Banks require to provide monthly report of foreign exchange transactions

KARACHI: Banks have been required to provide foreign exchange transactions in each currency to State Bank of Pakistan (SBP) on monthly basis.
According to updated Foreign Exchange Manual – 2019, the SBP said that the banks should report to the central bank particulars of foreign exchange transactions effected by them i.e. all outward and inward remittances made whether through their accounts in foreign currencies or through the Rupee accounts of non-resident banks.
For this purpose, Authorized Dealers should submit to the SBP-Banking Services Corporation a summarized statement of their transactions in each currency in which a position is maintained by them and also summary statement of transactions effected on the Rupee accounts of non-resident banks maintained with them for each month, reaching the respective area office of the Foreign Exchange Operations Department by the 5th of the following month from Head/Principal Offices of Authorized Dealers.
The SBP said that reporting of transactions reports should be as follows:
a) Export bills drawn under irrevocable letters of credit.
Transactions in respect of export bills negotiated by Authorized Dealers should be reported as purchases only at the time entries are made in the currency account duly supported by Schedule (A-1/A-2/A-3) and Forms ‘E’.
b) Export bills drawn on collection basis.
Sometimes Authorized Dealers also purchase export bills drawn on collection basis. Transactions relating to such export bills should be reported as an outright purchase against “Exports” in the summary statement after the transaction is put through the currency account on receipt of advice of realization of the export proceeds.
The procedure indicated in sub-paragraph (i) (a) above should also be followed with regard to D.Ds. and M. Ts. etc. In other words, purchases in respect of D.Ds. and M.Ts. etc. should be reported only when the transactions are put through the currency accounts.
a) In case of import bills drawn under letters of credit, the foreign currency accounts of the Authorized Dealers are debited at the time of negotiation of documents by their foreign correspondents. Accordingly, sales on account of import bills drawn under confirmed and irrevocable letters of credit should be reported when the transaction is put through the currency account on receipt of import documents and not on the basis of retirement of bills by the importers.
b) All sales on account of imports are required to be supported by the original copy of the Form ‘I’. In view of the time-lag between the date of receipt of the import bills and the date of their retirement by the importers, it may not be possible to submit original copy of Form ‘I’ duly signed by the importers. In such cases, Authorized Dealers should fill in the quadruplicate copy of the Form ‘I’ and submit it alongwith the relevant schedule and the summary statement. The original copy of the Form ‘I’ should be submitted after it has been signed by the importer, which will be at the time of retirement of the bill.
c) Authorized Dealers will forward to the State Bank a monthly statement showing particulars of the Form ‘I’ originals of which have not been sent by them to the State Bank, giving reasons for their non-submission. These statements should reach the State Bank by the 5th of the following month and should bear running serial numbers.
d) With regard to import bills received on collection basis, the transactions will be reported on Schedule E-2 supported by original Form ‘I’.
Transactions relating to D.Ds. and M.Ts. issued by the Authorized Dealers should also be reported only at the time entries are made in the currency accounts.
Non-resident Rupee accounts of foreign banks and correspondents including barter accounts should also be reported by Authorized Dealers in the manner indicated in this para.

1 Comment

Leave a Reply

You have to agree to the comment policy.