- Time frame: Three (3) months grace period.
- Compliance: cessation of new registration, re-licensing and assessment of bureaux de change.
- Reference: Government Notice No. 223 of 2nd June, 2017
Content of the order
The Bank of Tanzania (BOT)through its letter referenced FB.69/256/01 dated 21st June, 2017 has issued directivesrelated to operations of Bureaux de Change in Tanzania. Breakthrough Attorneys has summarized the contents of the letter here below:
I. Share Capital and non-interest bearing deposit
The minimum capital thresholds have been raised from Tshs 100 Million to Tshs 300 Million for holders of Class A licenses and from Tshs 250 Million to 1 Billion for holders of Class B licenses. Furthermore, non-interest bearing deposit has been increased from USD 50,000 to USD 100,000.
II. Re-licensing and assessment orders
The current operating Bureaux de Change have been urged to comply with the following measures:
- Licensing and/or registration of new Bureau de Change has been suspended until further notice.
- The existing Bureaux de Change have to apply for re-licensing.
- Multiple shareholding, membership, or directorship in more than one Bureau de Change is not allowed. However, the Law allows opening of branches under Regulation 15 (1) of the Foreign Exchange (Bureau de Change) Regulations, 2015
- Two-thirds of the required minimum capital must be in cash as working capital
- All outlets be fitted with CCTV Cameras in all strategic areas including teller cubes
- All shareholders, directors and heads of the branches are required to authenticate the source of funds invested in the Bureau de Change.
- Submission of the filled-in form for premises aptness checklist by every Bureau de Change
The order further encourages merger and acquisition of Bureau de Change for easy compliance and implementation of the measures. The provisions of Section 24 (1) (h) and 30 of the Banking and Financial Institutions Act, 2006 shall apply. However, due process for merger and acquisitions has to be adhered to’ including but not limited to, approval of BOT. The application has to be accompanied with a board resolution, pro-forma balance sheet, and pro-forma income statement.
Breakthrough Attorneys calls upon all interested stakeholders and the general public to take note of the above directives in order to ensure compliance accordingly.
This publication has been prepared for information only, and it does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Breakthrough Attorneys, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it and organisation structure.