INSTRUCTION OF FEBRUARY 11 TH, 2001 RELATING TO THE RESERVE REQUIREMENT SYSTEM

Transcription

1 INSTRUCTIONS 2001

2 INSTRUCTION OF FEBRUARY 11 TH, 2001 RELATING TO THE RESERVE REQUIREMENT SYSTEM Article 1: In pursuance of Article 93 of Law of April 14 th, 1990 relating to Money and Credit and in accordance with Instruction of April 9 th, 1994, Banks and Financial Institutions shall be compelled to constitute under the conditions provided for by this Instruction a reserve on certain elements of their liabilities denominated in dinars. Article 2: For Banks, this reserve requirement shall be constituted on all deposits in dinars whatsoever their nature (demand deposits, time deposits, savings passbooks, cash vouchers ). For Financial Institutions, the reserve requirement shall be constituted for all advances granted to them by Banks and Financial Institutions at deposits time and places. Article 3: The reserve requirement shall be monthly constituted as from the 15 th day of each month to the 14 th day of the next month. Article 4: The reserve rate applicable to liabilities mentioned in Article 2 above shall be set at 4%. Article 5: The reserve shall be constituted, up to the rate set in Article 4 above, by: - credit balances, recorded during the current period, of current accounts opened in the books of the Bank of Algeria.; and - cash balances in banknotes and metallic coins in dinars held by Banks and Financial Institutions. The level of reserve so constituted shall be represented by the average daily balance in current accounts, calculated on the number of days of the period concerned by the average daily balance of cash balances in banknotes and metallic coins in dinars held by a Bank or a Financial Institution during the same period.

3 The sum of these (2) two elements shall be, at least, equal to the required reserve amount. Article 6: The items included in the reserve requirement shall be extracted from Banks and Financial Institutions Accounting closed on the evening of the last day corresponding to the beginning of the reserve constitution period. Article 7: Banks and Financial Institutions shall send to the Bank of Algeria- General Department for Research- within (10) ten days after the end of the constitution reserve period, a statement showing details of calculation of said reserve according to an appropriate canvas attached in the Appendix of this Instruction. Failing such statement within the period of time mentioned above, the level of reserve requirement applicable to the considered period shall be that of the prior period increased by 10%. The average daily balance of applicable cash balances shall be that of the prior period decreased by 25%. Article 8: Part of the reserve requirement, constituted by credit balances of current accounts opened in the books of the Bank of Algeria, shall be paid at the rediscount rate of the Bank of Algeria decreased by (2) two points. Article 9: Without prejudice to the provisions of Article 93 of law mentioned above, providing for a daily penalty equal to (1%) one per cent for the lack of reserve requirement reported, the Bank or Financial Institution recording a lack of reserve requirement shall be compelled to send a written explanation to the Governor of the Bank of Algeria. Article 10: This Instruction shall cancel and replace Instruction of November 28 th, 1994 relating to the reserve requirement system together with the provisions of Instruction of April 9 th, 1994 relating to reserves requirements pay. Article 11: This Instruction shall enter into force as from the date of its signature. The Governor Abdelouahab KERAMANE

4 APPENDIX I TO INSTRUCTION Bank:. STATEMENT OF RESERVE REQUIREMENT COMPUTATION ELEMENTS FOR THE PERIOD From 15 to In millions of Algerian dinars Elements end 20. I. Deposit in dinars: a) demand deposits b) time deposits c) cash vouchers d) savings passbooks e) other deposits II. Average daily balance of cash balances in banknotes and coins in dinars from to 14 Amount Done on Signature (1) (1) Signature of the officer who shall sign the 10R model statements

5 APPENDIX II TO INSTRUCTION Financial Institution:. STATEMENT OF RESERVE REQUIREMENT COMPUTATION ELEMENTS FOR THE PERIOD From 15 to In millions of Algerian dinars Elements end 20. I. Advances in dinars: a) Advances granted by Banks b) advances granted by Financial Institutions II. Average daily balance of cash balances in banknotes and coins in dinars from 15 to 14 Amount Done on Signature (1) (1) Signature of the officer who shall sign the 10R model statements

6 INSTRUCTION OF APRIL 3 RD, 2001 SETTING CONDITIONS OF TRANSFER OF EXTERNAL PAYMENTS BY THE AUTHORIZED OFFICER IN CHARGE OF THE STATE BUDGET, LOCAL GOVERNMENT BUDGET, PUBLIC OFFICES BUDGET AND ADMINISTRATIVE INSTITUTIONS DGET THROUGH BANKS AND AUTHORIZED INTERMEDIARY FINANCIAL INSTITUTIONS Article 1: The object of this Instruction is to set the conditions for exercising the right of transfer, under their external payments, of banks or intermediary financial institutions, in favor of the authorized officer in charge of the Budgets of State, Local Governments, Public Agencies and Administrative Institutions, through banks, pursuant to Regulation of December 23 rd, 1995 amending and replacing Regulation of March 22 nd, 1992 relating to exchange control, namely its Articles 25, 26, 28, 34, 36, 37 and 41 and subsequent legislations adopted for its implementation. Article 2: The transfer of funds under external payments initiated by authorized officers in charge of public administration, public offices, administrative public institutions and local authorities, relating to any acquisition of goods or services from abroad or financial transfers abroad, under State budget, shall be carried out under the exchange Regulation in force enacted by the Bank of Algeria in this respect, this Instruction included. Article 3: The transfer of funds of any external payment as provided for in Article 2 above of the officer authorizing payment, shall be carried out by the domiciliary Bank upon the instruction of the officer authorizing payment, as defined in Article 1 above, supported by the relevant financial and/or commercial documents. Article 4: Goods and services imports (services binding public administration to non resident any economic agent under a contract) shall be subject to a prior domiciliation with a Bank or a domiciliary authorized intermediary financial Institution.

