Circular Letter No. 43 (2014)

Central Bank of Libya
P.O. Box 1103 | Telegram Address: CBL - Tripoli - Libya

Reference: CBL/804
Circular Letter No. CBL (43/2014)
Date: 17 Jumada al-Akhir 1435 AH
Corresponding to: 17 April 2014 AD

To the General Managers of Commercial Banks To the Heads of Temporary Administrative Committees of Commercial Banks To the General Manager - Libyan Foreign Bank

With greetings,

The Central Bank of Libya has received a letter from the President of the Court of Audit, addressed to the Acting Prime Minister of Libya’s Interim Government and copied to the Governor of the Central Bank of Libya, regarding a request to circulate to all ministries, entities, institutions, departments, and other bodies under the Court of Audit’s supervision the necessity to comply with laws and regulations governing contracting procedures, and the requirement to submit contracting matters with their complete documentation to the Court of Audit before commencement, for the purpose of prior supervision of contracts.

And as we forward to you a copy of the aforementioned letter from the President of the Court of Audit, we request that you take the necessary actions in this regard.

Peace, mercy of Allah, and blessings be upon you,

"Abdulmajid Mohammed Al-Maqouri"
Director of Banking and Monetary Supervision (Acting)

Copy to:

• The Governor
• The Deputy Governor
• The Undersecretary of the Court of Audit
• Banking Follow-up and Compliance Monitoring Department
  M. Boustom / R.D.

Phone: +21 233 3591, Fax: +21 444 1488, www.cbl.gov.ly, swift code: CBLJLYLX

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General National Assembly - Libya
Libyan Court of Audit
President's Office

Date: 2/4/2014 AD
Number: 14/19/1463

Respected Sir / Abdullah Al-Thani
Acting Prime Minister

With greetings,

With reference to Law No. (24) of 2013 AD amending Law No. (19) of 2013 AD regarding the reorganization of the Court of Audit, issued by the General National Assembly. And following our letter No. (1015- 19- 14) dated 2014/3/17 AD regarding the Court’s jurisdiction to examine and review contracts.

We wish to inform you that Article (One) of Law No. (24) stipulates that contracts subject to the Court’s prior supervision include supply, contracting, and commitment contracts, as well as other contracts in which the government, its departments, entities, and institutions under the Court’s supervision are parties, provided that each entails financial rights or obligations exceeding (5) five million dinars. In such cases, contracts may not be split to reduce their value below the threshold to avoid supervision, and a contract shall not be considered valid until approved by the Court.

Furthermore, Article (Two) of the aforementioned Law stipulates that (the Court shall verify the validity of documents and records related to the disbursement of any amount resulting from a contract immediately after disbursement, provided that the contract value exceeds (500) five hundred thousand dinars, and relevant employees responsible for making these payments must notify the Court thereof and send copies of documents evidencing disbursement immediately after payment).

However, what the Court of Audit has observed is that some executive entities under its supervision have completed contracting procedures, issued orders, and concluded contracts exceeding (5) five million dinars without submitting them to the Court of Audit for prior supervision, which constitutes a financial violation according to Article No. (46), paragraph (9) of Law No. (19) of 2013 AD (concluding contracts subject to the Court’s prior supervision before its review and observation).

Dahra Square - Tripoli - Libya | P.O. Box: 2879 Fax: +21 444 0630 | dewan.libya@hotmail.com

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General National Assembly - Libya
Libyan Court of Audit
President's Office

The Court has also observed that these entities failed to comply with the provisions of the Administrative Contracts Regulations, which mandate obtaining prior approval for contracting from the Council of Ministers or the relevant ministry according to budget allocations approved for such expenditures.

In light of achieving integrity, transparency, and professionalism in the prior supervision of contracts and subsequent supervision of payments, verifying the correctness and integrity of contracting procedures, and safeguarding public funds in accordance with applicable legislation, it is required to alert and circulate to all ministries, entities, institutions, departments, and other bodies under the Court’s supervision the necessity to comply with laws and regulations governing contracting procedures, and the requirement to submit contracting matters with their complete documentation to the Court of Audit before commencement for prior supervision of contracts. This requirement also applies to payments, whose documents must be attached immediately after disbursement in accordance with the provisions of the aforementioned Law.

For importance, we hope that due attention is given to this matter.

With greetings,

A. Khaled Ahmed Kashkash
President of the Court of Audit

Copy to:

• The President of the General National Assembly
• The President of the Follow-up Committee for Supervisory Bodies at the General National Assembly
• The Governor of the Central Bank of Libya
• The Minister of Finance
• The Undersecretary of the Court of Audit
• The Director of the General Administration for Contract Review and Project Follow-up
• The Director of the Follow-up Office
• File / Circular
• K.M. / Mufti 586 / S. Al-Ramali

Dahra Square - Tripoli - Libya | P.O. Box: 2879 Fax: +21 444 0630 | dewan.libya@hotmail.com