laws No.23 of the central bank of syria and the Basic Monetary Order 2002
( Law No. 23/2002 )
Pursuant to the constitution provisions,
what has been approved by People’s Assembly in its session of 27/9/1422 H corresponding to 12 December 2001,
promulgates the following:
Credit and Monetary Council
1. The Credit and Monetary Council shall undertake the task of organizing the credit and monetary institutions in the Syrian Arab Republic and coordinating their activities to fulfill the below stated objectives within the limits of its prerogatives and within the state public economic inclinations decided by the cabinet:
A- Development of the
monetary and financial market and the organization thereof according
to the national economy needs.
B- Maintain the
purchasing power of the Syrian currency.
D- Expand possibility of
utilizing resources and potentials and work towards the development of
2. For this purpose,
Credit and Monetary Council shall undertake:
A- Establish the monetary
policy in the Syrian Arab Republic and manage it pursuant to the state
general strategy and national economy needs inclusive these policies
related to price stability, purchasing power of the national currency,
and policies of credit, interest, banking saving and exchange rates.
B- Exercise the Credit
and Monetary Council prerogatives stipulated in chapter three of this
C- Follow up on the
banking apparatus, discuss all issues relevant to banking work,
activities of relevance and take appropriate decisions through the
Central Bank of Syria.
D- Organize transactions
of payment and settlement inclusive current transactions by means of
E- Supervise banking
profession and direct its activities according to the provisions of
chapter four of this law via the Central Bank of Syria.
F- Conduct necessary
surveys and studies related to its tasks or commissioned thereto by
the executive authority.
H- Expand all
prerogatives and tasks defined thereto in the laws and regulations in
1.Credit and Monetary
Council shall comprise:
1- Governor of the
Central Bank of Syria - president
2- First deputy of the
Central Bank of Syria Governor-vice president.
3- Second deputy of the
Central Bank of Syria Governor-member.
4- Assistant Minister of
Economy and Foreign Trade-member.
5- Assistant Finance
6- Assistant Minister of
Agriculture and Agrarian Reform-Member.
7- Assistant Industry
8- Head of State Planning
9- Three experts in
monetary, credit and banking affairs-Members.
2. Governor of the
Central Bank of Syria and his two deputies are definitely considered
members of the Council. Other members shall be named by a decree upon
the proposal of their ministries and bodies they represent. Upon the
selection of experts, it must be observed that they are renowned in
science, practical experience and technical expertise.
The council shall
have the right to seek the assistance of experts, call to its
meetings, in consultation and for a certain purpose, all persons
deemed to be beneficial for the performance of its tasks.
Remunerations of said persons shall be defined by the council and they
shall be issued by a decree upon the proposal of the Minister of
Economy & Foreign Trade.
decisions of the council are definitely considered confidential.
Central Bank of
Syria shall act as the secretary of the Council.
Secretary of the
Central Bank of Syria shall carry out the tasks of the Credit and
Monetary Council’s Secretary and he shall report decisions of this
Council to the concerned bodies.
Central Bank of Syria shall bear all expenses of the Council. It shall also bear all remunerations of its members and consultant experts whose assistance is sought pursuant to provisions of article 3 of this law.
Issue, Circulation and Withdrawal of Money Paper
The paper must bear the two signatures imposed in article 16 in full.
The paper must bear one of the serial numbers in full.
Except for the above-mentioned conditions, the incomplete or deformed papers are withdrawn without any payment to the bearer unless it is proven to the Central Bank of Syria that deformity has been caused as a result of force majeure.
1. Withdrawal of one category or more of the money papers or the exchange thereof shall be effected by a decree upon a recommendation of the Credit of the Monetary Council and proposal of the Minister of Economy & Foreign Trade.
2. This decree shall define the exchange period that can never be less than three months unless there is a need for expediting the withdrawal, then it is possible to shorten this period provided that it is not less than seven days.
3. Withdrawal decree shall be announced to the public through all appropriate means.
1. Money papers that are not submitted for changing prior to the expiry of the defined period shall lose their dissolving power and shall be dropped from circulation. The Central Bank of Syria, in its headquarter in Damascus, shall, within five years as of the start of the withdrawal process, pay the value of papers submitted for changing without receiving any expense.
