controlForeign exchange policy is administered by the BB in accordance with general policy formulated in consultation with the MOF. Licenses are issued to banks as ADs in foreign exchange. The Chief Controller of Imports and Exports of the Ministry of Commerce is responsible for registering exporters and importers and for issuing Import Policy Orders (IPOs). Registered importers may make their imports under the terms of the IPO against LCs. LC authorization forms (LCAFs) are issued by ADs and do not require a separate import license.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeThere are no restrictions on the internal sale, purchase, or possession of gold or silver ornaments (including coins) and jewelry, but there is a prohibition on the holding of gold and silver in all other forms except by licensed manufacturers or dentists.
Controls on external tradeThe importation and exportation of gold and silver require special permission. However, women may bring in or take out any amount of personal jewelry worn by them or brought as part of their accompanying personal luggage, without prior approval. Exports of gold jewelry and imports of gold and silver for the export or manufacture of jewelry are allowed under the Jewelry Export Scheme.
Controls on exports and imports of banknotes
On exports
Domestic currencyA resident or nonresident may take out up to Tk 500 in domestic currency.
Foreign currencyResidents may take out foreign currency and traveler’s checks up to the amount of any travel allocation they are granted, and also up to the equivalent of $5,000 brought in without declaration when returning from a previous visit abroad, and nonresidents may take out the foreign currency and traveler’s checks they declared on entry or up to the equivalent of $5,000 brought in without declaration. Foreign tourists may reconvert unspent taka at ADs on production of documentary evidence that the taka were acquired through a conversion of foreign exchange that had been brought into the country.
On imports
Domestic currencyThe importation of Bangladesh currency exceeding Tk 500 is prohibited.
Foreign currencyForeign currency traveler’s checks and foreign currency notes may be brought in freely up to the equivalent of $5,000, but larger amounts should be declared to customs on arrival in Bangladesh.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyResidents returning from abroad may bring in any amount of foreign currency and may maintain a resident foreign currency deposit account (RFCD) with the foreign exchange brought in. However, proceeds of exports of goods and services from Bangladesh or commissions arising from business deals in Bangladesh may not be credited to such accounts. Balances in these accounts are freely transferable abroad and may be used for travel in the usual manner. These accounts may be opened in dollars, euros, pounds sterling, and yen. Local and joint-venture contracting firms executing projects financed by a foreign donor or international agency may open foreign currency accounts. Returning nonresident Bangladeshis who did not open or maintain a foreign currency deposit account while abroad may open an RFCD with foreign exchange brought in from abroad within six months of the date of their return to take up permanent residence in Bangladesh. Foreign currency accounts may also be opened in the names of diplomatic missions in Bangladesh, their expatriates, the UN and its agencies, and diplomatic bonded warehouses (duty-free shops). Foreign currency accounts may be opened in the name of resident Bangladesh nationals working for foreign or international organizations operating in Bangladesh if their salaries are paid in foreign currency.
Exporters are permitted to open Exporters’ Retention Quota accounts against a certain percentage of the repatriated export proceeds.
Held abroadResidents who opened an account abroad when residing abroad may maintain it after returning to Bangladesh.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyADs may open convertible taka accounts in the names of foreign organizations or nationals (i.e., diplomatic missions, UN organizations, nonprofit international bodies, foreign contractors, and consultants) engaged for specific projects for the government or government agencies and the expatriate employees of such missions or organizations who are resident in Bangladesh. These accounts may be credited with foreign currency brought in or remitted from abroad or transferred from a foreign currency account or another convertible taka account and may be debited for (1) local payments in taka, (2) remittances abroad in convertible currency, (3) transfers to foreign currency accounts or other convertible taka accounts, and (4) credits to nonconvertible taka accounts.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedBangladesh nationals residing abroad; foreign nationals, companies, and firms registered or incorporated abroad; banks and other financial institutions, including institutional investors; officers and staff of Bangladesh missions, government institutions, autonomous bodies, and commercial banks posted abroad or seconded to international or regional agencies may open and maintain during their assignment abroad nonresident foreign currency deposit accounts that bear interest and are denominated in dollars, euros, pounds sterling, or yen. These accounts may be credited in initial minimum amounts equivalent to $1,000 ($25,000 for foreigners) with remittances in convertible currencies and transfers from existing foreign currency deposit accounts maintained by Bangladesh nationals abroad. The accounts bear interest if their terms range from one month to one year. The balance, including interest earned, may be transferred in foreign exchange by the account holder to any country or to any foreign currency deposit account maintained by Bangladesh nationals abroad. The balances in the accounts, which are freely convertible into taka, must be reported monthly by banks to the BB. The accounts may be maintained as long as the account holders desire. Nonresident Bangladesh nationals who did not open or maintain a foreign currency deposit account while abroad may open an RFCD with foreign exchange brought in from abroad within six months of the date of their return to take up permanent residence in Bangladesh.
All nonresident accounts are regarded for exchange control purposes as accounts related to the country in which the account holder is a permanent resident. (The accounts of the UN and its agencies are treated as resident accounts.)
Domestic currency accountsForeign missions and embassies and their expatriate personnel, foreign airline and shipping companies, and international nonprofit organizations in Bangladesh may open interest-bearing convertible taka accounts, but the interest earned may be disbursed in local currency only. Taka accounts of individuals, firms, or companies residing outside Bangladesh are designated as nonresident accounts. For portfolio investments in Bangladesh through the stock exchange, a nonresident may open a nonresident investor’s taka account (NITA) with any AD with foreign exchange remitted from abroad through normal banking channels or through transfer of funds from a foreign currency account. Effective November 15, 2005, the balance in the NITA may be used freely to buy Bangladesh shares and other securities. These balances are also freely transferable to foreign currency accounts opened in the names of(l) Bangladesh nationals residing abroad and Bangladesh nationals working and earning abroad, including self-employed Bangladesh migrants residing abroad; (2) foreign nationals residing abroad or in Bangladesh; (3) foreign firms registered abroad and operating in Bangladesh or abroad; and (4) foreign missions and their expatriate employees. Also, balances in these accounts are remittable abroad in equivalent foreign exchange.
Convertible into foreign currencyFunds from NITAs and convertible taka accounts may be converted freely.
Blocked accountsAmounts in nonresident taka accounts covering unapproved payments may be blocked By the BB.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsEffective January 1, 2005, advance payments for permissible imports of goods and services may be effected by ADs without prior BB permission against a repayment guarantee from a bank abroad. However, advance payments of up to the equivalent of $2,500 for imports of books, journals, or lifesaving medicines do not require any repayment guarantee. Previously, advance payments for up to $2,500 could be made for certain imports. The BB also allowed other advance payments covering imports of specialized or capital goods, usually against a guarantee from a first-class overseas bank.
Documentation requirements for release of foreign exchange for importsEffective December 15, 2005, instructions have been issued to ADs to avoid irregularities during importation through land ports: (1) only one port of entry (land port) is to be named in the LC; (2) a copy of the LC and subsequent amendments, if any, including other relevant information, are to be sent to the land port authority; (3) specimen signatures of the officials working at the import-export desks of the ADs concerned along with their contact phone and fax numbers are to be supplied to all land ports of Bangladesh; (4) a list regarding entry of goods into Bangladesh, a certified invoice, and a bill of entry evidencing entry of goods into Bangladesh are to be collected directly from the concerned land ports by ADs’ agents or representatives. Effective initiative is to be taken to create and maintain a database that may be accessed by all ADs; (5) the LC should not contain any reimbursement or debit authority; rather, it should stipulate the following payment terms: “on receipt of documents complying with credit terms, we shall effect payment as per instructions of negotiating bank or collecting bank”; and (6) LCs covering value more than $5,000 or its equivalent should be sent through Society for World-Wide Interbank Financial Telecommunications to the advising bank.
Domiciliation requirementsYes.
Preshipment inspectionAn inspection is required for all imports, with a few exceptions.
Letters of creditPayment against imports is generally permissible only under irrevocable LCs. However, a consignment of perishable food items not exceeding $7,500 or its equivalent in value may be imported overland without LCs; capital machinery and industrial raw materials may also be imported without LCs and without limit on value. Recognized export-oriented units operating under the bonded warehouse system may import up to four months’ requirements of their raw and packing materials by establishing import LCs without reference to any export LC. They may also effect such imports by opening back-to-back LCs (either on a sight basis under the Export Development Fund, or for up to 180 days on a usance basis) against export LCs received by them. ADs may establish LCs on an f.o.b. basis without the approval of the BB, subject to certain conditions. Foreign exchange for authorized imports is provided automatically by ADs when payments are due.
Import licenses used as exchange licensesLC authorization forms are issued by ADs and do not require a separate import license.
OtherEffective March 5, 2005, ADs are not permitted to open new LCs for importers who have failed to submit bills of entry of imports or customs certified invoices as evidence of actual importation of such goods.
Import licenses and other non tariff measuresAll importers (including all government departments, with the exception of the Ministry of Defense) are required to obtain LCAFs for all imports. Under the authority of the IPO issued by the chief controller, importers are allowed to effect imports against LCAFs that are issued for imports under bilateral trade or payments agreements and for imports under tied-aid programs. LCAFs are otherwise valid worldwide, except for imports from Israel and imports transported on Israeli flag vessels, which are prohibited. Goods must be shipped within 18 months of the date of issuance of LCAFs in the case of machinery and spare parts, and 12 months in the case of all other items
Positive listItems not specified in the control list of the IPO may be imported freely, provided the importer has a valid import registration certificate.
Negative listThe control list contains 24 items in about 357 categories at the four-digit level of the Harmonized System Codes. The importation of these items is restricted or prohibited for public safety, religious, environmental, or social reasons, or if similar items are produced locally.
Open general licensesAll items not on the control list may be imported freely by registered importers.
Licenses with quotasUnless otherwise specified in the IPO, industrial units approved on a regular basis are allowed to import up to 300% of their regular import entitlement of items whose import is banned for commercial purpose and that are importable by industrial consumers only. Industrial units approved on an ad hoc basis are allowed to import up to the maximum value, not exceeding 100% of their half-yearly import entitlement.
Import taxes and/or tariffsThere are four tariff bands: zero, 7.5%, 15%, and 25%. A number of goods are subject to regulatory duties, import license fees, and infrastructure development charges.
State import monopolyNo.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementProceeds from exports must be repatriated within four months of shipment unless otherwise permitted by the BB.
Surrender requirementsExporters are required to surrender to ADs 90% of the proceeds from exports of ready-made garments and other goods with high import content, and 50% (previously, 60%) of the proceeds from exports of merchandise and computer data entry and software services. They may use retained earnings for bona fide business purposes, such as business travel abroad; establishment and maintenance of offices abroad; participation in trade fairs and seminars; and imports of raw materials, spare parts, and capital goods. Fully foreign-owned industries and joint ventures or Bangladesh industries, other than in the garment industry, located in export processing zones (EPZs) are allowed to retain 100% and 80%, respectively, of their export earnings in a foreign currency deposit account. Joint ventures and Bangladesh industries in the ready-made garment sector located in EPZs may retain 75% of their export earnings in a foreign currency deposit account.
Financing requirementsNo.
Documentation requirementsEffective March 29, 2006, besides bills of lading and airway bills issued by the carriers concerned, negotiation of export bills may also take place against Forwarders’ Cargo Receipts (FCRs) and House Air Way Bills (HAWBs) issued by freight forwarders, provided (1) the export LC and the export sale contract specifically provide for negotiation of export bills against FCR/HAWB (as the case may be) issued by a freight forwarder and (2) the freight forwarder issuing the FCR/HAWB is operating in Bangladesh with authorization from the BB under section 18A of the FER Act of 1947.
DomiciliationYes.
OtherYes.
Export licensesExports of about 16 product categories are banned; 1 is conditionally exportable. Some of these are restricted for non trade reasons, whereas others are restricted to ensure the supply in the domestic market.
Export taxesExports of jute are taxed.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersPayments for invisibles related to authorized trade transactions are generally not restricted.
Trade-related paymentsPayment abroad of commissions and remittances for operational expenses is subject to indicative limits and bona fide checks.
Prior approvalUp to 5% of export receipts (up to 33.3% in the case of books) may be remitted abroad for commissions without prior approval from the BB.
Indicative limits/bona fide testYes.
Investment-related paymentsADs are allowed to remit dividends to nonresident shareholders without prior approval from the BB on receipt of applications from the companies concerned. Applications must be supported by an audited balance sheet; a profit and loss statement; and a board resolution declaring to their head offices dividends from profits earned from foreign firms, banks, insurance companies, and other financial institutions operating in Bangladesh. These remittances are, however, subject to ex post checking by the BB.
Prior approvalNo approval is required if loan agreements have been cleared by the Board of Investment (BOI).
Indicative limits/bona fide testYes.
Payments for travel
Quantitative limitsThe indicative limit for personal travel by resident Bangladesh nationals to countries other than Bhutan, India, Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka is $3,000 a person a year or its equivalent; the allowance for air travel to these seven countries is $1,000 a year. For new exporters, the indicative limit for business travel is $6,000 a person a year or its equivalent, while established exporters are permitted to use balances held under the Export Retention Scheme (10% of exports of ready-made garments and 50% of other export proceeds). Manufacturers producing for the domestic market and importers are granted business travel allowances equivalent to 1% of turnover as declared in tax returns and 1% of the value of imports, respectively. There is an annual ceiling of $5,000 or its equivalent in both cases. Amounts in excess of these limits require documents attesting to the bona fide nature of the transaction.
Indicative limits/bona fide testyes.
Personal paymentsForeign exchange for education is available up to the cost of tuition and living expenses, as estimated by the educational institution concerned. Prior permission is not required for the remittance of fees for approved undergraduate, postgraduate, and professional courses. Foreign exchange is available for the costs of dependents abroad, after production of a certificate from the Bangladesh embassy in the country concerned, up to a reasonable level, which is based on prevailing prices.
Prior approvalPrior approval is required for the transfer of pensions.
Quantitative limitsUp to $10,000 or its equivalent may be obtained for medical expenses without prior approval. Larger amounts may be obtained with approval of the BB after submission of documents attesting bona fides.
Indicative limits/bona fide testApplications for foreign exchange for studies abroad and for family maintenance are approved on verification of their bona fide nature.
Foreign workers’ wages
Quantitative limitsForeign nationals may remit freely up to 50% of net salary in connection with service contracts approved by the government. The entire amount of their earned leave pay and savings may also be freely remitted.
Indicative limits/bona fide testYes.
Credit card use abroad
Prior approvalGeneral approval is given for credit card use by (1) exporters against the foreign exchange retention entitlement, (2) residents against the annual indicative travel entitlement, and (3) residents against balances held in resident foreign currency deposit accounts.
Quantitative limitsYes.
Other payments
Prior approvalPrior permission is not required for the remittance of royalties and technical fees by firms registered with the BOI (1) up to 6% of the cost of imported machineries or (2) up to 6% of the previous year’s sales as declared in income tax returns for ongoing concerns.
Indicative limits/bona fide testIndustrial enterprises producing for local markets may remit up to 1% of sales receipts declared in the previous year’s tax return for the purpose of training and consultancy.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsExporters of services are required to surrender to ADs 95% of the proceeds (50% in the case Of proceeds from computer services) and may use retained earnings for bona fide business purposes. Bangladesh nationals working abroad may retain their earnings in foreign currency accounts or in nonresident foreign currency deposit accounts. Unless specifically exempted by the BB, all Bangladesh nationals who reside in Bangladesh must surrender any foreign exchange coming into their possession, whether held in Bangladesh or abroad, to an AD within one month of the date of acquisition. However, returning residents may keep, in foreign currency accounts opened in their names, foreign exchange brought in at the time of return from abroad, provided the amount does not represent proceeds from exports from Bangladesh or commissions earned from business activities in Bangladesh. Residents may retain up to $5,000 or its equivalent brought into the country without declaration. Foreign nationals residing in Bangladesh for more than six consecutive months are required to surrender within one month of the date of acquisition any foreign exchange representing their earnings with respect to business conducted in Bangladesh or services rendered while in Bangladesh.
Restrictions on use of fundsRetained foreign exchange may be used for travel abroad or bona fide business purposes.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsNonresidents may buy Bangladesh securities through stock exchanges against payment in freely convertible currency remitted from abroad through banking channels.
Sale or issue locally by nonresidentsProceeds from sales, including capital gains and dividends earned on securities purchased in Bangladesh, may be remitted abroad in freely convertible currency.
Bonds or other debt securities
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
On money market instrumentsControls apply to all these transactions in money market instrument.
On collective investment securities
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsThese transactions are subject to prior approval of the Securities and Exchange Commission. If an instrument is denominated in foreign currency, prior BB approval is required.
Controls on derivatives and other instruments
Purchase locally by nonresidentsThese transactions are not allowed.
Sale or issue locally by nonresidentsThese transactions are not allowed.
Purchase abroad by residentsADs may obtain hedging abroad against exchange rate risks on underlying trade transactions.
Sale or issue abroad by residentsYes.
Controls on credit operations
Commercial credits
By residents to nonresidentsExport payments deferred for more than 120 days require BB authorization.
To residents from nonresidentsCommercial credits may be used by residents for import of industrial raw materials (180 days) and capital machinery (360 days) without prior approval.
Financial credits
By residents to nonresidentsExcept in certain cases, credits are subject to prior BB approval.
To residents from nonresidentsADs may obtain short-term loans and overdrafts from overseas branches and correspondents for a period not exceeding seven days at a time. Industrial enterprises may borrow funds or make deferred payments for imports for a period beyond 360 days, with prior BOI approval.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsOn behalf of residents, banks may issue guarantees or sureties in favor of nonresidents for permissible current transactions.
To residents from nonresidentsReceipt of guarantees or sureties by residents from abroad requires full disclosure of the underlying transaction.
Controls on direct investment
Outward direct investmentAll outward transfers of capital require approval. For resident-owned capital, approval is granted only in exceptional cases.
Inward direct investmentInvestments, except in the industrial sector, require approval. The Foreign Private Investment (Promotion and Protection) Act provides for the protection and equitable treatment of foreign private investment, indemnification, protection against expropriation and nationalization, and guarantee of repatriation of investment. There is no ceiling on private investment. Tax exemptions are granted for periods of up to nine years, depending on location.
Controls on liquidation of direct investmentLiquidation of direct investment through the NITA does not require prior BB approval. In addition, transfers of Bangladesh shares and securities from one nonresident holder to another nonresident holder do not require prior BB approval. However, proceeds from the disinvestment of nonresidents’ equity investments in unlisted public limited companies and in private limited companies may be repatriated with prior BB permission, since there may not be any established market value for such investment at the time of a disinvestment. When a nonresident liquidates investment through a sale to a resident investor, the net asset value of the shares of the company is used as the basis for calculating the repatriation of proceeds.
Controls on real estate transactions
Purchase abroad by residentsRemittances of funds for these purchases are not permitted.
Purchase locally by nonresidentsPurchases of real estate by a nonresident with funds from abroad are allowed.
Sale locally by nonresidentsRepatriation of sales proceeds are subject to prior approval by the BB, which is not normally granted.
Controls on personal capital transactions
Loans
By residents to nonresidentsThese transactions are not allowed.
To residents from nonresidentsThese transactions are not allowed, except for borrowing by industrial enterprises in accordance with BOI guidelines and/or approval.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsTransfers of title to nonresidents by way of inheritances are not restricted, but income and sales proceeds from such assets are not normally transferable abroad and are required to be used locally with prior authorization from the BB.
To residents from nonresidentsA resident Bangladesh national must obtain prior approval from the government to receive gifts or endowments from a foreign donor. Inheritances must be reported to the BB. Net current income from estates inherited abroad must be repatriated.
Settlement of debts abroad by immigrantsThese transactions are normally not allowed, except for repayments on borrowing for industrial investments in accordance with BOI guidelines.
Transfer of assetsThese transactions are not allowed, except for movable personal effects.
Transfer abroad by emigrantsThese transactions are not allowed, except for normal travel allowances for residents.
Transfer into the country by immigrantsThese transactions are permitted, subject to a requirement that transfers exceeding $5,000 or its equivalent must be declared.
Transfer of gambling and prize earningsGambling is prohibited in Bangladesh.
References to legal instruments and hyperlinksForeign Private Investment (Promotion and Protection) Act.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsEffective September 4, 2005, prior BB approval is not required for taka advances in the form of purchasing checks from foreign embassies, international organizations, or foreign nationals employed therein.
Borrowing abroadThe regulations governing financial credits apply.
Maintenance of accounts abroadThe maintenance of these accounts is subject to notification to the BB.
Lending to nonresidents (financial or commercial credits)Lending to nonresidents is not allowed, except with prior BB approval and in specific cases. Effective February 2, 2005, ADs are permitted to extend working capital facilities to type “B” (joint venture) units of EPZs for the procurement of components needed for up to four months’ worth of production on the basis of the banker-customer relationship and the customer’s ability to repay from export proceeds.
Lending locally in foreign exchangeLending is subject to prior approval from the BB. ADs are permitted to use up to 50% of nonresident foreign currency deposit balances for (1) lending to exporters for settlement of back-to-back sight LCs for imports of inputs; and (2) discounting usance bills of wholly foreign-owned (type “A”) and joint venture (type “B”) EPZ units against input supplies to exporters. Industrial enterprises may borrow funds or make deferred payments for imports for a period beyond 360 days, with prior BOI approval.
Purchase of locally issued securities denominated in foreign exchangePurchases are subject to prior approval from the BB.
Differential treatment of deposit accounts in foreign exchange
Interest rate controlsBanks are required to maintain interest rates on foreign currency deposits in line with international market rates.
Differential treatment of deposit accounts held by nonresidents
Interest rate controlsADs are authorized to allow interest payments on ACU dollar accounts maintained with ADs by their correspondent banks in other ACU member countries.
Open foreign exchange position limitsIn accordance with BB limits, ADs’ net open positions may not exceed 12.5% of their capital.
Provisions specific to institutional investorsn.a
References to legal instruments and hyperlinksn.a
Changes during 2005
Exchange arrangementJanuary 4. ADs were required to cover at least 50% (previously, 100%) of their forward sales by forward purchases.
February 23. Limit restrictions on outstanding swap transactions were relaxed. However, counterparty limits on swap transactions between ADs are to be determined according to core risk management guidelines prescribed by the BB through Banking Regulation and Policy Department Circular No. 17, dated October 17, 2003
Nonresident accountsNovember 15. The balance on NITAs may be freely used to buy Bangladesh shares and other.
Imports and import paymentsJanuary 1. Advance payments for imports of goods and services were permitted to be effected by ADs without prior BB permission against a repayment guarantee acceptable to the ADs from a bank abroad.
March 5. ADs were not allowed to open new LCs for importers who had failed to submit bills of entry of imports or customs certified invoices.
December 15. Instructions have been issued to ADs to avoid irregularities during importation through land ports.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsFebruary 2. ADs were permitted to extend working capital facilities to type “B” (joint venture) units of EPZs for the procurement of components needed for up to four months’ worth of production on the basis of the banker-customer relationship and the customer’s ability to repay from export proceeds
September 4. Prior BB approval was not required for taka advances in the form of purchasing checks from foreign embassies, international organizations, or foreign nationals employed therein.
Changes during 2006
Exports and export proceedsMarch 29 Negotiation of export bills may take place under qualifications stipulated in the relevant regulation.

