Central Bank of Lebanon Circular No. 511: Amendment of Decision No. 6908 Regarding Cash Deposit and Withdrawal Procedures and Cheque Drawing Rules

Circular No. 511 For Banks, Financial Institutions, Exchange Houses, Financial Intermediation Institutions, and all Depositors at the Central Bank of Lebanon

Regarding Circular No. 12935 dated 4/12/2018, a copy of which is attached, amending the Basic Decision No. 6908 dated 26/2/1998 concerning the procedures for depositing and withdrawing cash amounts at the Central Bank of Lebanon and the procedures for drawing cheques on accounts opened with it, attached to Basic Circular No. 40.

Beirut, on 4 January 2018

Governor of the Central Bank of Lebanon Riad T. Salam

Decision No. 12935

Amendment of Basic Decision No. 6908 dated 26/2/1998 Concerning the procedures for depositing and withdrawing cash amounts at the Central Bank of Lebanon and the procedures for drawing cheques on accounts opened with it.

The Governor of the Central Bank of Lebanon, Based on the Monetary and Discount Law, specifically Articles 85 and 98 thereof, And based on Basic Decision No. 6908 dated 26/2/1998 and its amendments concerning the procedures for depositing and withdrawing cash amounts at the Central Bank of Lebanon and the procedures for drawing cheques on accounts opened with it, And based on the decision of the Central Council of the Central Bank of Lebanon taken in its session held on 28/11/2018, Decides as follows:

Article One: The text of point (4) from the first paragraph of Article Three of Basic Decision No. 6908 dated 26/2/1998 is repealed and replaced with the following text:

« 4- An identification card containing the details of the deposit operation, its type, value, the client's name, branch, and place of deposit at the Central Bank of Lebanon (Head Office or relevant branch), must be placed in the pocket of each "box". It is noted that the delivery of "boxes" and their associated identification cards is done to the Central Bank of Lebanon's safes, and a fee of 30,000 L.L. (thirty thousand Lebanese Lira) for the use of the box is deducted upon direct delivery from the client's account opened with the Central Bank of Lebanon. »

Article Two: The text of points (a) and (c) of point (6) from the first paragraph of Article Three of Basic Decision No. 6908 dated 26/2/1998 is repealed and replaced with the following text:

• a « Banks may perform a single deposit operation outside of boxes, exclusively at the safes of the Head Office of the Central Bank of Lebanon, provided that the following conditions are met cumulatively:

• The concerned bank must be compliant with the provisions of paragraph (e) of point (3) of Article One of Basic Decision No. 7299 dated 10/6/1999.

• The deposit operation in question must be performed on the twelfth of each month (specifically the 12th of the month).

• The deposited banknotes must be of the 2004 issue or later and of a single denomination only.

• These deposits must be arranged in accordance with Article Two of this Decision. »

• c « The Central Bank of Lebanon shall collect from the concerned banks a fee of 75,000 L.L. (seventy-five thousand Lebanese Lira) for each deposit operation performed in accordance with point (6) of this Decision. »

Article Three: The text of the first paragraph of Article Six of Basic Decision No. 6908 dated 26/2/1998 is repealed and replaced with the following text:

« First: Each bank or financial institution violating the deposit or withdrawal conditions for banknotes or coins specified in this Decision shall pay an amount of money from the funds to cover the expenses incurred by the Central Bank of Lebanon due to non-compliance with these conditions.

The aforementioned amount is collected by deducting it from the violating client's account opened with the Central Bank of Lebanon, as follows:

1. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for an error in the number of banknotes within a single "box".
2. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for each banknote of a denomination different from the denomination of the bundle deposited within a single "box".
3. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for each banknote of a size different from the size of the bundle deposited within a single "box".
4. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for each foreign currency banknote or non-currency note within a single "box".
5. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for each forged or counterfeit banknote within a single "box".
6. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) for each torn, soiled, or improperly packaged banknote within a single "box".
7. An amount of 200,000 L.L. (two hundred thousand Lebanese Lira) for each box containing banknotes not packaged according to standard procedures (mandatory to place banknotes on one side and in one direction).
8. An amount of 2,000 L.L. (two thousand Lebanese Lira) for each extra or missing coin within a single bag.
9. An amount of 60,000 L.L. (sixty thousand Lebanese Lira) for each forged or torn coin within a single bag.
10. An amount of 60,000 L.L. (sixty thousand Lebanese Lira) for each coin of another denomination, non-currency coin, or foreign currency coin within a single bag.
11. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) in case of submitting a deposit or withdrawal request outside the deadline specified in point (2) of the first paragraph of Article Four above.
12. An amount of 100,000 L.L. (one hundred thousand Lebanese Lira) in case the client withdraws from executing their request, whether at the Head Office or any of the branches.
13. In case of error in the type of "box":