2. With the end of the five-year period, provisions of prescription shall be applicable to the papers that are not submitted for changing and their value is up to the Central Bank.
1. It is impermissible to issue any monetary piece unless it has an equivalent increase thereto in the following assets of the Central Bank of Syria:
B- Claims in the transferable foreign currencies.
C- Claims in the Syrian pounds generated from credit operations to all economic sectors.
D- Public bonds of short, medium or long term issued or guaranteed by the state as well as credits and loans similar to those bonds.
2. Ratio of gold and transferable foreign currencies placed for coverage must be at least 40% (forty percent) of the total coverage components.
3. In application of the provisions of this part, total obligations of the Central Bank of Syria on demand are considered similar to issued money papers. First: Gold coverage:
1. It is impermissible to accept in the gold coverage except the assets that consist of monetized gold or gold moulds
2. The cabinet, upon the proposal of the Minister of Economy & Foreign Trade, shall define the places where gold under coverage must be put. Article 23:
1. Central Bank of Syria shall record the golden assets placed under coverage at the cost price or market price whichever is less.
2. Purchase prices shall be defined on basis of the internationally posted price.
3. Credit and Monetary Council shall define the selling prices of gold assets according to the internationally posted price taking into consideration molding costs and allowances of the historical value of moulds.
Second: Coverage in transferable Foreign Currencies.
1. It is impermissible to accept in the coverage of foreign currencies except the following assets:
A- Transferable foreign money papers.
B- Assets in transferable foreign currencies registered at the international, and governmental institutions and foreign banks in an account under demand or for a term that does not exceed one month.
C- Bank deposit certificates in transferable foreign currencies for terms that does not exceed one year.
D- Commercial bonds to the order of somebody edited in transferable foreign currencies withdrawn from Syria to abroad whose maturity does not exceed 120 days guaranteed by three signatures of solvency of which one is a banking signature.
E- All liability bonds on demand edited in transferable foreign currencies due abroad used in general in international money transfers.
F- Bonds of medium or short terms issued by international countries or Arab or international official financial institutions or guaranteed by those countries or bodies. This shall be by the approval of the Credit and Monetary Council provided that these bonds enjoy high international credit evaluation of excellent degree.
2. Credit and Monetary Council shall specify the transferable foreign currencies that may be accepted in coverage. It shall also specify the degree of credit evaluation of the papers allowed to be accepted in the coverage and specify, upon need, the maximum amounts for each type of them.
3. Assets in transferable foreign currencies placed under coverage shall be registered in a special field.
1. The Central Bank of Syria shall register the transferable foreign currencies placed under coverage at their exchange prices defined pursuant to provisions of article 13 of this law on purchase date.
2. It is impermissible that selling and purchasing prices of transferable foreign currencies against the Syrian pounds differ from posted exchange rate except within the limits specified by the Credit and Monetary Council. Article 26:
Profits and losses resulting from the amendments effected on the posted exchange rate of transferable foreign currencies placed under coverage or due to any force majeure shall revert to the state.Third: Claims Arising from Credit Transaction
1. It is impermissible to accept in the coverage of Credit transactions for all economic sectors except the following assets :
First: Promissory notes and all other commercial bonds edited to the order of somebody in Syrian pounds.
Second: loans and advance payments in Syrian pounds that get mature by a specific period against the mortgage of the following:
A- Minted gold or golden moulds.
B- Public bonds for short, medium or long terms issued or guaranteed by the state and all public bonds accepted by the Credit and Monetary Council and approved by Minister of Economy & Foreign Trade.
C- Promissory notes and commercial bonds.
D- All in kind values acceptable to the Credit and Monetary Council particularly the receipts issued by public stores and goods.
2. Term of promissory notes and commercial bonds maturity subject of discussion in para1 of first item must not exceed 120 days at most as of date of submission. It is also impermissible that period of advance payments and loans subject of discussion in para1, second item exceed 120 days.
It is possible, by a decision from the Credit & Monetary
Council, to extend the term of promissory notes, commercial bonds and
period of loans and advance payments to 200 days if they were related
to industrial or agricultural credits or to the export of industrial
or agricultural Syrian products abroad.