BARBADOS

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 3, 1993.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Barbados is the Barbados dollar..
Other legal tenderGold coins with face values of BDS $50, BDS $100, BDS $150, BDS $200, and BDS $500 are legal tender and are in limited circulation.
Exchange rate structureUnitary
Classification
Conventional pegged arrangementThe Barbados dollar is pegged to the U.S. dollar, the intervention currency, at BDS $2 per US $1. Buying and selling rates for the Canadian dollar, euro, and pound sterling are also officially quoted on the basis of their cross-rate relationships to the U.S. dollar. The quoted rates include commission charges of O.125% buying and 1.75% selling against the U.S. dollar, and 0.1875% buying and 1.8125% selling against the Canadian dollar, euro, and pound sterling. Certain businesses are allowed to change foreign currency.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThe Central Bank of Barbados (CBB) periodically obtains forward cover in the international foreign exchange market to cover or hedge its own or the central government’s exchange risks associated with foreign exchange loans that are not denominated in U.S. dollars. Commercial banks are allowed to obtain forward cover in international markets. The CBB and commercial banks enter into swap transactions in U.S. dollars, whereas commercial banks switch freely among non regional currencies.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with residents of countries outside the CARICOM area may be made in any foreign currency or through an external account in Barbados dollars. Settlements with residents of CARICOM countries other than Jamaica, Suriname, and Trinidad and Tobago may be made in the currency of the CARICOM country. Settlements with residents of Jamaica, Suriname, and Trinidad and Tobago may be made in U.S. dollars. CBB permission is required for retail outlets to issue change in the same foreign currency in which purchases are made.
Payments arrangements
Regional arrangementsBarbados is a member of the CARICOM.
Clearing agreementsUnder clearing arrangements with regional monetary authorities, the CBB currently sells only three CARICOM country currencies: the Bahamian dollar, the Eastern Caribbean dollar, and the Belize dollar. The Trinidad and Tobago, Guyana, and Jamaica dollars float against the U.S. dollar, and the CBB sets indicative selling rates based on rates supplied by the monetary authorities of these countries. These rates are applicable only to government transactions.
Administration of controlExchange control applies to all countries, except those in the OECS, and is administered by the CBB, which delegates to ADs the authority to approve normal import payments and foreign exchange for cash gifts. Further authority is delegated to commercial banks with respect to current account transactions ranging from BDS $7,500 to BDS $250,000. Commercial banks may allow the transfer of funds to CARICOM countries with respect to all current transactions except those for which special limits or restrictions apply. Trade controls are administered by the Ministry of Commerce, Consumer Affairs, and Business Development (MCCABD). The authority to approve payments to OECS countries is delegated to ADs.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents, other than the monetary authorities, ADs, and industrial users, are not permitted to hold or acquire gold in any form other than jewelry or coins for numismatic purposes. Any gold acquired in Barbados must be surrendered to an AD, unless exchange control approval is obtained for its retention.
Controls on external tradeThe importation of gold by residents is permitted for industrial purposes and is subject to customs duties and charges. Licenses to import gold are issued by the MCCABD. Exchange control permission is required to export gold.
Controls on exports and imports of banknotes
On exports
Domestic currencyTravelers may take out up to BDS $500.
Foreign currencyTravelers may take out up to the equivalent of BDS $l,000. Nonresident visitors may export freely any foreign currency they previously brought in.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallySubject to specific conditions under delegated authority, ADs may maintain foreign currency accounts in the names of individuals and companies resident in Barbados whose annual earnings are at least BDS $50,000 and BDS $100,000, respectively. Certain receipts and payments may be credited and debited to foreign currency accounts under conditions established at the time the account is opened. Other credits and debits require individual approval. In cases where authority has not been delegated to ADs, the permission of the CBB is required. Companies operating in Barbados and earning a minimum of the foreign currency equivalent of BDS $100,000 a year are allowed to maintain foreign currency accounts up to the equivalent of BDS $50,000 without reference to the CBB.
Approval requiredApproval is given on the basis of the anticipated frequency of receipts and payments in foreign currency.
Held abroadYes.
Approval requiredYes.
Accounts in domestic currency held abroadPermission of the CBB is required.
Accounts in domestic currency convertible into foreign currencyPermission of the CBB is required.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedThe regulations governing resident accounts apply.
Domestic currency accountsThese accounts may be credited with the proceeds from the sale of foreign currencies, transfers from other external accounts, bank interest, and payments by residents for which the CBB has given general or specific permission. The accounts may be debited for payments to residents of Barbados for the cost of foreign exchange required for travel or business purposes and for any other payment covered by delegated authority to ADs. Other debits and any overdrafts require individual approval.
Convertible into foreign currencyBalances on external accounts are convertible.
Approval requiredNonresident holders of foreign currency accounts are not required to obtain central bank approval to remit funds abroad when the funds were not the result of payment for trade or non trade transactions
Blocked accountsThe CBB may require certain payments in favor of nonresidents that are ineligible for transfer to be credited to blocked accounts. Balances in blocked accounts may not be withdrawn without approval, other than for the purchase of approved securities.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsADs may release foreign exchange up to the equivalent of BDS $250,000 (c.i.f.) for advance payments for imports into Barbados. Commercial banks may allow transfers of funds to CARICOM countries with respect to prepayment of imports from CARICOM countries. Other advance payments require the prior approval of the CBB.
Documentation requirements for release of foreign exchange for importsPayments for authorized imports are permitted on application and submission of documentary evidence (invoices and customs warrants) to ADs; payments for imports of crude oil and its derivatives are subject to the approval of the CBB.
Import licenses and other nontariff measuresCertain imports require individual licenses. Some items on the import-licensing list may be freely imported throughout the year, whereas others are subject to temporary restrictions (particularly agricultural products, which tend to be subject to seasonal restrictions). Individual licenses are also required for imports of commodities that are subject to the provisions of the Oils and Fats Agreement, to which Barbados, Dominica, Grenada, Guyana, St. Lucia, St. Vincent and the Grenadines, and Trinidad and Tobago are signatories, whether the goods are being imported from CARICOM countries or from elsewhere. Special licensing arrangements have been made for the regulation of trade between Barbados and other CARICOM countries in 22 agricultural commodities.
Licenses with quotasNot all goods that are subject to licensing are subject to quantitative restrictions or import surcharges.
Import taxes and/or tariffsCustoms duties corresponding to the fourth phase of the CARICOM CET are in the range of 5% to 20%. A VAT of l5% is levied. Tariffs ranging from 20% to more than 200% apply to imports of prepared meats, detergents, and T-shirts.
State import monopolyChicken heads, backs, and necks; onions; and sugar may be imported only by the Barbados Agricultural Development and Marketing Corporation, and milk may be imported only by the Pine Hill Dairy.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsProceeds must be repatriated within six months.
Surrender requirementsProceeds must be sold to an AD within six months, but exporters may apply for exemptions.
Financing requirementsn.a.
Documentation requirementsn.a.
Export licensesSpecific licenses are required for the exportation of certain goods to any country, including rice, sugarcane, rum, molasses, certain other food products, sewing machines, Portland cement, and petroleum products. All other goods may be exported without license.
Without quotasYes
With quotasExports of sugar to the United Kingdom and the United States are subject to bilateral export quotas, as are exports of rum to the EU.
Export taxesn.a.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related payments
Prior approvalApproval is required for amounts above the quantitative limits.
Quantitative limitsCommercial banks may approve all payments for insurance, freight, advertising, commissions, and fees relating to imports. Commercial banks must report these transfers to the CBB. The limit on unloading, storage costs, and administrative expenses is BDS $250,000 a transaction.
Indicative limits/bona fide testYes.
Investment-related payments
Prior approvalYes.
Quantitative limitsThe limit for principal and interest payments is BDS $50,000 a year for individuals. Commercial banks are permitted to approve all payments abroad of profits and dividends to nonresident beneficiaries in and residents of CARICOM countries. For payments of profits and dividends to residents of non-CARICOM countries, approval is required for amounts above BDS $250,000.
Indicative limits/bona fide testYes.
Payments for travel
Quantitative limitsThe limits are BDS $7,500 a person a calendar year for private travel, and BDS $750 a day for business travel, up to BDS $50,000 a person a calendar year. Commercial banks have the authority to approve all payments for cash currency swaps by in-port ships and cruise liners.
Indicative limits/bona fide testYes.
Personal payments
Prior approvalApproval is required for amounts above the limit. Payments for medical treatment and studies abroad require approval from a commercial bank based on appropriate documentation.
Quantitative limitsThere are no limits on payments for medical treatment or studies abroad. The limit on cash gifts is BDS $5,000 a person a year; the limit for alimony and other maintenance is BDS $50,000 a person a year. Nonresidents may have their pensions remitted to them while residing outside Barbados. Commercial banks may approve all payments with respect to bequests or inheritances that are due to beneficiaries resident in CARICOM countries, under the terms of the wills of persons who were resident or under the rules governing resident intestates for exchange control purposes. Beneficiaries residing outside CARICOM are permitted to transfer abroad bequests or inheritances at the rate of BDS $100,000 a year. Commercial banks must, however, continue to report such transfers to the CBB.
Indicative limits/bona fide testYes.
Foreign workers’ wagesCommercial banks may, without prior approval of the CBB, allow transfers of funds for payment of management services provided by residents of CARICOM countries.
Prior approvalYes.
Quantitative limitsNonresidents are allowed to remit amounts to cover commitments while employed in Barbados.
Indicative limits/bona fide testYes.
Credit card use abroad
Prior approvalYes.
Quantitative limitsThe limits are the same as for travel.
Indicative limits/bona fide testYes.
Other paymentsCommercial banks are permitted to approve all payments abroad for charges and fees with respect to granting and registration of patents, designs, and trademarks. Commercial banks are permitted to approve all payments abroad for entrance and subscription fees due to nonresident credit and travel card companies.
Prior approvalApproval is required for amounts above the limit.
Quantitative limitsThe limit is BDS $50,000 for subscriptions and membership fees a person a year, and BDS $100,000 for consulting and legal fees for each nonresident beneficiary. No limits apply for subscriptions to magazines, books for personal use, returns and refunds of deposits, and reimbursements of overpaid accounts and short postage payments.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsForeign currency proceeds from invisibles must be sold to ADs.
Restrictions on use of fundsn.a
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsCapital account transactions with the ECCB area denominated in Eastern Caribbean dollars are free from controls, except for transactions in debt issues of OECS governments.
Controls on capital and money market instruments
On capital market securitiesThe Barbados Stock Exchange is authorized to approve all investments in corporate securities in the form of equities cross-listed and cross-traded on CARICOM stock exchanges.
Shares or other securities of a participating naturePurchases and sales of shares and securities of companies cross-listed and cross-traded on any CARICOM stock exchange are permitted without limit. This excludes any government securities cross-listed or cross-traded on those stock exchanges. Commercial banks in Barbados may approve all investments in private unlisted securities in CARICOM countries without the prior approval of the CBB.
Purchase locally by nonresidentsThe issuance and transfer to nonresidents of securities registered in Barbados require exchange control approval, which is freely given provided that an adequate amount of foreign currency is brought in for their purchase.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsThese purchases require exchange control approval, and certificates of title must be lodged with an authorized depository in Barbados, except for regional securities purchased through the Securities Exchange o Barbados. Earnings on these securities must be repatriated and surrendered to an AD.
Sale or issue abroad by residentsExchange control approval is required.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participating nature apply.
On money market instruments
Purchase locally by nonresidentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue abroad by residentsYes.
On collective investment securities
Purchase locally by nonresidentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue abroad by residentsYes.
Controls on derivatives and other instrumentsControls apply to all these transactions.
Controls on credit operationsThe approval of the CBB is required for all credit operations. However, ADs may approve applications by domestically owned parent companies for permission to borrow funds from CARICOM and/or non-CARICOM sources for the purpose of investing in the operations of their CARICOM subsidiaries and/or affiliates.
Controls on direct investmentDirect investments require exchange control approval.
Outward direct investmentCommercial banks are authorized to approve investments in private unlisted securities in CARICOM countries.
Inward direct investmentYes.
Controls on liquidation of direct investmentLiquidation of proceeds is permitted, provided evidence documenting the validity of the remittance is submitted, all liabilities related to the investment have been discharged, and the original investment was registered with the CBB.
Controls on real estate transactions
Purchase abroad by residentsPurchases require exchange control approval.
Purchase locally by nonresidentsNonresidents may acquire real estate in Barbados for private purposes with funds from foreign currency sources; local currency financing is not ordinarily permitted.
Sale locally by nonresidentsProceeds from the realization of such investments equivalent to the amount of foreign currency brought in may be repatriated freely. Capital sums realized in excess of his amount may be repatriated freely on the basis of a calculated annual rate of return on the original foreign investment as follows: for the past five years, at 8%; for the five years immediately preceding the past five years, at 5%; and for any period preceding the past ten years, at 4%. Amounts in excess of the sum so derived are restricted to remittances of BDS $30,000 a year.
Controls on personal capital transactions
LoansCommercial banks in Barbados may approve applications for the transfer of funds for personal loans, maintenance, and financial assistance from Barbados to CARICOM countries without prior approval from the CBB.
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsThe annual limit is BDS $5,000 for gifts, and BDS $100,000 for endowments, inheritances, and legacies.
Settlement of debts abroad by immigrantsYes.
Transfer of assets
Transfer abroad by emigrantsThe limit is BDS $100,000.
Transfer of gambling and prize earningsNonresidents may take out winnings.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadAny borrowing abroad by ADs to finance their domestic operations requires the approval of the CBB. ADs may assume short-term liability positions in foreign currencies for the financing of approved transfers with respect to both trade and non trade transactions. Effective February 21, 2005, ADs are required to sell 25% of their foreign currency borrowings to the CBB. Effective September 1, 2005, ADs may approve borrowing by domestically owned parent companies from CARICOM and/or non-CARICOM sources to invest in the operation of their CARICOM subsidiaries and/or affiliates.
Maintenance of accounts abroadAccounts must be maintained with overseas correspondent banks.
Lending to nonresidents (financial or commercial credits)Exchange control permission is required.
Purchase of locally issued securities denominated in foreign exchangeInvestment in local securities requires CBB approval.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsThe reserve requirement ratio on deposits in foreign exchange is 21%, of which 16% must be maintained in stipulated government securities and 5% in cash.
Liquid asset requirementsThere is no liquidity requirement on deposits in foreign exchange. The liquid asset requirement for domestic currency deposits in commercial banks is 17%, of which 12% must be placed in government securities and 5% in cash.
Differential treatment of deposit accounts held by nonresidentsNonresident deposit accounts are treated the same as resident deposit accounts. Differential treatment is based on whether the amount is in domestic currency.
Open foreign exchange position limitsLimits on working balances are set by the CBB. Those on other assets and liabilities are controlled through the Exchange Control Act. If a bank has a short position in forward transactions, it may maintain a long spot position equivalent to 10% of the short position in forward transactions or 5% of the gross spot liabilities, whichever is higher. If a bank does not have a short position in forward transactions, it may maintain a long spot position equivalent to 5% of the gross spot liabilities. Banks must report weekly to the Foreign Exchange and Export Credits Department of the CBB.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on investment portfolio held abroadYes.
Pension fundsApproval is required for investment of pension funds abroad. A 6% tax is levied on portfolio investments of pension funds with foreign companies that are not registered with the Barbados Supervisor of insurance.
References to legal instruments and hyperlinksn.a
Changes during 2005
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsFebruary 21. ADs were required to sell 25% of their foreign currency borrowings to the CBB.
September 1. ADs were allowed to approve borrowing by domestically owned parent companies from CARICOM and/or non-CARICOM sources to invest in the operation of their CARICOM subsidiaries and/or affiliates.

