Home
| Databases
| WorldLII
| Search
| Feedback
Fiji Legislation |
LAWS OF FIJI
CHAPTER 210
RESERVE BANK OF FIJI
TABLE OF PROVISIONS
PART I
PRELIMINARY
SECTION
1.
Short title
2.
Interpretation
PART II CONSTITUTION
3.
Establishment of Reserve
Bank and transfer of assets and liabilities
4.
Principal purposes of
Reserve Bank
5.
Offices, branches, agents
and correspondents
PART III CAPITAL, PROFITS AND RESERVES
6.
Capital
7.
Profits
8.
General Reserve
PART IV BOARD, MANAGEMENT AND EMPLOYEES
9.
Board, its powers and
responsibilities
10.
Membership of the Board
11.
Appointment of Governor
12.
Directors
13.
Disqualification
14.
Appointment to fill a
vacancy
15.
Duties of the Governor
16.
Meetings of the Board
17.
Power to appoint Deputy
Governor, officers and employees
18.
Conflicts of interest
19.
Secrecy
20.
Personal immunity of
directors, officers and employees
PART V CURRENCY
21.
Monetary unit
22.
Sole right to issue currency
23.
Defacement of notes
24.
Legal tender
25.
Manufacture and
characteristics of bank notes and coins
26.
Power of recall
27.
Issue, withdrawal and
exchange of currency
28.
Recovery of lost, stolen,
mutilated or otherwise damaged currency
29.
Counterfeit currency
PART VI EXTERNAL RESERVE, FOREIGN EXCHANGE
OPERATIONS AND REVALUATION RESERVE ACCOUNT
30.
External Reserve
31.
Value of External Reserve
32.
Operations in gold and
foreign exchange
33.
Limitations
34.
Revaluation Reserve Account
35.
External value
36.
Exchange rates
PART VII RELATIONS WITH BANKS AND CREDIT INSTITUTIONS
37.
Opening accounts for banks
and credit institutions
38.
Operations with account
holders
39.
Determination of rates
40.
Required reserves of banks
and credit institutions
41.
Regulation of interest and
credit
42.
Foreign exchange position
43.
Minimum holdings of
unimpaired liquid assets
44.
Local assets ratio
PART VIII SUPPLY OF INFORMATION
45.
Supply of information
46.
Extension of any time limit
for provisions of documents and information
PART IX RELATIONS WITH AND FOR THE GOVERNMENT
47.
Reserve Bank to be banker,
fiscal agent and depository to the Government
48.
Agent for the administration
of Acts relating to banking and exchange control
49.
Advances to Government or
statutory corporations
50.
Acquisition of evidence of
indebtedness issued by the Government
51.
Credit to the Government and
statutory corporations
52.
Policy directives
53.Depository
and fiscal agency of international financial institutions and supranational
organisations
PART X ACCOUNTS AND STATEMENTS
54.
Financial year
55.
Accounts
56.
Publication of accounts and
annual report and monthly return
PART XI GENERAL
57.
Exemption from Government
taxes and duties
58.
National Bank of Fiji and
Fiji Development Bank
59.
Prohibited activities
60.
Banking Act
61.
Prohibited names
62.
Bank holidays
PART XII REPEAL
63.
Repeal and saving
-----------------------------------------
Act No. 14 of 1983
AN ACT
TO ESTABLISH THE RESERVE BANK OF FIJI AS SUCCESSOR TO THE CENTRAL MONETARY AUTHORITY OF FIJI AND FOR PURPOSES CONNECTED THEREWITH
[1 January 1984W]
PART I PRELIMINARY
Short title
1.
This Act may be cited as the
Reserve Bank of Fiji Act.
Interpretation
2. – (1)
In this Act, unless the context otherwise requires-
"bank" has the meaning given to it by the Banking Act; (Cap.212)
"banking business" has the meaning given to it by the Banking Act;
"Board" means the Board of Directors of the Reserve Bank
established under section 9;
"credit institution" has the meaning given to it by the Banking Act;
"currency" means bank note, currency note or coin;
"director" means a member of the Board;
"Deputy Governor" means the Deputy Governor of the Reserve Bank
appointed under section 17;
"dollar" means the currency established under section 21;
"financial institution" has the meaning given to it by the Banking Act;
"Governor" means the Governor of the Reserve Bank appointed under section 11;
"Reserve Bank" means the Reserve Bank of Fiji established under section 3;
"statutory corporation" means a body corporate established under any written law, other than a law relating to the formation and registration of companies.
(2)
Notwithstanding sub-section(1), it is hereby declared that, for the purposes of
this Act, the Fiji Sugar Corporation Limited shall
be deemed to be a statutory
corporation.
PART II -CONSTITUTION
Establishment of Reserve Bank and transfer of assets and liabilities
3.
– (1) The Reserve Bank
of Fiji is hereby established in accordance with the provisions of this Act.
(2) The Reserve Bank
shall be a body corporate with perpetual succession and a common seal. It shall
be capable of entering into contracts,
suing or being sued in its own name and
shall, subject to the provisions of this Act, have power to acquire, hold and
dispose of
real and personal property. The Reserve Bank shall have power to make
such expenditure as it deems necessary for the proper discharge
of its
functions.
(3) The
assets and liabilities and contractual rights and obligations of the Central
Monetary Authority of Fiji established under
the Central Monetary Authority of
Fiji Act, 1973W are hereby transferred to the Reserve Bank and any currency
issued or deemed to
have been issued under the Central Monetary Authority of
Fiji Act, 1973W shall be deemed to have been issued by the Reserve Bank.
