Eritrea Adopts Liberalization of Foreign Currency

The Revolution Begins
The Revolution Begins

By TesfaNews,

The government of Eritrea declares the adoption of proclamation No. 173/2013 aimed for the full liberalization of foreign currency in the country effective as of today.

In line with the proposed fiscal policy reforms for this year, the new law pertains on the opening of foreign currency deposit accounts, domestic commercial transactions and/or contracts, currency remittance and exchange, as well as the declaration of currency of travelers arriving into and departing from Eritrea. 

Previous Legal Notice No. 101/2005 and Legal Notice No. 102/2005 issued to amend the former are hereby repealed and replaced by this proclamation.

Accordingly, Eritrean citizens residing inside and abroad as well as government institutions inside Eritrea can now open foreign currency accounts and do international transactions with out any limitation and explanation including on the amount of foreign currency that they want to bring into or take out from Eritrea.

However, remittances and exchange of foreign currencies in the country shall remain under Eritrean banks and other service providing financial institutions authorized by the bank of Eritrea.

The change announced today in the control regime is an important factor for boosting growth and creating employment in the country as it greatly encourages private investment. It also enables Eritreans to enjoy complete freedom to engage in transaction with foreign currency as the freedom to engage in such activity will increase competition in the financial services and thereby reduce financing costs.


FOR THE ENTIRE ORIGINAL PROCLAMATION No. 173/2013, PLEASE CLICK HERE


 

GAZETTE OF ERITREAN LAWS
PUBLISHED BY THE GOVERNMENT OF ERITREA

Vol. 21/2013 No.1 Asmara, 20th February, 2013

Proclamation No. 173/2013

A Proclamation Pertaining to the Opening of Foreign Currency Deposit Accounts, Domestic Commercial Transactions and/or Contracts, Currency Remittance and Exchange and the Declaration of Currency of Travelers Arriving into and Departing from Eritrea.

Article 1. Short Title

This Proclamation may be cites as “Proclamation No. 173/2013 Pertaining to the Opening of Foreign Currency Deposit Accounts, Domestic Commercial Transactions and/or Contracts, Currency Remittance and Exchange and the Declaration of Currency of Travelers Arriving into and Departing from Eritrea”.

Article 2. Repealed Regulations

Legal Notice No. 101/2005 and Legal Notice 102/2005 issued to amend the former are hereby repealed and replaced by this Proclamation.

Article 3. Opening of Foreign Currency Deposit Accounts

  • (1) Government institutions authorized by the Ministry of Finance, as well other institutions authorized by the Bank of Eritrea, may open foreign currency accounts in Eritrea.
  • (2) Eritrean citizens residing in Eritrea may open foreign currency accounts in Eritrean banks and utilize their foreign currency for legitimate means.
  • (3) Eritrean citizens residing outside Eritrea may open foreign currency accounts in Eritrean banks and operate their foreign currency without any restriction.
  • (4) Institutions which have opened foreign currency accounts in Eritrea pursuant to sub-Article (1) of this Article may use their foreign currency for international transactions.
  • (5) Citizens residing in Eritrea who have opened foreign currency accounts in Eritrea may use their foreign currency upon presentation to the banks acceptable evidence.

Article 4. Currency of Payment in Domestic Transactions/Contracts

  • (1) Unless the Bank of Eritrea specially authorizes payment in foreign currency, all payments relating to commercial transactions and contracts in Eritrea shall only be made in Nakfa.
  • (2) Foreign currency collected by institutions specially authorized by the Bank of Eritrea to conduct transactions or provide services in foreign currency shall be surrendered to the Bank of Eritrea within the time frame prescribed by it.

Article 5. Remittance and Exchange of Foreign Currency

Remittance and exchange of foreign currencies in Eritrea shall be effected only through Eritrean banks and other service providing financial institutions authorized to do so by the Bank of Eritrea.

Article 6. Declaration of Currency Carried by Travelers Arriving into and Departing from Eritrea

Whereas there shall be no limitation on the amount of foreign currency that travelers may bring into or take out from Eritrea, they shall, where the amount they bring into or take out from Eritrea exceeds US Dollars ten thousand (10,000) or its equivalent in other convertible currencies, complete declaration forms prepared by the Bank of Eritrea and submit the same to Eritrean Customs Officers at the port of entry or departure in Eritrea.

Article 7. Penalty

Notwithstanding any provisions of law to the contrary, any person or institution who/which:

  • (1) exchanges foreign currency without a special permit from the Bank of Eritrea;
  • (2) remits illegally in Eritrea in Nakfa foreign currency received abroad;
  • (3) brings into or takes out of Eritrea foreign currency exceeding ten thousand (10,000) US Dollars or its equivalent in other convertable foreign currency without completing and submitting to Customs Officers declaration forms prepared by the Bank of Eritrea; or
  • (4) effect or receives in Eritrea payments relating to commercial transactions or contracts in foreign currency without a special permit from the Bank of Eritrea, shall, upon conviction by the competent civil court, in addition to the confiscation of the money that he/she/it is found exchanging foreign currency, remitting in Nakfa, bringing into or taking out from Eritrea without filling a declaration form and submitting it to the Customs Officers, or effecting or receiving payments in foreign currency in Eritrea, be punishable with simple imprisonment (i.e., from 10 days up to three years) or with a fine not exceeding fifty thousand (50,000) Nakfa; provided that the provisions of sub-Article (3) of this Article as well as the penalty of imprisonment herin provided for may not apply to institutions.

Article 8. Enrty into Force

This Proclamation shall enter into force as of the date of its publication in the Gazette of Eritrean Laws.

Done at Asmara, this 20th day of February, 2013,
Government of Eritrea.