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The Lebanese Parliament passes the "Capital Control" project for foreign exchange transfers


The Finance and Budget Committee of the Lebanese Parliament approved today a draft law that sets new controls on capital flows, especially in foreign exchange, known as “Capital Control”, after several months of research, study and controversy over the draft law, which made some amendments today, and it is scheduled to be presented to the Presidency of the House of Representatives. Representatives in the next two days in preparation for a plenary session to be discussed and approved once and for all.

 

In its session headed by Representative Ibrahim Kanaan, the committee approved the “Capital Control” bill, which allows setting exceptional and temporary controls on bank transfers, as a constitutional and legal way out of the current financial situation in the country and which has continued for more than 19 months, as Lebanese banks have frozen deposits and prevented foreign or foreign transfers. Exchanging any deposits of foreign currency depositors for long months.

 

In statements to reporters, Kanaan said that the "Capital Control" bill is constitutional and a necessary need, despite the passage of more than 19 months since the start of the crisis, because any important legislation that has been delayed will remain better than the current chaos - as he described it.

 

He added that the "Capital Control" bill amends the Monetary and Credit Law and prohibits transfers abroad, with the exception of what has a permanent and urgent character, such as education expenses and a maximum ceiling of 50 thousand dollars, and taxes and fees.

 

Although some people circulated texts of the Capital Control bill, MP Ibrahim Kanaan, head of the Finance and Budget Committee in the Lebanese Parliament issued a statement confirming that any formula published and circulated is neither complete nor final, and awaits the printing of the amendments approved today, which will be referred to the presidency. Parliament in the next two days.

 

The Capital Control Bill prohibits the transfer of foreign exchange abroad except for everything that has a permanent status, such as the accounts of international financial institutions, international and regional organizations and foreign embassies, and new money that was brought into banks and had not been transferred abroad after October 17, 2019, the date on which the demonstrations began In Lebanon.

 

Also excluded from the prohibition of transfer are everything that has an emergency and conditional character, such as university education expenses, taxes, fees and financial obligations due to foreign official authorities and entrusted exclusively to residential and not investment personal assets, and the expenses of subscriptions and applications on the Internet with a maximum of 50 thousand US dollars after a review by the General Authority after receiving the financial data Digital from the Central Bank of Lebanon.

 

The Capital Control Law is temporary and exceptional with the aim of protecting the national currency and the higher interest of the Lebanese state.

 

Lebanon is suffering a severe economic crisis, and the Lebanese pound has lost about 90% of its value, and the exchange of the pound on the black market has exceeded the barrier of 13,000 pounds to one dollar, while the official exchange rate is still 1500 pounds to the dollar, while banks continue to deliver dollar deposits at a price of 3900 Lebanese pounds to the dollar. the one.

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