(4) Any reference in
any Act, subsidiary legislation, instrument or document to the Central Monetary
Authority of Fiji shall, unless
inconsistent with the subject matter, be deemed
and be taken to refer to and mean the Reserve Bank.
Principal purposes of Reserve Bank
4.
The Principal purposes of
the Reserve Bank shall be-
(a) to regulate the issue of currency, and the supply, availability and international exchange of money;
(b) to promote monetary stability;
(c) to promote a sound financial structure; and
(d) to foster credit and exchange conditions conducive to the orderly and balanced economic development of the country.
Offices, branches, agents and correspondents
5. The Reserve Bank shall have its head office in Suva or such other place as the Minister may determine and may establish branches within Fiji, appoint agents and correspondents within Fiji and abroad, and, with the approval of the Minister, establish offices abroad.
PART III CAPITAL, PROFITS AND RESERVES
Capital
6.–(1) The authorised capital of the Reserve Bank shall be $5,000,000 which may be increased from time to time by any amount proposed by the Board and approved by the Minister.
(2) There
shall be issued to the Government, upon the establishment of the Reserve Bank,
an initial amount of $2,000,000 of capital
stock and any subsequent amount by
the Board and approved by the Minister.
(3) The initial
amount of capital stock issued to the Government shall be deemed to be fully
paid by reason of the extinction of the
capital stock of the Central Monetary
Authority of Fiji, and any subsequent amounts of capital stock issued shall be
paid up in full
by the Government at the time of issue or may, if the Minister
so elects, be credited as fully paid by debit to the General Reserve
established
under section
8.
(4) All capital
stock of the Reserve Bank, as and when subscribed, shall be for the sole account
of the Government, shall not be transferable
or subject to encumbrance and no
reduction of capital shall be effected except by an amendment to this Act.
(5) The Minister,
notwithstanding any other provision of this Act, shall cause to be transferred
to the ownership of the Reserve Bank
non-negotiable non-interest bearing
securities issued by the Government from time to time for such an amount as is
necessary for
the purpose of preserving the paid-up capital from any impairment
whenever, in the opinion of the Board, the assets of the Reserve
Bank are less
than the sum of its liabilities and paid-up capital.
Profits
7.
The net profits of the
Reserve Bank for any financial year shall be determined by the Reserve Bank
after meeting all current expenditure
for that year and after making provisions
for-
(a) bad and doubtful debts; depreciation in assets, and contributions to staff and pension funds;
(b) any other purposes as the Board may deem necessary.
General Reserve
8.–(1)
The Reserve Bank shall establish a General Reserve to which shall be allocated
at the end of each financial year of the
Reserve Bank-
(a) 100 per cent of the net profits of the Reserve Bank whenever the General Reserve does not exceed 50 per cent of the authorised capital of the Reserve Bank;
(b) 50 per cent of the net profits of the Reserve Bank whenever the General Reserve exceeds 50 percent of the authorised capital of the Reserve Bank until the General Reserve is equal to the authorised capital of the Reserve Bank;
(c) 25 per cent of the net profits of the Reserve Bank or such lesser sum as may be necessary to increase the General Reserve to twice the authorised capital of the Reserve Bank whenever the General Reserve exceeds 100 percent but does not exceed 200 percent of the authorised capital of the Reserve Bank:
Provided that the General Reserve May be increased beyond such
amount at such rate and to such extent as may be agreed between the
Minister and
the Reserve Bank.
(2) After appropriate allocations have been made to
the General Reserve under subsection (1), the remainder of the net profits for
the financial year shall be applied to the redemption on behalf of the
Government of any securities held by the Reserve Bank which
have been issued in
accordance with subsection (5) of section 6.
(3) The balance of the net
profits for the financial year remaining after all allocations and applications
under subsections (1) and
(2) have been made shall be paid to the Consolidated
Fund as soon as practicable after the end of each financial year.
(4) No
deduction under subsection (2) shall be required to be made nor shall any
payment under subsection (3) be made, if, in the
judgement of the Board, the
assets of the Reserve Bank are, or after the deduction or payment, would be,
less than the sum of its
liabilities and paid-up capital.
PART IV BOARD, MANAGEMENT AND EMPLOYEES
Board, its powers and responsibilities
9.–(1) There shall be a Board of Directors of the
Reserve Bank, composed in accordance with section 10, which shall be responsible
for its policy and affairs.
(2) The Board shall have powers-
(a) to make by-laws with the approval of the Minister for the conduct of the business of the Reserve Bank;
(b) to make regulations with the approval of the Minister generally for giving effect to the purposes of this Act;
(c) to issue directives for the purpose of giving effect to the provisions of this Act.
Membership of the Board
10.
The Board shall be composed
of 7 directors, namely-
(a) the Governor
(b) the Permanent Secretary for Finance; and
(c) 5 other members.
Appointment of Governor
11.–(1) The Governor shall be a person of recognised experience in financial matters, and shall be appointed by the Minister for a period of not less than 3 or more than 5 years but shall be eligible for re-appointment.
(2) The
remuneration and other terms and conditions of employment of the Governor shall
be as determined from time to time by the
Higher Salaries Commission.
Directors
12. The members of
the Board, other than the Governor and the Permanent Secretary for
Finance-
(a) shall be appointed by the Minister from among persons of recognised standing in agriculture, commercial, financial, industrial or professional matters; and
(b) shall hold office for a period not exceeding 3 years but shall be eligible for re-appointment; and
(d) shall be entitled to such fees and allowances as are determined by the Board and approved by the Minister.
