Region

Jurisdiction

Regulator

2017-01-01

Circular No. 269 Instructions for Dealing with Money Changers and Exchange Companies Operating and Licensed in Israel

The Palestine Monetary Authority and the National Committee for Combating Money Laundering and Financing of Terrorism issued Circular No. 269 and Instructions No. (J/2) to classify Israeli-licensed money changers and exchange companies as high-risk entities. The directives strictly prohibit Palestinian banks and financial institutions from conducting direct or indirect financial transactions with these Israeli entities unless they obtain specific regulatory approvals, including foreign company registration, written PMA consent, and supervisory clearance for bank accounts. Financial institutions must fully comply with these restrictions and regularize any pre-existing financial positions by March 30, 2018, under penalty of regulatory enforcement.

Palestine

Palestine Monetary Authority

Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Circular No. (2017/269) To all banks operating in Palestine

Date: Thursday, December 28, 2017

Subject: Instructions for Dealing with Money Changers and Exchange Companies Operating and Licensed in Israel

With reference to the above subject, please find attached the Instructions for Dealing with Money Changers and Exchange Companies Operating and Licensed in Israel No. (J/2) for the year 2017, dated 26/12/2017, issued by the National Committee for Combating Money Laundering and Financing of Terrorism.

The provisions of these instructions shall take effect from the date of their issuance, and all banks are required to take the necessary measures to ensure full compliance.

Supervision and Inspection Department Palestine Monetary Authority

Ramallah - Palestine P.O. Box 452 | Tel: +970 2 2415250 | Fax: +970 2 2415310 | Fax: +970 2 2415310 | Tel: +970 2 2415250 | Ramallah - Palestine P.O. Box 452 Gaza - Palestine P.O. Box 4026 | Tel: +970 8 2825292 | Fax: +970 8 2844487 | Fax: +970 8 2844487 | Tel: +970 8 2825292 | Gaza - Palestine P.O. Box 4026 Email: info@pma.ps | Email: info@pma.ps www.pma.ps

The National

Committee for Combating Money Laundering and Financing of Terrorism State of Palestine

The National AML and CFT Committee State of Palestine

Instructions No. (J/2) for the year 2017 Regarding Dealing with Money Changers and Exchange Companies Operating and Licensed in Israel

The National Committee for Combating Money Laundering and Financing of Terrorism, Pursuant to the provisions of Law Decree No. (20) for the year 2015, regarding the combating of money laundering and financing of terrorism and its amendments, particularly the provisions of paragraphs (14, 15) of Article (20), Based on the study submitted by the Financial Follow-up Unit regarding the risks of dealing with money changers, and Israeli exchange companies, Based on the powers delegated to us, And in pursuit of the public interest,

Have issued the following instructions:

Article (1)

Definition

The definitions set forth in Law Decree No. (20) for the year 2015, regarding the combating of money laundering and financing of terrorism and its amendments, shall apply wherever they appear in these instructions.

Article (2)

Scope of Application

The provisions of these instructions shall apply to all banks, money changers, and exchange companies operating in the State of Palestine and licensed to do so by the Palestine Monetary Authority.

The National

AML and CFT Committee State of Palestine

Article (3)

Risks

Exchange companies and money changers operating in Israel and/or licensed to operate in Israel are considered high-risk.

Article (4)

Prohibition

All banks, exchange companies, and money changers operating in the State of Palestine are prohibited from undertaking any of the following:

Directly or indirectly dealing with, or conducting any financial transaction originating from or destined to, money changers and/or Israeli exchange companies, except after fulfilling the following requirements: (a) Obtaining approval from the Palestinian Companies Registrar for the exchange company to operate as a foreign company in Palestine in accordance with the provisions of Jordanian Companies Law No. (12) for the year 1964. (b) Obtaining written approval from the Palestine Monetary Authority. (c) Obtaining approval from the competent supervisory and regulatory authority to open bank accounts in the State of Palestine.

The National

AML and CFT Committee State of Palestine

Opening any accounts for individuals licensed to practice the profession of money changing in Israel, if the purpose of such accounts is to conduct money changing business in the State of Palestine.

Article (5)

Rectification

All banks and exchange companies operating in the State of Palestine shall comply with the following:

Rectify their status in accordance with the provisions of these instructions by March 30, 2018.
Settle financial positions that arose prior to the issuance of these instructions, and any financial rights resulting from dealing with money changers and/or Israeli exchange companies, in accordance with instructions issued by the Palestine Monetary Authority for this purpose, in coordination with the Financial Follow-up Unit.

Article (6)

Necessary Measures

The Palestine Monetary Authority, in coordination with the Financial Follow-up Unit, shall issue the necessary measures to implement the provisions of this decision after notifying banks, exchange companies, and money changers thereof.

The National

AML and CFT Committee State of Palestine

Article (7)

Entry into Force

All competent authorities shall, each within their respective jurisdiction, implement the provisions of these instructions, which shall take effect from the date of their issuance and be published in the Official Gazette.

Issued in the city of Ramallah on: 26/12/2017 AD Corresponding to: / / 1439 AH

The National Committee for Combating Money Laundering and Financing of Terrorism