According to the Central Monetary and Payments Law No . (9) of 2021
And the provisions of Article (34) of the Law Regulating Money Exchange and Remittance Business
Co-chairmanship of the Central Monetary and Payments Office
decides that
Executive regulations of the law regulating money exchange and remittance business No. (1) for the year 2023
Article (1)
Definitions
The words and expressions mentioned in the Regulations shall have the meanings assigned to them below, unless the context requires another meaning.
Monetary Office: The Central Monetary and Payments Office for North and East Syria.
Board of Directors: The Board of Directors of the Central Monetary and Payments Office for North and East Syria.
Law: Law Regulating Money Exchange and Remittance Business No (1) of 2023.
Applicant: The person who applies to the cash office to obtain a license to practice money exchange and remittance business.
Exchange business: Dealing in foreign currencies permitted to be dealt with in the markets of the Autonomous Administration regions of northern and eastern Syria, converting them, and other permitted businesses according to the law and these regulations.
Exchange company: A company licensed to practice exchange and transfer business in accordance with the provisions of Article (21) the law.
Exchange office: The office licensed to practice exchange business in accordance with what is specified in the provisions of Article (21) law
Main center or branch: The place of work where some or all of the money exchange business is practiced, and it is legally considered part of the money exchange company or office.
Major Shareholde: Any company or person who owns or controls 20% or more of the shares or equity in the company.
Person: a natural or legal person.
Article (2)
the goal
This regulation aims to regulate the licensing of exchange companies and offices in the Autonomous Administration regions of northern and eastern Syria in accordance with the provisions of the law.
Article (3)
License terms
1-In accordance with the provisions of Article No. (3) of Law No. (1) of 2023 AD, it is not permissible for anyone to practice the exchange business stipulated in the law or to be a branch of a company or exchange office except someone who is licensed to do so by the monetary office and registered in the commercial registry and the registry of money changers’ licenses for the monetary office.
2- The Board of Directors of the Currency Office shall be the body responsible for licensing companies and offices to practice money exchange and remittance business in accordance with the conditions and procedures stipulated in the law. The legal form of companies and offices permitted to practice these businesses is limited to the following:
A- Exchange companies must be in the form of a joint-venture company or a simple partnership.
B- Exchange offices must be in the form of a joint-venture company, a simple partnership, or a sole proprietorship.
3-It is prohibited to register any company whose purposes include practicing money exchange or transferring and transporting money with the authorities responsible for registering companies in the areas of the Autonomous Administration of North and East Syria unless obtaining initial approval from the Monetary Office.
4-It is not permissible for any general partner who has withdrawn from one of the exchange offices and companies to apply for a license jointly with others unless it is proven that he has completely withdrawn from the first company. Nor is it permissible for any of the major shareholders in the companies to participate in establishing another company to practice exchange business.
5-It is prohibited for any individual, institution or company that is not licensed to practice money exchange and remittance business from the monetary office to use the term changer or any expression that indicates the practice of money exchange and remittance business, whether in its name, business address, advertising, website, or social media. Or any other means.
6-It is prohibited for anyone who has been convicted by a final ruling of a felony or misdemeanor involving breach of honor or trust, to establish a company or exchange office, or to contribute to it, or to be a real beneficiary of the shareholding shares in it, or to assume any management position in it, unless he refuses. He deserves credit.
7-It is prohibited for an exchange company or office to start equipping the main headquarters or any branch except after obtaining initial approval from the cash office.
8-It is prohibited to carry out money exchange activities at the main center or branch except after obtaining final approval from the monetary office.
9-A company or exchange office is prohibited from making any amendment to the ownership and capital structure, transferring or closing the main center or branch, merging with another company or exchange office, purchasing the assets and liabilities of another company or exchange office, or amending those authorized to sign on behalf of a company or exchange office. and their powers, or change the legal form of the exchange company or office except after obtaining prior written approval from the monetary office.
10-It is prohibited for an exchange company or office to make any change to the articles of incorporation or bylaws without obtaining the approval of the monetary office.
11-The monetary office issues a license certificate for the exchange company or office for a period of five years. License fees are paid annually. The exchange company or office must present the license certificate within the main center and branches.