1. Promissory notes and commercial bonds stipulated in item first, para1, article 27 must initially bear three signatures of solvency
2. It is permissible to replace two signatures by one signature guaranteed by the state.
3. It is possible that one mortgage stipulated in para1, item second, A, B, C, D of article 27 replaces one signature or two signatures according to the terms and conditions determined by the Credit& Monetary Council in policy attested by The Minister of Economy& Foreign Trade.
1. Loans and credits referred to in article 27 must be guaranteed by a solvent signature whether it is an original or additional one.
2. Credit and Monetary Council shall determine the cases in which the mortgage stated in article 27 can be exceptionally replaced by two solvent signatures.
Credit& Monetary Council shall seta policy to be attested by the Minister of Economy& Foreign Trade indicating the following:
A- Basics that must be observed to accept promissory notes, commercial bonds, credits and notes subject of discussion in articles 27, 28 and 29 in the monetary coverage.
B- Types of goods and items that can be mortgaged and the ratio that must be dropped from their sale value.
C- Public bonds that may be mortgaged and the ratio that must be dropped from their national or sale value.
D- The price of accepting gold upon mortgage.
The Central Bank of Syria
shall register the commercial bonds referred to in article 27
according to their nominal value.
Without prejudice to the provisions of article 27 and the articles thereafter, law No. 177 for 1958 relevant to the Industrial Bank, Legislative decree No. 29 for 1966 and its amendments in Law No. 11 for 1975 relevant to the Real Estate Bank, legislative decree No. 141 for 1970 amended by law No. 27 for 1990 relevant to Cooperative Agricultural Bank, it is possible to place the loans and credits granted to governmental credit institutions in the coverage within the limits and terms defined by the Credit and Monetary Council on condition that:
A. Ratio of loans of more than one year term must not exceed a specified percentage of the total loans and credits approved by the Central Bank to be granted to any bank provided that this percentage is specified for each bank by the Credit and Monetary Council pursuant to the nature of the financed activity.
B. Against those loans and credits, the aforementioned institutions must mortgage their claims that accrue from these loans and credits within their terms and that Central Bank of Syria must replace these institutions in all rights relevant to these claims.
C. Nominal value of the mortgaged claims must be more than loans or credit by one third at least.
D. Said claims must be documented by a real estate mortgage or any other in kind guarantee acceptable by the Credit and Monetary Council.
Credit and Monetary Council shall determine the following according to the requirements of the economic situation:
A. Maximum amount for deduction operations on one hand and for the loans and credit operations on the other hand. It shall also, if the need requires so, specify the distribution of these transactions among the various economic fields. The Council may also determine the distribution of the ceilings of these transactions among the banks.
B. Interest ratios on deduction, the credit and loans operations and their general conditions.
Public bonds and loans and
credits similar thereto:
It is impermissible to accept in the coverage of the public crediting operations except the following claims:
B. This credit must be paid before the end of the third quarter of the current financial year.
3. Treasury bonds issued or that may be issued by the state against the guarantees stipulated in articles 26 and 66 of this law. These bonds must be without interest.
4. Treasury bonds issued by the state against its underwriting in the International Monetary Fund (IMF), the International Bank, the international and Arab financial institutions, regional institutions defined by law, state contributions in the capital of Arab and international companies whose agreements or articles of associations are attested by a legislative deed.
5. Treasury bills and bonds upon need required for the public interest and requirements of economic and social development and loan bonds issued by the state or guaranteed thereby provided that these bills or bonds are issued by legislative bill.
6. Bonds signed by owners and beneficiaries from irrigation projects edited thereby against cost recovery resulting from the irrigation and reclamation of lands included in these projects, their improvement or sale. These bonds must be accompanied by a real estate mortgage or any other in-kind guarantee acceptable to the Credit or Monetary Council that determines the maximum amounts that may be borrowed pursuant to this paragraph.
Public bonds placed in the
coverage shall be registered in their purchase price if the price is
equal to the value of their payment or less than them. Value of their
payment shall be registered if the purchase price is more than them.
Money and Official
Silver and Golden Species:
Costs of metals
purchase and minting and all additional costs shall be born by the
Central Bank of Syria.
