FOREIGN CURRENCY ACCOUNTS AND TRADE LOANS UNDER FE-25 SCHEME
FE Circular No. 04 of 2012 September 04, 2012
Attention of Authorized Dealers is invited to Para-6 of Chapter VI of F.E. Manual (Eighth Edition-2002) and other instructions issued on the subject from time to time. SBP has been issuing various instructions to Exchange Companies from time to time in the shape of its FE Circulars and Circular Letters duly followed up with individual interactions during its monitoring and enforcement activities.
In this regard, it has been decided that Authorized Dealers may open foreign currency accounts and extend trade loans under FE-25 Scheme in US Dollar (USD), Pound Sterling (GBP), Euro (EUR), Japanese Yen (JPY), Canadian Dollar (CAD), UAE Dirham (AED), Saudi Riyal (SAR), Chinese Yuan (CNY), Swiss Franc (CHF) and Turkish Lira (TRY). by money laundering and financing of terrorism, please find attached the guidelines (at Annexure I) required to be followed in letter and spirit by the Exchange Companies. Further Exchange Companies shall review and submit their policy for combating money laundering and terrorist financing on annual basis, latest by September 30 of that financial year, duly approved by their Board of Directors.
Further to EPD Circular Letter No. 07/EPP.16 (326) NFCA-2002 dated September 12, 2002, it is advised that the interbank placements and interbank SWAPs or any other source of foreign currency liquidity that is permitted under SBP Rules / Regulations can be used to extend trade loans in the above foreign currencies. However, currency of the trade loan should be the same as that of the underlying LC/ Firm Trade Contract.
The above instructions are applicable with immediate effect. All other instructions on the subject shall remain unchanged.
Authorized Dealers are advised to bring the above to the notice of all their constituents and ensure meticulous compliance..