12-The applicant or the exchange company/office will be granted final approval to commence the exchange business after completing all final approval procedures and requirements in accordance with the provisions of these regulations.
Article (4)
License application procedures
1-The applicant must submit a license application to the monetary office according to the attached Form No. (1) for money exchange and remittance business companies, and according to the attached Form No. (2) for money exchange business offices. These forms are obtained from the monetary office
2-All fields in the forms must be completed and signed by all proposed partners in exchange companies and offices.
3-That none of the proposed partners be a major shareholder in another company or exchange office.
4-The following shall be attached to the submitted license application:
A-A draft contract of incorporation for a company or exchange business office, internal regulations, and organizational structure, for study and written approval by the monetary office.
B-The proposed estimated budget for the company or office for the first three years indicating the principles that were adopted in its preparation.
C-A certificate of good standing and conduct for the founders issued by the competent authorities.
5-Payment of a non-refundable license application fee to the monetary office fund in accordance with the provisions of these regulations.
6-The office conducts a preliminary study of the applications, interviews the applicants, and conducts a preliminary examination of the proposed headquarters of the exchange company or office.
7-In addition to the above, the Cash Office may request the following:
A-Residency documents of the proposed partners certified by the relevant authorities..
B-A summary of the CV of each of the proposed partners.
C-A financial disclosure statement for each of the proposed partners certified by the relevant authorities.
D-A title deed for the headquarters in the name of the applicant or a lease contract, in which case it requires that the company have another property owned in its name, approved by the monetary office.
F-The monetary Office may request any additional documents it deems necessary to complete the study.
Article (5)
Procedures and issuance of the licensing decision
- The monetary office will respond initially to the submitted application within (30) thirty days from the date of submission of the application regarding whether it is complete or not, provided that the response includes the deficiencies that must be present to consider the application.
- Deficiencies, if any, must be completed within (30) thirty days from the date of the response issued by the cash office. Otherwise, the application will be considered invalid.
- Upon completion of the shortcomings and the completion of the application, the Board of Directors shall issue its decision regarding the license application submitted to it within a period not exceeding sixty (60) days from the date of completion of the application, whether with initial approval or rejection, provided that the decision is justified in the event of rejection.
- If the initial approval decision is issued, the license applicant must complete the following procedures within one year from the date of issuance of the initial approval:
- A-Complete the approvals and licenses from the relevant authorities required by the monetary office.
- B-Payment of the minimum capital is as follows:
| Minimum capital amount | License applicant |
| 1,000,000 USD Only one million US dollars
|
Exchange business companies |
| 100,000 USD is only one hundred thousand US dollars | Exchange business offices |
A-Payment of the financial guarantee for exchange companies and offices is as follows:
| Minimum capital amount | License applicant |
| 150,000 USD Only one hundred and fifty thousand US dollars
|
Exchange business companies |
| 15,000 USD Only fifteen thousand US dollars
|
Exchange business offices |
- Pay the licensing fee in accordance with what is specified in these regulations.
- Nominating the Board of Directors and those authorized to sign on behalf of the company or exchange office and providing the cash office with samples of their signatures.
- Providing the monetary office with the company’s registration certificate, articles of incorporation, bylaws, and organizational structure.
- 8-Fulfilling the conditions that must be met in the headquarters designated for practicing money exchange business as follows:
A -Providing a suitable space to receive customers.
B -Adherence to the general safety and security requirements of the headquarters which include the following:
1) Installing a counter that separates employees at the headquarters from customers.
2) Installing a fixed cash safe that meets the conditions of security, protection, and fire resistance.
3) Installing window protection.
4) Installing doors with security and protection specifications.
5) Installing fire alarm and extinguishing devices.
6) Installing surveillance cameras inside and outside the headquarters of a company or exchange office.
C-Equipping the store with the following office equipment (computers, calculators price display screens, money counting machines, counterfeit detection machine, complaints box)
D – Providing an accounting system approved by the cash office.
E – A document bearing the name of the company or office, and preparing purchase and sale invoices in the name of the company or office.
9 – The initial license approval shall be deemed void if the license applicant does not fulfill the conditions stipulated in this article within one year from the date of issuance of the initial approval.