The Central Bank of
Syria shall place the golden and silver coins in circulation for its
account according to the principles determined by the Minister of
Economy& Foreign Trade upon the proposal of the Credit and Monetary
Council inclusive these costs relevant to minting and all expenses and
commissions on basis of receiving it from purchasers a weight of pure
gold or silver equal at least to a weight of pure gold or silver
specified pursuant to article 37 of golden or silver coins that are
Money of Small Categories
Money of small categories
mean the non precious coins issued by the state pursuant to the
provisions of this law.
Money of small categories shall be minted in the following groups:
fifty piasters, one hundred piasters, two pounds, five pounds, ten
pounds, twenty-five pounds.
The Central Bank of
Syria shall bear the expenses of purchasing small coin metals, their
minting expenses, all additional expenses as well as expenses of their
circulation and all management expenses.
Central Bank of Syria
Capital of the
Central Bank of Syria shall be defined by ten billion Syrian pounds in
which the state underwritten in full.
association of the Central Bank of Syria shall be issued by a decree
upon the proposal of the Credit and Monetary Council and the approval
of Minister of Economy& Foreign Trade.
Objectives of the Central Bank of Syria
The Central Bank of
Syria shall exercise, to the account of the state, the prerogative of
issue of money pursuant to the provisions of chapter two of this law.
It shall also perform all tasks stipulated in said chapter.
The Central Bank of
Syria shall perform the banking operations of the state or its
institutions that are subject to private legal provisions according to
the provisions of the texts stated in these laws with the guarantee of
the Central Bank of Syria
2. All above-mentioned works shall be effected within the terms and limits stipulated in chapter two of this law.
In addition to the works stated in article 60, the Central Bank of Syria shall have the right to:
A. Approval of the Credit and Monetary Council in full majority of its members.
B. The legislative deed shall define the maximum limit of the L/C that may be granted to the foreign country, its maximum period and method of its payment.
Documentary credits subject
of this paragraph shall be subjected to the provisions of para4 of
article 58 of this law and provisions of laws related to the control
of funds and dealing in foreign currencies that can transferred.
The Central Bank of
Syria shall have the right to perform all transactions that facilitate
the transfer of money. It shall have the right to establish or
participate in the establishment of liquidation or clearance offices
and their management.
While checking with
the courts, the Central Bank of Syria shall be relieved from
submission of guarantees and credits in all cases that law imposes on
both parties the submission thereof.
chapter two of this law relevant to the public bonds, credits and
loans similar thereto shall not be applicable to the group of the
bonds retained by the Central Bank of Syria that represent its
capital, reserve money and its account relevant to depreciations.
The state shall
provide sufficient guard to all buildings of the Central Bank and
buildings of its correspondents in the govenorates and their
protection through all suitable means and shall provide the necessary
guard to the safe transport of money and values.
Recruitment of the
governor, end of his services, defining his salary and remunerations
shall be by a decree.
Committee consists of governor as a president, four supervising
managers and a representative from workers to be named by the
Executive Office of The Worker’s Syndicate General Union.
By a decision from
the Minister of Economy& Foreign Trade, upon the proposal of the
governor, two of the supervising managers shall be named two deputies
of the governor, one is the first deputy and other is the second
It shall not be the
right of the governor or the supervising managers to be members in the
boards of any trading company or of a trading feature except for the
financial institutions under the state management, monetary and
banking and financial Arab and international institutions.
None of the
governor, the supervising managers nor the Credit and Monetary Council
members shall bear any personal responsibility resulting from the
obligations or liabilities of the Central Bank of Syria. They shall
only be questioned about the implementation of the tasks entrusted
thereto under the provisions of this law.
Without prejudice to the other provisions stipulated in this law, the Credit and Monetary Council shall exercise the following prerogatives:
All of these policies shall be subject to the attestation of the Minister of Economy& Foreign Trade.
Without prejudice to the provisions of article 68, all of the Central Bank of Syria expense and accounts shall be subject to the audit of the Central Body for Financial Control according to the provisions stated in the Body’s law. The Bank shall have the right to seek the assistance of the local or foreign specialized bodies in the accounts audit by the approval of the Credit and Monetary Council.