7 Article 5: Transfer abroad of the budgets of public administrative bodies and public administrations, public offices and administrative public institutions and incomes of local authorities staff, posted or sent abroad the external payments procedures of which shall be regulated by a legal text or regulation ( salaries, scholarship for studies abroad, training costs) also, public administration contributions for bilateral international organizations shall not be subject to transfer prior to an authorization of the Bank of Algeria. Article 6: The General Department of Exchange of the Bank of Algeria shall be notified for any difficulty in the application of this Instruction. Article 7: This Instruction shall enter into force as from the date of its signature. The Governor Abdelouahab KERAMANE

8 INSTRUCTION OF MAY 9 TH, 2001 SETTING THE TERMS AND CONDITIONS OF SETTLEMENT OF COSTS FOR REPAIR, CHANGE OR SUPPLEMENT OF LABOUR INCURRED ABROAD UNDER THE TEMPORARY EXPORTS OF MATERIALS AND EQUIPMENTS Article 1: The object of this Instruction is to set terms and conditions of the settlement of costs resulting from repairing, changing or supplement of labour incurred abroad under the temporary exports of materials and equipments, in pursuance of Article 37 of Regulation of December 23 rd, 1995 amending and replacing Regulation of March 22 nd, 1992 relating to exchange control. Article 2: The temporary export of any equipment or material abroad, for repair, processing, or supplement of labor by any economic operator under the Algerian Law regularly recorded in the Trade Register, resulting in the payment of achieved services, shall be subordinated to a prior bank domiciliation. Banks or authorized intermediary Financial Institutions shall, in such capacity, be entitled to domicile such transaction. Article 3: Bank domiciliation shall constitute the prior transaction at the beginning of the physical and financial transaction mentioned in Article 1 above. Bank domiciliation shall consist, for the economic operation under this Instruction, in opening a domiciliation file upon submission to any Bank or authorized intermediary Financial Institution of the following documents: - corresponding application drawn up by the economic operator and under the Algerian Law - commercial contract or pro forma invoice or any other relevant document. Article 4: Banks and authorized intermediary Financial Institutions shall be entitled to carry out, after an achieved service, the transfer of the corresponding costs subject to submission, by the concerned economic operator under the Algerian Law, of the following documents: - final invoice duly approved; - certificate of achieved services

9 - documents issued by the Customs authorities justifying temporary export and re-importation of the concerned equipment and materials. Article 5: The execution, management, follow up and clearance of domiciliation files opened under the transaction provided for this Instruction shall be conducted by Banks or authorized intermediary Financial Institutions, with strict conditions set above and provisions enacted by external trade and exchange regulations. Article 6: This Instruction shall enter into force as from the date of its signature. The Governor Abdelouahab KERAMANE

10 INSTRUCTION OF MAY 13 TH, 2001 AMENDING INSTRUCTION RELATING TO THE RESERVE REQUIREMENT SYSTEM Article 1: The reserve rate mentioned in Article 4 of Instruction of February 11 th, 2001 relating to the reserve requirement system shall be fixed at 3% Article 2: This Instruction shall enter into force as from May 15 th, 2001 The Governor Abdelouahab KERAMANE

11 INSTRUCTION OF SEPTEMBER 4 TH, 2001 AMENDING AND REPLACING INSTRUCTION OF JUNE 10 TH, 1992 SETTING TERMS AND CONDITIONS OF AIRLINE OR SHIPPING TICKETS ISSUE AND TRANSFER OF SURPLUS RECEIPTS Article 1: In accordance with Article 38 of Regulation of December 23 rd, 1995 amending and replacing Regulation of March 22 nd, 1992 relating to exchange control, the object of this Instruction, is to set terms and conditions of issue of airline or shipping tickets and transfer of surplus revenues. Article 2: The issue of airline or shipping tickets by national or foreign air and shipping lines regularly based in Algeria and by authorized transport and tourism companies and agencies together with the transfer of surplus revenues shall be carried out according to terms and conditions defined hereinafter. TITLE I- TERMS AND CONDITIONS OF ISSUE OF AIRLINE OR SHIPPING TICKETS I- CONDITIONS OF ISSUE I-1/ - Transport tickets shall be issued by national and foreign air and shipping lines regularly based in Algeria receiving from the proper authority an authorization to practice this activity according to an airline or sea agreement together with authorized transport and tourism companies and agencies under the Law in force. The activity of Airline or shipping tickets issue by companies and agencies mentioned in paragraph I-1above shall exclusively be performed under an issue authorization delivered for them by airlines or shipping lines. I-2/- Under this Instruction transport tickets means: - Airline: passenger s ticket- excess luggage ticket- the air waybill (L.TA) Miscellaneous Charge Order ( MCO).

