Regulatory Alerts2020-02-14
Exchange Control Circular No. 05 - Foreign Currency Accounts
The Central Bank of Barbados issued Exchange Control Circular No. 5 to regulate the maintenance of foreign currency accounts by authorized dealers for both residents and non-residents. Residents are required to utilize existing foreign currency holdings before accessing the local market and must obtain prior approval to hold accounts abroad, while non-residents enjoy unrestricted access to open accounts and repatriate funds. The circular further specifies that foreign currency held in trust for non-residents and proceeds from asset sales are treated under specific guidelines to facilitate compliance.
[Logo: Central Bank of Barbados]
CENTRAL BANK OF BARBADOS EXCHANGE CONTROL ACT, CAP.71
EXCHANGE CONTROL CIRCULAR NUMBER 5 AUGUST 2019
TO: AUTHORISED DEALERS AND AUTHORISED DEPOSITARIES
FOREIGN CURRENCY ACCOUNTS
This Circular sets out the circumstances in which Authorised Dealers may maintain foreign currency accounts for both residents and non-residents.
1. Definition
A foreign currency account is an interest bearing deposit or current account denominated in currency other than the Barbados dollar. For example, a United States dollar account held at an Authorised Dealer in Barbados is a foreign currency account.
For the definition of residents and non-residents, see Exchange Control Circular Number 3 (Residents and Non-Residents).
2. Foreign Currency Accounts of Residents
a) Authorised Dealers are permitted to open and maintain foreign currency accounts in the names of residents of Barbados (individuals and companies).
b) Foreign currency account holders must utilize the foreign currency held in their accounts before accessing the local foreign exchange market. Applicants for foreign exchange are required to make a full and frank disclosure to authorised dealers that they have no other foreign currency accounts. Failure to use their foreign currency accounts may result in the closure of the account.
c) Residents are not permitted to open and maintain foreign currency accounts abroad without prior approval of the Bank.
3. Foreign Currency Accounts of Non-Residents
a) Authorised Dealers may open foreign currency accounts in the names of non-residents, including Barbadian nationals permanently residing outside Barbados, without restrictions on these accounts. Non-residents may place the full amount of funds brought into Barbados on their foreign currency accounts.
b) Payments from foreign currency accounts of non-residents may be made without reference to the Bank.
c) Foreign currency being held in trust for a non-resident in the foreign currency account of a resident should be treated in the same way as if it was in the foreign currency account of the non-resident.
d) Foreign currency proceeds from the sale of assets may be credited to a foreign currency account or repatriated abroad.
[Signature]
Ian R. Collymore Director Foreign Exchange & Export Credits Department
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