EXCHANGE CONTROL is a set of procedures which assists the Government in directing flows in the best interest of its balance of payments on international transactions
The BALANCE OF PAYMENTS is a systematic record of all financial transactions between the residents, including the Government, of one country and those of other countries. The BALANCE OF PAYMENTS is said to be ADVERSE (in deficit) if payments abroad exceed receipts from abroad. It is said to be FAVOURABLE (in surplus) if receipts are in excess of payments. The item which mostly influences a deficit or surplus position is the net payment or net receipt on account of goods and services. A deficit in the BALANCE OF PAYMENTS, which represents a temporary imbalance, is usually financed by drawing down the country's foreign exchange reserves and is supplemented, if necessary, by short term external borrowing. A more fundamental deficit, one which is persistent and severe, requires corrective measures aimed at increasing output and exports and reducing imports in respect of goods and services, since over a given period we may import more goods and services than we export, the Central Bank maintains a RESERVE OF FOREIGN EXCHANGE to cover any temporary imbalance. This FOREIGN EXCHANGE RESERVE is maintained in the form of international trading currencies such as Sterling and US dollars or investments in such currencies held with the Central Bank's correspondents abroad.
The EXCHANGE CONTROL AUTHORITY in Barbados is the Minister of Finance. However, the Minister of Finance has delegated much of his authority to the Central Bank of Barbados, which sees that the provisions of the EXCHANGE CONTROL ACT, CAP 71 are carried out. The Central Bank in turn, delegates some of its authority to Authorised Dealers and Authorised Depositaries. This reduces the need for individual applicants to come in person to the Central Bank since it is more convenient for them to go to the nearest commercial bank branch.
AUTHORISED DEALERS assist the Central Bank by handling most of the transactions made in foreign currencies or gold bullion. Only AUTHORISED DEALERS may legally hold and deal in foreign currencies and gold bullion. They act on behalf of the Central Bank and must submit returns to the Central Bank on whatever transactions they carry out. Barbadians may accept foreign currency in return for goods and services. However, they cannot legally exchange that currency for Barbados dollars or any other currency except through an AUTHORISED DEALER. A list of AUTHORISED DEALERS and AUTHORISED DEPOSITARIES is appended.
Not unless permission has been obtained from the Central Bank. All persons resident in Barbados must hand over to an Authorised Dealer as soon as possible, all FOREIGN CURRENCY or GOLD BULLION which comes into their possession for conversion into local currency at prevailing rates of exchange.
By FOREIGN CURRENCY we mean the currency of a country other than Barbados. It includes notes and coins, cheques, travellers’ cheques, drafts, postal orders, money orders, bills of exchange, letters of credit and balances with foreign banks. Barbados dollars credited to or held in an External Account with an Authorised Dealer are treated on the same basis as FOREIGN CURRENCY.
GOLD BULLION is unwrought gold, usually in the form of ingots. Dealings in gold come under the same regulations as dealings in foreign currencies. The importation of gold requires Exchange Control permission. Such permission is normally given to those using gold in the manufacture of jewellery and for other industrial purposes. Residents are not allowed to hold GOLD BULLION; gold coins of foreign countries may be held for numismatic purposes only. Gold coins issued by the Central Bank of Barbados are, of course, legal tender in Barbados and may be used in the settlement of transactions and debts.
SECURITIES are defined in the Exchange Control Act Cap. 71 as shares, stocks, bonds, notes (other than promissory notes), debentures, debenture stock, treasury bills, units in a unit trust scheme, and shares in an oil royalty. SECURITIES denominated in foreign currencies are designated "FOREIGN CURRENCY SECURITIES".
Yes, since February 28, 1974 when the Exchange Control Act, CAP 71 was amended to do away with the distinction between what were known as "Scheduled Territories" or, more commonly "the Sterling Area", and the rest of the world. As a result, transactions with residents of any country other than Barbados (referred to as non-residents) are subject to Exchange Control regulations.
For Exchange Control purposes, RESIDENTS are defined as: (a)Barbadian nationals residing in Barbados, studying abroad or temporarily working abroad. (b)Nationals of other countries who have continuously resided in Barbados for at least three years; and (c)Firms and companies, or their branches, established or operating in Barbados. All others are NON-RESIDENTS and include:
If you are not sure of your residential status for Exchange Control purposes, please consult an Authorised Dealer or the Exchange Control Department of the Central Bank of Barbados.