Budget, Profit Distribution, Reserve Money
The balance sheet
and profit and loss account shall be submitted prior the First of
March of the next cycle to the Central Body For Financial Control for
attestation after auditing according to the provisions stated in the
Net profits of the
bank comprise the savings of the balance sheet after the dropping of
the expenses of management and work running, depreciations, reserves,
control, account audit and social burdens of different types.
The Bank’s articles
of association shall determine the manner in which its ready money
shall be used which represent the capital, reserve money and its
accounts relevant to depreciations
Profession of Banks and Money Exchange
Degree of this Chapter
Also, subject to the provisions of this chapter of the law, particularly licensing and control, within the rules, controls and conditions set by the Credit and Monetary Council and attested by the Minister of Economy& Foreign Trade are the following institutions
1. The banking and financial institutions that, in addition to the banking works stipulated in article 12 of Law No. 28 for 2001 and article 85 of this law, exercise the following transactions:
A- Management of money, properties and investment portfolios to the interest of others.
B- Provision of advice and assistance in the financial management of institutions, and, in general, the provision of facilities services for the establishment and development of institutions.
C- Transactions of employment in investment projects based on basis of the formula of financing leasing of production establishments and companies qualified for this type of loans provided that ceiling of these transactions is defined by the Credit and Monetary Council by a percentage of certain medium and long terms resources.
D- Borrowing for different terms against the issue of circulatable bonds.
2. The banking institutions that perform the following:
A- Provision of banking services that rely on modern electronic communications.
B- Banking works applied in Islamic banks.
3. Banking representation offices affiliated to non-Syrian banks. Article 87:
Subject to the provisions of this chapter also, within the
limits and conditions defined by the Credit and Monetary Council, are
the specialized banks already existing on the date of this law
The financial institutions and cooperative companies whose work
is confined to the receipt of money ready from their branches and
members abroad to concentrate the management of the money shall not be
subject to the provisions of this law provided that they do not use
the money in usual manner in banking transactions concluded with
persons rather than the branches and members.
Banks operating in the free areas shall be subject to the
regulations relevant thereto and they shall be subject to the
provisions of banking control stipulated in this law.
Licensing, Registration and Control:
Licensing decisions for the private and joint banks are issued and they shall be registered in the banks register at the Central Bank of Syria/ Government Commission For Banks/ pursuant to the provisions of Law No. 28 for 2001.Article 91:
1. It is permissible to cross out the bank from the banks register in one of the following cases:
A- Upon the request of the concerned bank.
B- Where the bank does not start its work during one year as of its registration in the banks register.
C- Where it stops its work without the obtainment of a prior approval of the Credit and Monetary Council despite warning it to proceed in its activity within the period defined by the Council.
D- Where it performs a work that interferes with its regulations, laws, decrees and decisions that organize its activities thus leading to damage to depositors and stock holders.
E- Where its liquidity or solvency is exposed to danger and can not be rectified due to measures to be agreed upon with the Credit and Monetary Council.
2. Crossing out shall take place by a decision from the Economy Minister upon the proposal of the Credit and Monetary Council after the Council had notified the bank’s representatives through providing their remarks thereto within ten days of being notified of the daily events of the crossing out reports, provided that the crossing out decision is justified within twenty days of being notified of said events.
3. The crossing out of the bank from the banks register requires its liquidation definitely according to the laws in force provided that this liquidation takes place in participation with the Central Bank of Syria with the purpose of maintaining the public confidence in the banking system and protecting the rights of depositors.
The Credit and Monetary Council shall organize every year a list
of the banks registered in the bank’s register. This list and
amendments that take place during the year shall be published in the
gazette and in three local newspapers.
1. It shall not be allowed to establishments other than those registered in the bank’s register referred thereto in article 90 of this law that are not crossed out therefrom to use names as……. bank, ……. owner of …….bank, banker representative of …….bank, or any name similar thereto in any language whether in its special name or commercial address, whether in specifying the type of its commercial business or its publicity. It shall be impermissible for the banks to use any term that may mislead the public regarding the special nature of their activities.
