All Authorised Dealers
in Foreign Exchange,

Dear Sirs,

FORWARD TRANSACTIONS WITH CUSTOMERS

In partial modification of instructions issued vide sub para (ii) of para 7 of F.E Circular No.8 of 1999 Authorised Dealers are advised that they should not enter into forward transactions with customers for a tenor of less than one month. Further, one month forward transactions with customers will be for fixed maturity, in case payment is made / received within one month, spot selling / buying rate will be applied and the relevant contract will be closed out at the maturity date.

Furthermore, Authorised Dealers are prohibited from buying and selling Foreign exchange from / to other Authorised Dealers unless such purchase / sale is backed by permissible transaction with their customers. Accordingly paragraph 9, chapter V of Foreign Exchange Manual, as revised vide para 6 of F.E Circular No. 8 of 1999 is amended with immediate effect to read as under:

" Authorised Dealers may freely buy and sell Foreign currencies from and to other Authorised Dealers in Pakistan provided such purchased / sales are backed by permissible transactions with their customers. "