BELARUS

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 5, 2001.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2005 Article IV consultation with Belarus states that as of June 3, 2005, the authorities informed the IMF that they maintain no exchange restrictions on the making of payments and transfers for current international transactions subject to approval by the IMF Executive Board. They have provided to the IMF updated information regarding the legislation in effect, which the IMF is in the process of reviewing and assessing.
International security restrictions
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Belarus is the Belarusian rubel.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe National Bank of the Republic of Belarus (NBRB) maintains a de facto conventional peg vis-à-vis the dollar with negligible daily fluctuations. As a result, the exchange rate regime was reclassified, effective January 1, 2005, to the category of conventional pegged arrangement from the category of crawling band. At the same time, the Belarusian ruble de jure targets the exchange rate of the Russian ruble within a horizontal band (±2%). However, de facto the exchange rate of the Belarusian ruble against the Russian ruble is allowed at certain times to move in line with market trends outside the established band with a view to limiting daily fluctuations in the exchange rate of the Belarusian ruble vis-à-vis the dollar.
Exchange taxNo.
Exchange subsidyn.a
Forward exchange marketThe forward market is regulated by the same provisions as the spot market.
References to legal instruments and hyperlinksBanking Code of the Republic of Belarus; www.nbrb.by/engl/legislation/code.asp; Statute of the NBRB; www.nbrb.by/engl/legislation/statute.asp; Annual Monetary Policy Guidelines; www.nbrb.by/publications/ondkp.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements of transactions between residents and nonresidents are effected in foreign currencies. Settlements in rubles are effected if provided for by intergovernmental agreements between the CBs of both parties to the settlements. Settlements in rubles between residents and nonresidents of the countries with which such arrangements have been concluded may be effected through nonresident accounts in domestic banks or through correspondent accounts in rubles of nonresident banks with authorized banks in Belarus. Settlements with nonresidents in rubles are also allowed regardless of the existence of an intergovernmental agreement, provided settlements are effected through a nonresident rubles account at a bank in Belarus
Controls on the use of domestic currency
For current transactions and paymentsYes.
For capital transactionsYes.
Transactions in capital and money market instrumentsYes.
Transactions in derivatives and other instrumentsYes.
Credit operationsYes.
Use of foreign exchange among residentsSettlements between residents in foreign currency are prohibited, except in cases established by law.
Payments arrangements
Bilateral payments arrangements
OperativeIn accordance with the intergovernmental agreements between the NBRB and the central banks of most CIS countries (except Azerbaijan and Uzbekistan), settlements are effected in the national currencies of the parties involved in the settlements and in freely convertible currencies.
Regional arrangementsBelarus has arrangements with Moscow and various other regions in the Russian Federation.
Clearing agreementsAn agreement with Uzbekistan provides for the exchange of cotton for strategic goods from Belarus on a balanced basis. There are also agreements with Moldova and Ukraine.
Administration of controlThe exchange regulation authorities are the Council of Ministers and the NBRB, while the exchange control authorities are the Council of Ministers, the NBRB, the State Control Committee, and the State Customs Committee. The exchange control agents are banks, customs offices, bodies of the state administration, and state organizations subordinate to the government of Belarus and oblast (local) governments.
Payments arrears
OfficialYes.
PrivateIn the event of insufficient funds on a current (settlement) bank account to effect all payments, the honoring of payment documents received by a bank is effected in the order of priority established by the legislation of the Republic of Belarus.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents (other than banks) are required to have a license issued by the MOF to engage in transactions in precious metals and stones. When effecting banking operations with precious metals and stones, banks are required to have a license issued by the NBRB. Banks must obtain a license from the MOF to engage in non banking operations in precious metals and stones.
Controls on external tradeLicenses for residents to export precious metals and stones are issued by the Ministry of Trade (MOT) with the approval of the MOF.
Controls on exports and imports of banknotes
On exports
Domestic currencyResident and nonresident individuals may export up to the equivalent of 500 base units established in Belarus.
Foreign currencyResident and nonresident individuals may freely export the equivalent of$10,000; amounts greater than this require documentary evidence certifying the origin of the funds. Traveler’s checks in foreign currencies may be exported without limitation, but they must be declared. Exports of foreign currencies to states participating in the customs union are unrestricted.
On imports
Domestic currencyResident and nonresident individuals may import up to the equivalent of 500 base units established in Belarus
Foreign currencyThere are no limits on imports of foreign currency by resident and nonresident individuals, but amounts in excess of $3,000 or its equivalent must be declared on arrival.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of July 22, 2003; Regulation No. 72 for the Performance of Foreign Exchange Transactions, adopted April 30, 2004; Instruction No. 73/78 on the Procedure for the Import, Export, and Remittance of Foreign Currency, Belarusian Rubles, Payment Documents in Foreign Currency, Documentary Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions of January 4, 2000; Article 207 of the Banking Code of the Republic of Belarus; Decree No. 359 of the President of the Republic of Belarus on Approval of the Procedure for Settlements between Legal Entities and Individual Entrepreneurs in the Republic of Belarus of june 29, 2000; Decree No. 493 of the President of the Republic of Belarus on Certain Measures to Provide State Support for Legal Entities and Individual Entrepreneurs of September 24, 2002.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyWithout declaring the sources of their foreign exchange, residents may open foreign currency accounts at commercial banks authorized to deal in foreign exchange.
Held abroadYes.
Approval requiredNBRB approval is required. No approval is required for accounts used to record credit transactions. Notification is required for representative offices to open accounts in Eurasian Economic Community countries in the domestic currency of the country in which they are opened. No approval is required for accounts of individuals temporarily residing abroad.
Accounts in domestic currency held abroadNBRB approval is required to open domestic currency accounts abroad by residents.
Accounts in domestic currency convertible into foreign currencyResident legal entities may purchase foreign currency without restrictions: (1) to effect settlements with nonresidents, with the exception of settlements involving the granting of a loan to a nonresident; to purchase securities from a nonresident that have been issued by residents or nonresidents; or to purchase real property from a nonresident; (2) to pay for business travel and training expenses abroad; (3) to perform settlements with banks; and (4) to perform a number of other transactions that have been specified by the NBRB.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of July 22,2003; Instruction No. 112 on the Procedure for the Performance of Foreign Exchange Transactions Involving Legal Entities and Individual Entrepreneurs, adopted July 28, 2005; Regulation No. 72 for the Performance of Foreign Exchange Transactions, adopted April30, 2004.
Nonresident Accounts
Foreign exchange accounts permittedNonresident legal entities may maintain foreign exchange accounts with authorized banks in Belarus. The source of the funds may be receipts from abroad; proceeds from the sale of goods and services in the territory of Belarus, including sales to residents; debt-service payments; interest earned on balances on the accounts; funds from other foreign exchange accounts of nonresidents in Belarus; and earnings from investments from the performance of other operations with residents and nonresidents. These accounts may be debited for purchases of goods and services and for investments, as well as for payments to residents and nonresidents. Funds from these accounts may be freely repatriated or exchanged for rubles at the market exchange rate through authorized banks, provided rubles are placed on account with Belarusian banks.
Domestic currency accountsNonresident legal entities may open T (current) and S (investment in government securities) accounts. A nonresident may open a T account for foreign currency transactions only in the name of its representative office (branch). Transactions on a T account are performed without restriction on the type of transaction (including transactions involving the purchase and sale of foreign currency). Funds from T accounts may be used to purchase foreign currency, goods and services, bonds, shares in enterprises, privatization vouchers, and payment for current transactions. Funds in S accounts are used for investment in securities issued by the Belarusian government and the NBRB. Proceeds from the sale of freely convertible currencies and/or Russian rubles, as well as proceeds from the redemption or sale of government and NBRB securities by nonresidents, are deposited in S accounts if the original purchases were made with payments from S accounts.
Convertible into foreign currencyBalances on T and S accounts may be converted into foreign currency.
Blocked accountsNo.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of July 22, 2003; Regulation No. 994 on the Procedure for the Investment of Funds by Nonresidents in Government Securities of the Republic of Belarus and NBRB Securities, adopted September 4, 1997; Instruction No. 112 on the Procedure for the Performance of Foreign Exchange Transactions Involving Legal Entities and Individual Entrepreneurs, adopted July 28, 2005; Regulation No. 72 for the Performance of Foreign Exchange Transactions, adopted April 30, 2004.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsAdvance payments for goods or services exceeding the equivalent of $500,000 require that one of the following conditions be present: (l)a foreign bank guarantee; (2) placement of a bank deposit (for 60 days); (3) an insurance agreement to cover the risk that the advance payment will not be returned; or (4) permission from the NBRB. Permission from the MOT is required for payments for imported services more than 90 days in advance of the performance of the services and for imported goods more than 60 days in advance of the receipt of the goods. Permission from the MOT and registration with the NBRB are required for advance payments of more than 180 days.
Advance import depositsYes.
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measuresLicenses are required for imports of the following goods: (1) raw sugar, molasses, carpets and floor coverings, and malt beer (other than those imported from countries in the Customs Union (Belarus, Kazakhstan, the Kyrgyz Republic, and the Russian Federation), with which customs controls have been eliminated); and (2) other products, including white sugar, starch syrup, inactive yeast and other dead unicellular microorganisms, alcoholic beverages, margarine, and new pneumatic tires.
Negative listThere are prohibitions on imports of production and consumption wastes that cannot be processed or used in Belarus and on printed matter, audiovisual materials, and other news media containing information that may harm the political or economic interests or security of Belarus or the health and morals of Belarusian citizens.
Licenses with quotasQuantitative restrictions are applied to raw cane and sugar, alcohol, tobacco products, seafood, and fish.
Import taxes and/or tariffsBelarus has abolished customs controls and customs processing of goods originating in Belarus and the Russian Federation and trading between Belarus and the Russian Federation. Goods originating from countries with which Belarus has a free trade agreement are imported into and exported from Belarus free of duty. Regular (base) import duty rates apply to countries with MFN status. Import duties at twice the base rates are imposed on goods imported from countries that Belarus has not granted MFN status and on goods whose country of origin can not be established. Seasonal customs duties apply to certain vegetables. VAT and excise taxes are imposed on imports if provided under law. Precious metal ingots imported by banks for purposes of banking operations and by legal persons for purposes of selling to banks are exempt from customs duties and VAT; also exempt are sales by legal persons to banks, transactions between banks, and sales by banks to individuals. Effective January 1,2005, indirect taxes apply on goods imported from the Russian Federation.
State import monopolyNo.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of july 22, 2003; Decree No. 7 of the President of the Republic of Belarus on Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions, adopted January 4,2000; Instruction No. 153 on the Performance of Advance Payments under Foreign Trade Agreements, adopted August 28, 2003; Decree No. 7 of the President of the Republic of Belarus on Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions, adopted January 4, 2000; Resolution No. 440 of the Republic of Belarus Council of Ministers of April 8, 2002, on Measures to Improve Exports and Imports of Goods.
Exports and Export Proceeds
Repatriation requirementsProceeds from exports of goods and services must be repatriated within 90 days from the date of shipment, and proceeds from other exports of goods and services produced by residents under commission contracts must be repatriated within 180 days. Longer time periods require MOT permission and registration with the NBRB.
Surrender requirementsThe surrender requirement is 30%.
Restrictions on use of fundsNo
Financing requirementsNo.
Documentation requirementsNo.
Export licensesLicenses from the MOT, coordinated with the Bellegprom (Belarus Light Industry) Concern, are required for exports of the following goods: fabrics made of wool yarn; cotton thread, yarn, and fabric; thread from chemical fibers; yarn and fabric made of artificial and synthetic fibers and blended fibers; cable and rope products; terry cloth towels and similar terry cloth fabrics; interwoven interlock fabrics; socks and hosiery articles; knitted clothing and accessories; textile clothing and accessories; blankets, throws, and bed, table, bath, and kitchen linens; dishcloths; curtains, window shades, and bedspreads; sacks; paper bags; floor cleaning fabrics; and sets consisting of fabrics and yarn (only for goods to be exported to the EU and Turkey, in accordance with quotas set by the EU and Turkey). In addition, exports of the following goods are effected on the basis of licenses issued by the MOT with the approval of relevant governmental authorities: mushrooms, cranberries, blueberries, grains, flax seeds and rape seeds, alcohol products, ethyl alcohol, raw amber, burned pyrites, unprocessed lumber, precious metals and precious stones in any form or state, crude oil and oil products, rawhide and animal skins, articles made of precious metals, flour and hulled and rolled grain products, processed amber, mineral fertilizers, raw timber, wooden railroad ties, combed flax, and ferrous and nonferrous metal waste and scrap. Contracts for exports of petroleum refining products by non producers of these products must be registered with the MOT with the approval of the Belneftekhim (Belarus Petrochemical) Concern. Minimum export prices apply to steel rods, chipboard and fiberboard panels, mushrooms, cranberries, blueberries, flax fiber, mineral fertilizer, raw and sawn timber, wooden railroad ties, natural resins, table salt, evaporated milk and cream, beef, pork, white sugar, casein, oil and petroleum products, polyethylene, cattle hides, pelts, and tanned hides.
With quotasMineral fertilizers and ferrous and nonferrous metal waste are subject to export quotas and licensing requirements.
Export taxesEffective January 1, 2005, indirect taxes apply on goods exported to the Russian Federation.
Other export taxesUnder the arrangement of the common customs region with the Russian Federation, export customs duties are collected on a list of goods with a low degree of processing that are exported outside the Customs Union. Most duties are on an ad valorem basis and range from 5% to 30%. Specific and combined duties are also levied. Effective January 1, 2005, indirect taxes apply on goods exported to the Russian Federation.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of july, 2003; Decree No. 311 of the President of the Republic of Belarus on Improvement of the Foreign Exchange Surrender Procedure, adopted June 2, 1997; Decree No. 7 of the President of the Republic of Belarus on Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions, adopted January 4, 2000; Decree No. 7 of the President of the Republic of Belarus on Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions, adopted January 4, 2000; Resolution No. 440 of the Republic of Belarus Council of Ministers of April 8, 2002 on Measures to Improve Exports and Imports of Goods.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Investment-related payments
Prior approvalYes.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of july 22, 2003; Regulation No. 72 for the Performance of Foreign Exchange Transactions, adopted April30, 2004.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsProceeds from export of goods and services must be repatriated by legal persons within 90 days, and proceeds from exports of services by residents under commission contracts must be repatriated within 180 days. MOT approval is required for deferrals of 90 to 180 days. Permission from the MOT and registration with the NBRB are required for periods exceeding 180 days.
Surrender requirementsThe surrender requirement is 30% of proceeds.
Restriction to on use of fundsNo
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of july 22, 2003; Decree No. 311 of the President of the Republic of Belarus on Improvement of the Foreign Exchange Surrender Procedure adopted June 2, 1997; Decree No. 7 of the President of the Republic of Belarus on the Improvement of the Procedure for the Performance and Monitoring of Foreign Trade Transactions, adopted January 4, 2000.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsThe government and the NBRB establish quotas and procedures for clearing the securities of foreign issuers for circulation in Belarus and quotas and procedures for clearing securities of issuers under the jurisdiction of Belarus for circulation outside Belarus.
The domestic placement of stocks and bonds of foreign issuers and foreign placement of stocks and bonds of domestic issuers are permitted, subject to regulations.
On capital market securities
Shares or other securities of a participating naturePurchases or sales locally by nonresidents require registration with the securities Committee under the Council of Ministries for shares to be exported.
Purchase locally by nonresidentsYes.
Sale or issue abroad by residentsYes.
Purchase abroad by residentsA permit from the NBRB is required.
Sale or issue abroad by residentsNotification of the NBRB is required.
Bonds or other debt securitiesRegistration of securities is required. The NBRB regulates the issue of certificates of deposit (CDs) and saving certificates by banks. These may be issued both in domestic currency and in foreign exchange. Banks are not allowed to export bank certificates.
Purchase locally by nonresidentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsThe regulations governing shares or other securities of a participating nature apply.
Sale or issue abroad by residentsNotification of the NBRB is required.
On capital market instruments
Purchase locally by nonresidentsAn NBRB permit is not required. Transfers of CDs to nonresidents are prohibited.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsAn NBRB permit is required.
Sale or issue abroad by residentsNotification of the NBRB is required.
On collective investment securities
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsAn NBRB permit is required.
Sale or issue abroad by residentsNotification of the NBRB is required.
Controls on derivatives and other instruments
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase locally by nonresidentsAn NBRB permit is required.
Sale or issue locally by nonresidentsNotification of the NBRB is required.
Controls on credit operations
Commercial credits
By residents to nonresidentsThe deferral of receipt of proceeds from exports of goods and services requires approval. For deferrals of 90 to 180 days, the permit is issued by the MOT; for deferrals of more than 180 days, permits from the MOT and registration with the NBRB are required. The same procedures apply to advance payments.
Financial credits
By residents to nonresidentsAn NBB permit is required if the credit is for longer than 180 days.
To residents from nonresidentsAn NBRB permit is required for credits longer than 180 days if one of the following conditions is present: (1) the amount exceeds the equivalent of $1 million; (2) the interest rate is higher than 10% (in U.S. dollars), higher than 11% (in euros), or higher than the central bank refinancing rate times 1.1 (for other currencies); (3) the funds are to be used to pay the obligations of a resident borrower, bypassing the resident’s account; (4) repayment is to be made from other than the resident borrower’s account; and (5) the credit is provided by a nonresident who is a resident of an offshore zone. For other credits longer than 180 days, notification of the NBRB is required.
Controls on direct investment
Outward direct investmentA permit from the NBRB is required.
Inward direct investmentForeign investments must be registered with the relevant local governments. Financial institutions must also register them at the NBRB. Insurance institutions, including those with foreign investments, must also be registered with the MOF. Certain activities require special approval (license). When establishing an enterprise with foreign investments, the proportion of a foreign investor’s share is not restricted, except for shares in insurance organizations, which may not exceed 49%.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsAn NBRB permit is required.
Controls on personal capital transactions
Loans
By residents to nonresidentsAn NBRB permit is required for loans with maturities of more than 180 days.
References to legal instruments and hyperlinksLaw No. 226-3 on Foreign Exchange Regulation and Foreign Exchange Control of July 22, 2003; Regulation No. 72 for the Performance of Foreign Exchange Transactions, adopted April30, 2004.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsForeign currency purchases and sales may be performed by legal entities, resident and nonresident individuals, and authorized banks on both the foreign exchange market and the over-the-counter exchange market.
Borrowing abroadThese operations may be performed on the basis of banking liecenses.
Maintenance of accounts abroadThese operations may be performed on the basis of banking licenses.
Lending to nonresidents (financial or commercial credits)Credits may be extended to nonresidents for investment activity with an NBRB permit.
Lending locally in foreign exchangeThese transactions are permitted for purposes of settlements with nonresidents and of settlements with residents who have the appropriate permits; purchases and sales of foreign currency and conversion to another foreign currency for purposes of settlements specified under the lending agreement are permitted.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsEffective February 1, 2005, the reserve requirement on domestic currency deposits was reduced to 5% from 6%, while the reserve requirement on all other currencies remained at 10%. Previously, during 2004, the reserve requirement on domestic currency deposits held by individuals was reduced in steps to 8% from the unified rate of 10% on April 1, to 7% on August 1, and to 6% on November 1. There are no reserve requirements for nonresident banks.
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsEffective February 1, 2005, the reserve requirement on domestic currency deposits was reduced to 5% from 6%. Effective April 1, 2005, the reserve requirement on all other currencies and for the domestic currency deposits of legal entities was reduced to 9% from 10%. There are no reserve requirements for nonresident banks.
Investment regulations
Abroad by banksApproval by the NBRB is required.
In banks by nonresidentsApproval by the NBRB is required.
Open foreign exchange position limitsOpen foreign exchange position limits are established for each type of foreign currency separately and also for the aggregate position. Limits are computed as a whole by type of foreign currency regardless of whether assets or liabilities belong to a resident or nonresident.
The following limits based on a bank’s equity capital have been established on open foreign exchange positions: (1) an overall open foreign exchange position of 20%; (2) an open foreign exchange position of 10% for each type of foreign currency on balance-sheet accounts and off-balance-sheet accounts; and (3) an open foreign exchange position of 10% on forward transactions for each type of foreign currency.
Provisions specific to institutional investorsLimits may be established by the Council of Ministers and the NBB.
Insurance companies
Limits (max.) on securities issued by nonresidentsAn insurence organization is required prior permission from the MOF to (1) increase the amount of its authorized capital using funds from foreign investors and/or their subsidiaries and (2) transfer shares (shares in their authorized capital>to foreign investors and/or their subsidiaries.
Limits (max.) on investment portfolio held abroadThe establishment of separate subdivisions outside Belarus by insurance organizations and insurance brokers, as well as participation in the establishment of foreign insurance organizations or insurance brokers, requires permission from the MOF following the procedure provided for by legislation.
Limits (min.) on investment portfolio held locallyThe quota of foreign investors in the authorized capital of all insurance organizations must not exceed 30%.
Investment firms and collective investment fundsControls are administered by the Securities Committee under Council of Ministers. The legislation provides for the establishment of investment funds; however, there are no investment funds in the country at this time. Specialized investment funds that handled registered “property” privatization vouchers ceased operation as of May 1, 2004
Limits (min.) on investment portfolio held locallyThe financial assets of an investment fund (cash and government securities) must be equal to the equivalent of at least €500,000.
References to legal instruments and hyperlinksLaw on Foreign Exchange Regulation and Foreign Exchange Control of July 22, 2003, No. 226-3; NBRB Decision on Reserve Requirements; www.nbrb.by/today/MP/ReserveRequirements.
Changes During 2005
Exchange arrangementJanuary 1. The exchange rate regime was reclassified to the category of conventional pegged arrangement from the category of crawling band.
Imports and import paymentsJanuary 1. Imports of goods from Russia were made subject to indirect taxes.
Exports and export proceedsJanuary 1. Exports of goods to Russia were made subject to indirect taxes.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsFebruary 1. The reserve requirement on domestic currency deposits of natural persons was reduced to 5% from 6%.
April 1. The reserve requirement on domestic currency deposits of legal persons and for foreign currency deposits was reduced to 9% from 10%.