2. It is impermissible that the bulletins, advertisements, notices and all documents ready for the public by operating banks contain what implies the control of monetary authorities on banking works. It is also prohibited that they contain any term that may lead to misleading the public regarding the type of the bank’s works, importance, guarantees and the bank’s relations with the public authorities.
Banks registered in the bank’s register shall exclusively enjoy
the prerogative of exercising all banking operations in Syria as shown
in article 12 of Law No. 28 for 2001 and articles 85 and 86 of this
law. It is impermissible for non-registered banks to exercise the
transactions of deposit acceptance from the public and lending them
1. The Credit and Monetary Council shall have the right to allow the non-banking establishments established in the form of joint companies or closed private shareholding companies or joint ones in which the public sector banking participates to exercise the trade of foreign currency exchange within the limits and conditions defined by this council according to a special system attested by the Minister of Economy& Foreign Trade in light of the country’s financial needs, needs of citizens and tourists. Granting this right is dependent on the submission of a guarantee.
2. It is impermissible for the institutions other than said ones to use the two terms: Exchange client, Money exchanger or any similar term in any language whether in its private name or in its trading address and whether in specifying the type of its trading business or in its publicity.
Banks Capitals and Reserve Money
1. Capital of any of the operating banks must not be less than the minimum indicated in article 6, Law No. 28 for 2001.
2. Each bank shall have to prove at any time that its assets are actually more than its liabilities towards others by an amount equal at least to the minimum of the capital defined in article 6 of Law No. 28 for 2001.
3. Should the bank’s capital be less than the minimum specified in article 6, Law No. 28 for 2001 as a result of the losses it sustained, it shall have to reform its capital within a period of six months at most.
4. The subject of loss definition is up to the Government Commission for Banks.
5. Where the concerned bank objects on the estimation of the Government Commission for Banks, the case shall be forwarded to the Credit and Monetary Council.
6. Decision of the Credit and Monetary Council in this respect shall be final and can not be reviewed by any administrative or judicial means.
7. Minimum limits of the founders shares in the bank’s capital and maximum limits for the shares of natural and artificial personalities in the capital shall be defined pursuant to the provisions of Law No. 28 for 2001. Shares of the wife and children of the natural person shall be within the maximum allowed that reaches/5/ five percent of the bank’s capital.
1. In addition to the imperatives imposed by Trade Law on the trading companies regarding the compulsory reserve, the bank must annually deduct from its net profits a percentage not less than/10/ ten percent to be allocated as a special reserve till said reserve reaches 100% at least of the bank’s capital.
2. Where the bank is liquefied, owners of deposits deposited therewith shall enjoy the prerogative on the outcome of the private reserve above, the compulsory reserve stated in Trade Law and the frozen account without interest with the Central Bank of Syria pursuant to para A, article 19, Law No.28 for 2001.
1. The Credit and Monetary Council, at the application of article 96 of this law, shall enjoy the prerogative of estimating the assets components that constitute the equivalent of the bank’s capital. It shall have the right to request the presentation of all necessary documents to verify the existence of these components. It shall determine all other conditions that must be available in the capital according to the requirements of need.
2. The Credit and Monetary Council shall have the right to decide at any time the necessity of increasing the minimum of the capital shown in article 96 pursuant to the requirements of solvency and in consistency with the international criteria of the capital sufficiency.
Compulsory Ratios Relevant to
Ready Money, Coverage, Solvency and others
1. The Credit and Monetary Council shall have the right to set a general system in which it defines the ratios that must be fulfilled between the below listed components and that banks must abide by provided that this system does not contain any discrimination between banks of similar business:
A- Ratio of the bank’s capital and its reserve money on one side and the total amount of its deposits or obligations under demand or for a specific term on the other side
B- Ratio between the bank’s ready money and its assets that can be ready, some of this money or these assets on one side and its obligations on demand or for a short term on the other side.
C- Ratio between the bank’s capital and its reserve money after dropping of losses on one side and the total amount of its assets or some of these assets on the other side.
2. The Credit and Monetary Council within the above-mentioned conditions, shall have the right to:
A- Ban banks from increasing the total amounts of deduction, credits, loans or the total amount of some of these transactions as of a specific date.
B- Determine the ratio that banks are permitted to increase the total of the transactions of deduction, credit, loans or the total of some of these transactions.
