Approved by Board of National Bank of Tajikistan on September 16, 1997 No. 51

Rules of issue to commercial banks of licenses for making of banking activities in foreign currency

I. Maintaining

1. The license for banking operations in foreign currency is issued to the banks functioning in the territory of the Republic of Tajikistan (joint and foreign venture banks) by National Bank of Tajikistan.

2. The license for banking operations in foreign currency is granted based on the petition of commercial bank with appendix of complete set of documents (according to the list specified in Appendix No. 1 of these rules), Management of banking supervision of National Bank of Tajikistan based on the conclusion of Management of the International financial relations and currency transactions of National Bank of Tajikistan (hereinafter in the text of these rules: - in case of renaming of the above-named divisions in case of structural changes of National Bank of Tajikistan - their legal successors) about readiness of bank for carrying out these transactions with indication of transaction type in foreign currency which the bank is capable to carry out.

In case of representation of incomplete set of documents the petition is not taken cognizance.

The petition of the banks violating the bank, foreign law of the Republic of Tajikistan and regulations of National Bank of Tajikistan is not subject to satisfaction.

The license is granted with the specific list of the permitted transactions (the list of banking activities and their short characteristic is given in Appendix No. 2 of these rules).

The license for making of banking activities in foreign currency is granted to the banks which finished complete financial (operational) year. The license can be granted earlier specified term to banks with participation of the foreign capital and to branches of foreign banks.

3. For determination of readiness of bank for carrying out certain circle of foreign currency transactions qualification and technical requirements (Appendix No. 3 of these rules) are established.

Necessary condition for receipt of the license for carrying out any kind of foreign currency transactions is availability in bank of adequate control systems behind carrying out its regular banking activities in rubla.

4. Licensing is preceded by spot test of bank by specialists of Management of the International relations and currency transactions and Management of banking supervision of National Bank of Tajikistan on identification of degree of its readiness for receipt of the right to making of foreign currency transactions, including clarification of the following questions:

- availability of the suitable room;

- proper stores organization of values (fireproof cases, alarm system, protection, access control, etc.);

- the correct statement of accounting and operational accounting, daily creation of the consolidated balance in general on bank and daily availability at head office of balances of branches;

- the correct organization of document flow, control system availability behind passing of documents;

- availability of service of internal audits;

- accurate differentiation of job responsibilities, their observance by personnel;

- availability and observance of requirements to readiness of personnel;

- other questions necessary for confirmation of adequacy of internal control system in bank and compliance to qualification and technical requirements.

During check knowledge is investigated by specialists of bank of the foreign exchange legislation of the Republic of Tajikistan, rules and procedure of currency transactions.

By results of check the conclusion which forms National Bank of Tajikistan the basis for issue or refusal of issue to bank of the license for the right of banking operations in foreign currency is constituted.

5. The banks addressing to National Bank of Tajikistan behind receipt of licenses for making of foreign currency transactions represent to Management of banking supervision of National Bank of Tajikistan together with the conclusion of Management of the International financial relations and currency transactions, set of documents according to Appendix No. 1.

The National Bank of Tajikistan within 30 days after receipt of documents and their comprehensive study and the analysis makes the decision on licensing to commercial bank or rejects its request for receipt of the license.

6. Banks have the right to petition for receipt of the additional rights to making of foreign currency transactions. In this case banks provide the set of documents including only those documents on Appendix No. 1 of these rules which are connected with receipt of the new right.

7. The bank which obtained the license for banking operations in foreign currency is authorized bank and performs functions of the agent of currency control over transactions of the clients.

8. The licenses granted by National Bank of Tajikistan are not the basis for implementation by banks of the foreign trade transactions of any kind which are not relating directly to banking activity.

9. The authorized bank has the right to entrust accomplishment of the permitted circle of foreign currency transactions to the branch, issuing to branch Permission to the right of making of those currency transactions which this branch can perform. The bank shall provide information on the branches which acquired the right of making of banking activities in foreign currency in National Bank of Tajikistan.

10. The National Bank of Tajikistan exercises supervision of accomplishment of conditions of the licenses granted to commercial banks, carries out thematic inspections of correctness of carrying out banking activities in foreign currency.

By results of checks the National Bank of Tajikistan has the right to apply to commercial banks of measure, provided legislative and regulations of currency control and currency exchange control.

11. The National Bank of Tajikistan can make changes and additions to the licenses granted by it in connection with change of the bank and foreign exchange legislation, and also to make changes, additions or to suspend its action, or to cancel licenses in case of identification of violations by banks of their conditions or the existing bank and foreign exchange legislation of the Republic of Tajikistan according to the procedure established by National Bank of Tajikistan.

Appendix 1

The list of the documents necessary for submission to National Bank of Tajikistan, for consideration of question of licensing for making of banking activities in foreign currency

1. The petition of Council of commercial bank (Board) for receipt of the license for making of banking activities in foreign currency;

2. Reasons for economic feasibility and readiness of bank for implementation of foreign currency transactions;

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