Disqualification
13.–(1) No person, other than the Permanent Secretary for Finance, shall serve on the Board who is at the time of his appointment or later becomes-
(a) a member of either House of Parliament;
(b) a director, officer or employee of a corporation (other than the Reserve Bank) engaged wholly or mainly in banking business; or
(c) a public officer.
(2) A director, other than the
Permanent Secretary for Finance, may resign his office on giving notice in
writing to the Minister.
(3) No person shall be appointed or remain a
director-
(a) who becomes or has anywhere been declared bankrupt and has not been discharged;
(b) who has any where been convicted of an offence involving dishonesty;
(c) who has, in the case of a person having professional qualifications, been disqualified or suspended from practising his profession by the order of any competent authority made in respect of him personally by reason of his misconduct.
(d) if the Minister, after consultation with the Governor, is satisfied that he is incapable of carrying out, or is guilty of serious misconduct in the performance of, the duties of his office.
Appointment to fill a vacancy
14. If a director
dies or resigns or otherwise vacates his office before the expiry of the term
for which he has been appointed, another
person shall be appointed at the
earliest opportunity, and in any event within 30 days, to fill the vacancy and
shall hold office
until the date when the appointment of the person in whose
place he was appointed would have expired.
Duties of the Governor
15. – (1) The
Governor shall-
(a) serve as Chief Executive Officer of the Reserve Bank responsible to the Board for the execution of its policy and the management of the Reserve Bank;
(b) except as may otherwise be provided in this Act, the by-laws of the Reserve Bank or the resolutions of the Board, have the power to act, contract, sign instruments and documents on behalf of the Reserve Bank and, pursuant to the resolutions of the Board, delegate any of these powers to the Deputy Governor or to other officers of the Reserve Bank.
(2) The
Governor shall devote the whole of his professional services to the Reserve Bank
and shall not, without approval of the Minister-
(a) receive any salary or supplement thereto from any source other than the Reserve Bank;
(b) occupy any other office or employment, whether remunerated or not, except as nominee of the Reserve Bank except that he may-
(3) In the event of
the absence or incapacity of the Governor from whatever cause arising, the
Deputy Governor appointed in accordance
with section 17 shall have and may
exercise all the powers and functions of the Governor in accordance with
subsection (1).
(4) In the event of both the Governor and the Deputy
Governor being unable for any reason to carry out their duties, the Minister
may
after consultation with the Board appoint another director, an officer of the
Reserve Bank or any other person who is qualified
for appointment as a director
under this Act, to act as Governor for the time being; and any person so
appointed shall, so long as
his appointment continues, have all the powers and
functions of the Governor.
(5) Any person, other than a director, who is
appointed under this section to act as the Governor shall while so acting be
deemed
to be a director.
Meetings of the Board
16.–(1)
The Board shall meet as often as the business of the Reserve Bank may require
but not less frequently than 10 times in each year
and so that there shall not
be an interval greater than 2 months between 1 meeting of the Board and the next
meeting.
(2)
Meetings of the Board shall be convened, and notice given, in accordance with
by-laws to be made and, in addition, the Governor
or in his absence the Deputy
Governor shall convene a meeting of the Board after receipt of a written request
by any 2 directors
or whenever, in his judgement, he deems it necessary.
(3) At all meetings
of the Board, the Governor, or in his absence such director as the other
directors present may select, shall
preside.
(4) In the
absence of the Governor, the Deputy Governor will participate in Board meetings
and shall have the right to exercise a
vote.
(5) 4 directors, of
whom 1 shall be the Governor, or in his absence the Deputy Governor, shall form
a quorum at any meeting and, unless
otherwise provided in this Act, decisions
shall be adopted by a simple majority of the votes of the members present except
that,
in the event of an equality of votes, the Governor, or in his absence the
director presiding, shall have and exercise a second or
casting vote.
(6) The Deputy
Governor shall be entitled to attend all meetings of the Board but, except in
the circumstances specified in subsection
(4) and (5), shall not cast a vote at
any meeting of the Board and shall not be regarded as a member for the purpose
of forming a
quorum.
(7) No act or
proceeding of the Board shall be invalidated merely by reason of the existence
of a vacancy or vacancies among the directors.
(8) All acts done by
a person acting in good faith as a director shall be as valid as if he were a
director notwithstanding that some
defect in his appointment or qualification be
discovered.
Power to appoint Deputy Governor, officers and employees
17. Subject to the
provisions of the Higher Salaries Commission Act, the Board may appoint and
employ, at such remuneration and on such terms and conditions as it may
determine, an officer of the Bank
to be Deputy Governor and such other officers
and employees as the Board considers necessary for the efficient functioning of
the
Reserve Bank.
Conflicts of interest
18.–(1) No
director shall act as a delegate of any commercial, financial, agricultural,
industrial or other interest, or receive
or accept directions therefrom in
respect of duties to be performed under this Act.
(2) All directors
shall fully disclose to the Board any commercial, financial, agricultural,
industrial or other interests with which
they may at any time be directly or
indirectly connected and shall refrain from voting on any matter related thereto
which becomes
the subject of Board action:
Provided that such an
interest, if so disclosed, shall not disqualify the interested party for the
purpose of constituting a quorum.
(3) No director nor any officer or
employee of the Reserve Bank shall accept any gift or advantage for himself or,
in his behalf,
for persons with whom he may have family, business, or financial
connections if the acceptance thereof would result, or give the
appearance of
resulting, in a diminution of his impartial devotion to his duties under this
Act.