C- Determine the absolute minimum or the comparative one on whose basis the opening of the documentary credits or some of them must be covered by a cash payment.
D- Specify a maximum period for the maturity of deductions, loans and credits or the maturity of some of these transactions.
E- Determine the maximum limit for crediting that the bank may lend for one person proportionate to the bank’s capital and its reserve money after loss dropping.
F- Determine the percentages that banks must deposit with the Central Bank of Syria out of the origin of their current deposits, for a specified term and deposits in foreign currencies.
G- Determine the degree of the bank’s investment concentration and its employments abroad proportionate to the total assets of the bank.
3. The systems issued in execution to this article shall have no retroactive effect. They shall not prevent the execution of the agreements concluded on date of their publication. They must specify the periods necessary to enable the banks to conciliate their transactions with the imposed provisions and name the assets on whose basis the compulsory rates are computed. Section Five Banking Works Article 100:
In addition to what is prohibited for banks pursuant to Law No.28 for 2001, banks may not carry out non-banking works particularly the following:
1. Ownership of goods and trading therein to their own account unless the process is meant to secure the collection of suspected debts.
2. Purchase of real estates for their own accounts or keeping them in a permanent way except for the following cases:
A- Real estates necessary to run their works.
B- Real estates that the bank acquires in payment of its debts or as a guarantee of debts. The bank in such cases must sell these real estates within two years.
3. It is impermissible for any of the licensed banks to:
A- Open documentary credits or grant loans or credits in any way to the chairman and members of the bank’s board, its general manager and their relatives till the third degree, their wives and their relatives till the second degree.
B- It is also prohibited for any of the licensed banks to open credits, or grant loans or credits in any way to its staff, supervisors, account inspectors, auditors, staff of sale departments who are directly related to the supervision of the bank’s works, control, follow up of their activities, their wives and their children unless the Credit and Monetary Council approves of this in advance.
4. The ban stated in paragraphs 1 and 2, article 20, Law No.28 for 2001 shall not be applied to :
A- The values that the bank acquires to collect suspected debts. In this case, the bank must relinquish said values within two years.
B- Values that gain the state guarantee and shares in the capital of credit institutions established under a special law.
C- Stocks and loan bonds in Syrian currency or in foreign currencies that the bank is commissioned to offer to the public and shares in one company or more formed especially offer such stocks and bonds to the public within a period that does not exceed six months as of the date of the bank’s underwriting in said stocks and bonds.
1. Credit and Monetary Council shall have the right, upon need, to take justified decisions with the majority of two thirds of the Council members in which it decides the maximum rates of interests, commissions and other expenses that must be applied on some specified categories of credit transactions. These transactions shall not be executable unless coupled with the attestation of the Minister of Economy& Foreign Trade.
2. The Credit and Monetary Council shall have the right to decide that it is not possible to prepare the credit transactions in any way whatsoever at the Central Bank of Syria if they do not fulfill the conditions defined regarding the interest, commission and other expenses.
Board Members and Managers
1. Without prejudice to the provisions of laws in force, it is definitely prohibited that any member in the board or a manager in any bank is convicted of a crime as theft, mistrust, forgery, fraudulence, fraudulent bankruptcy, stealing, money usurpation, money washing, trading in drugs, withdrawing a cheque without provision, defame the financial situation of the state, crimes defaming the public confidence, any crime or felony, concealing the money acquired as a result of one of these crimes or disposing of this money whether the decision was taken in Syria or aboard and whether the sentenced person is the original doer, partner or intervening in any of said crimes. Same ban shall be applicable to any one sentenced by attempting to commit these crimes.
2. This ban shall also be applicable to the persons against whom or against the bank they managed a sentence of bankruptcy or judicial liquidation was passed whether they are rehabilitated or not and whether the verdict was issued in Syria or abroad. This ban shall not be valid where the competent court decides that bankruptcy or judicial liquidation was due to force majeure.
3. Court of first instance where the bank is included within its prerogatives shall enjoy taking decision whether the crime’s or convicted actions by a foreign court are subject to the ban stated above upon the request of the Attorney Public.