12 - Shipping: passenger s tickets and,, auto- passengers and luggage, as the case may be. I-3/- airline or shipping tickets shall be issued for residents and non-residents according to the conditions set in paragraph II hereinafter. I-4/- Routes : airline or shipping routes shall be classified into (3) three areas A, B and C, mentioned hereinafter: - Area A shall include all trips from Algeria to foreign countries - Area B shall include trips from foreign countries towards Algeria, or any other destination. - Area C shall include trips through national domestic lines. II. TERMS OF ISSUE II-1/- The issue of transport tickets by air or shipping lines and companies and agencies mentioned in I.1 above, shall be authorized on transports and according to the payment terms defined hereinafter. II-1.1/- in Algerian dinars (A.D): - upon requisition or order forms delivered by administrations, State institutions and local authorities on routes A, B and C; - for resident or non-resident physical and legal entities, together with associations regularly certified on routes A and C; - for legal entities organized and existing under the Law of Algeria regularly recorded in the trade register on B route limited to abroad /Algeria, and exclusively for their non-resident foreign agents and technicians called to come in Algeria to carry out transactions or contracts previously domiciled in accordance with the Regulation in force. Such issue shall be subject to the handing over of order form mentioning namely the domiciliation number of the transaction or contract and the domiciled Bank counter. II-1.2/- In foreign currencies: on all routes the payment of which in dinars shall not be authorized. The following payments shall be considered as payment in foreign currencies: - in Algerian Dinars from foreign currencies assignment, based on foreign currencies assignment certificate delivered by a Bank or an authorized intermediary Financial Institution; - by cheque drawn on a CEDAC account; - by bank cheque payable abroad;

13 - by credit card. II-2/ Reimbursement II-2.1/- Airline and shipping tickets issued in Algeria shall not in any case be subject of any refund abroad. NON REFUNDABLE shall imperatively be mentioned on all the transport tickets coupons. II-2.2/- Transport tickets issued in Algeria shall be reimbursement only at the issuing agency. II-2.3/- Transport tickets amounts paid in convertible dinars through an account CEDAC debit shall be charged to the credit of this account by the Bank or authorized intermediary Financial Institution after the ticket cancellation by the issuing agency, which shall deliver a cancellation certificate of these tickets. II-2.4/- Transport tickets paid in dinars by foreign currencies assignment regularly imported or debited from a foreign currency account shall be reimbursable in dinars by the issuing agency that shall cancel the transport ticket and annotate the foreign currencies assignment certificate with the mention TRANSPORT TICKET CANCELLED Foreign currencies assignment certificate duly annotated by the issuing agency with the mention TRANSPORT TICKET CANCELLED, supported by the reimbursement form, shall entitle its holder to benefit from the surrender of foreign exchange at Bank or authorized intermediary Financial Institution that conducted the initial exchange transaction. TICKET II- SURPLUS REVENUES TRANSFER Foreign air or shipping lines regularly based in Algeria and authorized to issue Airline and shipping tickets shall be authorized, after a prior approval of the Bank of Algeria (Department of Exchange Control), to transfer the amount of surplus revenues on costs incurred each three months. This surplus shall appear in their statement of income as defined by the National Chart of Accounts.

14 I/ INCOME STATEMENT I-1/- Costs: costs liable to be charged shall exclusively be relating to current and normal operational expenses of the agency and to the activity of issue of air or shipping transport tickets In this respect, expenditures of the agency shall be charged such as: - related salaries and costs; - rents of commercial and housing premises - current operating costs of the agency( supplies, equipment and furniture, telecommunication services costs, electricity etc ); - amount of reimbursable tickets paid in Algeria; - commissions and discounts paid to authorized transport and tourism companies and agencies. Expenses relating to aircrafts and cars ferry operation or assistance whatsoever, either on regularly lines or unusual stopovers shall not be charged to the enterprise expenses accounts. As such the following items shall be exclude, namely: - all costs incurred by stopover of cars-ferry or commonly by aircrafts touches, airport taxes, handling, maintenance, repair etc ; - costs relating to bunkering fuel in hotel services - taxes of flight over and others, - lodging costs of aircrew and passengers transiting through Algeria These expenses shall be paid, as the case may be, by stopover account debit or in convertible foreign currencies regularly imported or by the debit of the enterprise CEDAC account. CEDAC account resources of the agency shall be constituted by sums imported in convertible foreign currencies or from a foreign currency account of the agency or also, on prior approval of the Bank of Algeria, of all sums recognized as transferable. I-2/- Proceeds Proceeds shall trace normal and current operating income resulting, for foreign companies, from their Airline and shipping transporter activity performed in Algeria: - proceeds of transport tickets sale as defined in title I section I paragraph I-2;