BELGIUM

(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: February 15, 1961.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsIn accordance with EU regulations and the relevant UN Security Council resolutions, certain restrictions are maintained on the making of payments and transfers for current international transactions with respect to certain individuals of Côte d’Ivoire, the Democratic Republic of the Congo, Liberia, Myanmar, Sudan, Zimbabwe, certain individuals linked to the former government of Iraq, certain individuals associated with the government of the former Federal Republic of Yugoslavia, certain persons indicted by the International Criminal Tribunal for the Former Yugoslavia, and persons suspected of involvement in the murder of Rafik Hariri. Financing of and financial assistance related to military activities in Sierra Leone, Somalia, and Uzbekistan are prohibited. Restrictions also apply to transfers with respect to the Taliban and terrorist organizations and individuals associated therewith.
In accordance with IMF Executive Board Decision No. 144-(52/51Yes.
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Belgium is the euro.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderBelgium participates in the EMU with 11 other members of the EU: Austria, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain. The ECB may intervene to smooth out fluctuations in the euro exchange rate.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketBanks are allowed to engage in spot and forward exchange transactions in any currency, and they may deal among themselves and with residents and nonresidents in foreign notes and coins.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirements
Controls on the use of domestic currencyThe sales price of real estate may be paid only by means of a bank transfer or check, except for an amount not exceeding 10% of the sales price and as long as this amount is not higher than €15,000. The price of a sale by a merchant for a product whose total value is equal to or greater than €15,000 may not be paid in cash.
Payments arrangementsNo.
Administration of controlNo.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotesNo.
References to legal instruments and hyperlinksArticles l0bis and l0ter of the Law of january 11, 1993, Preventing the Use of the Financial System for Purposes of Laundering Money and Terrorism Financing; www.juridat.be/cgi_loi.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadControls apply to deposits held with financial institutions not supervised by the authorities of an EU country if these deposits are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
Accounts in domestic currency held abroadControls apply to deposits held with financial institutions not supervised by the authorities of an EU country if these deposits are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksLaw of March 22.1993, on the legal Status and Supervision of Credit Institutions: www.juridat.be/cgi_loi.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsThese accounts are affected by international security restrictions. The accounts held in the names of the Taliban and terrorist organizations are still blocked, as are accounts of certain officials of Zimbabwe and certain persons linked with Liberia.
References to legal instruments and hyperlinksTaliban and Terrorist Organizations: Council Regulation (EC) No. 881/2002 of May27, 2002, Imposing Certain Specific Restrictive Measures Directed Against Certain Persons and Entities Associated with Osama bin Laden, the Al-Qaida Network, and the Taliban; and repealing Council Regulation (EC) No. 467/2001 Prohibiting the Export of Certain Goods and Services to Afghanistan, Strengthening the Flight Ban and Extending the Freeze of Funds and other Financial Resources in respect of the Taliban of Afghanistan: http://europa.eu.intleur-lex
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
Negative listIndividual licenses are required for certain specified imports from some non-EU countries, including many textile and steel products, diamonds, and weapons. All other products are free from license requirements.
Licenses with quotasAlong with other EU countries, the Belgium-Luxembourg Economic Union applies quotas on a number of textile products from China, Belarus, the Democratic People’s Republic of Korea, Serbia and Montenegro, and Kosovo, and on a number of steel products from Kazakhstan, the Russian Federation, and Ukraine.
Import taxes and/or tariffsBelgium applies the Common Import Regime of the EU to imports of most agricultural and livestock products from non-EU countries.
State import monopolyYes.
References to legal instruments and hyperlinksCouncil Regulation (EC) No. 517/94 on Common Rules for Imports of Textile Products from Certain Third Countries not Covered by Bilateral Agreements; http://europa.eu.int/eur-lex
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport licenses are required for only a few products (mostly of a strategic character), for weapons, and for diamonds.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksCouncil Regulation (EC) No. 1334/2000 Setting up a Community Regime for the Control of Exports of Dual-Use Items and Technology; http://europa.eu.int/eur-lex.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase abroad by residentsControl applies to the acquisition of(l) securities not traded on a regulated market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (2) securities not traded on a regulated market, negotiable within a period exceeding three months, issued by financial institutions headquartered in the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (3) securities not traded on a regulated market, negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; and (4) securities not traded on a regulated market, negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
Bonds or other debt securities
Purchase abroad by residentsControls apply to the acquisition of (1) securities not traded on a regulated market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
On money market instruments
Purchase abroad by residentsControls apply to the acquisition of money market securities not traded on a regulated (1) foreign financial market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (2) foreign financial market, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (3) market negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; and (4) market negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
On collective investment securities
Purchase abroad by residentsControls apply to the acquisition of securities issued by collective investment funds not regulated by EU authorities if these assets are to form more than 10% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
Controls on derivatives and other instruments
Purchase abroad by residentsControls apply to the purchase of or swap operations in instruments and claims not traded on a regulated foreign financial market (1) negotiable within a period exceeding three months, except liabilities of financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (2) negotiable within a period exceeding three months, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; (3) negotiable within three months, except liabilities of financial institutions headquartered within the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; and(4) issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund.
Controls on credit operations
Financial credits
By residents to nonresidentsControls apply to credits and loans granted to (1) nonresident borrowers, other than financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund; and (2) nonresident financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company or of the assets representative of the liabilities of a private pension fund
Controls on direct investment
Inward direct investmentNo authorization is required for inward direct investment in Belgium, except for the acquisition of Belgian flag vessels by shipping companies that do not have their principal office in Belgium and investment by non-EU nationals in accountancy and legal services.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsNo.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsNo.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on securities issued by nonresidentsControls apply to the acquisition of(l)capital market securities not traded on a regulated market, negotiable within a period exceeding three months except, securities issued by financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company; (2) capital market securities not traded on a regulated market, negotiable within a period exceeding three months, issued by financial institutions headquartered in the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; (3) capital market securities not traded on a regulated market, negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company; (4) capital market securities not traded on a regulated market, negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; (5) money market securities not traded on a regulated foreign financial market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company; (6) money market securities not traded on a regulated foreign financial market, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; (7) money market securities not traded on a regulated market, negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company; (8) money market securities not traded on a regulated market, negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; and (9) securities issued by collective investment funds not regulated by EU authorities if these assets are to form more than 10% of the cover of the technical reserves of an insurance company.
Limits (max.) on investment portfolio held abroadControls apply to credits and loans granted to (1) nonresident borrowers, other than financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company; and (2) nonresident financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; and to swap operations in instruments and claims not traded on a regulated foreign financial market (a) negotiable within a period exceeding three months, except liabilities of financial institutions headquartered in the EU, if these assets are to form part of the cover of the technical reserves of an insurance company; (b) negotiable within a period exceeding three months, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the cover of the technical reserves of an insurance company; (c) negotiable within three months, except liabilities of financial institutions headquartered within the EU, if these assets are to form more than 10% of the cover of the technical reserves of an insurance company; and (d) issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the cover of the technical reserves of an insurance company.
Currency-matching regulations on assets/liabilities compositionThese regulations are maintained, but the introduction of the euro has considerably reduced their significance. The EU allows its member countries to maintain such regulations.
Pension funds
Limits (max.) on securities issued by nonresidentsControls apply to the acquisition of(l) capital market securities not traded on a regulated market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the assets representative of the liabilities of a private pension fund; (2) capital market securities not traded on a regulated market, negotiable within a period exceeding three months, issued by financial institutions headquartered in the EU, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; (3) capital market securities not traded on a regulated market, negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the assets representative of the liabilities of a private pension fund; (4) capital market securities not traded on a regulated market, negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; (5) money market securities not traded on a regulated foreign financial market, negotiable within a period exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form part of the assets representative of the liabilities of a private pension fund; (6) money market securities not traded on a regulated foreign financial market, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; (7) money market securities not traded on a regulated market, negotiable within a period not exceeding three months, except securities issued by financial institutions headquartered in the EU, if these assets are to form more than 10% of the assets representative of the liabilities of a private pension fund; (8) money market securities not traded on a regulated market, negotiable within a period not exceeding three months, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; and (9) securities issued by collective investment funds not regulated by EU authorities if these assets are to form more than 10% of the assets representative of the liabilities of a private pension fund.
Limits (max.) on investment portfolio held abroadControls apply to credits and loans granted to (1) nonresident borrowers, other than financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 10% of the assets representative of the liabilities of a private pension fund; or (2) nonresident financial institutions headquartered in the EU, with a residual maturity exceeding three months, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; and to swap operations in instruments and claims not traded on a regulated foreign financial market (a) negotiable within a period exceeding three months, except liabilities of financial institutions headquartered in the EU, if these assets are to form part of the assets representative of the liabilities of a private pension fund; (b) negotiable within a period exceeding three months, issued by financial institutions headquartered within the EU, if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund; (c) negotiable within three months, except liabilities of financial institutions headquartered within the EU, if these assets are to form more than 10% of the assets representative of the liabilities of a private pension fund; and (d) issued by financial institutions headquartered within the EU if these assets are to form more than 20% of the assets representative of the liabilities of a private pension fund.
References to legal instruments and hyperlinksn.a
Changes During 2005
No significant changes occurred in the exchange and trade system.

BELIZE

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: June 14, 1983.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Belize is the Belize dollar.
Exchange rate structure
DualThere are two exchange rates: the official exchange rate and the market rate.
Classification
Conventional pegged arrangementThe Belize dollar is pegged to the U.S. dollar, the intervention currency, at the rate of BZ $1 per US $0.5. The Central Bank of Belize (CBB) quotes daily rates for the Canadian dollar, the pound sterling, and a number of currencies of CARICOM member countries. Commercial banks are allowed to buy and sell foreign exchange at the official rate. On July 11, 2005, exchange houses were ordered to close down. All transactions in foreign exchange have to be conducted through ADs (i.e., commercial banks, the Postmaster General, the Accountant General, and the Belize Global Travel Services). Previously, exchange houses were authorized and allowed to deal in foreign exchange. They had to purchase foreign exchange at the official rate and sell it at the official exchange rate plus an adjustable service charge to be determined by the CBB; the maximum service charge—inclusive of the 1.25% stamp duty—was 7.5%. Exchange houses had to sell 5% of the gross amount of each foreign exchange purchase to the CBB at the official exchange rate, and they were not allowed to purchase foreign exchange earned by major exports, such as bananas, citrus products, shrimp, and sugar.
Exchange taxA stamp duty of 1.25% is levied on all conversions from the Belize dollar to a foreign currency.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsExport processing zone (EPZ) businesses may use only U.S. dollars for all transactions except payments for labor, which may be made in domestic currency.
Controls on the use of domestic currency
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 residentsResidents with earnings in foreign exchange may pay their taxes, utility bills, and other expenses in U.S. dollars.
Payments arrangements
Regional arrangementsBelize is a member of the CARICOM.
Clearing agreementsBelize participates in the CMCF.
Administration of controlThe CBB is responsible for administering exchange controls, which apply to transactions with all countries. Authority covering a wide range of operations is delegated to commercial banks in their capacity as ADs. All applications for foreign exchange processed by ADs are regularly forwarded to the CBB for audit and record keeping. Capital transactions are subject to CBB approval.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents may not hold gold without specific authorization from the CBB.
Controls on external tradeMonetary gold may not be imported or exported without the approval of the CBB.
Controls on exports and imports of banknotes
On exports
Domestic currencyEach traveler may take abroad up to BZ $500. Amounts beyond this limit require the approval of the CBB, which is liberally granted when justified.
Foreign currencyThe amount of foreign currency that each resident traveler may take abroad is limited. Nonresidents may take out up to the equivalent of BZ $500 or up to the amount imported.
On imports
Domestic currencyEach traveler may bring in up to BZ $100.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedDomestic commercial banks are authorized to open foreign currency accounts for residents. The CBB reserves the right to prohibit specific accounts. Foreign currency accounts held abroad must be approved by the CBB.
Held domesticallyYes.
Approval requiredYes.
Held abroadYes.
Approval requiredYes.
Accounts in domestic currency held abroadn.a
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedOnly international banks may maintain foreign currency accounts for nonresidents.
Domestic currency accountsThese accounts may be credited with proceeds from the sale of foreign currency. Nonresidents are allowed to have domestic currency accounts with domestic commercial banks.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetYes.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsPrepayments for imports require authorization from the CBB.
Letters of creditYes.
Import licenses and other nontariff measures
Negative listFor reasons of health, standardization, and protection of domestic industries, import licenses from the Ministry of Industry are required for a number of goods, mostly food and agricultural products and certain household and construction products; such licenses are granted liberally.
Import taxes and/or tariffsCustoms duties corresponding to the fourth phase of the CARICOM CET range from 5% to 20%, with a number of items (particularly agricultural inputs) entering duty-free. Imports by most of the public sector and certain nonprofit entities, imports of an emergency or humanitarian nature, and goods for re export are exempt from import duties; goods originating from the CARICOM area are also exempt. Some items are subject to revenue-replacement duties ranging from 5% to 25%. Effective March 1, 2005, an environmental tax of 2% (previously, 1%) is levied on a broad range of imports. Specific duties and surcharges apply to certain products.
State import monopolyThe Belize Marketing Board has an import monopoly on rice, potatoes, onions, and carrots.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsExport proceeds must be surrendered to ADs not later than six months after the date of shipment, unless otherwise directed by the CBB. The CBB requires the direct surrender of sugar export proceeds.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport licenses are required for live animals, excluding pets; fish, crustaceans, and mollusks, excluding agricultural species; lumber and logs; beans; citrus fruits; and sugar.
Without quotasYes.
Export taxesTransshipments are subject to a 1.5% customs administration fee.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related paymentsThere are controls on the payment of commissions.
Prior approvalFor the payment and transfer of commissions, approval is granted by the CBB, subject to clearance by the Commissioner of income Tax (CIT).
Investment-related paymentsPayments of interest are subject to CBB approval and require a copy of the loan agreement, amortization schedule, and proof of the loan disbursement.
Prior approvalFor interest payments, approval is granted by the CBB, subject to clearance by the CIT. For transfer of profits and dividends, an income statement and a declaration of dividends must be presented along with clearance by the CIT.
Payments for travel
Quantitative limitsThe following limits are in effect: (1) for non business travel by residents, up to the equivalent of BZ $6,000 a person a trip; (2) for business travel by residents, BZ $500 a person a day; (3) for medical travel, BZ $6,000 a person a trip; and (4) for business or non business travel by nonresidents, BZ $500 a person a year, unless payment is made from an external account or from proceeds of foreign currency. Resident travelers are required to sell their excess holdings of foreign currencies to an AD on returning to Belize. The CBB reserves the right to waive these limits.
Indicative limits/bona fide testYes.
Personal paymentsPayments related to medical costs are made directly to a doctor or hospital with original invoices or bills supporting the application.
Prior approvalFor the transfer of pensions and payments for family maintenance and alimony, CBB approval and CIT clearance are required.
Quantitative limitsThe limit for gifts is BZ $1,000 a person a year or its equivalent.
Indicative limits/bona fide testForeign exchange is provided by ADs for payment of correspondence courses when applications are properly documented.
Foreign workers’ wages
Prior approvalApproval for remittances of wages is granted by the CBB, subject to clearance by the CIT.
Other payments
Prior approvalFor the transfer of consulting and legal fees, approval is granted by the CBB, subject to clearance by the CIT.
Indicative limits/bona fide testSimilar requirements apply for subscriptions and membership fees for study abroad.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsProceeds must be sold to an AD.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsAll capital transfers require the approval of the CBB, but controls are administered liberally.
Controls on capital and money market instrumentsControls apply to all these transactions.
Controls on derivatives and other instrumentsControls apply to all these transactions.
Controls on credit operations
Commercial credits
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Financial credits
By residents to nonresidentsYes.
To residents from nonresidentsEPZ developers, EPZ businesses, commercial free zone (CFZ) developers, and CFZ businesses may obtain loans or advances up to US $1 million from offshore banks. Loans or advances in excess of this amount require written CBB approval.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Controls on direct investment
Outward direct investmentYes.
Inward direct investmentInward direct investment must be registered with the CBB if the profits are to be repatriated in the future.
Controls on liquidation of direct investmentRepatriation of proceeds requires clearance by the CIT.
Controls on real estate transactionsThere is a land speculation tax of 5% of the unimproved value of land holdings exceeding 300 acres.
Purchase abroad by residentsYes.
Purchase locally by nonresidentsYes.
Sale locally by nonresidentsYes.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Settlement of debts abroad by immigrantsYes.
Transfer of assets
Transfer abroad by emigrantsYes.
Transfer into the country by immigrantsYes.
Transfer of gambling and prize earningsThe repatriation of gambling proceeds by nonresidents requires clearance by the CIT.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadYes.
Maintenance of accounts abroadYes.
Lending to nonresidents (financial or commercial credits)Yes.
Lending locally in foreign exchangeYes.
Purchase of locally issued securities denominated in foreign exchangeYes.
Differential treatment of deposit accounts held by nonresidentsEffective January 16, 2006, nonresidents are required to use offshore banks.
Liquid asset requirementsThe liquid assets requirement is 20%
Provisions specific to institutional investorsna.
References to legal instruments and hyperlinksn.a
Changes During 2005
Exchange arrangementJuly 11. Exchange houses were ordered to close down.
Imports and import paymentsMarch 1. The environmental tax levied on a broad range of imports was increased to 2% from 1%.
Changes During 2006
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsJanuary 16. Nonresidents were required to use offshore banks