10- After the license applicant completes the requirements and conditions specified in this article and after conducting the necessary final inspection, the Board of Directors of the Cash Office issues the final approval for the license within (30) thirty days following the date of completing the conditions and requirements and submitting and accepting the required papers.
11- The exchange company or office that obtained the final license must carry out exchange business within a maximum period of three months from the date of obtaining the final license.
12-If the company or the exchange office is unable to carry out exchange business within the period specified in Clause No. (11) of this Article, the cash office may extend the period for a period of (30) non-renewable days based on the request of the company or the exchange office, with a statement of the reasons that led to it not carrying on the job.
13-The license shall be deemed automatically canceled if work is not commenced within the period specified in Clause (11) of this Article unless the period is extended pursuant to written approval from the monetary Office as stated in Clause (12) of this Article.
Article (6)
Branch licensing
- A company or exchange office licensed by the Money Exchange Office may open three branches in addition to its main center without increasing its capital. It may also open additional branches, and in this case it must adhere to the following:
- With regard to exchange companies, they must increase their capital by an amount of (100,000) one hundred thousand US dollars for each additional branch, and increase the amount of the financial guarantee by an amount equivalent to 15% of the value of each capital increase.
- With regard to exchange offices, they must increase their capital by (10,000) ten thousand US dollars for each additional branch, and increase the amount of the financial guarantee by an amount equivalent to 15% of the value of each capital increase.
- Exchange companies and offices wishing to branch out must submit a request to the cash office to obtain prior initial approval to obtain a new branch license according to the attached Form No. (3) (Application for a New Branch License), provided that the application includes the following:
- Statement of the need for this branch/branches and specifying the places where the branches are intended to be opened and their locations in accordance with the instructions issued by the cash office in this regard.
- feasibility study and estimated budgets for the next three years in accordance with the requirements of the law regulating money exchange and remittance business and the instructions issued pursuant thereto.
- Payment of a non-refundable branch application fee to the cash office fund in accordance with the provisions of these regulations.
- The exchange company or office must fulfill the required conditions at the branch headquarters according to the requirements of Clause No. (7) of Article (5) of the provisions of these regulations.
- Payment of the capital increase in the event that the number of branches exceeds the number permitted in accordance with the provisions of Clause (1) of this Article.
- The cash office will conduct an initial study of the application, ensure that the required conditions are met, and respond to the applicant regarding the extent of its completion within a period of (30) days from the date of submitting the application, provided that the response includes the deficiencies, if any, and the deficiencies must be completed within a period of (30) days from the date of the response issued by monetary Office. Otherwise, the application will be deemed invalid.
- Payment of a license fee for the first time in accordance with the provisions of Article No. (9) of these regulations.
- The office conducts the necessary inspection of the proposed headquarters, and if all conditions and requirements are met, the office issues the final approval to license the branch within a period of (30) thirty days from the date of completion of the application.
- The exchange company or office that has obtained the final license for the branch must carry out the exchange business
- within a maximum period of three months from the date of obtaining the final license for the branch. If it is unable to carry out the work during this specified period, the cash office may extend the period for a period of (30) additional days. It is renewable upon the request of the exchange company or office, with a statement of the reasons for not starting work in the branch.
- The license shall be deemed automatically canceled if work is not commenced in the branch within the period specified in Clause (7) of this Article unless the period is extended pursuant to written approval from the Cash Office as stated in Clause (7) of this Article.
Article (7)
Registration in the register of licensed money changers
- No company or exchange office may carry out exchange business except after registering in the register of licensed money changers with the Central Monetary and Payments Office.
- The exchange company or office is registered and granted a license number from the cash office, after submitting an application including the following:
A- A notification from the cash office regarding payment of the minimum capital and financial guarantee specified within these regulations.
B- A notification from the monetary office of payment of all fees specified in these regulations.
C- A copy of the final approval after completing all procedures and conditions required for the license.
D- A copy of the company’s bylaws or the office’s articles of incorporation, certified by the competent authority.
E- A copy of the commercial register of the exchange company or exchange office.