15 - cashing cargo freight etc, only for airline transport Receipts carried out by foreign companies representatives and having another origin shall not be taken into account for the determination of transferable surpluses (rents, services etc ) All proceeds as defined in the first paragraph above shall not constitute sure receipts for the company as long as the service is not made by the issuing company or transport company. As such these products shall be recorded in an account of class 5, account 57 commercial advances in accordance with the National Chart Account A sure incoming is all the duty free receipts recorded in account 75 Provided services as defined hereinafter: - amount of tickets transported and issued by the company itself as recorded as the case may be, on the flying sheet or boarding sheet provided for in section II hereinafter; - amount of tickets issued by the company and transported by other companies recorded on the statement in duplicate sent monthly by these companies to the issuing company to support billings issued against such. - Encashment for freight, as concerns air transport only. Account balance 74 Provided Services expressed Duty free shall be taken into account for the determination of transferable surplus. II/ TICKETS ISSUED AND ACTUALLY TRANPORTED Foreign companies shall be compelled to draw up, without erasure or overload, after each flight or departure of car-ferry as the case may be, a flight or a boarding sheet in duplicate, in accordance with the model attached in appendix I and I bis, on the basis of tickets coupons used to transport and cancelled at the the completion of registration, with the mention Coupon used on Both copies of flight or boarding sheet shall be submitted by the foreign company within (2) hours at the latest - after the flight or the departure of the car-ferry to airport or port customs service - for the visa, supported by the relevant bill of lading attached. After checking all the elements mentioned on the flight or boarding sheet on the basis of the relevant bill of lading attached, cargo and corresponding transport tickets coupons and visa of the flight or boarding sheet, one copy shall be returned to the foreign company, the second one shall be kept by the customs service and put under the disposal of the Bank of Algeria controllers.

16 Amounts recorded in A and B of line 2 of the flight sheet and A, B and C if line 2 of boarding sheet shall constitute the tickets proceeds, issued and actually transported. Return tickets shall be accounted for their amount. If during checking, the customs service recognizes that the elements indicated on the flight or boarding sheet do not comply with the provisions enacted by this Instruction, it shall request the company s representative to correct the take the corrective actions, as required. If this latter refuses, the customs service shall automatically correct them. III/ OPERATING INCOME Proceeds and costs amounts as listed above shall be recorded on the statement of income of the representative of the foreign company, that this later shall be compelled to draw it up each three months in accordance with the National Chart of Accounts. When the incurred balance reaches a surplus, the company shall be entitled to claim the transfer of the corresponding amount, provided that all its other obligations shall also be met (operating costs, payment of duties and taxes due etc ) If the enterprise s activity during the concerned period is in deficit, on the basis of the statement of income drawn up each three months in accordance with the National Chart of Accounts, the foreign air or shipping lines shall, in the next month, be compelled to bridge the shortfall by repatriation of amounts needed to balance its account. The foreign air or shipping line shall be compelled to draw up each three months in accordance with the model attached in Appendix II, a summary showing amounts of costs and products actually recognized in its statement of INCOME during the reference quarter. It shall also constitute under each quarter of activity a file including the following documents: - a copy of the summary mentioned above (Appendix II); - a summary statement of flight and boarding sheets drawn up according to the model in Appendix III or III bis; - a signed certificate of the official, certifies that the amounts appearing on the summary (Appendix II) shall be the results of the practiced

17 enterprise s activity, in strict compliance with the provisions of this Instruction; - statement of bank account of reference quarter. This file shall be sent to the Bank of Algeria (Department of Exchange Control) by the intermediary of the domiciled bank of the airline or shipping line supported as the case may be by: - transfer application of receipts surplus if the assets income during the concerned quarter is positive. - Supporting documents of repatriation of foreign currency amounts needed to hedge deficit in case of negative income. IV/TERMS OF TRANSFER Upon obtaining the approval of the Bank of Algeria (Department of Exchange Control) the domiciliary bank shall carry out by the enterprise s bank account debit, the transfer of the amount authorized by depositing its exchange value in foreign currencies in the account opened on its books on the name of this latter, in accordance with the regulatory provisions in force in this area. The exchange value shall be determined on the basis of the Sale rate resulting from the foreign currencies fixing in force in the Bank of Algeria accounts in at the date of conversion. The effective transfer of surplus receipts placed in foreign currency accounts of representatives of foreign air and shipping lines shall be subject to a prior authorization of the Bank of Algeria (Department of Exchange Control). I/ III- MISCELLANEOUS PROVISIONS I/-The Bank of Algeria shall reserve the right to revert the transfer authorizations granted in case further checks and controls show up breaches of Regulation regarding transport tickets issue or irregularities into the Agency management. II/- Documents relating to the issue of transport tickets, strain of tickets, monthly statements drawn up by airlines and shipping lines provided for in title II- point 1.2, together with flight and boarding sheets, as provided for in title II-point 2, shall be preserved and held at the disposal of the Bank of Algeria services (Department of Exchange Control) during (4) four years counted as from the end of the year to which they relate.

