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Based on the Central Monetary and Payments Law No. (9) of 2021 AD

and the provisions of Articles (4), (21), (22), (23) and (34) of the Exchange and Remittances Regulation Law No. (1) of 2023 AD

the joint presidency of the Central Monetary and Payments Office

decides the following: 

Article (1)

Definitions

Monetary Office: The Central Monetary and Payments Office of North and East Syria.

Exchange Business: Dealing in foreign currencies permitted to be dealt with in the markets of the Autonomous Administration regions of North and East Syria and transferring them and other permitted businesses according to the Law Regulating Exchange and Remittances No. (1) of 2023 and the regulations and instructions issued pursuant thereto.

 

Exchange office: The office licensed to practice exchange business in accordance with the provisions of Article (21) of the Exchange and Remittances Regulation Law No. (1) of 2023 and the instructions issued pursuant thereto.

 

Net working capital: The sum of the value of cash balances in safes and boxes, balances with other exchange dealers, balances with banks, and the value of precious metals.

 

Person: A natural or legal person.

 

Article (2)

Objective and scope of application

  1. The provisions of these instructions aim to regulate the permitted and prohibited activities of exchange companies and offices operating in the areas of the Autonomous Administration of North and East Syria.
  2. The provisions of these instructions apply to exchange companies and offices licensed by the Monetary Office.

Article (3)

General Provisions

All licensed exchange companies and offices must adhere to the following:

  1. Provide work procedures for all permitted businesses in accordance with the provisions of the Exchange and Remittances Regulation Law No. (1) of 2023 and the provisions of these instructions, and with the requirements of due diligence, identification and verification in accordance with the provisions of the Anti-Money Laundering and Terrorist Financing Law in force.
  2. Keeping documents and records related to financial transactions for a period of no less than (5) five years from the date of the transaction’s termination or the termination of the business relationship, provided that this is done in an appropriate manner that facilitates reference to them at any time. In the event that the business relationship ends due to the existence of investigation cases related to money laundering or terrorist financing crimes, the information and documents must be kept until the investigation case is completed.

 

  1. Commitment to using capital in permitted exchange business and maintaining the independence of exchange records and exchange business and not mixing them with any other records or business.
  2. Adherence to disclosing the exchange rates of the currencies traded on the price board or screen at the main headquarters and branches of the exchange company or office in a place that is clear to the dealers, as well as disclosing the value of commissions and fees due on other services provided by the exchange company as permitted by the instructions.
  3. Recording all currency buying and selling operations and incoming and outgoing transfers on the automated accounting system used and approved by the Monetary Office.

 

Article (4)

Permitted activities for exchange companies

Based on the provisions of Article No. (4) and Article No. (21) of the Exchange and Remittances Regulation Law, exchange companies may engage in the activities specified below in accordance with the following:

  1. Providing the service of buying and selling various currencies to natural or legal persons, provided that they adhere to the following:
  2. Issuing an official invoice from the automated accounting system used in the exchange company and approved by the Monetary Office, provided that a copy of the invoice is delivered to the customer.
  3. Obtaining a copy of the identity document for natural persons (ID/passport) when carrying out transactions whose value is equal to or exceeds (5,000) five thousand US dollars or its equivalent in other currencies.
  4. Obtaining a copy of the registration certificate for legal persons when carrying out transactions whose value is equal to or exceeds (5,000) five thousand US dollars or its equivalent in other currencies.
  5. The value of a single transaction shall not exceed the equivalent of the net working capital of the exchange company.
  6. Keeping invoices and documents for executing currency buying and selling operations whose value is equal to or exceeds (5,000) five thousand US dollars or its equivalent in other currencies, as well as documents and transactions for buying and selling various currencies with banks and exchangers operating and licensed in the areas of the autonomous administration and outside them.
  7. Opening and using accounts in different currencies with licensed banks operating in or outside the areas of self-administration according to the following:

 

  1. Opening one main account with the trade name of the exchange company recorded in the license issued by the Monetary Office, and not using the personal name of the license holder, shareholders or employees of the exchange company.

 

  1. Using the account exclusively for the purposes of permitted exchange business.

 

  1. The responsibility for managing and implementing financial operations on the bank account of the exchange company shall be exclusively by those authorized to sign the account.

 

  1. Signing agreements with the banks dealing with it that specify the responsibilities and obligations of each party.

 

  1. Obtaining prior written approval from the Monetary Office before starting the procedures for opening accounts with banks operating outside the areas of self-administration.
  2. Providing money transfer services inside and outside the areas of the Autonomous Administration in accordance with the instructions issued by the Monetary Office.
  3. Providing the service of buying and selling non-manufactured precious metals, provided that prior written approval is obtained from the Monetary Office and adherence to the following controls and specifications:
  4. The precious metals must be in the form of bullion.
  5. The bullion must be stamped by the competent official authorities in the areas of the Autonomous Administration in accordance with the rules.
  6. Obtaining a copy of the identity document for natural persons (ID/passport), and a copy of the registration certificate for legal persons for each purchase or sale.
  7. An official invoice must be issued for each transaction and recorded on the automated accounting system used.
  8. The value of a single transaction must not exceed 20% of the net working capital of the exchange company.
  9. Any other financial transaction permitted by the Monetary Office pursuant to instructions issued for this purpose.