An EXTERNAL ACCOUNT is an account held in Barbados dollars with an Authorised Dealer in Barbados in the name of a non-resident. As funds in an EXTERNAL ACCOUNT are normally convertible into a foreign currency, deposits to and withdrawals from such an account require Exchange Control permission. This permission may be either general or specific. A general permission is granted to Authorised Dealers to make deposits to and withdrawals from and EXTERNAL ACCOUNT in certain cases. For example, an Authorised Dealer may, without reference to Exchange Control, deposit to an EXTERNAL ACCOUNT any funds which the holder (who must of course be a non-resident) brings into Barbados or obtains from another EXTERNAL ACCOUNT. The Authorised Dealer may also (without reference to Exchange Control) permit the holder of an EXTERNAL ACCOUNT to make withdrawals for payments in Barbados or to purchase foreign currency for travel or business purposes. In other cases, specific permission is required from Exchange Control before an Authorised Dealer may permit the holder of an EXTERNAL ACCOUNT to make deposits or withdrawals. For example, if a non-resident owns shares in a local company, permission must be obtained from Exchange Control before any income earned on these shares may be deposited to his EXTERNAL ACCOUNT. This is to make sure that he has satisfied all local tax liabilities. If a non-resident brings in foreign currency for investments in fixed deposits with a commercial bank in Barbados, and subsequently wishes to transfer the principal and/or interest payments abroad, he must obtain permission from the Central Bank. Residents are not allowed to hold External Accounts.
Yes, if such foreign nationals have not resided continuously in Barbados for at least three years. However, their external accounts are treated differently from other External Accounts. For example, general permission has been granted to authorised dealers for net salaries earned by such foreign nationals to be credited to their accounts, and 25 percent of their net annual salaries so credited to be paid to other EXTERNAL ACCOUNTS. In addition, funds may also be withdrawn from these accounts as in the case of other EXTERNAL ACCOUNTS. However, Exchange Control permission is required if payments to other EXTERNAL ACCOUNTS will exceed 25 percent of net annual salaries credited to their accounts or if funds are to be utilized for business purposes.
A FOREIGN CURRENCY ACCOUNT is an account denominated in a currency other than Barbados dollars e.g. U.S. or Canadian dollars. Residents may open FOREIGN CURRENCY ACCOUNTS through Authorised Dealers in Barbados. A resident, whether an individual or firm, a company, an association or institution, who wishes to open a FOREIGN CURRENCY ACCOUNT, must apply to an Authorised Dealer stating the nature and estimated volume of his receipts and payments in whatever foreign currencies are involved. Subject to Exchange Control approval, residents may also maintain FOREIGN CURRENCY ACCOUNTS with banks abroad, provided that Authorised Dealers in Barbados are not in a position to service such accounts. The Authorised Dealer forwarding the application must justify why such an account is necessary. Where permission is granted, the holder of a FOREIGN CURRENCY ACCOUNT must submit to the Central Bank of Barbados monthly account statements, together with full particulars of receipts and payment, not later than fourteen days after the end of the month. This is to ensure that the conditions for holding the FOREIGN CURRENCY ACCOUNT are being observed. The chief purpose of allowing the residents to operate FOREIGN CURRENCY ACCOUNTS is to enable them to save bank charges. It is not intended that residents of Barbados with FOREIGN CURRENCY ACCOUNTS should be given preferential treatment over other residents by allowing them unrestricted use of foreign exchange which they are allowed to hold. Resident account-holders are permitted to make payments from their FOREIGN CURRENCY ACCOUNTS only to the extent of general or specific authorization granted by the Authorised Dealer. For example, a resident may make use of the equivalent of BDS$7,500 from his foreign currency account for private travel in any one year; any excess over this limit must receive prior permission from the Central Bank of Barbados. In the case of non-resident account-holders, the full amount of funds brought into Barbados can be maintained on their account. Payments from FOREIGN CURRENCY ACCOUNTS of non-residents may be made without reference to the Central Bank of Barbados.
As long as the goods to be imported are covered by general or specific licence approved by the Minister of Trade, a local importer may freely obtain foreign currency for payment to an overseas supplier. However, before he can purchase the foreign currency required, he must present to the Authorised Dealer the appropriate invoice and Customs warrant as proof that the goods have landed in Barbados and have been cleared by the Customs Authority. Such forms are obtainable from the Authorised Dealers or the Central Bank and, when completed, must be lodged with the Authorised Dealer through whom the transaction has been carried out. When advance payments have to be made before the foreign supplier will ship the good, permission to purchase foreign currencies must be obtained from the Central Bank of Barbados by presenting Form FC (1), (for Imports only) for payments over BDS$100, 000.00. These forms are obtainable from the Authorised Dealers or the Central Bank. All amounts under BDS$100,000.00, can be processed through Authorised Dealers upon presentation of the following documents:
Advance payments over BDS$100,000.00 require the permission of the Exchange Control on submission of a Form FC (1) and the relevant documentation aforementioned. If goods have already landed, the applicant should proceed to the Authorised Dealer to facilitate the payments. A Form FC (1) should be completed and relevant documents (As listed in a-d) submitted.