Secrecy
19.–(1) Except
for the purpose of the performance of his duties or the exercise of his
functions or when lawfully required to
do so by any court or under the
provisions of any written law, no director, or any officer or employee of the
Reserve Bank shall
disclose to any person any material information relating to
the affairs of the Reserve Bank or of any bank or credit institution
or other
person which he has acquired in the performance of his duties under this Act.
(2) Any person contravening the provisions of this section shall be
guilty of an offence and liable to a fine not exceeding $200.
Personal immunity of directors, officers and employees
20. No director,
officer or employee of the Reserve Bank shall be personally liable for an act or
default of the Bank done or omitted
to be done in good faith and without
negligence in the course of the operations of the Bank.
PART V CURRENCY
Monetary unit
21.
The monetary unit of Fiji is
the dollar, divided into 100 cents.
Sole right to issue currency
22.–(1) The
Reserve Bank shall have the sole right of issuing currency in Fiji and no other
person shall issue currency or any documents
or tokens payable to bearer on
demand having the appearance of or purporting to be currency.
(2) Any
person contravening the provisions of this section shall be guilty of an offence
and liable to imprisonment for a term not
exceeding 14 years.
Defacement of notes
23.–(1)
No person shall, without the authority of the Reserve Bank, deface any bank note
or currency note by means of any writing, printing,
stamp, mark or erasure.
(2) Any person
contravening the provisions of this section shall be guilty of an offence and
liable to a fine not exceeding $100.
Legal tender
24.–(1)
Currency issued, or deemed to have been issued, by the Reserve Bank shall be
legal tender in Fiji-
(a) in the case of notes, for the payment of any amount;
(b) in the case of coins, if the coins have not been tampered with-
(i) in the case of coins of denominations in excess of $1, for the payment of any amount;'
(ii) in the case of coins of denominations of $1 or less. For payment of an amount not exceeding 50 times face value.
(2)
For the purposes of this Act, a coin shall be deemed to have been tampered with
if it has been impaired, diminished or lightened
(other than by fair wear and
tear) or has been defaced, whether or not the coin has thereby been diminished
or lightened.
Manufacture and characteristics of bank notes and coins
25.–(1)
The Reserve Bank shall arrange for the printing of bank notes and the minting of
coins and for all matters relating thereto, and
for the security and safekeeping
of unissued currency and for the custody, disposal and destruction, as
necessary, of plates, dies
and retired currency.
(2) The Reserve
Bank, with the approval of the Minister, shall determine the denominations,
composition, form, design, content and
material of its currency.
(3) The
characteristics of currency to be issued by the Reserve Bank shall be published
in the Gazette.
Power of recall
26.
Notwithstanding the
provisions of section 24, the Reserve Bank shall have power, on giving notice in
the Gazette and in 1 newspaper
published and in general circulation in Fiji, to
call in, for the purpose of withdrawing from circulation, any currency issued or
deemed to have been issued by the Reserve Bank on payment of the face value
thereof, and any such currency so recalled shall, on
the expiration of the time
limit specified in the notice, cease to be legal tender:
Provided that the
holders of any currency shall be entitled at any time to claim payment from the
Reserve Bank of the face value thereof.
Issue, withdrawal and exchange of currency
27. The Reserve Bank
shall issue, reissue and exchange on demand and without charge currency which it
has or which is deemed to have been
issued by it:
Provided that-
(a) in the event of the unavailability of a requested denomination, the Reserve Bank may deliver currency of available denominations which most nearly approximate those requested;
(b) a charge may be made for the issue or the reissue of any particular currency that the Minister has specified by notice made under paragraph (b) of the proviso to section 31.
Recovery of lost, stolen , mutilated or otherwise damaged currency
28.– (1) No
person shall be entitled to recover from the Reserve Bank the value of any lost
or stolen currency, except under the terms
of any waiver expressly executed in
respect of the assumption by the Reserve Bank of risks incidental to shipments
of currency.
(2) The conditions under which mutilated or otherwise
damaged currency may be exchanged or refunded at partial or face value shall
be
determined by the Reserve Bank.
Counterfeit currency
29. The Reserve
Bank shall assist in the enforcement of any law related to the counterfeiting of
currency in Fiji and certification
by a duly authorised officer of the Reserve
Bank that an item in question is or is not genuine shall be prima facie evidence
of the
fact in any legal proceeding in Fiji.
PART VI EXTERNAL RESERVE, FOREIGN EXCHANGE OPERATIONS AND REVALUATION RESERVE ACCOUNT
External Reserve
30. The Reserve Bank
shall maintain an External Reserve consisting of all or any of the following on
such terms and conditions as the
Board may determine-
(a) gold;
(b) foreign exchange in the form of currency or bank balances held abroad;
(c) any international recognised reserve asset, including-
(i) the reserve tranche position of Fiji in the General Department of the International Monetary Fund; and
(ii) the holding of any special drawing rights by Fiji;
(d) bills of exchange and promissory notes denominated in foreign currency and payable at any place outside Fiji;
(e) treasury bills issued by foreign governments specified from time to time by the Board;
(f) securities issued or guaranteed by foreign governments, supranational organisations, international financial institutions or any foreign public, municipal or local authority specified from time to time by the Board;
(g) such other external assets as the Board, with the approval of the Minister, shall specify.