18 III/- Foreign currency receipts generated by the use of credit cards or any other external means of payment cashable abroad by the foreign airlines or shipping lines shall be subject to an effective repatriation in Algeria, by the intermediary of the domiciled Bank of the latter. These receipts shall be deposited in the foreign currency accounts of foreign air or shipping line as soon as they are achieved by them. Article 3: Treatment of cases not provided for by the provisions of this Instruction shall fall under the jurisdiction of the Department of Exchange Control of the Bank of Algeria. Article 4: Any infringement of the provisions of this Instruction shall expose its actor (s) to penalties prescribed by Law. Article 5: Any prior provisions relating to air and shipping tickets and transfer of surplus receipts of foreign air or shipping lines based in Algeria shall be repealed by this Instruction. Article 6: This Instruction enters into force as from September 15 th, The Governor Abdelouahab KERAMANE

19 APPENDIX I FLIGHT SHEET Airline Company Domiciliary Bank (Bank Institution name and complete address) Airport: Flight No: Plane type: Destination: Number of seats: 1) Number of passengers: 2) Tickets issued in Algeria by the foreign airline company including: Number Duty free amount A) Full price ticket B) Special price ticket C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling to transfer (A+B) Number Duty free amount Customs visa Date

20 APPENDIX I Bis BOARDING SHEET Shipping line: Domiciliary Bank (Bank Institution name and complete address) Boarding port: Car-ferry: Destination: Number of seats: 1) Number of passengers 2) Tickets issued in Algeria by the foreign shipping company including: Number Duty free amount A) Full price ticket (passengers) B) Special price ticket (auto-passengers and luggage) C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling transfer (A+B+C) Number Duty free amount Customs visa Date

21 APPENDIX II SUMMARY OF PROCEEDS AND COSTS RECORDED IN STATEMENT OF INCOME DURING QUARTER 20.. A) PROCEEDS (PROVIDED SERVICES) Designation Month of.. Month of Month of Month of. Totals (A) B) COSTS Designation Month of.. Month of Month of Month of. Totals (B) Amount to be transferred (A-B) AD.. Amount to be repatriated (B-A) AD.. Date, stamp and signature of the representative (full name) of the company.

22 APPENDIX III SUMMARY STATEMENT OF FLIGHT SHEETS Company: Domiciliary bank Month : (Airport) 1NUMBER OF PASSENGERS 2) Tickets issued in Algeria by the foreign airline company includingt: Number Duty free amount A) Full price ticket B) Special price ticket C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling transfer (A+B) Number Duty free amount Date, stamp and signature of the company.

23 APPENDIX III Bis SUMMARY STATEMENT OF BOARDING SHEETS Company: Domiciliary bank Month : (Airport) 1) Number of Passengers: 2) Tickets issued in Algeria by the foreign shipping company including: Number Duty free amount A) Full price ticket (passengers) B) Special price ticket (auto-passengers and luggage) C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling transfer (A+B+C) Number Duty free amount Date, stamp and signature of the company.

24 INSTRUCTION OF DECEMBER 6 TH, 2001 AMENDING INSTRUCTION RELATING TO THE RESERVE REQUIREMENT SYSTEM Article 1: The reserve rate mentioned in Article 4 of Instruction of February 11 th, 2001 relating to the reserve requirement system shall be set at 4, 25% Article 2: This Instruction shall repeal Instruction of May 13 th, 2001, amending Instruction of February 11 th, 2001 relating to the reserve requirement system. Article 3: This Instruction enters into force as from December 15 th, The Governor Mohammed LAKSACI

25 INSTRUCTION OF DECEMBER 6 TH, 2001 AMENDING AND COMPLETING INSTRUCTION SETTING THE FINANCIAL CONDITIONS OF IMPORT TRANSACTIONS Article 1: Domiciliation for goods import by foreign currency account debit of physical entities shall not be authorized, except for imports of passenger s vehicle by individuals. Article 2: This Instruction shall come into force as from the date of its signature The Governor Mohammed LAKSACI

26 INSTRUCTION OF DECEMBER 30 TH, 2001 AMENDING AND REPLACING THE PROVISIONS OF INSTRUCTION OF SEPTEMBER 5 TH, 2001 SETTING THE TERMS AND CONDITIONS OF AIRLINE TICKETS ISSUE AND TRANSFER OF SURPLUS RECEIPTS Article 1: In accordance with Article 38 of Regulation of December 23 rd, 1995 amending and replacing Regulation of March 22 nd, 1992 relating to exchange control, the object of this Instruction is to set the terms and conditions of airline tickets issue and transfer of surplus receipts. Article 2: Issue of airline tickets by national or foreign airlines regularly based in Algeria and by authorized tourism and transport companies and agencies as well as the transfer of surplus receipts shall be carried out according to the terms and conditions hereinafter determined. TITLE I- TERMS AND CONDITIONS OF AIR LINE TICKETS ISSUE I/ CONDITIONS OF ISSUE I-1/1 Transport tickets shall be issued by national or foreign airlines regularly based in Algeria which have been granted an authorization from the proper authority to practice this activity in accordance with an airline agreement together with tourism and transport companies and agencies authorized under the Law in force. The airline tickets issue activity performed by companies and agencies mentioned in I-1 above shall exclusively be practiced under an authorization for issue delivered in their favor by airlines. I-2/- Under this Instruction airline tickets means: - Passenger s ticket excess luggage ticket- air waybill (L.T.A) Miscellaneous Charges Order (MCO). I/3/- Airline tickets shall be issued for residents and non-residents according to the conditions set in I.4 and I.5 hereinafter. I/4- In the sense of this Instruction, the following entities shall be considered as residents and non-residents:

