Exchange Control (Money Transfer Agencies) Order,2004 (Statutory Instrument 77 of 2004)

Statutory Instrument 77 of 2004

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Exchange Control (Money Transfer Agencies) Order,2004

S.Is 77/2004, 81A/2004.

ARRANGEMENT OF SECTIONS PART I

PRELIMINARY

• Persons providing money transfer services to be registered.
• Documentation in support of registration as a money transfer agency.

5. Registration of money transfer agencies.
6. Amendment and cancellation of registration of money transfer agencies.
7. Renewal of registration of money transfer agencies and opening of new branches.
8. Minimum capital and financial security requirements of money transfer agencies.
9. Operations of money transfer agencies.
10. Commissions, fees and charges.
11. Officers of money transfer agencies.
12. Premises and equipment of money transfer agencies.
13. Accounts, returns and financial statements of money transfer agencies.
14. Compliance directions and penalties.
16. Directives to money transfer agencies
17. Existing money transfer agencies deemed to be registered.

SCHEDULES

First Schedule: Application for Registration as a Money Transfer Agency.

Second Schedule: Form of Reserve Bank Receipt.

Third Schedule: Minimum Equipment and Stationery Requirements of Money Transfer Agency.

Fourth Schedule: Foreign Currency Weekly Return

IT is hereby notified that the Reserve Bank of Zimbabwe, in terms of section 40 of the Exchange Control Regulations, 1996, and with the approval of the Minister of Finance, has made the following order:—

1. Title

This order may be cited as the Exchange Control (Money Transfer Agencies) Order, 2004.

[Section amended by s.i. 81A of 2004]

                                                                                           2.   Interpretation

(1) In this order—

“auditor” means an auditor who is registered as a public auditor in terms of the Public Accountants and Auditors Act [Chapter 27:12];

[Definition inserted by s.i. 81A of 2004]

“banking institution” means a banking institution registered in terms of the Banking Act [Chapter 24:20];

“building society” means a building society registered in terms of the Building Societies Act [Chapter 24:02];

“Exchange Control Order” means the Exchange Control Order, 1996, published in Statutory Instrument 110 of 1996;

“float money” means money kept by a money transfer agency—

• in the form of Zimbabwean currency to meet its Zimbabwe dollar commitments to its customers; or
• in the form of foreign currency to meet its foreign currency commitments to its customers;”;

[Definition substituted by s.i. 81A of 2004]

“free funds” means foreign currency acquired outside Zimbabwe by a resident of Zimbabwe otherwise than by any trade, business or other gainful occupation or activity carried on by him or her in Zimbabwe, or otherwise lawfully held outside Zimbabwe by a resident of Zimbabwe;

“money transfer agency” means a person that provides a money transfer service;

“money transfer service” means the business of transferring foreign currency between persons resident in Zimbabwe and persons resident in any other country or territory, and includes the buying of foreign currency in connection with such a service;

[Definition amended by s.i. 81A of 2004]

“principal regulations” means the Exchange Control Regulations, 1996, published in Statutory Instrument 109 of 1996;

“ruling auction rate” has the meaning given to that term by subsection (1) of section 2 of the Exchange Control (Currency Exchange) Order, 2004, published in Statutory Instrument 9 of 2004.

(2) Any word or expression to which a meaning has been assigned in the principal regulations and the Exchange Control Order shall have the same meaning when used in this order.

3. Persons providing money transfer services to be registered

• Subject to section 16, no person may provide a money transfer service unless such person is registered as a money transfer agency in terms of this order.
• No person shall be registered as a money transfer agency in terms of this order unless such person—
• is registered or incorporated as a company in terms of the Companies Act [Chapter 24:03]; or
• is a division, department, unit or subsidiary company of a banking institution or a building society, the accounts of which are audited separately from the accounts of the parent banking institution or building society.

                                                   4.   Documentation in support of registration as a money transfer agency

A person wishing to be registered as a money transfer agency shall apply to the Exchange Control Division of the Reserve Bank in the form set out in the First Schedule for such registration, and shall submit with the application a fee of five hundred thousand dollars and the following documentation in support of the application—