A CREDIT CARD is an instrument issued by an institution or its agent to an individual who then enjoys credit facilities to the extent of the limit agreed upon between the issuer and the CREDIT CARD holder. The CREDIT CARD holder may use these facilities in acquiring cash, goods or services in other parts of the world. Residents are permitted to use CREDIT CARDS for travel services abroad to the extent of their authorised travel allowances; that is, BDS$7,500 per person for holiday travel and without limit per person for travel within the CARICOM. For business travel, there is an allowance for BDS$50,000 per person outside of CARICOM per calendar year or $750 per day. Where the stated allowances are to be exceeded, permission must first be sought from the Central Bank of Barbados through an application letter submitted in duplicate by the issuer of the CREDIT CARD.
NON-RESIDENTS may use locally issued credit cards on condition that the balance be maintained on an External Account or Foreign Currency Account to cover claims against the credit card.
Presumably, you will want some currency of the country to which you are travelling. Residents of Barbados travelling abroad on holiday are allowed to purchase foreign currency up to the equivalent of BDS$7,500.00 per person per calendar year. Barbadian residents travelling abroad on business are allowed to purchase foreign currency (at the rate of $750 per day) or $50,000 within a year. There is no limit for business travel within CARICOM. These amounts may be obtained from Authorised Dealers without reference to Exchange Control. However, you are required to present a return ticket and your passport or approved travelling documents so that the amount of foreign exchange purchased may be marked in your passport. Businessmen must, in addition, present a letter from their employer confirming that they are travelling abroad on business on behalf of the company or firm concerned. If you require more foreign currency for your trip than stipulated above, or if you have used up your travel allowance for the calendar year, or if you plan to combine private and business travel on the same journey, an Authorised Dealer will not be able to accommodate you without referring you to the Central Bank of Barbados. In such cases, you must complete an application on Form FC (Not for Imports) for submission to the Central Bank of Barbados. Do not wait until the last minute before you try to obtain your foreign currency. Non-residents may purchase foreign currency through an Authorised Dealer for holiday (BDS$7,500) or business travel up to the equivalent of BDS$50,000.00 (at the rate of BDS$750 per day) per person per calendar year. However, if non-residents are meeting their travel expenses through an External Account, a Foreign Currency Account, or from funds which they had originally brought into Barbados, Authorised Dealers are permitted to sell them foreign currency for travel purposes to the limit of such amounts.
Authorised Dealers have authority to approve remittances by residents without limit per person per academic year for maintenance of CHILDREN and DEPENDANTS who are BEING EDUCATED ABROAD, subject to: (a)Documentation showing that the dependent has been accepted at a SCHOOL or UNIVERSITY ABROAD (b)Documentation indicating the fees and charges for his tuition; (c)Documentary evidence of likely living expense abroad; and (d)Some indication of reasonable expenses with respect to books and other incidentals. In the absence of documentary evidence, the permission of The Central Bank of Barbados is required and an application should be completed and submitted on our Form FC (Not for Imports).
Authorised Dealers are permitted to sell foreign currency to meet the cost of CORRESPONDENCE COURSES up to the equivalent of BDS$50,000 for each course, including the cost of books, apparatus and enrolment fees. Naturally, you will have to present documentary evidence in support of your request. As usual, amounts in excess of this allowance require the permission of Exchange Control, in which case a Form FC (Not for Imports) must be completed and submitted.
Barbados residents travelling abroad are permitted to take out on their person without reference to the Central Bank of Barbados, up to BDS$500 in BARBADOS NOTES to be encashed abroad only in CARICOM territories. You can only be assured that your notes will be accepted and exchanged for the local currency at par value if you go to a commercial bank in the CARICOM country concerned. Both residents and non-residents travelling abroad may take with them on their person up to the equivalent of BDS$1,000 in FOREIGN CURRENCY NOTES and COINS as part of their approved travelling allowance (BDS$7,500). The remainder may be taken in the form of travellers' cheques, drafts on foreign banks or other approved monetary instruments. Visitors, of course, are allowed to take out any foreign CURRENCY NOTES which they originally brought with them into Barbados.
There is no prohibition on the importation of Barbados dollars or any foreign CURRENCY into Barbados. Remember, however, that if you are a resident, you should surrender as soon as possible, any foreign CURRENCY which you may bring back from abroad to an Authorised Dealer for exchange into Barbados dollars. The Central Banks of Jamaica and Guyana have requested that under no circumstances should Jamaica and Guyana CURRENCY notes be encashed outside of their respective territories. E.C. dollar notes are freely exchanged by Authorised Dealers. It should also be noted that currency notes of Trinidad & Tobago are not currently exchanged by Authorised Dealers in Barbados.