Value of External Reserve
31. The value of
the External Reserve, provided for in section 30, shall be not less than an
amount equal to 50 percent of the total demand
liabilities of the Reserve Bank
including currency in circulation but excluding non-interest bearing notes
issued to international
financial institutions:
Provided that the
Minister may, on the recommendation of the Board, authorise the Reserve
Bank-
(a) to alter the minimum reserve to such higher or lower proportions not being less than 25 percent and for such periods of time not exceeding 12 months as may be specified by him by notice in the Gazette;
(b) not to take into account in assessing the total demand liabilities of the Reserve Bank for the purposes of this section, such particular currency in circulation as may be specified by him by notice in the Gazette.
Operations in gold and foreign exchange
32. The Reserve Bank
may-
(a) buy, sell or deal in gold or silver coins or gold bullion or other precious metals as defined in the Mining Act; (Cap.146)
(b) buy, sell or deal in foreign exchange using for these purposes any of the instruments commonly used in such banking transactions;
(c) buy, sell or deal in treasury bills and other securities issued or guaranteed by foreign governments, supranational organisations, international financial institutions or any foreign public, municipal or local authority specified from time to time by the Board;
(d) open and maintain accounts with central banks and other banks and financial institutions abroad;
(e) open and maintain accounts for, and act as agent or correspondent for, foreign central banks, monetary authorities, commercial banks, foreign governments and agencies, supranational organisations and international financial institutions;
(f) borrow foreign exchange; and
(g) establish foreign credits.
Limitations
33. The
Reserve Bank shall, in connection with the operations enumerated in section 32,
deal only with banks and credit institutions doing
business in Fiji, the
Government, statutory corporations, foreign governments or their agencies,
supranational organisations, central
banks, monetary authorities, commercial
banks, international financial institutions, foreign public, municipal or local
authorities
and members of a recognised overseas stock exchange.
Revaluation Reserve Account
34.–(1) The
gains or losses arising from any change in the valuation of the Reserve
Bank‘s assets or liabilities in, or
denominated in, gold or foreign
currencies or any internationally recognised reserve asset as a result of
alterations of the exchange
rate of the currency of Fiji, or of any change in
the values of those assets or liabilities with respect to the currency of Fiji,
shall be credited or debited to a Revaluation Reserve Account and neither profit
nor loss arising from any such change shall be included
in the computation of
the annual profit or loss of the Reserve Bank.
(2) Any net loss arising
from any such change referred to in subsection (1) shall be set off against any
credit balance in the Revaluation
Reserve Account and, notwithstanding any other
provision of this Act, if such balance is insufficient to cover that loss, the
Government
shall cause to be transferred to the ownership of the Reserve Bank
non-negotiable non-interest bearing securities issued by the Government
to the
extent of any deficiency.
(3) Any credit balance in the Revaluation
Reserve Account at the end of each financial year of the Reserve Bank shall be
applied,
on behalf of the Government, to the redemption of all securities issued
and outstanding under subsection (2) of this section and
subsection (5) of
section 6; one fifth of the remaining balance shall be paid to the Government to
be used for such purposes as the
Government, after consultation with the Reserve
Bank, may decide:
Provided that, when the remaining balance does not
exceed $100,000 it shall be paid in full to the Government.
(4) No
credit or debit shall be made to the Revaluation Reserve Account except in
accordance with the provisions of this section.
External value
35. The external
value of the Fiji dollar shall be determined, from time to time, in a manner
proposed by the Reserve Bank and approved
by the Minister and which has due
regard to the obligations which Fiji has assumed in accordance with the
provisions of any international
monetary agreement to which it is a party or to
which it has adhered.
Exchange rates
36.–(1) The
Reserve Bank may determine the rate at which Fiji currency may be exchanged for
the currency of any other country.
(2) Any person who exchanges any Fiji
currency for the currency of any other country at a rate other than the rate
determined under
subsection (1) shall be guilty of an offence and liable to
imprisonment for a term not exceeding 12 months or to a fine not exceeding
$2,000 or to both.
PART VII RELATIONS WITH BANKS AND CREDIT INSTITUTIONS
Opening accounts for banks and credit institutions
37.
The Reserve Bank may, under
such terms and conditions as the Board may determine-
(a) open accounts for, and accept deposits from, bank and credit institutions doing business in Fiji; and
(b) open accounts with, and place deposits with, banks and credit institutions doing business in Fiji.
Operations with account holders
38.
The Reserve Bank may,
(a) for its own account and for holders of accounts with it, issue drafts and effects any other kinds of remittance payable at its own offices or at the offices of any agent and correspondent;
(b) purchase from, sell to, discount and rediscount for, holders of accounts with it bills of exchange and promissory notes drawn or made for bona fide commercial, industrial or agricultural purposes, bearing 2 or more good signatures of which 1 shall be that of a bank or credit institution and maturing within 183 days from the date of their acquisition by the Reserve Bank;
(c) for its own account, issue, sell or place bonds, certificates, notes and similar instruments and purchase such instruments from account holders;
(d) grant to holders of accounts with it advances for periods not exceeding 183 days-
(i) secured by-
(aa) instruments specified in paragraphs (b) and (c) of this section; or
(bb) warehouse warrants and documents of title issued in respect of staple
commodities or other goods duly insured:
Provided that the Reserve Bank shall determine the maximum Percentage of advances in relation to the current value of those Commodities or goods; or
(cc).holdings of any assets which the Reserve Bank is permitted to buy, sell, or deal in under section 32; or
(dd) notes, bills, stocks, securities or other evidence of indebtedness issued or guaranteed by the Government or any statutory corporation, subject to the provisions of section 51;
or
(ii) secured by such other assets or on such terms and conditions as the Board may specify.
