The Central Bank of Egypt (CBE) announced on February 12, 2022, that the country will only accept documentary credits for all import transactions. Banks will be allowed to accept collection documents for any goods that were in transit prior to the issuance of the decision. In addition, foreign companies and their subsidiaries are exempt from this new regulation.
The CBE’s decision will force importers to pay using letters of credit (LCs) to purchase goods, effective as of March 1, 2022. Banks in Egypt have been notified (as of February 12, 2022), to only accept documentary credits to facilitate imports. The new regulatory frameworks by the CBE are part of the cabinet’s directives to enhance governance measures related to import operations, and will entail a compulsory pre-registration system for shipments.
Prior to this decision, importers had the option to pay for imports by documentary collection as well as Open Account.
The Governor the Central Bank of Egypt indicated that these rules are irreversible and no amendments will be made to them.
The information relayed in RA’s alert is based on various news sources, and may be subject to change. Please contact RA’s team on [email protected] for further information or support.
