Iran's Currency Repatriation Rules Revised

EghtesadOnline: Iran’s central bank has communicated the details of the latest currency repatriation rules that oblige all exporters to repatriate their earnings.

News ID: ۷۴۶۲۴۸

20 November 2018

According to Financial Tribune, the directive has four clauses, as reported on the regulator’s website:

1. All exporters of goods and services are obliged to return their export earnings to the country’s economic cycle,

2. The CBI is responsible for allocating currency (at cheap rates) for import of goods and services of only those exporters whose mechanisms for repatriating their earnings to the country’s economic cycle is specified in the directive that follows,

3. Regulations for returning export earnings of exporters whose total annual exports amount to up to €1 million, €1-3 million, €3-10 million, and over €10 million are as follows:

a) Up to €1 million:

exempt from selling currency through Nima–the Integrated Forex Deals System launched by the government after it unified the USD rate

use their export currency for import of goods and services needed for their own production and business after submitting orders

give the forex to importers after submitting their orders with approval from the Ministry of Industries, Mining, and Trade,

offer it to banks, authorized exchange houses in the form of Hawalah or banknotes and submit it on SANA foreign exchange data system.

b) €1-3 million

Are obliged to offer 50% of their export earnings on Nima.

Provision: Earnings up to €1 million are exempt from sale on Nima.

Return the remaining amount into the economic cycle

use export currency for importing goods and services needed for their own production and business after submitting orders

sell it directly to other importers after submitting orders and approval by the Ministry of Industries, Mining, and Trade

offer it to banks and authorized exchange houses in the form of Hawalah or banknotes and submit it on SANA foreign exchange data system.

c) €1-3 million

Obliged to offer 70% of the export earnings on Nima

return the remaining amount to the economic cycle,

use export currency for import of goods and services needed for their own production and business after submitting orders.

d) Over €10 million

obliged to offer 90% of their export earnings on Nima.

return the remaining amount to the economic cycle

use the export currency for import of goods and services as well as marketing costs needed for their own production after submitting orders

Provision: selling on Nima more than the specified percentage in the three clauses above is possible.

4.  The directive applies to all exports undertaken since April 11, 2018.

According to an earlier CBI directive, exporters should bring back their export earnings to the country's economic cycle within three months. While no exceptions were made for the money repatriation in earlier directives, businesses are not expected to be satisfied with the latest order. Businesses often complain that mandatory rules for currency repatriation hurt exports and should be an exception and not a norm.