Annual Report on Exchange Arrangements and Exchange Restrictions, 2007
Chapter

ANTIGUA AND BARBUDA

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
October 2007
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(Position as of January 31, 2007)

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, 2006.
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.
Other security restrictionsYes.
References to legal instruments and hyperlinksn.a.
Exchange Arrangement
CurrencyThe currency of Antigua and Barbuda is the Eastern Caribbean dollar, issued by the ECCB.
Exchange rate structureUnitary.
Classification
Currency board arrangementAntigua and Barbuda participates in a currency union with seven other members of the ECCU and has no separate legal tender. The Eastern Caribbean dollar is pegged to the U.S. dollar, under a currency board arrangement, at EC$2.70 per US$1. Effective January 1, 2007, the exchange arrangement of the ECCU countries has been reclassified to the category currency board arrangement from the category exchange arrangement with no separate legal tender. The new classification is based on the behavior of the common currency, whereas the previous classification was based on the lack of a separate legal tender. The new classification thus reflects only a definitional change, and is not based on a judgment that there has been a substantive change in the exchange regime or other policies of the currency union or its members.
Exchange taxNo.
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.
Controls on the use of domestic currency
For capital transactions
Transactions in derivatives and other instrumentsn.r.
Use of foreign exchange among residentsYes.
Payments arrangements
Regional arrangementsAntigua and Barbuda is a member of CARICOM and the OECS.
Clearing agreementsYes.
Administration of controlThe MOF applies controls to all foreign exchange transactions.
Payments arrears
OfficialYes.
Privaten.a.
Controls on trade in gold (coins and/or bullion)No.
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 domesticallyCommercial banks are required to report external accounts operations to the MOF on a monthly basis.
Approval requiredYes.
Held abroadn.a.
Approval requiredn.a.
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. Commercial banks are required to report external accounts operations to the MOF on a monthly basis.
Approval requiredYes.
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.
Domiciliation requirementYes.
Letters of creditYes.
Othern.a.
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 Industry and Commerce. Nonautomatic licensing is applied on products subject to quantitative restrictions.
Licenses with quotasQuantitative restrictions are applied to carbonated beverages, beer, stout, ale, and porter. In agriculture, quantitative restrictions are applied if there is domestic supply.
Other nontariff measuresn.a.
Import taxes and/or tariffsCustoms 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. There is a customs service charge with a maximum rate of 10%.
Taxes collected through the exchange systemn.a.
State import monopolyThere is a monopoly on imports of petroleum products.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementsn.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.
Collected through the exchange systemn.a.
Other export taxesn.a.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersPayments for certain categories of invisibles (related to authorized imports) do not 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.
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 limitsPayments related to medical expenses and studies abroad are permitted.
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.
Credit card use abroadn.a.
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.
Capital Transactions
Controls on capital transactionsYes.
Repatriation requirementsn.a.
Surrender requirementsn.a.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operations
Financial credits
By residents to nonresidentsMOF approval is required for lending to nonresidents by commercial banks.
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 transactions
Transfer of gambling and prize earningsn.a.
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.
Borrowing abroadn.a.
Maintenance of accounts abroadn.a.
Lending to nonresidents (financial or commercial credits)MOF approval is required for these transactions. Loans are not subject to a 3% stamp duty.
Lending locally in foreign exchangen.a.
Purchase of locally issued securities denominated in foreign exchangen.a.
Investment regulationsn.a.
Open foreign exchange position limitsn.a.
Provisions specific to institutional investorsn.a.
References to legal instruments and hyperlinksn.a.
Changes during 2006
No significant changes occurred in the exchange and trade system.
Changes during 2007
Exchange arrangementJanuary 1. The exchange arrangement of the ECCU countries was reclassified to the category currency board arrangement from the category exchange arrangement with no separate legal tender. The new classification reflects only a definitional change.

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