Article (5)

Permitted activities for exchange offices

Based on the provisions of Article No. (4) and Article No. (21) of the Law Regulating Exchange and Remittances, exchange offices may engage in the activities specified below in accordance with the following:

  1. Providing the service of buying and selling various currencies from natural or legal persons, provided that the following is adhered to:
  2. Issuing an official invoice from the automated accounting system used in the exchange office and approved by the Monetary Office, provided that a copy of the invoice is delivered to the customer.
  3. Obtaining a copy of the identity document for natural persons (ID/passport) when carrying out transactions equal to or exceeding the value of (5,000) five thousand US dollars or its equivalent in other currencies.
  4. Obtaining a copy of the registration certificate for legal persons when carrying out transactions equal to or exceeding the value of (5,000) five thousand US dollars or its equivalent in other currencies.
  5. The value of a single transaction shall not exceed the net working capital of the exchange office.
  6. Keeping invoices and documents for executing currency buying and selling transactions whose value is equal to or exceeds (5,000) five thousand US dollars, as well as documents and transactions for buying and selling various currencies with banks and money changers operating and licensed in the areas of the Autonomous Administration and outside them.
  7. Any other financial activity permitted by the Monetary Office pursuant to instructions issued for this purpose.

Article (6)

Prohibited Activities

It is prohibited for exchange companies and offices to practice any of the following activities:

  1. Opening accounts for their clients or accepting deposits or trusts of all kinds or precious metals.
  2. Providing credit facilities or direct financing (in all forms including loans, credit cards or payment cards), and indirect financing (in all forms including guarantees or pledges).
  3. Obtaining credit facilities from banks operating outside the areas of the Autonomous Administration.
  4. Obtaining banking facilities from banks operating in the areas of self-administration without obtaining prior written approval from the Monetary Office, and the conditions specified in Article No. (7) of these instructions.
  5. Dealing in derivatives, including spot, forward, futures and options contracts for currencies, metals, indices, commodities and other financial instruments on behalf of those dealing with them or on behalf of any other party.
  6. Dealing in foreign stock exchanges.
  7. Selling goods and services in all their forms, except for the financial services permitted under the provisions of these instructions or any other services permitted under the instructions issued by the Monetary Office in this regard.
  8. Refraining from selling any foreign currencies, if any.
  9. Any of the partners in an exchange company or office who manages other accounts with banks such that his transactions indicate that they are used for exchange purposes.
  10. Dealing with exchange practitioners who are not licensed by the Monetary Office.
  11. Any other work not stipulated in the final license of the exchange company or office.

 

Article (7)

Terms and conditions for obtaining credit facilities

Exchange companies may obtain credit facilities from licensed banks operating in the areas of self-administration, provided that the following is met:

  1. Obtaining prior written approval from the Monetary Office before proceeding with the procedures for obtaining credit facilities.
  2. The company must have been licensed and operating for at least three years.
  3. That its business results for the last fiscal year be profits.
  4. That the credit facilities be in the form of a loan or guarantee for the purposes of the business permitted for the exchange company.
  5. That the facilities be obtained under the trade name of the exchange company.
  6. That the facilities be used in the permitted business only.
  7. That their value does not exceed (50%) of the net working capital of the exchange company.
  8. It is prohibited to obtain credit facilities with the guarantee of the shareholders’ shares in the exchange company or office. 9. Shareholders in the exchange company and natural persons who own exchange offices may obtain credit facilities in their personal names or as their guarantee, provided that these facilities are not used in exchange business.

Article (8)

Requirements for combating money laundering and terrorist financing

All licensed exchange companies and offices must comply with the requirements for combating money laundering and terrorist financing referred to in the Anti-Money Laundering and Terrorism Financing Law, especially those related to international and local sanctions.

, in terms of compliance with the following:

  1. Adopting electronic systems to check the names of clients on international sanctions lists.
  2. Immediately stop dealing and freeze accounts and operations related to names included on international and local sanctions lists.
  3. Examine incoming and outgoing transactions and transfers to verify that the names associated with these transactions are not listed or linked to names included on international or local sanctions lists.
  4. Verify that the operations and transfers carried out for the benefit of its clients are not linked to sectors covered by international sanctions.
  5. Inform the Anti-Money Laundering and Terrorist Financing Directorate at the Central Monetary and Payments Office, immediately and without any delay, of any operations linked or suspected to be linked to names included on international or local sanctions lists, provided that the report is accompanied by the balances of the operations that have been frozen in addition to the clients’ files (Know Your Customer form and operations statements).

 

Article (9)

Penalties

Penalties shall be imposed on anyone who violates the provisions of these instructions in accordance with the penalties stipulated in the Law Regulating Exchange and Remittance Business No. (1) of 2023 AD.

Article (10)

Implementation, Enforcement and Transitional Period

  1. All competent authorities in the areas of the Autonomous Administration of North and East Syria, each in its own capacity, must implement the provisions of these instructions and their provisions shall be applied from the date of their issuance.
  2. All exchange companies and offices must settle their situations in accordance with the provisions of these instructions from the date of their issuance and publication.

 

Issued in Raqqa

On …./…../2023 AD.

 

Co-Presidency of the Central Monetary and Payments Office

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