• a If the type of "box" submitted by banks or financial institutions to any branch of the Central Bank of Lebanon does not match its content, the relevant branch shall reject the deposit operation until the error is corrected within the specified working hours for the safes. In case the bank or financial institution withdraws from executing the deposit operation, or if the correction is made outside the specified working hours for the safes, the operation is considered unexecuted, and the bank or financial institution shall pay an amount of 100,000 L.L. (one hundred thousand Lebanese Lira). As for the Head Office of the Central Bank of Lebanon, the "box" subject to the error shall be opened, its content counted, and the bank or financial institution shall pay an amount of 400,000 L.L. (four hundred thousand Lebanese Lira) for each "box" whose type does not match its content.
• b If the type of "box" matches its content but does not match the request of the bank or financial institution, the client shall modify their request to correspond with the "box" intended for deposit. In this case, an amount of 100,000 L.L. (one hundred thousand Lebanese Lira) shall be paid for the initial request, considered as an unexecuted request, and an amount of 100,000 L.L. (one hundred thousand Lebanese Lira) shall be paid for the second request, considered as an additional request. The same procedure applies if coin bags are contrary to what is stated in the deposit request.

14. In case of submitting additional requests to perform deposit and/or withdrawal operations at the Central Bank of Lebanon safes on the same day, an amount of 100,000 L.L. (one hundred thousand Lebanese Lira) shall be paid for the second request of the day for both banknotes and coins, and the amount doubles with each additional request, becoming 200,000 L.L. (two hundred thousand Lebanese Lira) for the third request and 400,000 L.L. (four hundred thousand Lebanese Lira) for the fourth request, and so on.
15. An amount of 50,000 L.L. (fifty thousand Lebanese Lira) for each bundle deposited outside of boxes in accordance with point (6) of the first paragraph of Article Three above, containing banknotes not packaged according to standard procedures (mandatory to place banknotes on one side and in one direction). »

Article Four: The text of point (3) of Article Seven of Basic Decision No. 6908 dated 26/2/1998 is repealed and replaced with the following text:

« 3- All banks must complete the coding field by adding the currency code and the amount value on all cheques:

• a Issued by them on their accounts opened with the Central Bank of Lebanon under the payment of an amount of 200,000 L.L. (two hundred thousand Lebanese Lira) for each un-coded or incompletely coded cheque, or if the coding is unclear or cannot be read by the special scanning machines.
• b Issued by third parties on their accounts opened with the Central Bank of Lebanon and which they submit for crediting to their accounts with the Central Bank of Lebanon under the payment of an amount of 200,000 L.L. (two hundred thousand Lebanese Lira) for each un-coded or incompletely coded cheque, or if the coding is unclear or cannot be read by the special scanning machines. The amount mentioned in both points (a) and (b) of point (3) of this Decision shall be borne by the bank issuing the cheque and the bank presenting the cheque for crediting to the account, and the amount shall be collected by deducting it from the accounts of the concerned banks opened with the Central Bank of Lebanon. »

Article Five: Paragraph (c) with the following text is added to point (4) of Article Seven of Basic Decision No. 6908 dated 26/2/1998:

« - c The price of a cheque book is set at 16,000 L.L. (sixteen thousand Lebanese Lira), which the Central Bank of Lebanon collects from banks and financial institutions when they submit a request to print cheque books. »

Article Six: This Decision shall enter into force as of 1/2/2019.

Article Seven: This Decision shall be published in the Official Gazette.

Beirut, on 4 January 2018

Governor of the Central Bank of Lebanon

Riad T. Salam