BENIN

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: June 1, 1996.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with UN sanctionsThe WAEMU Council of Ministers adopted, September 19,2002, Regulation 14/2002/ CM/UEMOA on the freezing of funds within the framework of action to combat the financing of terrorism in the member states of the union. This framework regulation facilitates the enforcement of the decisions on the freezing of funds made by the Sanctions Committee of the UN Security Council, based on the list of persons and entities established by that committee.
Exchange Arrangement
CurrencyThe currency of Benin 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 the fixed rate of CFAF 655.957 per €1. Exchange rates for other currencies are derived from the rates for the currency concerned in the Paris foreign exchange market vis-à-vis the euro.
Exchange taxEffective April 1, 2005, a symmetrical bank commission of 0.3% (previously, 0.25%) applies to transfers to all countries outside the WAEMU. The proceeds of this commission must be surrendered in their entirety to the Treasury. In addition, banks are allowed to charge an exchange commission of up to 2% on over-the-counter exchange for euros.
Exchange subsidyNo.
Forward exchange marketResidents are authorized to contract forward exchange cover to settle payments related to imports and exports of goods and services. The forward exchange cover must be established under the prescription of currency requirements of the contract. The maturity of the contract may not exceed the due date of the import or export payment stipulated in the commercial contract.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsBenin is linked to the French Treasury through an Operations Account, through which settlements with France, Monaco, and other Operations Account countries (WAEMU and CAEMC member countries and the Comoros) are made in euros or in the currency of any other Operations Account country. Settlements outside the Operations Account may be conducted freely in CFA francs.
Controls on the use of domestic currency
For capital transactions
Transactions in derivatives and other instrumentsYes.
Use of foreign exchange among residentsThe CFA franc is the only legal tender, and residents are not permitted to use foreign exchange for domestic transactions
Payments arrangements
Bilateral payments arrangements
InoperativeYes.
Regional arrangementsAn Operations Account is maintained with the French Treasury that links Operations Account countries. All 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 multilateral clearing agreement exists in the context of the WAMA between the countries of the WAEMU, Cape Verde, The Gambia, Ghana, Guinea, Liberia, Mauritania, Nigeria, and Sierra Leone. All payments related to current transactions between the member bank countries may be effected under the clearing arrangements. However, this excludes transactions specified by the committee of governors of the CBs of ECOWAS member countries and payments related to the exportation from the country of a member bank to the country of another member bank of finished products originating in countries whose CB or monetary authority is not a member of the WAMA.
Administration of controlExchange control is administered jointly by the MOF and the BCEAO. Most of the authority to supervise foreign exchange transactions is delegated to authorized banks, which are required to report these operations to the MOF. The BCEAO is also authorized to collect—either directly or through banks, financial institutions, the postal administration, or judicial agents—any information necessary to compile balance of payments statistics. Customs officers monitor outflows of foreign exchange and confirm import and export of goods. All foreign exchange operations with foreign countries must be effected through authorized intermediary banks, the postal administration, or the BCEAO. No supporting documents are required for transfers of up to the equivalent of CFAF 300,000. Within the framework of the regional financial market, the placement and soliciting of foreign and domestic securities in Benin require the prior authorization of the RCPSFM.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on external tradeImports of gold require prior MOF authorization. Exempt from this requirement are (1) imports by or on behalf of the treasury or the BCEAO, (2) imports of manufactured articles containing minor quantities of gold (such as gold-filled or gold-plated articles), and (3) imports by travelers of gold objects up to a combined weight of 500 grams. Both licensed and exempt imports of gold are subject to customs declaration. Exports of gold have been liberalized.
Controls on exports and imports of banknotes
On exports
Domestic currencyCFA franc banknotes may be exported freely by travelers. However, the suspension of BCEAO repurchases of exported banknotes continues. In addition, the exchange of BCEAO banknotes between authorized intermediaries and their correspondents outside the WAEMU is prohibited.
Foreign currencyThe reexportation of foreign banknotes by nonresident travelers is allowed up to the equivalent of CFAF 500,000; the re exportation 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 in local banks.
On imports
Foreign currencyResidents and nonresidents 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 and foreign currency traveler’s checks exceeding the equivalent of CFAF 300,000 must declare them to customs on entry and sell them to an authorized intermediary bank within eight days. Nonresident travelers must declare to customs foreign currency exceeding the equivalent of CFAF 1 million on entry and exit.
References to legal instruments and hyperlinks.n.a.
Resident Accounts
Foreign exchange accounts permittedResidents may hold foreign exchange accounts with local banks or with banks abroad subject to prior authorization of the MOF, after approval of the BCEAO.
Held domesticallyYes.
Approval requiredYes.
Held abroadYes.
Approval requiredIndividuals traveling abroad may open bank accounts to receive foreign currency legitimately exported during their travel or earned during their stay abroad. However, residents are required to repatriate assets held in these accounts within 30 days of their return. In all other cases, the prior authorization of the MOF, after BCEAO approval, is required to open an account abroad.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency held abroadNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Approval requiredThe holding by nonresidents of accounts denominated in foreign currency other than the euro is subject to the prior authorization of the BCEAO. The opening of the account is subject to presentation of documents by nonresidents proving their status 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 prior authorization of the MOF. Transfers of funds between nonresident accounts are not restricted.
Convertible into foreign currencyThe holding by nonresidents of accounts denominated in foreign currency other than the euro is subject to the prior authorization of the BCEAO. The opening of the account is subject to presentation of documents by nonresidents proving their status and actual residence
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsAdvance payments for imports require authorization, and importers may not acquire foreign exchange until the date of the payment specified in the contract.
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 shipment if a documentary credit is opened, or on the due date of payment if the products have already been imported.
Domiciliation requirementsAll import transactions from outside the CFA franc zone exceeding CFAF 5 million must be effected through an authorized bank.
Preshipment inspectionAll imports arriving by sea and exceeding CFAF 3 million, and overland imports exceeding CFAF 1.5 million, are subject to prior inspection
OtherExchange authorization, invoices, and export-import cards are required.
Import licenses and other nontariff measures
Negative listCertain imports, e.g., narcotics, are prohibited from all sources.
Import taxes and/or tariffsThe CET of the WAEMU consists of four rates (zero, 5%, 10%, and 20%). Imports are also subject to a statistical fee of l% and a community solidarity levy of 1%.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsProceeds from exports, excluding those from WAEMU countries, must normally be collected within 120 days of shipment and repatriated through the BCEAO not later than one month after the due date of the payment.
Surrender requirementsProceeds must be surrendered to authorized banks within 30 days of the payment due date. 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 MOF, with the exception of articles with small gold content, travelers’ personal effects weighing less than 500 grams, and coins (fewer than 10 pieces, irrespective of their face value and denomination).
With quotasExports of teakwood and other varieties of unprocessed wood and charcoal are banned.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersTransfers for invisible transactions to France, Monaco, and Operations Account countries maybe made freely. Payments and receipts made by foreign ships on stopovers in WAEMU countries or by WAEMU ships abroad are considered current transactions. Payments and transfers for current transactions may be made freely through authorized intermediaries. Transfers exceeding CFAF 300,000 are subject to documentary requirements.
Trade-related payments
Indicative limits/bona fide testYes.
Investment-related payments
Indicative limits/bona fide testYes.
Payments for travel
Indicative limits/bona fide testYes.
Personal payments
Indicative limits/bona fide testAll personal payments may be conducted through an authorized bank.subject to presentation of supporting documents.
Foreign workers’ wages
Indicative limits/bona fide testPayments abroad related to wages, salaries, and honoraria; contributions and benefits; pensions and work-related activities; and service contracts are generally authorized on presentation of the appropriate documentation.
Credit card use abroadThe use of credit cards is allowed only when issued by specialized institutions.
Indicative limits/bona fide testYes.
Ohter payments
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsProceeds from invisible transactions with non–WAEMU member countries must be repatriated.
Surrender requirementsAll proceeds from invisible transactions with non-WAEMU countries must be surrendered to an AD within one month of the due date. Resident travelers must declare to customs any foreign means of payment in excess of the equivalent of CFAF 300,000 that they bring in and must surrender them to an authorized bank within eight days of their return.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsCapital transactions between WAEMU countries are unrestricted. Outward capital transfers require MOF authorization, except in the case of (1) amortization of debts and repayment of short-term loans granted to finance industrial and commercial operations, (2) transfers of proceeds from the liquidation of investments or sale of foreign securities by nonresidents, and (3) payments for the purchase of options. Capital receipts from WAEMU countries, however, are permitted freely. All investments abroad by residents require prior authorization from the MOF; 75% of such investments must be financed with borrowing from abroad. Foreign borrowing must be reported for statistical purposes.
Controls on capital and money market instrumentsThe prior authorization of the RCPSFM is required for the following operations: issuing or marketing of securities and real assets of foreign entities, canvassing, and publicity or advertising for investment abroad.
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsThese purchases are subject to prior declaration to the MOF for statistical purposes.
Sale or issue locally by nonresidentsThe issue of securities and the sale of corporate or foreign securities in Benin by nonresidents are subject to prior RCPSFM authorization. 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, but such sales are 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 MOF for approval, accompanied by supporting documentation.
Purchase abroad by residentsThe purchase of foreign securities by residents and the transfer abroad of funds for this purpose are subject to the prior authorization of the MOF. Authorization is not required for purchases of foreign securities whose issuance or offering for sale in WAEMU countries has been authorized by the RCPSFM.
Sale or issue abroad by residentsResidents may sell local corporate securities abroad. If these operations result in foreign control of domestic establishments, foreign investors are required to make a prior declaration to the MOF. The sale of securities to liquidate an investment abroad is subject to declaration to the MOF for statistical purposes. The proceeds in foreign exchange from sale or liquidation must be surrendered to an authorized intermediary bank within one month.
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 MOF for statistical purposes.
Bonds or other debt securitiesThe regulations governing shares or other securities of a participating nature apply.
On money market instrumentsThe regulations governing shares or other securities of a participating nature apply.
On collective investment securitiesThe regulations governing shares or other securities of a participating nature apply.
On collective investment securitiesThe regulations governing money market instruments apply.
Controls on derivatives and other instrumentsAll transactions in these instruments are subject to general regulations that apply to securities and investments. Residents may freely purchase abroad or from nonresidents call or put options for primary commodities or securities transactions. Residents may not purchase commodities or securities on foreign markets for delivery in a put option contract. Put options must be on assets that can be acquired locally by the resident seller for delivery abroad in execution of the contract.
Controls on credit operationsBorrowing by residents from nonresidents must be channeled through authorized intermediaries (whenever borrowed funds are made available for use in the country), unless otherwise indicated by the MOF.
Commercial credits
By residents to nonresidentsThere are no controls on credits related to exports of goods, provided the date on which payment falls due is not more than 120 days after the date of shipment. The transfer of funds abroad for this purpose is subject to prior MOF authorization.
To residents from nonresidentsThere are no controls, and repayments of commercial credits are generally approved, subject to the presentation of documents attesting to the validity of the commercial operation or of the services rendered, as well as the payment due date.
Financial credits
By residents to nonresidentsThese credits require prior approval of the MOF. Outward transfers necessary to service such facilities require an exchange authorization, subject to the approval of the BCEAO acting on behalf of the MOF and substantiated by documentation.
To residents from nonresidentsThere are no controls on these credits, but they must be reported for statistical purposes. The necessary funds must be transferred from abroad through an authorized agent. There are no controls on repayments of loans, provided the authorized agent handling the settlement is furnished with documentation attesting to the validity of the transaction.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsThe granting of guarantees and sureties is subject to prior approval by the MOF. Transfers abroad of funds to service these facilities require an exchange authorization, subject to approval of the MOF, and submission of supporting documents.
To residents from nonresidentsThese facilities may be granted freely, although the funds required for servicing them must be transferred abroad by an authorized bank. If, however, these transactions take place between a resident direct investment company and its parent company located abroad, they are considered to be direct investments and therefore require prior declaration to the MOF
Controls on direct investment
Outward direct investmentAll investment abroad by residents is subject to prior MOF authorization. At least 75% of such investment must be financed by foreign loans. Authorization is not required for purchases of foreign securities whose issuance or offering for sale in WAEMU countries has been authorized by the RCPSFM.
Inward direct investmentForeign direct investments, including those made by resident companies that are directly or indirectly under foreign control and those made by branches or subsidiaries of foreign companies, must be reported to the MOF for statistical purposes
Controls on liquidation of direct investmentThe liquidation of investments abroad must be reported to the MOF for statistical purposes. Reinvestment of the proceeds from the liquidation is subject to prior MOF authorization. If reinvestment is not authorized, the proceeds from the liquidation must be repatriated within one month through an authorized intermediary. The sale of foreign investments by nonresidents is unrestricted but must be reported to the MOF for statistical purposes.
Controls on real estate transactions
Purchase abroad by residentsThese purchases require the prior authorization of the MOF.
Purchase locally by nonresidentsPurchases for purposes other than direct investment in a business, branch, or company are allowed. They require a declaration to the MOF for statistical purposes.
Sale locally by nonresidentsSales by nonresidents to residents require submission of supporting documentation to the authorized intermediary that handles the settlement, and they must be declared to the MOF.
Controls on personal capital transactionsPersonal capital transactions between residents and nonresidents must be made through the BCEAO, the postal service, or an authorized intermediary bank, unless prior authorization is obtained from the MOF
LoansThe regulations governing securities and investments apply.
By residents to nonresidentsYes.
To residents from nonresidentsThese transactions may be made freely, but are subject to declaration for statistical purposes to the MOF when granted and when repaid.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsThese transactions may be made freely, but are subject to declaration for statistical purposes to the MOF when granted and when repaid.
To residents from nonresidentsThese transactions are subject to declaration.
Settlement of debts abroad by immigrantsImmigrants who have obtained resident status must obtain prior authorization from the MOF to settle debts incurred abroad while they were nonresidents.
Transfer of assets
Transfer abroad by emigrantsThese transactions require prior authorization of the MOF.
Transfer into the country by immigrantsForeign accounts of nonresidents (in foreign currencies or CFA francs) who become residents must be closed. However, they may maintain abroad bank accounts opened and financial assets acquired while they were nonresidents. New transfers to these accounts require MOF approval.
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadFor statistical purposes, these transactions must be declared to the MOF when they are granted and when they are repaid.
Maintenance of accounts abroadBanks and financial institutions are authorized to open accounts with their correspondent banks for settling transactions for their own account or the accounts of their customers. However, banks are not authorized to hold amounts in these accounts that exceed their current requirements.
Lending to nonresidents (financial or commercial credits)Commercial lending is allowed. Financial credits are subject to prior MOF authorization following BCEAO approval.
Lending locally in foreign exchangeNo explicit regulations exist regarding these transactions, but prior authorization by the MOF is required with the approval of the BCEAO
Purchase of locally issued securities denominated in foreign exchangeThese purchases require prior RCPSFM authorization, after approval by the MOF.
Differential treatment of deposit accounts in foreign exchange
Credit controlsLoans of any kind, CFA franc overdrafts, and, in general, any advances granted to nonresidents are subject to prior MOF authorization, after BCEAO approval. These claims are included in the external position of banks and financial institutions, which is subject to special monitoring.
Differencial treatment of deposit accounts held by nonresidentsMonetary regulations make no distinction among recident deposit accounts, nonresident deposit accounts, and forein deposit accounts.
Credit controlsYes.
Investment regulationsThe regulations governing foreign investment apply.
Abroad by banksYes.
In banks by nonresidentsYes.
Open foreign exchange position limitsNo prudential ratios apply. Open positions result from special dispensations.
Provisions specific to institutional investors
Insurance companiesControls are imposed by the Insurance Code of the Inter-African Conference of Insurance Markets (CIMA Code).
Limits (max.) on securities issued by nonresidentsSecurities and mutual funds issued outside the WAEMU by a private or public entity that is not a resident of a member country may not be listed on a regional securities exchange
Limits (max.) on investment portfolio held abroadThe CIMA Code does not allow insurance companies to invest abroad.
Limits (min.) on investment portfolio held locallyThe CIMA Code includes specific rules forthe use of insurance companies’ technical reserves.
Currency-matching regulations on assets/liabilities compositionThe CIMA Code specifies that liabilities in a given currency must be covered by assets denominated in the same currency.
References to legal instruments and hyperlinksn.a
Changes During 2005
Exchange arrangementApril 1. The commission rate charged by banks on transfers to countries outside the WAEMU was increased to 0.3% from 0.25%.

BHUTAN

(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple, currency practicesInformation is not publicly available
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Banking institutions have been instructed to freeze all capital transfers and financial assets of individuals, groups, and organizations associated with terrorism, pursuant to the relevant UN Security Council resolutions. In addition, financial institutions are required to report to the Royal Monetary Authority (RMA) any financial transactions linked to terrorist groups.
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Bhutan is the Bhutanese ngultrum.
Exchange rate structureUnitary.
Classification
Conventional pegged arrangementThe ngultrum is pegged to the Indian rupee at par. The rates for currencies other than the Indian rupee are determined on the basis of the prevailing exchange rates of the Indian rupee (average rate) against the currencies concerned. Indian rupee banknotes and coins circulate freely in Bhutan.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsTrade transactions between Bhutan and India may be conducted only in ngultrums or Indian rupees.
Use of foreign exchange among residentsExcept for payments for duty-free goods, handicraft items, and purchases of Druk Air (Royal Bhutan Airlines) tickets by foreigners, all other payments in Bhutan must be made in local currency.
Payments arrangements
Bilateral payments arrangements
OperativeYes.
Clearing agreementsBhutan is a member of the ACU.
Administration of controlThe MOF has delegated to the RMA the authority to release foreign exchange (other than Indian rupees) for current transactions. The RMA is responsible for approving the use of foreign exchange for payments for current transactions and implementing the surrender requirements for proceeds from merchandise exports.
Payments and transfers by residents to nonresidents other than in cash and traveler’s checks must be channeled through authorized banks in Bhutan.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on external tradeImports of gold and silver by Bhutanese citizens require authorization from the RMA
Controls on exports and imports of banknotesThe importation and exportation of cash and securities above a certain limit are subject to a declaration of value at the customs point of entry into and departure from Bhutan.
On exports
Domestic currencyExports exceeding Nu 5,000 require permission from the RMA.
Foreign currencyExports of convertible foreign currency legally imported or purchased from authorized banks are allowed freely. Exports of Indian rupees are allowed except for Rs 500 and Rs 1,000 banknotes.
On imports
Domestic currencyImports exceeding Nu 5,000 require approval by the RMA.
Foreign currencyImports of convertible foreign currencies are permitted freely, but amounts exceeding the equivalent of $10,000 are subject to customs declaration. Imports of Indian rupees are allowed except for Rs 500 and Rs 1,000 banknotes.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedThe following categories of persons are permitted to open and maintain dollar-denominated foreign currency accounts with authorized banks in Bhutan: (1) diplomatic missions in Bhutan and their expatriate employees, (2) representative offices of donor agencies and their expatriate employees, (3) third-country contracting firms and their expatriate employees engaged in executing projects financed by donor agencies, (4) any person who is a national of a third country and resides in Bhutan, (5) FDI companies incorporated in Bhutan under the 2002 Foreign Direct Investment Policy, and (6) local industries approved by the Ministry of Trade and Industry.
Held domesticallyYes.
Approval requiredYes.
Held abroadBhutanese nationals are not permitted to hold foreign exchange accounts abroad. These accounts are permitted only for residents who are foreign nationals.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyThese accounts are permitted but only for nonresidents who are foreign nationals.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Domiciliation requirementsYes.
Letters of creditYes.
Import licenses used as exchange licensesYes.
Import licenses and other nontariff measuresAn import license is required for the importation of capital and intermediate goods from countries other than India. Such licenses are governed by the Rules and Procedures for Imports of Goods from Third Countries issued by the Department of Trade of the Ministry of Trade and Industry. Foreign exchange for all payments related to licensed merchandise imports is automatically made available by authorized banks against import licenses. Capital imports from third countries by foreign direct investors must be financed by their own convertible foreign exchange resources.
Negative listYes.
Import taxes and/or tariffsImports from countries other than India are subject to tariffs. Imports from India are subject only to the Bhutanese sales tax.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsProceeds in currencies other than the Indian rupee must be surrendered to the RMA directly or to authorized banks in Bhutan.
Financing requirementsNo.
Documentation requirements
Letters of creditYes.
GuaranteesYes.
DomiciliationYes.
Preshipment inspectionYes.
OtherYes.
Export licenses
Without quotasYes.
With quotasYes.
Export taxesExports to countries other than India receive an export tax rebate at rates ranging from 5% to 20% of the c.i.f. value, with the lowest rate applying to unprocessed primary products and the highest rate applying to processed products.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersAll invisible payments, other than those made in Indian rupees, must be approved by the RMA. The RMA is authorized to set limits on foreign exchange for payments for invisible transactions.
Trade-related payments
Prior approvalYes.
Indicative limits/bona fide testYes.
Investment-related paymentsUnder the 2002 Foreign Direct Investment Policy, foreign direct investors may remit profits and dividends from net earnings only in convertible foreign currency.
Prior approvalYes.
Indicative limits/bona fide testYes.
Payments for travel
Prior approvalYes.
Quantitative limitsTravel allowances are limited to the equivalent of $1,500 a ticketed passenger each calendar year. In the case of business travel, a country-specific per diem covering accommodation is provided to travelers. There are no time limits for business travel.
Indicative limits/bona fide testYes.
Personal paymentsAllowances for educational fees and tuitions are given based on the statements provided by the institutions. Students may also purchase foreign exchange for a monthly stipend of $900 and a onetime settling-in allowance of $1,500 or the equivalents. The settling-in allowance and three monthly stipends may be purchased in advance
For medical expenses, subject to referral by a local physician for treatment abroad, foreign exchange may be purchased to cover the cost of treatment and medicine and for living expenses abroad.
Prior approvalYes.
Quantitative limitsA citizen of Bhutan, who under the recommendation of a medical specialist travels to a country other than India for medical treatment, is permitted to purchase foreign exchange from authorized banks within the limit prescribed by the RMA for the cost of treatment and medicine and for living expenses.
Foreign workers’ wages
Prior approvalForeign nationals employed directly by a public or private organization in Bhutan with prior approval of the Royal Government of Bhutan are permitted to remit their salary and savings in foreign exchange through an authorized bank.
Quantitative limitsThe RMA may set limits on any or all such remittances as it deems necessary.
Credit card use abroad
Prior approvalYes.
Quantitative limitsThe RMA may set limits on any or all such remittances as it deems necessary.
Indicative limits/bona fide testYes.
Other payments
Prior approvalYes.
Quantitative limitsThe RMA may set limits on any or all such remittances as it deems necessary.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsForeign exchange proceeds of any receipts or holdings by Bhutanese citizens and companies should be repatriated to Bhutan by transferring such claims and funds to authorized banks in Bhutan.
Surrender requirementsAll receipts from invisible transactions in currencies other than the Indian rupee must be surrendered to the RMA or ADs.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsAll capital transactions must be approved by the RMA. Resident individuals are not allowed to acquire or engage in capital transactions abroad.
Controls on capital and money market instrumentsControls apply to all transactions in capital and money market instruments
Controls on derivatives and other instrumentsControls apply to all these transactions.
Controls on credit operationsAll transactions in credit operations are subject to controls.
Controls on direct investment
Outward direct investmentYes.
Inward direct investmentUnder the 2002 Foreign Direct Investment Policy, direct investment in convertible foreign exchange may be made in (1) manufacturing, with a minimum investment of $1 million, of which 20% to 70% could be foreign investor equity; and (2) services, with a minimum investment of $500,000, of which 20% to 70% could be foreign investor equity. Other collaboration in different forms, such as technical and marketing collaboration, and franchises for use of trade names, patents, and trademarks, are allowed with prior permission of the Ministry of Trade and Industry.
Controls on liquidation of direct investmentYes.
Controls on real estate transactionsControls apply to all real estate transactions.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
Transfer of assets
Transfer abroad by emigrantsYes.
Transfer into the country by immigrantsYes.
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadBorrowing abroad requires prior authorization from the RMA.
Maintenance of accounts abroadYes.
Investment regulations
Abroad by banksYes.
In banks by nonresidentsDirect investment in convertible foreign exchange may be made in services with a minimum investment of $500,000, of which 20% to 70% could be foreign investor equity
Provisions specific to institutional investors
Insurance companies
Limits (max.) on investment portfolio held abroadYes.
References to legal instruments and hyperlinksn.a
Changes During 2005
No significant changes occurred in the exchange and trade system.