F- A statement of the full names of the owners of the exchange company or office, including the title, age, place of residence, the full names of the local and foreign partners, if any, their place of residence, the nationality of the foreign partners, and the amount of each partner’s shares in the capital of the company or exchange office.
G- A statement of the amount of paid-up capital and financial guarantee.
H- The names of those authorized to sign on behalf of the administration, their nationalities, and samples of their signatures.
I- Provide any other information requested by the cash office.
Article (8)
Payment of capital and financial guarantee
- The capital shall be paid to the exchange company or exchange office, as well as the increase in capital, as the case may be, in one lump sum in cash at the cash office fund, which shall be kept without interest until the final licensing procedures are completed.
- Once the exchange company or office is ready to begin exchange work, and the nomination of the board of directors and those authorized to sign on behalf of the company or exchange office is completed and the cash office is provided with their names and samples of their signatures, the exchange company or office can submit a written request to the cash office to transfer the capital to its/his account after deducting the specified financial guarantee amount. In this regulation the amount of capital.
- The exchange company or office may not use the financial guarantee amount that remains withheld by the office as an interest-free financial guarantee.
- Any increase in capital is subject to the same procedure set forth in this Article.
- The monetary office may amend the minimum capital and amend the amount of the financial guarantee as the case may be, in accordance with economic conditions and variables.
- Partners in exchange companies and offices, members of boards of directors, and branch managers may not borrow from exchange companies and offices by guaranteeing their capital shares, and their withdrawals from companies or offices may not exceed the value of net annual profits after deducting all legal reserves.
- The cash office may dispose of the amount of the financial guarantee in settlement of any violation committed by a company or exchange office, and the company or exchange office must pay any deficiency in the amount of the financial guarantee within the period determined by the cash office.
- The guarantee remains reserved as long as the exchange company or office is licensed, and it can be returned in the event that the company/office’s license is withdrawn and after settling any financial obligations of the company/office towards the cash office, such as unpaid fees or fines or any other obligations.
Article (9)
License fees
Based on the provisions of Article No. (8) of the law, the monetary office collects the following fees from exchange companies and offices:
- License application fee
An applicant for a license for a new company or exchange office, or an application for a license for a branch of a company or exchange office, must pay a non-refundable license application fee to the cash office fund when submitting the application as follows:
A- For an exchange business company, the fee is (1,000 USD ) only one thousand US dollars.
B- For the exchange office, the fee is set at (300 USD ) only three hundred US dollars.
- License fee for the main center or branches
Applicants for a license for a new exchange company or office or a branch of a company or exchange office must pay a license fee for the first time to the cash office fund upon issuance of the initial license approval as follows:
A- For exchange business companies:
1) The fee for the company’s head office is set at (10,000 USD ) only ten thousand US dollars.
2) The branch fee is set at (5,000 USD ) only five thousand US dollars.
A- For exchange offices:
1) The fee for the main office is set at (3,000 USD ) only three thousand US dollars.
2) The office branch fee is set at (1,000 USD ) one thousand US dollars .
- Annual license renewal application fee:
Money exchange companies and offices must pay the annual license renewal fee no later than the thirty-first of January of each year to the cash office fund as follows:
A- For exchange business companies, the annual license renewal fee for the center is set at (2,000 USD ) two thousand US dollars, and for the branch is set at (700USD) seven hundred US dollars
B- For exchange offices, the annual license renewal fee for the center is set at (1,000 USD) one thousand US dollars, and for the branch is set at (300 USD ) three hundred US dollars.
Article (10)
License renewal
- All duly licensed money exchange companies and offices must submit an annual license renewal application to the cash office of the main center and branches no later than the thirty-first of January of each year.
- The delay in submitting the annual license renewal application, as well as the delay in paying the annual license renewal application fees until after the thirty-first of January of the year, leads to a doubling of the late amounts paid. However, if the delay exceeds thirty days beyond the thirty-first of January of the year, This leads to the temporary closure of the exchange company or office and its branches, and it will not be allowed to reopen except after re-registration and paying double the late registration fees.
- In the event of non-payment of the doubled annual license renewal fees within a period of thirty days, this will lead to the final closure of the exchange company or office and its branches that are in arrears, the cancellation of the license, and the deletion of the name of the company or office from the exchange registry.
