950819

Diplomatic bonded

warehouses directed

to open foreign

currency accounts

Nasir Siddiqui

KARACHI: The Central Board of Revenue (CBR) has directed the licencees of diplomatic bonded warehouses to open foreign currency accounts with authorized dealers in Pakistan.

Foreign Exchange Department sources at the State Bank of Pakistan said that the CBR order further states that entitled persons and organizations shall be required to make payment for purchase from warehouses through crossed cheques, pay orders or drafts issued in favour of licencees from their foreign currency accounts maintained in Pakistan. No other credit into these accounts will be permissible.

Each bonded warehouse owner shall open a separate foreign currency account with an authorized dealer in Pakistan with the approval of Central Board of Revenue or State Bank of Pakistan.

Sources said that at present, payments by the entitled persons for purchases from licensed bonded warehouses are required to be made through instruments drawn in favour of overseas owners of the goods held in the bonded stores. These instruments are sent by the stores to the beneficiaries. The ammount of commission accruing to the warehouse is subsequently repatriated to Pakistan through normal banking channels.

Sources said that henceforth immediately after the proceeds have been realized and credited to the relative foreign currency account, the bonded warehouse owners will remit to the owners of the goods the sale proceeds less the amount of agreed commission. The amount of agreed commission will simultaneously be converted by the warehouse owners into Pakistani rupees.

The amount of interest accruing on these foreign currency accounts, if any, will be converted and paid to the account holders in Pakistan rupees.

Sources further said that the bonded warehouse owners will continue to submit the monthly statements prescribed by the State Bank of Pakistan as per the terms and conditions of the approval letters issued by the State Bank together with the requisite documents. The bonded warehouse owners will also submit along with the prescribed monthly statements, the following additional documents:

(a) the statement of the foreign currency account indicating each credit/debit entry, and

(b) the proceeds realization certificates in evidence of conversion of the accounts of commission/interest into Pakistan rupees.