Determination of rates
39. The Reserve Bank shall determine and publicly announce from time to time its minimum rates for discounts, rediscounts, advances, loans or overdrafts, and may determine different rates for various classes of transactions or maturities.
Required reserves of financial institutions
40.–(1)
The Reserve Bank may, by written notice to the principal place of business in
Fiji of each financial institution and by
publication in the Gazette, specify
the reserves required to be maintained against deposits and other similar
liabilities which may
be specified for this purpose. Those reserves shall be
maintained by way of cash holdings or deposits with the Reserve Bank or by
both
in such proportions as the Reserve Bank may specify.
(2) The
Reserve Bank may fix rates of interest to be paid to financial institutions on
all or part of any reserves required to be
maintained under subsection (1).
(3) The Reserve Bank
may specify different reserve ratios for different classes of deposit and
other similar liabilities and may specify the method of their computation: Provided that-
(a) the Reserve Bank shall not require a financial institution to hold a total amount of reserves in excess of 25 percent of the total deposit and other similar liabilities to which reserve ratios have been made applicable;
(b) the initial specification of, or any increase in, the required reserve ratios shall be effective only after at least 30 days‘ notice thereof has been given and shall not relate to a period prior to the initial date of notice;
(c) the Reserve Bank may determine that the requirements of this subsection may be met by meeting the specific reserve ratio on the basis of averages of daily reserve holdings over such period as the Reserve Bank may specify;
(d) the specified reserve ratios shall be uniform for all financial institutions within the same category.
(4) The Reserve Bank may impose on any
financial institution which fails to maintain required reserves in the
appropriate ratio specified
under this section a penalty not exceeding one-tenth
of one per cent per day on the amount of deficiency in the financial
institution‘s
reserve holdings until the deficiency is corrected.
Regulation of interest and credit
41.–(1) The
Reserve Bank may, with the approval of the Minister, specify by publication in
the Gazette and by written notice to
the principal place of business in Fiji of
each financial institution-
(a) the maximum or minimum, or maximum and minimum, rates of interest payable in respect of deposit and other similar liabilities and the method of computation thereof;
(b) the permissible purposes, aggregate ceilings, maximum amounts beyond which the approval of the Reserve Bank is necessary, the maximum maturities, and maximum and minimum rates of interest chargeable in respect of-
(i) the making of advances, whether by loans or overdrafts and investments;
(ii) the discounting of bills of exchange, promissory notes and other commercial or financial paper;
(iii) the issuing of letters of credit;
(iv) the granting of acceptances and other forms of credit;
(c) the manner of disclosure to the public and to-
(i) each depositor in a financial institution, the effective annual interest rate payable in respect of deposits made therewith;
(iii) each person to whom credit is extended, the terms of obtaining such credit including the effective annual interest rate payable in respect thereof.
(2)
The Reserve Bank, in its notices under this section, may-
(a) differentiate in respect of the items specified in paragraphs (a) and (b) of subsection (1) between-
(i) banks
(ii) credit institutions; and
(iii) other creditors,and between members of the classes referred to in sub-paragraphs (ii) and (iii) of this paragraph; and
(b) establish different criteria for different purposes under paragraphs (a) and (b) of subsection (1).
(3)
The Reserve Bank may specify, by written notice to the principal place of
business in Fiji of each financial institution and by
publication in the
Gazette, the minimum cash margin or security required in respect of the items
enumerated in paragraph
(b)
of subsection (1):
Provided that any
increase in the said minimum cash margin or security required shall only be
effective after at least 30 days‘
notice thereof has been given and shall
not relate to a period prior to the initial date of notice.
(4) With the
approval of the Minister, the provisions of subsection (1), (2) and (3) may be
made applicable by the Reserve Bank, by
publications in the Gazette and by
written notice, to any person having as a principal object of his business the
extension of credit.
(5) The Reserve Bank
shall have authority to examine the accounts, books, and papers of any person
who it has reason to suspect is
extending or has extended credit in violation of
subsection (4) and the refusal to submit those accounts, books and papers shall
be prima
facie evidence of a
violation.
(6) Any
financial institution in wilful violation of subsection (1), (2) or (3) may be
required to pay to the Reserve Bank for each
violation a penalty not exceeding
$2,000.
(7) Any
person to whom the provisions of subsection (1), (2) or (3) have been made
applicable pursuant to subsection (4) shall be
guilty of an offence
if-
(a) that person is in breach of this section; or
(b) that person supplies false information or fails to furnish, within a specified time, any information required by the Reserve Bank to satisfy it that that person is complying with this section.
(8) Any person guilty of an offence under subsection (7) shall be liable-
(a) in respect of an offence under paragraph (a) thereof, to a fine not exceeding $2,000; or
(b) in respect of an offence under paragraph (b) thereof, to a fine not exceeding $200 for every day during which the offence continues.
Foreign exchange position
42. The Reserve Bank may determine-
(a) the maximum amount of the working balances which financial institutions may hold in foreign currencies generally or in any specified currency; and
(b) the maximum amount of indebtedness in foreign currencies generally or in any specified currency which financial institutions may incur.
Minimum holdings of unimpaired liquid assets
43.–(1)
(a) Every bank shall, in relation to its operations in Fiji, maintain such minimum holding of unimpaired liquid assets as may, from time to time, be specified by the Reserve Bank and published in the Gazette, so however that the minimum shall be the same for all banks and shall not exceed 35 percent of deposit and other similar liabilities.