- In addition to what was mentioned in the previous clauses, the following are required to renew the license:
A- Addressing existing supervisory observations regarding the company or office and pledging not to repeat them.
B- Pay all fines incurred by the company or office, if any.
C- That the company or the exchange office, or one of the partners, shareholders, or the real beneficiaries of the ownership shares in it, or one of the directors of the company or the exchange office, or one of its authorized signatories, is not included on the international or local ban and freeze lists in effect in the regions of the Autonomous Administration of North and East Syria .
D- Any other reasons that the cash office determines are an obstacle to renewing the license .
Article (11)
Transferring centers and branches
- Based on the provisions of Article No. (12) of the law, no company or exchange office may move its headquarters or any of its branches to another place except after obtaining written approval from the currency office, provided that:
A- Submit a request to the cash office according to the attached form No. (4), a request form for transferring the headquarters of the main center or a branch of a company or exchange office, and attach the relevant documents specified by the cash office.
B- The location specified to move the headquarters to should be suitable in terms of location and appropriate space.
C- The conditions required for the property must be met as specified in Clause (8) of Article No. (5) of these regulations.
D- must not have serious violations or unpaid fines.
- The monetary office conducts a preliminary inspection of the headquarters proposed to move to verify its suitability for practicing exchange business.
- The monetary office considers the transfer request in accordance with the provisions of Article No. (5) of these regulations.
- If the initial approval for the transfer is issued, the exchange company or office must complete all requirements within a maximum period of one year from the date of its issuance.
- The cash office will conduct a final inspection of the proposed headquarters, and if the company or exchange office complies with the requirements, the final approval will be issued in accordance with the provisions contained in Article No. (5) of these regulations.
Article (12)
Temporary and permanent closure
- Temporary closure: A company or exchange office may temporarily close its main center or any of its branches under the following conditions and procedures:
- Submit a request to obtain prior written approval from the cash office, according to Form No. (5), a request form to temporarily close the main center, a branch of a company, or an exchange office.
- The application shall be accompanied by the papers and documents shown in Appendix No. (5).
- Explaining the reasons and justifications for the closure and presenting a plan to reproved exchange services through the headquarters to be closed.
- The maximum temporary closure period is one year, non-extendable.
- The cash office shall inform the exchange company or office of its written decision of approval or rejection within one month from the date of completion of the closure request, explaining the reasons in the event of rejection.
- If approval is issued for the temporary closure of the headquarters, it will be closed according to the period specified in the approval letter issued by the Cash Office.
- company or office must inform its customers at least two weeks before the temporary closure process by announcing the closure process in a prominent place until the end of the temporary closure period, in addition to announcing the temporary closure on the website of the exchange company or office and its social media outlets.
- A team from the cash office will conduct a field visit to verify compliance with the temporary closure requirements and commitment to equipping the headquarters with the equipment and requirements specified in Article No. (5) of these regulations.
- The exchange company or office must reintroduce the exchange business in the headquarters that was closed immediately after the end of the closure period and notify the cash office on the first working day of the headquarters. It must also announce to the customers the date of re-practicing the exchange business in that headquarters by the same means of announcement referred to in Clause (1 –G) of this article.
- The exchange company or office is obligated to pay all annual fees due at the temporarily closed headquarters, and the cash office may exempt the exchange company or office from paying these fees throughout the closure period according to the cash office’s discretion.
- Permanent closure: A company or exchange office may permanently close its main center or any of its branches under the following conditions and procedures:
- Submit a request to obtain prior written approval from the cash office, according to Form No. (5), the application form to permanently close the main center, branch of a company, or exchange office.
- The application shall be accompanied by the papers and documents shown in Appendix No. (5).
- Explaining the reasons and justifications for permanent closure , and presenting a clear plan to complete the closure process.
- The cash office shall inform the exchange company or office of its written decision of approval or rejection within one month from the date of completion of the closure request, explaining the reasons in the event of rejection.
- In the event that approval is issued for the permanent closure of the exchange company or exchange office or any of their headquarters, the closure procedures must be initiated provided that the closure process is completed according to the time period specified in the plan submitted by the exchange company or office and approved by the cash office according to the approval issued by it.