1. Name of the board members or managers in any bank shall have no right to undertake the management of another bank or be a member in its board of directors.
2. The Credit and Monetary Council shall have the right, in special cases that do not interfere with the public interest, to approve of the exception from the provisions of the previous paragraph. Article 104:
1. Where one of the banks goes bankrupt or is judicially liquidated, all transactions that the bank, due to which it had rendered, in kind, clearance or in any other way, to its board members or managers amounts in the form of shares of profits, bonuses or other contributions in profits, shall be considered cancelled and ineffective during the two years preceding the date that the court considers the date of payment ceasing in case of bankruptcy or during the two years preceding putting the bank under judicial liquidation.
2. Provisions of this article shall not be applicable where the competent court decides that bankruptcy or judicial liquidation is due to force majeure.
1. All licensed banks must annually submit to the Credit and Monetary Council an annual budget and a detailed account of the profits and losses attested by the accounts inspectors within ninety days of the date on which the annual accounts are closed.
2. These documents shall be organized according to the international accountancy criteria approved by the Minister of Economy& Foreign Trade upon the proposal of the Credit and Monetary Council. This decision shall also determine the form of bulletins, statements and documents related to the annual budget and profit and loss account imposed to be published by Trade Law or their deposit with the competent authorities. This decision may impose the publication, and submission of these data and documents to all banks existing in Syria whatever the form of the right they exercise their activities basis.
1. The banks must submit to the Credit and Monetary council, within the periods it defines, the following statements:
A- A monthly statement on the bank’s creditor and debtors situation.
B- A monthly statement on the bank’s creditor and debtor situation in foreign currencies.
2. They shall have also to submit to the Credit and Monetary Council, upon its request and within the periods it determines:
A- A list in the documentary credits in an amount determined by said Council.
B- All information, explanations and documents necessary for the council to carry out its task.
3. The aforementioned documents shall be organized according to the international accountancy criteria approved by the Minister of Economy& Foreign Trade upon the proposal of the Credit and Monetary Council.
All documents that must be submitted pursuant to articles 105
and 106 shall be signed by the Chairman and Managing director or
manager and the bank’s supervisor shall attest their accuracy.
The Credit and Monetary Council shall regularly publish a total
statement on the creditor and debtor status of banks.
1. In addition to the provisions of Trade Law relevant to trading companies, each bank must nominate a number of persons who enjoy appropriate qualifications to exercise the task of internal controller in the bank. The Credit and Monetary Council shall select an internal controller or more according to the volume of the bank’s transactions from the nominated names to fill in the position of an internal controller. This internal controller shall not exercise the tasks of his work unless he swears the oath before the civil court of First Instance.
2. The Credit and Monetary Council shall set system for the acceptance of internal controllers, cases of withdrawal of acceptance and a basis for internal controllers. The two said systems shall be attested by a decision from the Minister of Economy& Foreign Trade.
1. The internal controllers shall generally exercise the authorities granted by law to the inspectors at companies in which this type of control is exercised.
2. The internal controllers shall review the bank’s books, correspondence, minutes of their meetings and all entries in general. They monitor regular inventory lists, annual budgets, reports, all situations and data that must be submitted pursuant to this law and their correctness.
3. They shall also monitor the bank’s abidance by the texts and legal and regular provisions that banks are subject thereto.
4. They must notify the Government Commission for Banks of any decision or situation that expose the bank’s solvency or liquidity to danger.
5. The Government Commission for Banks shall issue all directives and instructions to the internal controllers necessary to perform their duties.
1. Internal controllers must submit in the fifteenth of each month a report on their works during the last month to the Government Commission for Banks.
2. It is impermissible that this report discusses the bank’s relations with a specific dealer therewith except in the following cases:
A- Where the bank carries out transactions contrary to law.
B- Where one of the dealers with the bank goes bankrupt or subject to the conciliation system or where he is allowed to delay payment.
C- Where the bank grants documentary credits that may expose its liquidity to danger.
D- Where the bank grants documentary credits in way contrary to the provisions of para5, item 2, article 99 of this law.
3. Controllers shall have no right to interfere with issues related to fees and taxes.
1. Each internal controller must immediately inform the bank’s board members and managers of the violations he observes.