27 I.4.1/- Residents in Algeria: State administrations, local authorities, legal entities organized and existing under the Algerian Law regularly recorded in the Trade Register, companies organized and existing under the Algerian Law and providing goods or services and registered under the legal status physical entities, physical entities practicing a profession, associations governed by the Laws in force, and physical entities who have been residing in Algeria for more than (6) six months. Notwithstanding the provisions of I.4.1 above shall be considered as: I-4.2/- Residents: Algerian students and trainees pursuing studies abroad, spouses and children of the latter, foreign wives of national residents as well as national residents hospitalized abroad for long term. Also, foreign residents benefiting from the right of partial transfer of their salaries shall be authorized to acquire in dinars transport tickets, exclusively, for their native countries in Europe- Africa Middle East in the geographical sense. I-4.3/- Non residents in Algeria: physical or legal entities of foreign nationalities not gainfully employed in Algeria and those whose activity in Algeria is totally remunerated in foreign currencies, whatever the duration of their stay in Algeria, such as diplomats, Algerian staff on duty abroad and national residents abroad. I-5/- Routes Airline routes shall be classified into (3) areas A, B and C hereinafter defined: - Area A shall include all trips from Algeria to abroad (it is understood round trip); - Area B shall include trips from foreign countries towards Algeria, or any other destination - Area C shall include trips through domestic national lines. I-6/- The issue of airline tickets shall be carried out in accordance with the provisions of II hereinafter subject to the tariffs approved from the one hand and to the observation of the provisions of airline agreements concluded by Algeria with third countries on the other hand.

28 II/-TERMS OF ISSUE II-1/- The issue of transport tickets by airlines and companies and agencies mentioned in I.1 above shall be authorized on the lines and according to the payment terms hereinafter defined: II-1.1/- in Algerian dinars (A.D) a- upon requisitions or purchase orders delivered by administrations, State institutions and local authorities on paths A, B and C; b- in favor of legal entities organized and existing under the Algerian Law regularly registered in the Trade Register, companies organized and existing under the Algerian Law providing goods or services and registered under the legal status physical entity, as well as physical entities practicing professions on routes A and C; c- in favor of legal entities organized and existing under Algerian Law regularly registered in the Trade Register and companies organized and existing under the Algerian Law producing goods or services registered under the legal status physical entity on path B limited for Algeria/abroad and exclusively in favor of their non-residents foreign technicians and agents called to carry out transactions or contracts in Algeria previously domiciled in accordance with Regulation in force. Such issue shall be subject to the delivery of an order form, mentioning namely, the contract or transaction domiciliation number and the domiciled bank counter; d- in favor of associations and physical entities residents on path A exclusively situated in Europe, Africa and Middle East in the geographical sense, providing that the tickets shall include only one stopover between Algeria and the point of destination and vice-versa (technical stopovers not registered on the ticket shall not be taken into account). In any case, the cost of tickets including one or two stopovers shall not in any case exceed the 100 % (one hundred per cent) the price of a direct ticket of equivalent class to the final target destination. Beyond the free percentage of 100 mentioned above the extra cost shall be subject to payment in foreign currencies.

29 II-1.2/- In foreign currencies On paths A, B and C the payment of which in Algerian dinars shall not be authorized. The following payments shall be considered as payment in foreign currencies: - in Algerian dinars resulting from foreign currencies assignment on the basis of foreign currencies assignment certificate delivered by a Bank or an authorized intermediary Financial Institution; - by cheque drawn on a CEDAC account; - by bank cheque payable abroad; - by credit card II.2/Use of non limited transport lines The use of non limited transport lines within A and B specified in II.1.1 paragraphs b and c shall be authorized only if it proves necessary due to the constraints relating to the professional object of such a transport. The use of such transport lines for purposes other than those specified in the paragraph above, shall be forbidden and as a result, shall constitute an infringement of the exchange Regulation which shall make his perpetrator (s) run a risk of sanctions as prescribed by Law. II.3/- Supporting documents to the status of residents Companies, enterprises and agencies mentioned in I.1 above shall check the status of resident or non-resident before delivering any ticket. II.3.1/- Legal entities and associations The status of resident with respect to legal entities organized and existing under the Algerian Law and companies providing goods and services organized and existing and the Algerian Law and registered in the Trade Register under the legal status physical entity, shall be justified by the submission for once only to the airline, of a true certified copy of the Trade Register- and annually, of documents in proof of their existence by the submission of a certificate delivered by he Taxation Authorities and/or National Insurance Organization. As regards Associations, this status of resident shall be justified by the submission of the relevant agreement decision.

30 II.3.2/ Physical entities with a profession Any official document justifying the carrying out of said profession in Algeria on a private basis and authorized by the State Administration or recognized by a national organization legally entitled to this effect. II.3.3/ Physical entity In order to justify the status of resident, passengers shall submit to the issuing office one of the following documents the references of which (nature of the document, number, date and place of delivery) shall be indicated on the stub or attached to the ticket. a-as regards national residents A valid passport issued in Algeria b-as regards national students and trainees abroad, besides the valid passport: - a training certificate delivered by the administration, company, organization or local authority as far as workers are concerned. - A certificate delivered by the Ministry of Higher Education with regard to scholarship holders - A scholarship certificate delivered by the host institution as far as free students are concerned c- As regards nationals living abroad: Besides the valid passport - A certificate recording the change of residence d-as regards foreigners: - a valid certificate of residence or a residence permit delivered by the proper Algerian authorities - a work certificate stating precisely the salary, fees or any other supporting document justifying the source of incomes. II.4/- Reimbursement II.4.1/- Air transport tickets issued in Algeria shall by no means be subject of any reimbursement abroad. The mention NON REFUNABLE ABROAD shall imperatively be clearly mentioned on all the coupons of transport tickets.

