Forex Regulations
Foreign Exchange Regulation Act of Pakistan:-
One of the core pieces of legislation in Pakistan regulating foreign currency exchange is the Foreign Exchange Regulation Act. As of June 16, 2010, the Pakistani Rupee is worth 85.3811 to the U.S. dollar; 126.5007 to the British Pound; .9314 to the Japanese Yen; and 105.0359 to the Euro.
History
The Foreign Exchange Regulation Act was passed in 1947, the same year Pakistan gained independence from Great Britain. As Pakistan at the time also encompassed East Pakistan, which later became Bangladesh, the same law (with slight modifications that have been enacted since 1971) also effects Bangladesh.
Currency and Bullion
Under the Act’s Section 8, it is illegal to take gold, jewelry, other precious metals, or either Pakistani or foreign currency into or out of Pakistan. Exceptions to the law must be approved by the State Bank of Pakistan and are subject to a fee. Furthermore, the State Bank of Pakistan is entitled to set conditions and regulations it deems necessary on dealings involving gold and silver.
Government Acquisition
The Act, under Section 9, stipulates that the Federal Government of Pakistan may force the owner of a foreign exchange to sell the exchange to the State Bank of Pakistan at a price determined by the government. The State Bank of Pakistan may also authorize another party to take over the foreign exchange on behalf of the State Bank.
Regulation of Securities
It is illegal to transfer securities to any party outside of Pakistan without the expressed permission of the State Bank of Pakistan under Section 13. Furthermore, Section 14 stipulates that the State Bank may compel the holder of a security to transfer the security to the custody of an “authorized depository.”
Acquisition of Foreign Securities
Section 16 of the Act permits the Federal Government, when it feels that “it is expedient so to do for the purpose of strengthening its foreign exchange position,” to acquire foreign securities within Pakistan at a price determined by the government to be equal to or greater than the market value of the security. The State Bank may also compel holders of foreign securities to transfer the securities to a third party authorized to receive the securities by the State Bank.
Affiliate Program