ECONOMY

Capital controls relaxed for corporations

capital-controls-relaxed-for-corporations

The Finance Ministry eased capital controls on corporate transactions on Wednesday by doubling from 7 to 14 million euros the daily limit each of the country’s four systemic banks is allowed to approve in response to demands by enterprises and professionals for international payments.

As a part of the gradual relaxation of the capital restrictions introduced at the end of June, the ministry also decided to allow requests involving amounts of up to 5,000 euros to be examined by the bank branch on the spot, thereby easing the workloads of the subcommittees created to handle daily demands of up to 150,000 euros each.

The increase in the daily limit will come into effect immediately after the law has been changed, expected to happen today, to help businesses ahead of their increased needs for imports this fall. If a bank does not use all of the available funds in one day, it will be able to add the remaining amount to the next day, and so on through the end of the week, thereby raising the weekly limit to 70 million euros per bank, and to 280 million euros for all four systemic banks.

As a result, the time required to approve requests should be reduced. According to the most recent available data, each request currently takes an average of 18 working days. Ministry data showed that in August the total amount of requests approved by the various committees at the State General Accounting Office and at the banks amounted to 2.4 billion euros, covering 73 percent of needs.

Despite the gradual easing of the capital controls the market remains a long way from normality and the resulting problems are having knock-on effects on an already burdened financial environment. Those who wish to send money abroad are asked to bear in mind that the banks have no leeway when it comes to the required documents, and that transactions are forbidden unless all the neccessary paperwork is presented. In the case of money for tuition fees abroad, the Committee for the Approval of Banking Transactions has to issue its approval first.