BOLIVIA

(Position as of June 30, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: June 5, 1967.
Exchange Measures
Restrictions and/or multiple currency practices.No restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Bolivia is the boliviano.
Other legal tenderThe dollar is also legal tender.
Exchange rate structureUnitary
Classification
Crawling pegThe official selling rate is determined daily by the Central Bank of Bolivia (CBB) at a daily competitive auction (“bolsin”). The Committee for Exchange and Monetary Policy (CEMP) sets the amount of foreign exchange to be auctioned and a price below which the CBB will not accept any bids. This floor price, which is expressed in dollars, is the official exchange rate. The CBB Board determines the difference between the selling rate and a buying rate, which is currently Bs 0.10 (as of March 9, 2006), based on the CEMP recommendations. Previously, on July 5, 2005, the buy and sell spread on the boliviano against the dollar was increased to Bs 0.08 from Bs 0.02. The private sector may participate in the auctions (with a minimum bid of $100,000 or the equivalent) through financial institutions that have accounts with the CBB. The opening up of the CBB exchange rate spread has resulted in the development of a private foreign exchange market, and foreign exchange sales through the bolsin have become scarce. In the current environment of a current account surplus, it is more common for the CBB to acquire foreign exchange from the financial system at the buying rate for the day, without any restriction as to the amount.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksBoard Resolution 144/2002 (Approving Exchange Regulations); Board Resolution 092/ 2005 (Amending Exchange Regulations); www.bcb.gov.bo.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payments arrangements
Regional arrangementsPayments between Bolivia and the other LAIA countries may be made through accounts maintained with each other by the CBB and the central banks of the countries concerned, within the framework of the multilateral clearing system of the LAIA.
Clearing agreementsYes.
Administration of controlNo.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)Gold may be traded freely, subject to the following tax scale in accordance with the gross value of the sale of gold bullion: 7% for official quotations larger than $700 a troy ounce; between 4% and 7% for official quotations between $400 and $700 a troy ounce, calculated as a 0.0l factor multiplied by the official quotation; and 4% for official quotations of less than $400 a troy ounce.
Controls on exports and imports of banknotesNo.
References to legal instruments and hyperlinksLAIA Reciprocal Payments and Credits Arrangement; www.aladi.org/NSFALADI/CONVENIO.NSF; Law 1777, dated March 17,1997 (Mining Code); www.mineria.gov.bo/web.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instrument and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Letters of creditLCs have to be opened at a bank in the Bolivian banking system.
Import licenses and other nontariff measures
Negative listCertain imports are controlled for reasons of public health or national security.
Import taxes and/or tariffsBolivia applies an import tariff of 10% on consumer goods. Tariffs of zero and 5% are applied to capital goods in accordance with approved lists. A zero rate is also applied to imports of books and printed materials. Donated food, including wheat, is exempt from the import tariff
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesNo.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersSince July 1, 2004, a temporary tax has been applied on inward transfers or shipments of money made through authorized financial institutions without using current or savings accounts and/or through institutions that provide funds transfer services that are legally established in Bolivia. The rate was 0.3% between July 2004 and June 2005, and 0.25% between July 2005 and June 2006, when it was eliminated.
Investment-related paymentsThere are no restrictions on capital inflows and outflows, nor on outward remittances of dividends, interest, and royalties with respect to technology transfers or under other business categories. All remittances or transfers are subject to payment of the taxes prescribed by law. When income of Bolivian origin is paid to beneficiaries abroad, the taxed net profit must be equivalent to 50% of the total amount paid or remitted. Those who pay or remit such items to beneficiaries abroad must apply a single and final withholding at the rate of 25% of the presumed taxed net profit.
Indicative limits/bona fide testYes.
References to legal instruments and hyperlinksLaw No. 2646 and other related provisions; Investment Law No. 1182, dated September 17, 1990; Law No. 1606 Amending Law No. 843, dated December 22, 1994; www.impuestos.gov.bo/itf.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsOnly securities authorities by the Superintendency of Securities may be traded on the over-the-counter market. Pursuant to a specific resolution, the Superintendency of Securities identifies securities exchanges abroad so that the instruments listed thereon may be publicly offered on the Bolivian securities market, provided they comply with the registration and disclosure requirements envisaged in the law.
Controls on capital and money market instrumentsBrokerage houses have the sole corporate purpose of engaging in activities and intermediation related to securities, carrying out any action related to the transfer there of, and performing activities allowed under this law. Brokerage houses authorized by the Superintendency of Securities may, among other things, represent foreign brokers and persons incorporated abroad who have activities connected with the exchange market
Controls on derivatives and other instrumentsNo.
Controls on credit operationsAll foreign credits, including suppliers’ credits to government agencies and autonomous entities, and credits to the private sector with official guarantees are subject to prior authorization by the national congress, which is obtained by the MOF. All cash proceeds of borrowings from foreign public sector agencies are channeled through the CBB. Commercial and financial credits to the private sector without official guarantees are not subject to authorization but must be reported to the CBB for statistical purposes.
Commercial credits
To residents from nonresidentsYes.
Financial credits
To residents from nonresidentsYes.
Controls on direct investmentNo.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsNo.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksExchange Market Law No. 1834, Article 17, Article 19, Article 3, and Article 6.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institution
Borrowing abroadShort-term foreign liabilities are subject to reserve requirements, except for liabilities incurred solely for foreign trade operations and provided assets and liabilities are fully matched for each transaction.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsA reserve requirement rate of 2% in cash is applied to time deposits, savings account deposits, and deposits with a maturity of up to 60 days in foreign currency and in housing development units (UFV), and with a maturity of up to 360 days for foreign currency and in domestic currency. A reserve requirement of 2% is applied to time deposits in domestic currency with a maturity of up to 60 days and in foreign currency with a maturity ofup to 360 days.
Liquid asset requiremEffective April 1,2005, a marginal liquidity asset requirement of 7.5% applies to foreign currency deposits exceeding 80% of the total stock of foreign currency and domestic currency deposits as of March 31,2005. The marginal requirement may be offset against increases in deposits in local currency and UFV, effective on the same date.
Investment regulations
Abroad by banksBanks may engage in investments abroad for the purpose of setting up banks, branches, or agencies; these investments must not exceed 40% of their net worth.
Open foreign exchange position limitsFinancial institutions may maintain a short foreign exchange position up to the equivalent of 20% of the book value of their net worth and, effective June 30, 2005, up to 25% (previously, 50%) of the balance of provisions for losses on the indexed foreign currency and domestic currency portfolios. From the book value of net worth, 25% could be deducted for provisions for losses. This deduction was eliminated December 31, 2005.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investors
Insurance companies
Limits (max.) on securities issued by nonresidentsBy law, the maximum limit for investment in securities issued by issuers established abroad may not exceed 50% of resources for investment. Pursuant to a Board resolution, the CBB each year sets the maximum amount for investments abroad by insurance companies. Effective January 18, 2005, this limit is 10%.
Pension funds
Limits (max.) on investment portfolio held abroadThe maximum limit that pension fund administrators may invest abroad varies between 10% and 50% of each individual capitalization fund. The sum of investments in equities, in investment fund shares, or in any other equity security, issued by issuers established in Bolivia or abroad, may not taken together exceed 45% of the value of the Individual Capitalization Fund. The securities that pension funds may hold should be rated by private international rating agencies. The minimum acceptable rating for long-term securities is BB3 or Level 2 for short-term securities. Trading with these securities has to be performed only on authorized foreign secondary markets.
Investment firms and collective investment funds
Limits (max.) on investment portfolio held abroadOpen investment funds may invest up to 20% of their total portfolio on international financial markets. In the case of closed investment funds, whose nominal value at the time of issue is below $20,000, the limit is 40% of their total portfolio. If the nominal value of the share is larger, the limit is up to 100% of their total portfolio.
References to legal instruments and hyperlinksLaw on Banks 1488, Article 43, updated May 5,2004; Administrative Resolution SPVS-IP No. 038/2002, Article 6(d); Board Resolution No. 048/2005 (Approving New Regulations to Govern the Legal Reserve Requirements); Board Resolution No. 076/ 2003 (Approving Amendments to the Regulations Governing Exchange Positions in the Financial System); Insurance Law; Regulations for the Insurance Law; Board Resolution No. 006/2006 (Approving Maximum Limits for Foreign Investments by Insurance Companies); Law on Pensions; Administrative Resolution SPVS-IV No. 421 (Regulations Governing Investment Funds and Investment Fund Administrators); http://www. bcb.gov.bo; www.sbef.gov.bowww. bcb.gov.bo; www.sbef.gov.bo; www.spvs.gov.bo.
Changes During 2005
Exchange arrangementJuly 5. The buy and sell spread on the boliviano against the dollar increased to Bs 0.08 from Bs 0.02.
Payments for invisible transactions and current transferJuly 1. The temporary tax on certain financial transactions was reduced to 0.25% from 0.3% in accordance with the law that took effect in July 2004.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsApril 1. The marginal liquid asset requirement was increased to 7.5% and applied to foreign currency deposits exceeding 80% of the total stock of foreign currency and domestic currency deposits as of March 31, 2005. The marginal requirement could be offset against increases in deposits in local currency and UFV.
June 30. The limit on the short foreign exchange position was reduced to 25% from 50% of the balance of provisions for losses on indexed foreign and domestic portfolios.
Provisions specific to institutional investorsJanuary 18. The CBB’s new limits ofup to 10% on investments abroad of insurance companies went into effect.
December 31. The 25% deduction for provisions for losses from the book value of net worth when calculating the open position was eliminated
Changes During 2006
Exchange arrangementMarch 9. The buy and sell spread of the boliviano against the dollar increased to Bs 0..10 from Bs 0.08.
Payments for invisible transactions and current transfersJune 30. The temporary tax of O.25% on certain financial transactions was eliminated.

BOSNIA AND HERZEGOVINA

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple currency practicesThe staff report for the 2005 Article IV consultation with Bosnia and Herzegovina states that as of May 13, 2005, Bosnia and Herzegovina maintained an exchange restriction arising from the restrictions imposed on withdrawals and transfers from certain foreign exchange accounts held by residents and nonresidents (frozen foreign currency deposits). (Country Report No. 05/199)
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51Yes.
In accordance with UN sanctionsIn accordance with the relevant UN Security Council resolutions, restrictions are imposed on certain financial transactions related to listed terrorist groups.
Exchange Arrangement
CurrencyThe currency of Bosnia and Herzegovina is the convertible marka.
Other legal tenderEuro banknotes and coins also circulate freely and are used for cash payments.
Exchange rate structureUnitary.
Classification
Currency board arrangementThe convertible marka is pegged to the euro at the rate of KM 1 per €0.51129.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirements
Controls on the use of domestic currencyControls apply only to prevent money laundering.
Payments arrangementsNo.
Administration of controlCompanies wishing to engage in foreign trade must register with the relevant ministry.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotes
On exports
Domestic currencyYes.
Foreign currencyExports of foreign currency and securities denominated in foreign currency are regulated with specific conditions prescribed by the relevant ministry.
On imports
Domestic currencyYes.
Foreign currencyThere are no restrictions on imports of foreign currency and securities in foreign currency.
References to legal instruments and hyperlinksLaw on the Central Bank of Bosnia and Herzegovina.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyIndividuals and legal entities may hold foreign exchange accounts with commercial banks without restrictions or approvals.
Held abroadYes.
Approval requiredExporters who are legal entities may open accounts, but approval is required from the relevant ministry.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksLaw on Foreign Currency Business Operations in the Federation of Bosnia and Herzegovina; Law on Foreign Currency Business Operations in Republika Srpska.
Nonresident Accounts
Foreign exchange accounts permittedNonresident persons may open foreign exchange accounts with commercial banks
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsAccounts are blocked, in accordance with the law that regulates money laundering and financing of terrorism.
References to legal instruments and hyperlinksLaw on Foreign Currency Business Operations in the Federation of Bosnia and Herzegovina; Law on Foreign Currency Business Operations in Republika Srpska.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Advance payment requirementsImports must arrive within 90 days from the date of the advance payment.
Documentation requirements for release of foreign exchange for importsCommercial banks may require documents verifying the purpose of the transaction before effecting payment.
Import licenses and other nontariff measuresThere are no import quotas for any product. All imports are free from licensing requirements, except those that relate to the protection of public security; the health of people, plants, and animals; articles of artistic or historic value; industrial-commercial property; and the elimination of drugs and scrap.
Positive listYes.
Negative listThere is no official list of prohibited imports, but the Council of Ministers may establish such a list as circumstances require.
Open general licensesYes.
Other nontariff measuresMeasures related to security and public health apply.
Import taxes and/or tariffsImport tariffs range from zero to 15%, with an average unweighted rate of 6%.
State import monopolyNo.
References to legal instruments and hyperlinksLaw of Foreign Trade Policy.
Exports and Export Proceeds
Repatriation requirementsExport proceeds must be collected and repatriated in full within 90 days of the date of exportation. This period may be extended for 60 days with permission from the relevant ministry.
Financing requirementsNo.
Documentation requirementsExporters must be authorized to engage in foreign trade. Customs requires that exporters provide documents accompanying the goods; in some cases, documents verifying the origin of the goods are also required. Approval from the Ministry of Foreign Trade is required for exports of military equipment, blood, narcotics and medicines containing narcotics, and other pharmaceutical products.
Preshipment inspectionYes.
Export licensesExports are free of restrictions except for certain products, such as weapons, drugs, and works of art, for which permits are required.
Export taxesNo.
References to legal instruments and hyperlinksLaw on Foreign Currency Business Operations in the Federation of Bosnia and Herzegovina; Law on Foreign Currency Business Operations in Republika Srpska; Law on Foreign Trade Policy.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsFollowing an agreement with Germany, the Central Bank of Bosnia and Herzegovina will provide documentation to Germany on pensions from Germany that are being paid by commercial banks under German jurisdiction to workers in Bosnia and Herzegovina.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsSecurities market participants must be authorized to trade on the organized markets, in accordance with laws on securities transactions.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsYes.
Sale or issue locally by nonresidentsYes.
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
Controls on derivatives and other instrumentsNo.
Controls on credit operations
By residents to nonresidentsFinancial credits by residents to nonresidents are not allowed.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsPrudential regulations on banks apply.
Controls on direct investment
Inward direct investmentForeign equity ownership is not limited, but in the production of arms, ammunition, explosives for military use, and military equipment, or in the dissemination of public information investments above 49% must be registered with the relevant ministry.
Controls on liquidation of direct investmentWhen liquidating, outstanding tax balances must be paid.
Controls on real estate transactions
Purchase locally by nonresidentsA reciprocity agreement applies to countries that were previously part of the former Federal Republic of Yugoslavia. There are no limitations on other nonresidents.
Controls on personal capital transactions
LoansLoans to nonresidents are not allowed.
By residents to nonresidentsYes.
To residents from nonresidentsResident natural persons are required to use financial credits through the authorized domestic banks.
Gifts, endowments, inheritances, and legacies
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Transfer of assets
Transfer abroad by emigrantsYes.
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksLaw on Foreign Currency Business Operations in the Federation of Bosnia and Herzegovina; Law on Foreign Currency Business Operations in Republika Srpska; Law on Securities in the Federation of Bosnia and Herzegovina; Law on Securities in Republika Srpska.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutionsThe Foreign Exchange Entity Law and the Banking Law regulate these transactions.
Lending to nonresidents (financial or commercial credits)Domestic commercial banks are not allowed to extend such credits,
Purchase of locally issued securities denominated in foreign exchangeThere are no locally issued securities denominated in foreign exchange.
Open foreign exchange position limitsOpen foreign currency position limits allow a ratio of up to 30% between its open foreign currency position and the amount of its regulatory capital.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investors
Investment firms and collective investment fundsSecurities of a particular company may not comprise more than 10% of total assets of the Investment Fund.
References to legal instruments and hyperlinksLaw on Foreign Currency Business Operations in the Federation of Bosnia and Herzegovina; Law on Foreign Currency Business Operations in Republika Srpska; Law on Banks in the Federation of Bosnia and Herzegovina; Law on Banks in Republika Srpska.
Changes During 2005
No significant changes occurred in the exchange and trade system.