• in the case of a company—
  • a true copy, certified by the auditors of the company, of its memorandum and articles of association; and
  • a true copy, certified by the auditors, of the certificate of incorporation or registration of the company, issued in terms of the Companies Act [Chapter 24:03]; and
  • a statement, certified by the auditors of the company showing the authorised and paid-up share capital of the company; and
• in the case of a division, department or unit of a banking institution or building society, proof of registration of the parent banking institution or building society as a banking institution or building society; and
• a statement, certified the auditors of the company or and the auditors of the parent banking institution or building society (as the case may be) showing—
  • the assets that will comprise the minimum capital required in terms of paragraph (a) of section 8; and
  • bank deposits comprising the float money referred to in paragraph (b) of section 8; and
  • compliance with the minimum financial security requirements specified in paragraph (c) of section 8; and
• a statement of monthly cashflow projections indicating expected foreign currency receipts for a twelvemonth period, and target markets; and
• the name and address of every person who will become an officer of the proposed money transfer agency, together with details of their qualifications in the field of exchange control law and procedure, and the offices and branches where they will be stationed; and
• the name of each country or territory in or from which the applicant provides a money transfer service with Zimbabwe together with proof—
  • in the form of an agreement or provisional agreement between the applicant and the money transfer agency concerned that the applicant is affiliated or associated with a money transfer agency lawfully operating in the country or territory concerned; or
  • that the applicant is itself registered or otherwise lawfully operating in the country or territory concerned; and
• an application for exchange control authority to maintain float money consisting of foreign currency of a specified amount.
  • affiliate or associate with a money transfer agency lawfully operating in the country or territory concerned; or
  • secure registration or other authorisation to enable it to operate in such country or territory.

[Section amended by section 3 of s.i.81A of 2004]

                                                                        5.   Registration of money transfer agencies

(1) The Reserve Bank shall consider every application submitted to it in terms of section 4 and, if it is satisfied—

• as to the matters specified in paragraphs (a) to (g) of section 4; and
• that the applicant has sufficient financial resources to conduct a money transfer service; and
• that the applicant has a fixed place of business which, in regard to location, size and security, is suitable for conducting a money transfer service; and
• the applicant will take adequate steps to safeguard and account for any foreign currency and Zimbabwean currency it may receive and deal with in the course of its business as a money transfer

agency, and in particular that it will comply with the requirements of section 9; and

• the documents or information submitted with the application do not disclose that undesirable methods of conducting business will be adopted by the applicant; it shall register the applicant as a money transfer agency, subject to such terms and conditions as the Reserve Bank may specify in writing to the applicant.

(2) If the Reserve Bank refuses to register the applicant as a money transfer agency it shall furnish the reasons for its refusal to the applicant and refund half of the application fee to it—

• immediately, if the applicant does not intend to appeal against the decision of the Reserve Bank; or
• upon the determination of any appeal lodged by the applicant against the decision of the Reserve Bank, if it loses the appeal:

Provided that if the applicant gives any information in connection with the application which is, to the applicant’s knowledge, false in any material particular, or which the applicant does not have reasonable grounds for believing to be true, no part of the application fee shall be refunded

(3) On registering any person as a money transfer agency the Reserve Bank shall—

(a) enter the name of the agency in a register kept by it for the purpose, together with any terms and conditions subject to which the agency is registered; and (b) issue the agency with a certificate of registration.

(4) A money transfer agency may, subject to this order and the terms and conditions of its registration, conduct a money transfer service.

                                                 6.   Amendment and cancellation of registration of money transfer agencies

• The Reserve Bank may at any time amend the terms and conditions subject to which a money transfer agency is registered:

Provided that, before effecting any such amendment otherwise than at the request of the money transfer agency concerned, the Reserve Bank shall afford the money transfer agency an adequate opportunity to make representations in the matter.

• If the Reserve Bank is satisfied that—
• the registration of any money transfer agency was secured through fraud or the misrepresentation of a material fact; or
• a money transfer agency has failed to comply with—
  • any provision of this order or any direction or order made or issued thereunder with which it was its duty to comply; or
  • any term or condition subject to which it was registered; or
• a money transfer agency no longer possesses sufficient financial resources to conduct business as a

money transfer agency; or

• a money transfer agency has failed to safeguard or account for any foreign currency or Zimbabwean currency it has received or dealt with in the course of its business as a money transfer agency;

it may cancel its registration as a money transfer agency or may alter or amend any term or condition of its registration:

Provided that before doing so the Reserve Bank shall afford the money transfer agency concerned an adequate opportunity to make representations in the matter.

                                           7.   Renewal of registration of money transfer agencies and opening of new branches

• The annual fee payable to the Reserve Bank by a money transfer agency for the renewal of its registration shall be five hundred thousand dollars.
• The annual fee referred to in subsection (1) shall be paid not later than the 31st March of the year following that in respect of which the fee is payable.
• A registered money transfer agency that wishes to open a new branch of its operations anywhere in Zimbabwe may apply in writing to the Reserve Bank for permission to open such branch, and shall submit with its application—
• a fee of one hundred thousand dollars; and
• particulars of the location, size and security of the proposed branch of the money transfer agency; and (c) such information as the Reserve Bank may require.