(b) Every credit institution shall, in relation to its operations in Fiji, maintain such minimum holdings of unimpaired liquid assets as may, from time to time, be specified by the Reserve Bank, and published in the Gazette, so however that the minimum shall be the same for all such credit institutions and shall not exceed 35 percent of deposit and other similar liabilities.
(2)
The Reserve Bank shall determine the method of computing the amounts of
unimpaired liquid assets to be held by financial institutions.
(3) For the purposes
of this section, —unimpaired liquid assets" means all or any of the
following-
(a) Fiji currency;
(b) balances held with the Reserve Bank, excluding required reserves specified under section 40;
and which mature in not more than 10 years;
(f) net claims on or net balances held with other banks in Fiji other than items in course of collection;
(g) bills of exchange eligible for rediscount by the Reserve Bank;
(h) such foreign exchange, in the form of currency or bank balances held abroad as the Reserve Bank may approve for this purpose; and
(i) such other assets as the Reserve Bank may specify.
(4)
Any financial institution which fails to comply, within such reasonable time as
the Reserve Bank may fix, with any requirements
of subsection (1) shall be
liable to pay, on being called upon to do so by the Reserve Bank, a penalty
interest charge not exceeding
one-tenth of one percent of the amount of the
deficiency for every day on which the deficiency continues.
Local assets ratio
44. A financial
institution shall maintain assets consisting of such claims payable in the
currency of Fiji and other assets situated
in Fiji in such minimum proportion of
its deposits and other similar liabilities payable in Fiji as the Reserve Bank
may specify.
PART VIII SUPPLY OF INFORMATION
Supply of information
45.–(1) A
financial institution shall furnish to the Reserve Bank such information
regarding its business, or that of any related
company in Fiji or elsewhere, as
the Reserve Bank may require for the purposes of this Act.
(2) The
Reserve Bank may require a certificate from the auditor of the financial
institution verifying the accuracy of any information
furnished under subsection
(1).
(3) Every director and every manager of a financial institution
which fails to provide the required information or a certificate from
its
auditor after a reasonable period of notice shall be guilty of an offence and
shall be liable to a fine not exceeding $500 for
every day during which the
offence continues
(4) If information provided under this section is
false in any material particular, every director and every manager of the
financial
institution shall be guilty of an offence and shall be liable to a
fine not exceeding $5,000.
(5) Any person who is prosecuted in respect
of any offence under this section shall have a good defence if he proves that
the offence
was committed without his consent or connivance and that he
exercised all such diligence to prevent the commission of the offence
as he
ought to have exercised, having regard to his position in the financial
institution in respect of which the offence was committed.
(6) In
subsection (1), —related company" means any body corporate which is or has
at any relevant time been the financial institution‘s
subsidiary or
holding company or a subsidiary of its holding company or a holding company of
its subsidiary.
Extension of any time limit for provision of documents and information
46. At the
request of a financial institution, the Reserve Bank may extend any period
within which the financial institution is, in accordance
with the provisions of
this Act, obliged to furnish any document or information.
PART IX RELATIONS WITH AND FOR THE GOVERNMENT
Reserve Bank to be banker, fiscal agent and depository to the Government
47.–(1)
The Reserve Bank shall be the banker and fiscal agent of the Government and
shall be the depository of Government funds:
Provided that-
(a) the Reserve Bank may also act in such capacities to any Ministry or the Department of Government or any statutory corporation; and
(b) the Government may maintain balances with and generally use the services of financial institutions on such terms and conditions as may be agreed between the Reserve Bank, the Minister and the parties concerned.
(2)
The Minister may request the Reserve Bank to render advice and to furnish
reports on matters relating to the purposes of the Reserve
Bank.
(3) It shall be the
duty of the Reserve Bank to inform and advise the Minister about any matter
which in the opinion of the Reserve
Bank is likely to affect the achievement of
its purposes.
Agent for the administration of Acts relating to banking and exchange control
48. The Reserve Bank
shall exercise, as agent for the Government, such powers or functions under any
law for the time being in force relating
to exchange control and the regulation
of financial institutions in Fiji as may be delegated to it by the Minister.
Advances to Government or statutory corporation
49. – (1) The
Reserve Bank may grant temporary advances to the Government or any statutory
corporation in respect of temporary deficiencies
of current budget revenue,
subject to repayment within 6 months following the end of the financial year in
which they were granted,
at such rates of interest as the Board may determine.
(2) If at the end of any financial year, any advance remains unpaid
within the period provided for by subsection (1), that advance
shall be taken
into account when determining the maximum advances that may be made under that
subsection in the following year.
(3) Without limiting the generality of
subsection (1), the Reserve Bank is expressly authorised to make advances to the
Government,
on such terms and conditions as may be agreed between them, in
respect of subscriptions and other payments resulting from, or incidental
to,
the membership of Fiji in any international financial institution, the
participation of Fiji in any account thereof or any transactions
and operations
undertaken in connection therewith.
(4) The Reserve Bank shall be
consulted by-
(a) the Minister, on the occasion of the preparation of the Government‘s budget, to the end of reaching an understanding on the total amount of credit that may be expected to be extended by the Reserve Bank to the Government during the following year;
(b) the Government, its institutions, agencies, statutory corporations and local government bodies at any time that either domestic or foreign credit operations are contemplated; in the event that, in the opinion of the Board, such operations individually or collectively appear to be of a magnitude inappropriate to prevailing economic conditions, the Reserve Bank shall report to the Minister drawing attention to the situation and recommending measures to rectify the situation.