31 II.4.2/- Transport tickets issued in Algeria shall be reimbursable only at the issuing agencies. II.4.3/- Transport tickets amounts paid in dinars convertible by CEDAC account debit shall be charged to the credit of that account by the bank or authorized intermediary financial institution after cancelling the ticket by the issuing agency that shall deliver a ticket cancellation certificate.. II.4.4/- Transport tickets paid in dinars by foreign currencies assignment regularly charged or debited from foreign currency account shall be reimbursable in dinars by the issuing agency that shall cancel the transport ticket and annotate foreign currencies assignment certificate by the mention TRANSPORTATION TICKETS CANCELLED. Foreign currencies assignment certificate duly annotated by the issuing agency by the mention TRANSPORTATION TICKETS CANCELLED, supported by the refund form entitles its holder to advantage of surrender of foreign exchange at the Bank or the authorized intermediary Financial Institution that carried out the initial exchange transaction. TITLE II- SURPLUS RECEIPTS TRANSFER Foreign airlines regularly based in Algeria and authorized to issue airline tickets shall be authorized, after a prior approval of the Bank of Algeria (Department of Exchange Control), to transfer the surplus receipts amount on costs incurred quarterly. Theses surpluses shall appear on their statement of income as defined by the national chart of accounts. I/ Costs I/- INCOME STATEMENT Costs liable to be charged shall exclusively be referred to normal and current operating expenses of the agency and of the issue activity of air transport tickets. In this regard, the agency expenses shall be charged, such as: - Rent of premises for commercial and housing use - The agency current running costs (supplies, equipment and furniture, telecommunication services costs, electricity etc )

32 - Amount of reimbursable tickets paid in Algeria - Commissions and discounts paid to authorized companies and transport and tourism agencies - Promotion and advertisement costs incurred in Algeria Expenses relating to aircrafts operation or landing assistance under either regular lines or unusual stopovers, shall not be charged to the agency expense accounts In this regard, the following shall be excluded such as, - all costs incurred by stopover of cars-ferry or commonly by aircrafts touches, airport taxes, handling, maintenance, repair etc ; - costs relating to bunkering fuel in hotel services - taxes of flight over and others, - lodging costs of aircrew and passengers transiting through Algeria These expenses shall be paid, as the case may be, by convertible foreign currencies regularly imported or by debit of the enterprise CEDAC account CEDAC account resources of the representative shall be constituted by sums imported in convertible foreign currencies or from foreign currency account of the agency or also, on prior approval of the Bank of Algeria, of all sums recognized as transferable. I-2/- Proceeds Proceeds shall trace normal and current operating income resulting, for foreign companies, from their air transporter activity performed in Algeria: - proceeds of transportation tickets and accessories sale (surplus luggage, on classification etc ) as defined in title I section 1 paragraph encashment of cargo freight,, mail etc ) Receipts generated by foreign companies representatives and having another origin shall not be taken into account for the determination of transferable surpluses (rents, services etc ) All proceeds as defined in the first paragraph above shall not constitute sure receipts for the company as long as the service is not made by the issuing company or transport company. As such these proceeds shall be recorded in an account of class 5, account 57 commercial advances in accordance with the National Chart Account

33 A sure income is all the duty free receipts recorded in account 75 Provided services as defined hereinafter: - amount of tickets issued and transported by the company itself as recorded as the case may be on the flying sheet or boarding sheet provided for in II hereinafter; - amount of tickets issued by the company and transported by other companies and recorded in duplicates sent monthly by these companies to the issuing company to support billings issued against him; - Encashment for freight. Account balance 74 Provided Services expressed duty free shall be taken into account for the determination of transferable surplus. II/ TICKETS ISSUED AND ACTUALLY TRANPORTED Foreign companies shall be compelled to draw up, without erasure nor overprint, after each flight or departure of car-ferry as the case may be, a flight or a boarding sheet of paper in duplicate, in accordance with the model attached in appendix I and I bis, on the basis of tickets coupons used for transport and cancelled after completing registration, with the mention Coupon used on Both copies of flight or sheet shall be submitted by the foreign company within (2) hours, at the latest, after the flight to airport customs service for the visa supported by the bill of lading of the concerned flight. After checking all elements mentioned on the flight sheet on the basis of the bill of lading, and transport tickets coupons and visa of the flight sheet, one copy shall be returned to the foreign company, the second one shall be kept by the customs service and put at the disposal of the Bank of Algeria controllers. Amounts reported in A and B of line 2 of the flight sheet shall constitute the proceeds of the tickets issued and actually transported. Return tickets shall be recognized for their amount. If during the checking, customs service recognizes that the indications mentioned on the flight sheet do not comply with the provisions enacted by this Instruction, it shall requesr the company s representative to correct the mistakes, as required. If this latter refuses, the customs service shall automatically correct them.

