27 Oct 2017
PHILIPPINES: Foreign Exchange Procedures Set to be Streamlined by Year End
Companies and banks will no longer need to register and seek official permission when conducting foreign exchange (forex) transactions. The change has been championed by the Bangko Sentral ng Pilipinas (BSP), the country’s central bank, and is expected to be enacted by the end of 2017.
While the registration of inbound foreign investments is not currently mandatory, any repatriation of funds via a forex operator requires BSP approval. Similarly, any such exchanges sourced in the Philippines and used for the remittance of earnings must be pre-approved. Additionally, any foreign currency-denominated borrowings by privately-owned businesses have to have BSP approval at present.
Under the proposed changes, all such transactions will no longer need to be pre-approved, although they still have to be reported to the BSP. All such reporting, however, can be conducted online, with the manual submission of documents no longer a requirement.
The move to liberalise the Philippine forex regime forms part of a wider initiative intended to improve the ease of doing business in the country. It is also seen as a way of curtailing unlicensed foreign currency exchange practices.