BOTSWANA

(Position as of December 31,, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 17, 1995.
Exchange Measures
Restrictions and/or multiple currency practicesInformation is not publicly available,
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Botswana is the Botswana pula.
Exchange rate structure
DualSome external loans undertaken by parastatals before October 1, 1990, are protected from exchange rate movements under a FERSS. Under the scheme, risks associated with exchange rate fluctuations up to 4% are borne fully by the borrower, while the next 6% and the following 5% of fluctuations are shared between the borrower and the government in ratios of 50:50 and 25:75, respectively. Risks associated with exchange rate fluctuations in excess of 15% are borne fully by the government. The scheme is symmetrical in that the borrower and the government share any gains from an appreciation in the external value of the pula on the same basis. Under the FERSS, borrowers obtain foreign exchange for servicing their external debt at exchange rates that may differ from the market rate by more than 2%. No new loans will be issued under this scheme, and the scheme is to be phased out in 2006, once the existing loans are fully repaid in 2006.
Classification
Crawling pegThe exchange rate of the pula is determined with reference to a weighted basket of currencies comprising the SDR (approximately 30%) and the South African rand (approximately 70%). Effective May 31, 2005, the Bank of Botswana (BOB) devalued the pula by 12% against this basket. The BOB announced that from that date, the pula would be adjusted continuously against the basket on the basis of the differential between expected inflation in Botswana and in major trading partner countries. As a result, the exchange arrangement of Botswana was reclassified, effective May 31, 2005, to the category of crawling peg from the category of conventional pegged arrangement. Also effective this date, the spread between the buying and selling rates of the pula was widened to 0.5% from 0.125%.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketForward exchange cover is offered by the commercial banks, and the maturity dates of forward exchange contracts and transactions are not restricted.
Official cover of forward operationsYes.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsResidents are permitted to make payments for goods and services from outside sources using pula-denominated checks, provided traders outside Botswana are willing to accept their collection by banks outside Botswana. Such transactions are subject to supporting documentation for checks in amounts exceeding P 10,000
Payments arrangements
Bilateral payments arrangementsBotswana has bilateral trade agreements with the People’s Republic of China, the Czech Republic, the Republic of Korea, Malawi, Romania, Russia, Serbia and Montenegro, the Slovak Republic, Zambia, and Zimbabwe.
OperativeYes.
InoperativeYes.
Regional arrangementsBotswana is a member of the SACU, which allows for free import movements and, hence, has no restrictions on trade-related payments to or from SACU countries.
Administration of controlFor practical and operational purposes, several administrative powers of the BOB have been delegated to commercial banks.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)There are no restrictions on trading or owning precious metals in commercial forms, such as coins, but there are restrictions on possession of unwrought precious metals, such as bullion.
Controls on exports and imports of banknotes
On exports
Domestic currencyA declaration is required for amounts equal to or in excess of P 10,000 at the time of travel.
Foreign currencyVisitors may take out any foreign currency that they legitimately own, subject to completion of a declaration for any amount equal to or greater than the equivalent of P 10,000.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyCommercial banks are authorized to open foreign currency accounts for permanent and temporary residents and for nonresidents. These accounts facilitate foreign receipts and payments for approved transactions, without requiring conversion of foreign currency receipts into pula and vice versa, and offer protection against fluctuations in exchange rates. Commercial banks are authorized to open foreign currency accounts for their customers for any amount in any currency at the banks’ discretion.
Held abroadYes.
Accounts in domestic currency held abroadn.a
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
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 measuresImport licenses are regulated by customs and excise legislation.
Negative listYes.
Import taxes and/or tariffsAs a member of the SACU, Botswana applies a CET only on imports from outside the SACU.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsn.a
Documentation requirements
OtherThe maximum limits for exports free of payments are (1) for bona fide nonmonetary gifts, P 20,000 a year for a permanent resident; (2) for rejected goods, P 100,000 a transaction, subject to provision of documentary evidence; and (3) for commercial samples (i.e., goods for exhibitions or other promotional purposes), P 150,000 a transaction.
Export licensesCertain exports are subject to licensing, mainly for revenue purposes. The exportation of a few items, such as precious and semiprecious stones, requires a permit.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Investment-related paymentsADs may allow remittances of interim dividends without reference to the BOB for companies listed on the Botswana Stock Exchange (BSE) and may approve other remittances of dividends or profits without reference to the BOB, subject to satisfactory supporting documentation in relation to tax withholding.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsYes.
Bondfs or other debrt securities
Purchase locally by nonresidentsNonresident are permitted ot issue long-term pula-denominated bonds traded on the BSE, subject to the listing requirements of the exchange.
Sale or issue locally by nonresidentsNonresidents are permitted to issue long-term pula-denominated bonds traded on the BSE, subject to the listing requirements of the exchange.
On money market instruments
Purchase locally by nonresidentsNonresidents are not permitted to purchase the monetary instruments used by the BOB to absorb excess liquidity.
Controls on derivatives and other instrumentsDealing in these instruments is subject to prudential foreign exposure limits
Controls on credit operationsNo.
Controls on direct investmentNo.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsn.r
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial credits)A commercial bank’s loans to nonresidents are restricted to 25% of a bank’s unimpaired capital for each nonresident customer, and, in aggregate, loans to nonresidents may not exceed 800% of the unimpaired capital.
Purchase of locally issued securities denominated in foreign exchangeThese transactions are subject to the listing requirements of the BSE.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsReserve requirements apply only to domestic currency deposits.
Open foreign exchange position limitsPrudential limits are set for exposure per currency and for the overall foreign currency risk exposure. For major dealing currencies, the limit is 15% of a bank’s unimpaired capital, and for others it is 5%. The limit for the overall foreign exchange exposure is 30% of the unimpaired capital of a bank, using the shorthand method.
Provisions specific to institutional investors
Insurance company
Limits (max.) on investment portfolio held abroadLife insurance companies may invest up to 70% of their assets outside Botswana. This control is imposed by the Registrar of insurance.
Pension funds
Limits (max.) on investment portfolio held abroadPension funds may invest up to 70% of their assets outside Botswana. This control is imposed by the Pension and Provident Funds Act.
References to legal instruments and hyperlinksn.a
Changes During 2005
Exchange arrangementMay 31. The exchange rate of the pula was devalued by 12%.
May 31. The spread between the buying and selling rates of the pula was widened to 0.5%from 0.125%.
May 31. The exchange rate of the pula began to be adjusted continuously against a basket of currencies on the basis of the differential between expected inflation in Botswana and in major trading partner countries. As a result, the exchange arrangement of Botswana was reclassified to the category of crawling peg from the category of conventional pegged arrangement.

BRAZIL

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: November 30, 1999.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with UN sanctionsYes.
Exchange Arrangement
CurrencyThe currency of Brazil is the Brazilian real.
Exchange rate structureUnitary.
Classification
Independently floatingThe exchange rate of the real is determined by supply and demand in the foreign exchange market. Transactions in the exchange markets are carried out by banks, brokers, tourist agencies, and providers of accommodation for tourists that are authorized to deal in foreign exchange. Brokers and tourist agencies deal only in banknotes, bank drafts, and traveler’s checks. Providers of accommodation for tourists may buy only banknotes, bank drafts, and traveler’s checks.
Exchange taxA 5% tax is applied to inflows related to external loans with a minimum maturity of up to 90 days. A 2% tax is applied to remittances related to obligations of credit card administration companies to pay for purchases by their clients. The tax is zero for other foreign exchange transactions.
Exchange subsidyNo.
Forward exchange marketBanks are permitted to trade foreign exchange on a forward basis within statutory limits (bought and sold) of the exchange position; such transactions must be settled within 360 days.
References to legal instruments and hyperlinksLaw 9,069 (1995); Decree 4,494 (2002); Resolution NMC 3,265 (2005); Communique CBB 6,565 (1999).
Arrangements for Payments and Receipts
Prescription of currency requirementsPrescription of currency is required only in foreign exchange transactions related to the LAIA covenant. These transactions must be made in dollars.
Use of foreign exchange among residentsThe use of foreign exchange for pricing or settlement of transactions among residents is prohibited.
Payments arrangementsAll interbank transactions and clearinghouse operations must be effected through the Central Bank of Brazil’s (CBB) real-time gross-settlement payments system
Regional arrangementsBrazil is a member of the LAIA.
Clearing agreementsPayments between Brazil and Argentina, Bolivia, Chile, Colombia, the Dominican Republic, Ecuador, Mexico, Paraguay, Peru, Uruguay, and República Bolivariana de Venezuela may be made through special central bank accounts within the framework of the multilateral clearing system of the LAIA.
Administration of controlThe National Monetary Council (NMC) is responsible for formulating the overall foreign exchange policy. In accordance with the guidelines established by the NMC, exchange control regulations affecting foreign capital and the management of international reserves are under the jurisdiction of the CBB. Foreign trade policy is formulated by the Chamber of Foreign Trade, which consists of the minister of development, industry, and foreign trade (head); the minister of the civil house; the minister of finance; the minister of planning, budget, and administration; the minister of foreign affairs; and the minister of agriculture and supply. The Ministry of Development, Industry, and Foreign Trade is in charge of implementing trade policy, through the Secretariat of Foreign Trade (SECEX).
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)There are three separate markets for gold transactions: the financial, exchange, and commercial markets. Transactions that occur in the financial market are regulated by the CBB. The first domestic transaction of newly mined gold on this market is subject to a financial transactions tax of at least 1%. Rules regarding gold transactions for industrial purposes are defined separately by the federal states, which also establish different rates for the commercial tax levied thereon.
Controls on domestic ownership and/or tradeYes.
Controls on external tradeThe CBB and authorized institutions may buy and sell gold for monetary use on the international market. Imports and exports of gold for nonmonetary use are subject to the same procedures as those that are applied through the SECEX with respect to other products.
Controls on exports and imports of banknotesTravelers may take out or bring in domestic or foreign banknotes, checks, or traveler’s checks without restriction but must declare to customs any amount over R$10,000 or its equivalent.
References to legal instruments and hyperlinksLaws 4,595 (1964) and 9,069 (1995); Resolutions NMC 2,524 (1998) and 2,882 (2001).
Resident Accounts
Foreign exchange accounts permittedThese accounts may be held by authorized foreign exchange dealers, tourist agencies not authorized to deal in foreign exchange, Brazilian citizens living abroad, the Brazilian Post Office Administration, credit card administration companies, companies responsible for the development and execution of projects in the energy sector, and insurance and reinsurance companies and reinsurance brokers.
Held domesticallyYes.
Accounts in domestic currency held abroadn.r.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksDecree 42,820 (1957)
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be held by embassies, foreign delegations, international permitted organizations, foreign transportation companies, foreign citizens in transit in the country, Brazilian citizens living abroad, and reinsurance companies.
Domestic currency accountsYes.
Convertible into foreign currencyNatural and juridical persons (financial and nonfinancial institutions) may hold these accounts. Only resources deposited in nonresident banks or resources that have entered Brazil through foreign currency sales and have not been withdrawn may be repatriated to foreign countries. These resources continue to be available to nonresidents once they are withdrawn, but only in the national currency.
Blocked accountsNo.
References to legal instruments and hyperlinksDecree 42,820 (1957); Resolution NMC 3,265 (2005).
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsExternal financing of imports for periods in excess of 360 days must be registered in the Financial Operations Registry, an electronic system. Financing is considered approved by the CBB if the registration is not refused by its Department of Foreign Capital and Exchange within five days. The time limit for finalizing anticipatory settlements for critical imports is 30 days.
Documentation requirements for release of foreign exchange for importsAll importers must be registered in the SECEX Importer and Exporter Register; registration automatically occurs with the first transaction. Imports must be registered in the import subsystem of the Integrated Foreign Trade System (SISCOMEX/IMPORT), which allows importers, carriers, banks, and brokers to register the various stages of an import process directly through the interlinked computers of the SECEX, customs, and the CBB. Imports are grouped into the following three categories: (1) imports that do not require automatic licenses, (2) imports that are subject to automatic import licenses, and (3) prohibited imports. Federal ministries and subordinate agencies and public enterprises are required to submit for approval an annual investment program specifying their expected import requirements. There is a simplified arrangement for foreign exchange transactions related to imports of small amounts.
Domiciliation requirementsThese are required for imports originating or proceeding from countries under restrictions determined by the UN Security Council.
Letters of creditDrafts or LCs must be settled on maturity against the presentation of the appropriate documents by the importer. Exchange contracts for imports financed under LCs must be closed on the date of settlement or two working days before the maturity date of the LCs.
OtherFederal ministries and subordinate agencies and public enterprises are required to submit for approval an annual investment program specifying their expected import requirements. There is a simplified arrangement for foreign exchange transactions related to imports of small amounts.
Import licenses and other nontariff measuresIn general, imports are exempt from prior approval requirements. However, some imports require prior approval (i.e., an import license) from the SECEX or other government agency. This approval is promptly given to importers whenever the licensing requirements are fulfilled. As a rule, licenses are valid for 60 days, except for imports of custom-made capital goods. The Secretariat of Federal Revenue issues clearance certificates for certain groups of commodities to special bonded warehouse importers. Import licenses for a number of specified imports may be obtained after the commodities have been landed and customs clearance obtained. The importation of certain products requires approval of the Ministry of Science and Technology. For some products, eligibility for exemption from import duties may be precluded by the existence of a satisfactory domestic equivalent.
Negative listImports of agrochemical products not authorized under Brazilian regulations; weapons; and certain drugs that are not licensed for reasons of security, health, or morals are prohibited.
Licenses with quotasIn addition to imports under Brazilian concessions covered by the LAIA agreement, goods imported through the Manaus and Tabatinga free zones are subject to an annual quota. Foreign goods up to the equivalent of US $2,000 imported into the Manaus free trade zone may be transferred to other parts of Brazil (as a passenger’s baggage) free of import taxes. The tariff rate on imports of toys is 20% plus a possible safeguard extension of 9% for 2005 and 8% for 2006.
Other nontariff measuresSanitation and measurement requirements must be observed.
Import taxes and/or tariffsThe MERCOSUR Customs Union agreement stipulates a CET ranging from zero to 20%, though higher rates may be exceptionally applied in particular cases, such as 53 products pertaining to the automotive sector, on which a rate of 35% applies. Additionally, the MERCOSUR countries have approved the use of temporary national tariff exceptions, according to which Brazil exempts from the CET 100 tariff lines until December 31, 2005. Exemptions for 302 tariff lines pertaining to information and technology goods will expire on the same date.
Taxes collected through the exchange systemForeign exchange transactions related to imports of goods are exempt from the tax on financial operations, and foreign exchange transactions related to imports of services have a tariff of zero.
State import monopolyImports of petroleum and derivatives are subject to prior disclosure from the National Petroleum Agency.
References to legal instruments and hyperlinksLaw 10,755 (2003).
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsEffective March 14, 2005, proceeds must be surrendered before 210 days (previously, 180 days) from the shipment date for operations not subjected to the Credit Register date for financed operations.
Financing requirementsNo.
Documentation requirements
Preshipment inspectionInspection is required for commodities subject to standardization.
OtherDocumentation includes invoices, international shipment notification, and export registration. There is a simplified arrangement for foreign exchange transactions related to exports up to the equivalent of US $20,000.
Export licensesExports are prohibited of wild animals and their hides, hair, feathers, or eggs in any form; jacaranda-da-Bahia wood; ipecacuanha plants; amber and white varieties of honey; and antiques older than 100 years. Exports of certain goods require prior approval of the SECEX, including those effected through bilateral accounts, exports without exchange cover, exports on consignment, re exports, and exports requiring prior authorization from government agencies. The SISCOMEX integrates the activities related to the registration, monitoring, and control of foreign trade operations into a single computerized flow of information. The SISCOMEX comprises two subsystems (exports and imports). The exports subsystem allows exporters, carriers, banks, and brokers to register the various stages of an export process directly through the interlinked computers of the SECEX, customs, and the CBB.
With quotasExports of sawed or cut pine woods, mahogany, Brazilian walnut, and virola are subject to quotas. For exports of ethyl alcohol and sugar in any form, including sugarcane syrup unsuitable for human consumption, the eligibility for exemption from the export tax of 40% is subject to quotas on the basis of an annual quantity exceeding domestic necessity authorized by the Industry, Trade, and Tourism Minister and the MOF. An annual quota is in place for imports under Brazilian concessions, subject to quotas due to agreements with the LAIA member countries and for goods imported into the Manaus and Tabatinga free zones. Foreign goods up to the equivalent of US $2,000 imported into the Manaus free trade zone may be transferred to other parts of Brazil (as a passenger’s baggage) free of import taxes.
Export taxesIn general, exports are exempt from export taxes or are subject to a tax of zero. However, export duty applies to the following: (1) cashew nuts with husk, 30% whenever the amount of exports exceed 10,000 tons; (2) fume products exported to Paraguay and Uruguay, 105%; (3) cigarettes to Central America, the Caribbean, and South America, 150%; (4) raw hides, 9%; (5) tanned leather and skins, 7% for 2005 and 4% for 2006; (6) cylinders for cigarette filters to Central America, the Caribbean, and South America (except Argentina, Chile, and Ecuador), 105%; and (7) weapons and ammunition to Central America, the Caribbean, and South America (except Argentina, Chile, and Ecuador), 150%.
References to legal instruments and hyperlinksDecree 23,258 (1933); Resolution NMC 3,266 (2005).
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related paymentsThere are established rules and surveillance procedures for unloading and storage costs related to operations freely conducted in the commercial market. Regulations on insurance and reinsurance transactions in foreign currency are set by the National Council on Private Insurance.
References to legal instruments and hyperlinksResolution NMC 3,265 (2005).
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirements
Surrender requirementsExchange proceeds from current invisibles must be sold to authorized banks at the prevailing market rate.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksResolution NMC 3,265 (2005).
Capital Transactions
Controls on capital transactionsNonresident capital transactions must be registered electronically at the CBB.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsLimitations apply to participation in certain economic activities.
Sale or issue locally by nonresidentsThe sale of shares of foreign enterprises (essentially from MERCOSUR countries) in Brazil is regulated through share custody certificates or directly. The only way to sell other foreign securities is through Brazilian Depository Receipts (BDRs), which allow the placement of certificates representing these shares in the Brazilian market.
Purchase abroad by residentsResidents are allowed to purchase bonds or other debt securities and money market securities through dedicated offshore investment funds (FIEX).
Sale or issue abroad by residentsCorporations may issue depository receipts abroad. In the MERCOSUR countries, Brazilian enterprises may operate through share custody certificates or directly.
Bonds or other debt securities
Sale or issue locally by nonresidentsNonresidents may offer these instruments only through private placements.
Purchase abroad by residentsResidents may purchase bonds or other debt securities through FIEX.
Controls on derivatives and other instrumentsForeign investors have access to derivative markets. They are required to register locally for identification purposes.
Sale or issue locally by nonresidentsNonresident financial institutions are allowed to issue swaps in the domestic market, subject to constituting the regulatory capital charge against the counterparty credit risk of such operations if they are not guaranteed by a clearinghouse. In addition, nonresidents may trade any exchange-listed derivative contracts.
Purchase abroad by residentsPrivate sector entities may engage in hedging operations with financial institutions or stock exchanges abroad to protect themselves against the risk of variations in interest rates, exchange rates, and commodity prices. Payments and receipts in foreign currency scheduled or expected to occur in the future in connection with commercial or financial rights or obligations may also be protected by hedging.
Controls on credit operations
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsEffective March 14,2005, CBB authorization is not required. Previously, guarantees by non financial juridical persons in credit operations for their foreign subsidiaries were subject to prior authorization by the CBB.
Controls on direct investment
Outward direct investmentEffective March 14, 2005, Brazilian non financial enterprises may make transfers for outward direct investment purposes without limitation. Previously, the limit was US $5 million including all remittances in the previous 12 months. Transfers exceeding the established limit must first be submitted to the CBB before the exchange contract. Exchange operations in which the purchaser of the foreign exchange is an entity belonging to the direct or indirect public administration are subject to prior authorization by the CBB. Investments abroad by institutions authorized to operate by the CBB must obtain the prior approval of the CBB’s Department of Financial System Organization and satisfy several conditions, especially with respect to paid-up capital, net assets, time in operation, fixed-asset ratios, and borrowing ceilings.
Inward direct investmentThere are legal limitations on participation in certain economic activities.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsNo.
Controls on personal capital transactionsEffective March 14, 2005, no controls apply on loans, gifts, endowments, inheritances, and legacies between residents and nonresidents and on settlements of debts abroad by immigrants.
References to legal instruments and hyperlinksLaw 4,131 (1962); Decree55,762 (1965); Resolutions NMC 2,337 (1996), 2,689 (2000), 2,770 (2000), and 3,265 (2005); Circular BBC 3,305 (2005).
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending locally in foreign exchangeAll contracts, securities, or other documents, as well as any obligations executable in Brazil that require payment in foreign currency, are null and void. Consequently, banks are prohibited from granting foreign currency loans within Brazil. However, this regulation does not apply to the on-lending of external foreign currency loans.
Purchase of locally issued securities denominated in foreign exchangeDomestic operations in foreign currencies are prohibited.
Investment regulations
Abroad by banksYes.
In banks by nonresidentsYes.
Open foreign exchange position limitsEffective January 2,2006, banks authorized to conduct foreign exchange operations are allowed to hold long positions exceeding the equivalent of US $6 million, including all currencies and all of ach bank’s branches. Previously, amounts exceeding this ceiling had to be deposited with the CBB in dollars. The ceiling on banks’ short exchange position is unlimited, provided the total amount of combined exposure in gold, assets, and liabilities in foreign exchange does not exceed 30% of each bank’s base capital. Banks must increase capital by their open positions over 5% of capital.
For licensed dealers (brokerage firms; securities distributors; and credit, financing, and investment enterprises), short exchange positions are not allowed, and the ceiling on the long exchange position is the equivalent of US $500,000.
Provisions specific to institutional investors
Insurance Companies
Limits (max.) on investment portfolio held abroadInstitutional investors may invest up to 10% of their technical reserves in investment fund shares abroad. Private social security agencies may also invest up to 50% of their reserves, together with other investments up to the same ceiling, in shares of open companies, publicly issued convertible debentures, bonds for subscriptions to shares issued by open companies, and certificates of deposit for shares issued by companies headquartered in MERCOSUR countries.
Pension funds
Limits (max.) on investment portfolio held abroadPrivate social security agencies may invest up to 50% of their reserves, together with other investments up to the same ceiling, in shares of open companies, publicly issued convertible debentures, bonds for subscriptions to shares issued by open companies, and certificates of deposit for shares issued by companies headquartered in MERCOSUR countries.
References to legal instruments and hyperlinksLaw 10,192 (2001); Circular CBB 3,307 (2005).
Changes During 2005
Exports and export proceedsMarch 14. The deadline for surrendering export proceeds was extended to 210 days from 180 days
Capital transactions
Controls on capital and money market instrumentsMarch 14. The US $20,000 a person a year limit on investment in shares of the main company by employees of firms belonging to foreign economic groups was eliminated.
Controls on credit operationsMarch 14. The CBB authorization requirement for guarantees by non financial juridical persons in credit operations for their foreign subsidiaries was eliminated
Controls on direct invetmentMarch 14. The US $5 million limit on remittances for outward direct investment by non financial private enterprises was eliminated.
Controls on personal capital transactionsMarch 14. The CBB authorization requirement was eliminated on loans, gifts, endowments, inheritances, and legacies between residents and nonresidents and on settlements of debts abroad by immigrants.
Changes During 2006
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsJanuary 2. The requirement to deposit long positions exceeding the equivalent of US $6 million, including all currencies and all of each bank’s branches, with the CBB in dollarswas abolished.