34 III/ OPERATING INCOME Proceeds and costs amounts as listed above shall be reported on the statement of income of the representative of the foreign company, that this later shall be compelled to draw up it each three months in accordance with the National Chart of Accounts. When the incurred balance reaches a surplus, the company shall be entitled to claim the transfer of the corresponding amount, provided that all its other obligations are also met (operating costs, payment of duties and taxes due etc ) If the enterprise s activity during the concerned period records a deficit, on the basis of the statement of income drawn up each three months in accordance with the National Chart of Accounts, the foreign airline shall, in the next month, be compelled to bridge the shortfall by repatriation of the amounts needed to balance its account. The foreign airline shall be compelled to draw up each three months in accordance with the model attached in Appendix II, summary showing amounts of costs and proceeds actually recognized in its statement of INCOME during the reference quarter. It shall also constitute under each quarter of activity a file including the following documents: - a copy of summary mentioned above (Appendix II); - a summary statement of flight sheets drawn up according to the model in Appendix III; - the agency officer signed certificate, by which he certifies that the amounts appearing on the summary (Appendix II) are the results of the enterprise activity practiced in strict compliance with the provisions of this Instruction; - statement of bank account of reference quarter. This file shall be sent to the Bank of Algeria (Department of Exchange Control) through the domiciliary bank of the airline supported, as the case may be, by: - application for transfer of surplus receipts if the operating balance during the concerned quarter proves to be positive. - Supporting documents of repatriation of foreign currency amounts needed to hedge the deficit in case of negative income.

35 IV/TERMS OF TRANSFER Upon obtaining the approval of the Bank of Algeria (Department of Exchange Control) the domiciliary bank shall carry out by enterprise s bank account debit, the transfer of the authorized amount by deposit of its exchange value in favor of the foreign currency account opened on its books on behalf of this latter, in accordance with the relevant regulatory provisions in force. The exchange value shall be determined on the basis of Sale rate in force at the date of conversion, resulting from the foreign currencies quotation in the Bank of Algeria accounts. The effective transfer of surplus receipts placed in foreign currency accounts of the representative of foreign airlines shall be subject to a prior authorization from the Bank of Algeria (Department of Exchange Control). I/ III- MISCELLANEOUS PROVISIONS I/-The Bank of Algeria shall reserve the right to revert the granted transfer authorizations in case any further checks and controls show up breaches of Regulation regarding transport tickets issue or irregularities into the enterprise s management. II/- Documents relating to the issue of any transport tickets, the strain of these ticket.bearing the references or with relevant documents submitted by the traveler, monthly statements drawn up by airlines provided for in title II- point 1.2, together with flight sheets as provided for in title II-point 2, shall be preserved and held at the disposal of the Bank of Algeria services (Department of Exchange Control) during (4) four years counted as from the end of the corresponding year. III/- Foreign currency receipts generated by the use of credit cards or any other external mean of payment cashable abroad by foreign airlines shall be subject to an effective repatriation in Algeria, through the bank domiciling the latter. These receipts shall be deposited in foreign currency accounts of foreign airlines as soon as they are achieved by them. Article 3: Treatment of cases not provided for by the provisions of this Instruction shall fall under the jurisdiction of the Department of Exchange Control of the Bank of Algeria.

36 Article 4: Any infringement of the provisions of this Instruction shall expose its perpetrator (s) to penalties prescribed by Law. Article 5: Any prior provisions relating to air transport tickets and transfer of surplus receipts of foreign airlines based in Algeria shall be repealed by this Instruction. However, the provisions of the Bank of Algeria decision of November relating to airlines and Appendixes remain in force. Article 6: This Instruction shall come into force as from its signature. The Governor Mohammed LAKSACI

37 APPENDIX I FLIGHT SHEET Airline: Domiciliary Bank (Bank Institution name and complete address) Airport: Flight No: Plane type: Destination: Number of seats: 1) Number of passengers: 2) Tickets issued in Algeria by the foreign airline company including: Number Duty free amount A) Full price ticket B) Special price ticket C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling transfer (A+B) Number Duty free amount Customs visa Date

38 APPENDIX II SUMMARY OF PROCEEDS AND COSTS RECORDED IN STATEMENT OF INCOME DURING QUARTER 20.. A) PROCEEDS (PROVIDED SERVICES) Designation Month of.. Month of Month of Month of. Totals (A) B) COSTS Designation Month of.. Month of Month of Month of. Totals (B) Amount to be transferred (A-B) AD.. Amount to be repatriated (B-A) AD.. Date, stamp and signature of the representative (full name) of the company.

39 APPENDIX III SUMMARY STATEMENT OF FLIGHT SHEETS Company: Domiciled Bank Month : (Airport) 1) number of passengers 2) Tickets issued in Algeria by the foreign airline company including: Number Duty free amount A) Full price ticket B) Special price ticket C) Free tickets D) Tickets paid by cheques or credit cards cashable abroad 3) Tickets issued by other companies 4/ Tickets issued abroad 5) Other tickets Tickets entitling transfer (A+B) Number Duty free amount Date, stamp and signature of the company.