All Authorized Dealers
In Foreign Exchange,

Dear Sirs,

EXPORTS

Attention of the Authorised Dealers is invited to State Bank of Pakistan's Notification No. F.E. 5/72-SB dated the 27^th December, 1972 in terms of which it has been enjoined upon the exporters to repatriate the full export proceeds of the goods within a period of four months from the date of shipment / posting, as the case may be. The aforementioned Notification has since been amended vide Notification No. F.E. 1/98-SB dated the 8^th June, 1998 a copy whereof is attached herewith. It will be observed from the revised Notification that exporters are now required to repatriate the export proceeds on the due date for payment or within four months from the date of shipment, whichever is earlier. You are advised to ensure meticulous compliance of the provisions of the revised Notification.

2. As a consequence of the above, following amendments will be made in the Foreign Exchange Manual (7^th Edition, 1992):-

1. The first sentence of Para 6(a) - Chapter XII is recast as under :-

"Full export value of goods exported from Pakistan and declared to the Custom authorities should be received in an approved manner as embodied in State Bank's Notifications No. F.E. 1/98-SB dated the 8^th June, 1998 on the due date for payment or within four months from the date of shipment / dispatch whichever is earlier or within such period as may be prescribed by the State Bank through special or general permission, through an Authorised Dealer either in convertible foreign currency in which the Authorised Dealer maintains accounts or in U.S.D. Dollar or in Pakistan rupee from a non-resident bank account".

 

 

2. The words "within four months ------ 27^th December, 1972"

Appearing in 4^th to 6^th line of para 7(i) are replaced by the following :-

"within the time limit stipulated in State Bank's Notification No. F.E. 1/98 dated the 8^th June, 1998".

 

 

3. The words "prescribed a period of four months" appearing in

The first and second lines of para 18(a) are replaced by the following :-

"has prescribed the period"

 

 

4. The following may be added in the format of exporters undertaking (App-V-13) in the 5^th line after the word "goods" :-

"on the due date of payment or"

 

 

"We undertake to ensure that export proceeds against shipment on firm contract shall be received by us within the time limit stipulated in State Bank's Notifications No. F.E. 1/98-SB dated 8^th June, 1998".

 

 

3. It has been reported to us that some Authorised Dealers have allowed deposit of the export proceeds into foreign currency accounts. The State Bank has taken a serious note of these reports. Authorised Dealers are aware that the export proceeds can be credited temporarily, to a foreign currency account, only in those cases where an exporter had obtained a foreign currency loan in respect of the particular export contract / letter of credit and the proceeds have been received before maturity of the loan, vide F.E. Circular No. 24 of 1995. Authorised Dealers are, therefore, advised to ensure that the export proceeds are not allowed to be credited to the foreign currency account, except to the extent permitted vide aforementioned circular.

4. Attention of the Authorised Dealers is also invited to the instructions contained in paragraph 18, Chapter-XII of the Foreign Exchange Manual regarding reporting of over due export cases. It has decided that with immediate effect all those authorised branches which are handling export documents shall submit the statement of overdue case in the form prescribed vide Appendix V-16 of the Manual on weekly basis i.e. position as on 8^th, 15^th, 23^rd, and the last day of the month to the area Exchange Control Offices under whose jurisdiction they are functioning. The first such report should cover all those export bills which became overdue during the month of May, 1998 and have not so far been realized. This statement should reach the area Exchange Control Offices by 12^th June, 1998. The subsequent statements should contain particulars of only those cases which become overdue during the addition to the statement required to be submitted by the Head Offices.

• Notification No. F.E. 1/98-SB dated the 8^TH June, 1998.