BRUNEI DARUSSALAM

(Position as of December 31, 2005)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: October 10, 1995.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictionsNo.
Exchange Arrangement
CurrencyThe currency of Brunei Darussalam is the Brunei dollar.
Other legal tenderThe Singapore dollar also circulates as customary tender.
Exchange rate structureUnitary.
Classification
Currency board arrangementThe Brunei dollar is issued by the Brunei Currency and Monetary Board (BCMB) only against payments in Singapore dollars and at par. Under the terms of a 1967 Currency Interchangeability Agreement (CIA) between the BCMB and the Monetary Authority of Singapore (MAS), the Singapore dollar is customary tender in Brunei Darussalam and the Brunei dollar in Singapore. The BCMB and MAS have accepted each other’s currency and have agreed to mutual exchange at par and without charge. They have instructed their banks to do the same with their customers. Any excess Brunei or Singapore currency is repatriated regularly, with the issuing institution bearing the costs, and settlements are made in the other country’s currency. The BCMB deals only in Singapore dollars and does not quote rates for other currencies. Banks, however, are free to deal in all currencies, with no restrictions on amount, maturity, or type of transaction.
The Brunei Association of Banks fixes daily buying and selling rates for electronic transfers and sight drafts in 17 other currencies on the basis of the interbank quotations for these currencies in relation to the Singapore dollar. Banks in Brunei Darussalam must apply these rates for transactions with the general public for amounts up to B$100,000. Exchange rates for amounts exceeding B$100,000 are set competitively by each bank on the basis of the current interbank quotations for the Singapore dollar on the Singapore market.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThere is no forward market for foreign exchange in Brunei Darussalam. However, as a result of the CIA, foreign exchange risk may be hedged in terms of Singapore dollars by resorting to facilities available in that country, including foreign currency futures and options traded on the Singapore International Monetary Exchange, over-the-counter forward transactions arranged by banks in Singapore, and the short-term foreign exchange swap market operated among the banks in the Singapore money market.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsn.a
Payments arrangements
Regional arrangementsBrunei Darussalam is a member of the ASEAN.
Administration of controlThere are no formal exchange controls since the Exchange Control Act was repealed in 2000.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeOnly banks licensed to operate in Brunei Darussalam and gold dealers and jewelers specifically authorized by the MOF may buy and sell gold bars. Gold bars are not subject to import duty, but a 5% duty is levied on the importation of gold jewelry.
Controls on external tradeYes.
Controls on exports and imports of banknotesNo.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadn.a
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedThere is no distinction between accounts of residents and nonresidents of Brunei Darussalam.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a
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
Negative listA few imports are banned or restricted for environmental, health, safety, security, or religious reasons. Alcoholic beverages may be imported only by nonresident non-Muslims.
Import taxes and/or tariffsSome 70% of items (including basic foodstuffs, construction materials, and educational materials) are exempt from customs duties. Most other goods are subject to tariff rates of 5%, 15%, or 20%. The maximum tariff is 30%.
State import monopolyNo.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsn.a
Documentation requirementsNo.
Export licensesExport licenses are required for alcoholic beverages, cigarettes, diesel, gasoline, kerosene, rice, salt, and sugar.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersThere are indicative limits or bona fide tests for all payments for invisible transactions and current transfers.
Investment-related paymentsInterest payments are subject to a 20% withholding tax. Information is not available on the payment of amortization of loans and depreciation of direct investments.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investment
Inward direct investmentThere are no sectoral controls, but activities relating to national food security and those based on local resources require some degree of local participation. Industries producing for the local market that are not related to national food security and industries that solely export may be fully foreign owned. Joint ventures are particularly encouraged in export import industries and activities supporting such industries. At least one-half of the directors of a company must be either Brunei citizens or residents of Brunei Darussalam.
Controls on liquidation of direct investmentNo
Controls on real estate transactions
Purchase locally by nonresidentsOnly Brunei citizens are allowed to own land. However, foreign investors may lease land on a long-term basis, including sites destined for industry, agriculture, agroforestry, and aquaculture.
Controls on personal capital transactions
Transfer of gambling and prize earningsYes.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Maintenance of accounts abroadYes.
Lending to nonresidents (financial or commercial credits)Yes.
Lending locally in foreign exchangeYes.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsYes.
Liquid asset requirementsYes.
Differential treatment of deposit accounts held by nonresidents
Reserve requirementsYes.
Provisions specific to institutional investorsNo.
References to legal instruments and hyperlinksn.a.
Changes During 2005
No significant changes occurred in the exchange and trade system.

BULGARIA

(Position as of January 31, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: September 24, 1998.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51Yes.
Exchange Arrangement
CurrencyThe currency of Bulgaria is the Bulgarian lev.
Exchange Rate Structure.Unitary.
Classification
Currency board arrangementAn amendment to the Law on the Bulgarian National Bank (BNB) effectively established a currency board arrangement. The peg currency is the euro at the rate of lev 1.95583 per €1. The BNB is required to buy and sell euros on demand against leva on the basis of spot exchange rates that may not differ from the official exchange rate by more than 0.5%, inclusive of any fees, commissions, and other charges to the customer. Cash transactions involving an exchange rate that differs from the official rate by more than 10% require a written contract.
Exchange taxYes.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a
Arrangements for Payments and Receipts
Prescription of currency requirementsBalances remain on clearing accounts maintained under former bilateral arrangements. These arrangements are now inoperative, and the only transactions that take place are those that are intended to settle the balances. Valuation and settlement of the balances take place in convertible currencies.
Controls on the use of domestic currency
For current transactions and paymentsYes.
For capital transactions
Transactions in capital and money market instrumentsYes.
Credit operationsYes.
Payments arrangements
Bilateral payments arrangements
InoperativeThere are arrangements with Albania, Cambodia, Guinea, the Democratic People’s Republic of Korea, the Lao People’s Democratic Republic, and the Syrian Arab Republic. Bulgaria has outstanding transferable ruble accounts with Cuba and Mongolia.
Regional arrangementsBulgaria is a party to the CEFTA and has concluded free trade agreements with Albania, Bosnia and Herzegovina, the EFTA member states, Israel, the former Yugoslav Republic of Macedonia, Moldova, Serbia and Montenegro, and Turkey.
Barter agreements and open accountsThere are inactive agreements with the Islamic State of Afghanistan, Guyana, and Mozambique.
Administration of controlForeign exchange control is exercised by the MOF, the BNB, the customs administration, and the postal authorities.
Payments arrears
PrivateFour commercial banks that are in bankruptcy have outstanding debt-service arrears.
Controls on trade in gold (coins and/or bullion)Residents carrying out extracting, processing, or other transactions involving precious metals and stones as their business activity are obliged to register with the MOF within 14 days before starting their activity.
Controls on domestic ownership and/or tradeBanks may trade in precious metals.
Controls on external tradeResident and nonresident natural persons may export and import freely precious metals and stones or products there of for personal use in amounts prescribed by MOF regulations. Transactions exceeding these quantities are treated as commercial goods and have to be declared to customs. The export or import of precious metals and stones by mail are prohibited except in the case of parcels with declared values. This prohibition does not apply to the BNB and the commercial banks. Imports of diamonds are subject to the Kimberley Process Certification Scheme.
Controls on exports and imports of banknotes
On exportsResident and nonresident natural persons may export domestic or foreign currencies in cash without a declaration if the amount is less than the equivalent of lev 8,000. Amounts exceeding lev 8,000 must be declared to customs. In the case of exports exceeding lev 25,000, resident and nonresident natural persons must obtain a certificate from the tax authorities stating that they do not have any tax arrears and must declare to customs the origin of the funds. Nonresident natural persons may export cash amounts exceeding lev 25,000 or its equivalent in foreign currency with a customs declaration, provided the amounts do not exceed the amount of foreign currency previously imported and declared to customs. The export of domestic and foreign banknotes by mail is prohibited, except in cases of parcels with declared values. This prohibition does not apply to the BNB and commercial banks.
Domestic currencyYes.
Foreign currencyYes.
On importsResident and nonresident natural persons may import unlimited amounts of domestic and foreign currency in cash; however, amounts exceeding lev 8,000 or its equivalent in foreign currency must be declared to customs.
Domestic currencyYes.
Foreign currencyYes.
References to legal instruments and hyperlinksn.a
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyThe crediting and debiting of up to the equivalent of lev 5,000 are not subject to regulations. Transfers abroad exceeding the amount of lev 5,000 may be made only by commercial banks after declaring, for statistical purposes, the reason for the transfer. For payments abroad, the declaration must be submitted on the day of the order; for receipts, within 30 days after the account of the beneficiary has been credited. In cases where amounts exceed the equivalent of lev 25,000, the transferor must submit documentation. If the transfer is related to transactions for which a BNB statistical declaration is required, the commercial bank should verify the declaration with the B
Held abroadExport proceeds must be repatriated. Approval is not required, but a declaration must be submitted to the BNB within 15 days after the account has been opened.
Approval requiredApproval is not required, but a declaration for statistical purposes must be submitted to the BNB within 15 days after a payment is made
Accounts in domestic currency held abroadApproval is not required, but a declaration must be submitted to the BNB within 15 days after a payment is made.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksn.a
Nonresident Accounts
Foreign exchange accounts permittedYes.
Approval requiredTransfers abroad exceeding the amount of lev 5,000 may be made only by commercial banks after declaring, for statistical purposes, on the day of the order the reason for the transfer.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsn.a
References to legal instruments and hyperlinksn.a
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsYes.
Import licenses and other nontariff measures
Negative listImports of certain goods—such as dangerous substances with ozone-depleting potential; machinery and equipment for air conditioning using Freon 12; or refrigerators, freezers, and other equipment using Freon 11 or 12—are banned for health and security reasons.
Licenses with quotasPrior licensing is required for imports of the following products originating in the EU subject to tariff quotas (opened in accordance with the European Association Agreement): meat of domestic swine, fresh, chilled, or frozen; meat of swine, salted, in brine, dried, or smoked; sausages and similar products; prepared or preserved meat, meat offal, or blood of swine; meat or edible offal of poultry; frozen subcutaneous pig fat, salted or in brine; milk and cream, in powder, granulates, or other solid form; and prepared or preserved meat of poultry.
Effective January 1, 2006, prior licensing is required for one import subject to a global tariff quota (opened in accordance with the WTO schedule of concessions and commitments of the Republic of Bulgaria): raw cane sugar not containing added flavoring or coloring.
Other nontariff measuresNonautomatic licenses (permits) are applied to monitor trade in arms and ammunition and to protect human, animal, and plant health and life. They are required for imports of nuclear materials, radioactive substances and other sources of ionizing radiation; asbestos, asbestos products, and asbestos-containing materials and products; polygraph production for public supply; powder, explosive, and pyrotechnical materials and derivatives there of for civil application; trinitrotoluene (TNT); certain weapons and ammunition; medications for humans; products for plant protection; veterinary medical products; live game and its genetic material; wild flora and fauna species included in the Washington Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), including live or dead species as well as parts and products there of; alien flora and fauna species designated for propagation and breeding (except for some parrot species); military and special production, and products and technologies for possible dual (civil and military) use; narcotic and psychotropic substances; controlled chemicals used for the production of narcotic and psychotropic substances; certain types of wastes, according to the Basel Convention on Hazardous Wastes; and ozone-depleting substances, according to the Montreal and Kyoto Protocols.
Import taxes and/or tariffsThere are 22 tariff bands; import tariffs range from zero to 74% and are calculated on a transaction-value basis in foreign currency and converted to leva. The maximum rate of import tariffs for nonagricultural goods is 27%, and for agricultural goods, 74%. The arithmetic mean tariff for all products is 11.6%. The simple unweighted average level of Bulgaria’s MFN tariffs is 11.10%. The average tariff for industrial goods is 8.62%, and for agricultural products, 21.69%.
State import monopolyno.
References to legal instruments and hyperlinksn.a
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirements
Letters of creditYes.
OtherYes.
Export licensesAutomatic licenses (registration) are required for exports of precious metals and unsawn timber (coniferous and deciduous with a diameter at the thin end of more than 4 cm, and all wood species, as well as firewood, except for fire-burnt timber). Nonautomatic licenses (permits) are required for exports of nuclear material, radioactive substances, and other sources of radiation; gunpowder, explosives, and pyrotechnic material and their derivatives for civil uses; TNT; certain weapons and ammunition; artifacts and objects with historical, archeological, numismatic, ethnographic, artistic, and antiquarian value, as well as museum-grade natural specimens; wild plants and parts there of, as well as tetter and moss; wild mushrooms; wild animals and parts there of (other than those that are subject to the regulations of the Hunting and Game Protection Act); clams, sea and land snails, and frogs, including those raised on farms; live game and genetic material there of, as well as hunting trophies, shed game horns and antlers, and game products; military products or specialpurpose products, and products and technologies for possible dual use (civil and military); narcotic and psychotropic substances; and controlled chemicals used in the production of narcotic and psychotropic substances.
Without quotasYes.
Export taxesNo.
References to legal instruments and hyperlinksn.a
Payments for Invisible Transactions and Current Transfers
Controls on these transfersTransfers abroad exceeding the amount of lev 5,000 may be made only by commercial banks after declaring, for statistical purposes, the reason for the transfer.
Trade-related payments
Indicative limits/bona fide testPayments abroad for trade purposes that exceed lev 25,000 are subject to documentary requirements.
Investment-related payments
Indicative limits/bona fide testPayments abroad for investment purposes that exceed lev 25,000 are subject to documentary requirements.
Personal payments
Indicative limits/bona fide testPayments abroad exceeding lev 25,000 are subject to documentary requirements.
Foreign workers’ wagesForeign workers’ wages may be transferred abroad, provided applicable taxes have been paid.
Other payments
Indicative limits/bona fide testPayments abroad exceeding lev 25,000 are subject to documentary requirements.
References to legal instruments and hyperlinksn.a
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operations
Financial credits
By residents to nonresidentsYes.
To residents from nonresidentsYes.
Guarantees, sureties, and financial backup facilities
By residents to nonresidentsYes.
Controls on direct investment
Outward direct investmentA declaration to the BNB is required within 15 days of concluding a direct investment transaction abroad. Direct investment abroad occurs when a resident (1) acquires equity participation in a nonresident juridical entity and is eligible to exercise more than 10% of the voting power at a shareholder meeting, (2) extends a loan for the abovementioned purpose, (3) makes additional investments to an existing direct investment, or (4) acquires real estate for business purposes. Registration is not required for investments in amounts up to the equivalent of lev 25,000; however, for purposes of balance of payments statistics, such transactions must be declared to the BNB within 15 days of their conclusion. For investments exceeding this limit, the appropriate documents must be submitted to a domestic bank.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsFor purchases exceeding lev 5,000, the appropriate documents must be submitted to a domestic bank.
Purchase locally by nonresidentsNonresidents may not purchase or own land. If they inherit land, they must dispose of it within three years. Foreign citizens and foreign legal entities may acquire the right of ownership in premises and limited property rights to real estate, unless otherwise provided by law. A foreign state or an intergovernmental organization may acquire right of ownership in land, premises, and limited property rights to real estate on the basis of an international treaty, by way of legislation, or through an act of the Council of Ministers.
Controls on personal capital transactions
Loans
By residents to nonresidentsYes.
To residents from nonresidentsYes.
References to legal instruments and hyperlinksn.a
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadPrior registration with the BNB is required if the bank is licensed to carry out only domestic transactions.
Maintenance of accounts abroadPrior registration with the BNB is required if the bank is licensed to carry out only domestic transactions.
Open foreign exchange position limitsEach bank must maintain daily (1) a maximum ratio of up to 15% between its open position in any particular currency and the amount of its own funds, excluding the euro; and (2) a maximum ratio of up to 30% between its net open foreign currency position and the amount of its own funds, excluding the euro.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsNo.
Insurance companies
Currency-matching regulations on assets/liabilities compositionCurrency matching is required when the assets in a certain currency exceed 7% of the assets in the other currencies. Twenty percent of the overall technical reserves may be covered with assets in a currency different from the one in which they are formed if the total assets in all currencies are at least equal to the total liabilities in all currencies.
Pension funds
Limits (max.) on securities issued by nonresidentsPension funds for additional mandatory pension insurance may invest not more than 15% in foreign securities.
References to legal instruments and hyperlinksn.a
Changes During 2005
No significant changes occurred in the exchange and trade system.
Changes During 2006
Imports and import paymentsJanuary 1. Prior licensing was required for raw cane sugar not containing added flavoring or coloring that was subject to a global tariffquota.

BURKINA FASO

(Position as of February 28, 2006)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: June 1, 1996.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2005.
International security restrictions
In accordance with UN sanctionsThe WAEMU Council of Ministers adopted, September 19,2002, Regulation 14/2002/ CM/UEMOA on the freezing of funds within the framework of action to combat the financing of terrorism in the member states of the union. This framework regulation facilitates the enforcement of the decisions on the freezing of funds made by the Sanctions Committee of the UN Security Council, based on the list of persons and entities established by that committee.
Exchange Arrangement
CurrencyThe currency of Burkina Faso 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 the 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 foreign exchange market vis-à-vis the euro.
Exchange taxEffective April 1, 2005, a symmetrical bank commission of 0.3% (pre