- company or office must inform its customers at least two weeks before the permanent closure process by announcing the closure process in a prominent place, in addition to announcing the permanent closure on the website of the exchange company or office and its social media outlets.
- The exchange company or office must vacate the closed headquarters and remove any belongings related to the exchange business, including removing signs, devices, and supplies related to the exchange company or office.
- A team from the cash office is conducting a field visit to verify compliance with the requirements for permanent closure.
- The exchange company or office must provide the cash office with proof of the closure of the main center or branch.
- The cash office shall delete the closed exchange company or exchange office from the register of licensed money changers, including all its branches. If the closure is for a specific branch or branches, only that branch or branches will be deleted from the register
Article (13)
Liquidity requirements
- The exchange company or office must, in all cases, maintain net working capital Equal to the cash balances in the safes and in the bank accounts of the exchange company or office, according to the following:
- Working capital means the net property rights and liabilities, minus the value of the cash collateral held at the cash office, as well as the value of supplies, equipment, furniture, automated systems, and other fixed assets, net after excluding the value of depreciation and amortization.
- Calculation equation: Net working capital = (cash balances in warehouses + cash balances in bank accounts).
- The value of the book balances of cash in the records of the exchange company/office must be identical to the value of the actual balances in its safes and bank accounts.
Article (14)
Permitted and prohibited actions
All licensed exchange companies and offices must commit to practicing the exchange business specified in accordance with the provisions of Article () of the Law Regulating Money Exchange and Remittance Business No. (…) of 2023, in accordance with the conditions, specifications and controls that will be issued by the Monetary Office pursuant to executive instructions in this regard.
Article (15)
Anti-money laundering and terrorist financing requirements
All licensed exchange companies and offices must adhere to the requirements for combating money laundering and the financing of terrorism referred to in the Anti-Money Laundering and Combating the Financing of Terrorism Law, especially those related to international sanctions, including the Syrian Civilian Protection Law (Caesar Act as long as it is in effect), in terms of adhering to the following :
- Adopting electronic systems to check the names of clients on international sanctions lists.
- Immediately stop dealing and freeze accounts and operations related to names that are included on international sanctions lists, especially those linked to the Caesar Act.
- Examining incoming and outgoing transactions and transfers to verify that the names associated with these transactions are not included or linked to names included on international sanctions lists, especially the Caesar Act.
- Verifying that the operations and transfers carried out on behalf of its customers are not related to sectors covered by the Caesar Act .
- Notify the Directorate of Combating Money Laundering and Terrorist Financing in the Central Monetary and Payments Office, immediately and without any delay, of any operations linked or suspected of being linked to names included on international sanctions lists, especially the Caesar Act, provided that the balances of the operations that have been frozen in addition to customer files are attached to the report (know Your client form, and transaction statements )
Article (16)
Penalties
Penalties shall be imposed on anyone who violates the provisions of these regulations in accordance with the penalties stipulated in the Law Regulating Money Exchange and Remittance Business No. (1) of 2023 .
Article (17)
Effectiveness, implementation and transitional period
- All competent authorities in the regions of the Autonomous Administration of North and East Syria, each within its jurisdiction, must implement the provisions of this regulation and its provisions shall be applied from the date of its issuance.
- All exchange companies and offices must settle their situations in accordance with the provisions of these regulations within six months from the date of their issuance.
Issued in the territory of ……….. on …/ …./ 2023 AD.
Co-presidency
Central Cash and Payments Office
Application forms:
- Form No. (1) Application for a new exchange company license
- Form No. (2) Application for a new exchange office license
- Form No. (3) Application for a new branch license
- Form No. (4) Request to transfer the main headquarters or branch
- Form No. (5) Request to close the main center, company branch, or exchange office
- Forms of periodic reports that exchange companies and offices must send to the cash office:
- Table (1): Buying and selling foreign currencies (monthly)
- Table (2): Incoming transfers detailed by country (monthly)
- Table (3): Outward transfers detailed by country (monthly)
- Table (4) Major dealers in incoming and outgoing remittances (monthly)
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