Barbadians may make cash gifts up to the equivalent of BDS$10,000 per donor per year through an Authorised Dealer without reference to the Central Bank of Barbados. Amounts in excess of this figure require the permission of the Central Bank of Barbados by way of a completed Form FC (Not for Imports). Authorised Dealers may sell foreign currency for the purchase of books and periodicals from abroad as required for personal use and not for re-sale. You must, of course, present evidence that payment is due. Foreign currency for entrance and subscription fees to clubs and societies abroad may also be purchased from Authorised Dealers without reference to the Central Bank of Barbados. Again, you must provide evidence that these fees are due and payable. Such permission does not cover subscriptions to credit cards and other organisations issuing documents entitling holders to travel services outside of Barbados.
Residents seeking to make investments abroad require the permission of the Central Bank of Barbados.
Residents seeking to borrow abroad require the permission of the Central Bank of Barbados.
NON-RESIDENTS are allowed to bring foreign exchange INTO BARBADOS for the purposes of deposit with a financial institution or to engage in lawful business. To facilitate repatriation of such funds in due course, NON-RESIDENTS should register with Exchange Control any foreign funds brought into Barbados for investment in Real Estate, Loan Capital or Equity. To have their foreign funds registered, NON-RESIDENTS should take the following steps:
Permission is required from Exchange Control for the purchase of REAL PROPERTY situated in Barbados. Such permission is usually granted if the NON-RESIDENT purchaser brings funds into Barbados to cover the cost of the property concerned. The purchase price must be paid and received in Barbados. NON-RESIDENTS are not normally allowed to borrow for financing such purchases. However, Barbadian nationals, even though they may be NON-RESIDENTS, are given permission to borrow in Barbados to acquire residential property.
NON-RESIDENTS and firms or companies controlled either directly or indirectly by NON-RESIDENTS require Central Bank’s permission to BORROW or to obtain credit or mortgage loans from a LOCAL source.
Transfer of LEGACIES and inheritances due to beneficiaries who were NON-RESIDENTS at the time of death of the benefactor is permitted on the presentation of the relevant documentation. An application on Form FC (Not for Imports) should be submitted to the Central Bank of Barbados along with the following:
(*) These documents relate to where the sale of property is involved as part of the transaction. So, you wish to Emigrate. Barbadian nationals EMIGRATING to take up permanent residence abroad are allowed to transfer funds at the rate of BDS$100,000 for a family unit per annum. For this purpose an application on Form FC (Not for Imports) must be submitted to the Central Bank of Barbados. The application should be supported by an Asset Declaration Sheet showing assets held in Barbados, A Tax Clearance Certificate from the Inland Revenue Department and evidence that the applicant will be permitted to take up permanent residence in the new country. Foreign nationals who have resided in Barbados and are proceeding to take up permanent residence abroad will be given similar treatment. However, in their case, they will be allowed initially to transfer funds to the extent of amounts brought into the country and registered with the Central Bank of Barbados if such amounts exceed the standard rate of BDS$100,000. Can RESIDENTS buy INSURANCE denominated in FOREIGN CURRENCIES? RESIDENTS are free to purchase annuities, life and endowment policies and any other type of INSURANCE from insurance companies properly licensed to operate in the Island. All policies sold to residents must be denominated in Barbados dollars. (Mr. Boyce to check) The issue to RESIDENTS of policies expressed in a FOREIGN CURRENCY requires Central Bank of Barbados’ permission. Application for such permission must be sought via letter in duplicate. RESIDENTS holding policies denominated in FOREIGN CURRENCIES and issued prior to March 1, 1974 may remit premiums freely through an Authorised Dealer.
There are NO RESTRICTIONS on transactions between residents of Barbados in respect of SECURITIES denominated in Barbados dollars. However, the transfer of a Barbadian dollar security from a resident to a non-resident, or vice versa, requires Central Bank of Barbados’ permission. Similarly, Central Bank’s permission is necessary where local companies issue SECURITIES denominated in Barbados dollars to non-residents. In the case of FOREIGN CURRENCY SECURITIES, purchase or sold by residents can only be made with permission of the Central Bank of Barbados. If a resident already holds FOREIGN CURRENCY SECURITIES registered in Sterling Area countries prior to March 1, 1974 or is already in possession of FOREIGN CURRENCY SECURITIES on becoming a resident, permission for retention of such securities should be sought from Exchange Control without delay. In all cases where Central Bank’s permission is required, it should be sought by letter in duplicate.Residents must deposit Certificates of Title to FOREIGN CURRENCY SECURITIES with an Authorised Depositary in Barbados or with his agent abroad. No person whether a resident or non-resident may buy, sell or otherwise deal in FOREIGN CURRENCY SECURITIES in Barbados except through an Authorised Depositary.