Acquisition of evidence of indebtedness issued by the Government
50. The Reserve Bank
may buy, sell or deal in notes, bills, stocks, securities or other evidence of
indebtedness issued or guaranteed
by the Government or any statutory
corporation, which were publicly offered for sale or form part of an issue which
is being made
to the public at the time of acquisition by the Reserve Bank and
which mature in not more than 20 years.
Credit to the Government and statutory corporations
51.–(1)
Except in accordance with this section and sections
38,
49
and
50,
the Reserve Bank shall not, directly or indirectly, make advances to the
Government or to any statutory corporation or acquire the
notes, bills,
securities or other evidence of indebtedness of, or guaranteed by, the
Government or any statutory corporation or establish
credits for the Government
or any statutory corporation:
Provided that this section shall not operate to prevent the acquisition by the Reserve Bank of securities in accordance with subsection (5) of section 6 and subsection (2) of section 34 or its making advances in accordance with subsection (3) of section 49.
(2) The
total amount of outstanding advances made by the Reserve Bank to the Government
or to any statutory corporation and of the
holdings by the Reserve Bank of
notes, bills, securities or other evidence of indebtedness of, or guaranteed by,
the Government or
any statutory corporation exclusive of credit permitted under
subsection (5) of section
6
and subsection (2) of section
34
and of the amount of credits
established for the Government or any statutory corporation shall, at no time,
exceed 30 percent of the
average annual ordinary revenue of the Government,
except as provided in subsection (5) of this section.
(3) For the purposes
of this section-
(a) the ordinary revenue of the Government shall include revenues from taxes, levies, duties, and fees, rents, profits and income from any investment or undertaking by the Government and any contribution to the revenue of the Government from any statutory corporation but shall not include loans, grants, other forms of economic aid or capital raised;
(b) the average of the annual ordinary revenue shall mean the average of the annual ordinary revenues for the 3 financial years immediately preceding for which accounts are available.
(4)
If, in the opinion of the Board, the limitation provided in subsection (2)
appears to be in danger of being exceeded, the Reserve
Bank shall submit to the
Minister a report containing such recommendations as it deems appropriate to
remedy the situation. The Reserve
Bank shall make further reports at intervals
not to exceed 3 months until such time as, in its opinion, the situation has
been rectified.
(5)
If the limitation provided for in subsection (2) is reached, the Reserve Bank
shall forthwith notify the Minister of the fact
and shall permit no further
increase, whether directly or indirectly, in the Reserve Bank‘s advances
and holdings referred
to in subsection (2):
Provided that the Minister may direct the Reserve Bank to permit temporary further increases in total of the advances, holdings and credits referred to in subsection (2) subject to an overall limitation of 40 percent of the average annual ordinary revenue to Government for a period not exceeding 6 months and the Reserve Bank shall thereupon give effect to that policy while the direction remains in operation.
Policy directives
52. The Minister
may, after consultation with the Board, issue to the Reserve Bank such written
directives of a general nature as may
be necessary to give effect to the
economic policies of the Government, and the Reserve Bank shall comply
therewith.
Depository and fiscal agency of international financial Institutions and supranational organisations
53. The Reserve Bank
shall, upon the designation by the Minister, serve as the depository and fiscal
agency of, and the institution
through which dealings shall be conducted with,
international financial institutions and supranational organisations of which
Fiji
is a member.
PART X ACCOUNTS AND STATEMENTS
Financial year
54. The financial
year of the Reserve Bank shall coincide with the financial year of the
Government.
Accounts
55.
– (1) The accounts of
the Reserve Bank shall be audited by auditors appointed annually by the Board
with the approval of the Minister.
(2) In its accounts,
the Reserve Bank shall not be required to include the face value of any
particular currency in circulation that
the Minister has specified by notice
made under paragraph
(b)
of the proviso to section
31.
Publication of accounts and annual report and monthly return
56.–(1)
The Reserve Bank shall, within 3 months after the close of each financial year,
transmit to the Minister-
(a) a copy of the annual accounts certified by the auditors; and
(b) a report of its operations during that year.
(2)
The Reserve Bank shall cause a copy of the annual accounts to be published in
the Gazette.
(3) The
Minister shall cause a copy of the annual accounts and the report of operations
to be laid before Parliament at the next meeting
subsequent to the submission
thereof.
(4) The
Reserve Bank shall, as soon as may be after the last Wednesday of each month,
make up a return of its assets and liabilities
as at the close of business on
that day and send a copy of the return to the Minister and publish the return in
the Gazette:
Provided that, where a Wednesday is a public holiday, a return shall be as at the preceding working day.
PART XI GENERAL
Exemption from Government taxes and duties
57. The Reserve Bank
shall be exempt from all Government taxes and duties on its profits, purchases,
operations, capital, property transactions
and documents.
National Bank of Fiji and Fiji Development Bank
58. – (1)
Notwithstanding anything to the contrary in the National Bank of Fiji Act, the
provisions of this Act apply to the National
Bank of Fiji. (Cap.213)
(2)
After due consultation with the Fiji Development Bank, any section or subsection
of this Act may be made applicable by the Minister
to that Bank upon a finding
by the Reserve Bank that it is engaging as a substantial part of its business in
the acceptance of deposits
of money from the public.
Prohibited activities
59.
The Reserve Bank shall not-
(a) engage in trade, purchase the shares of any corporation or company, including the shares of any banking company or otherwise have an ownership interest in any commercial, agricultural, industrial, or other undertaking except such interest as the Reserve Bank may acquire in the course of satisfaction of debts due to it:
Provided that all such interest so acquired shall be disposed of at the earliest suitable opportunity;
(b) purchase, acquire or lease real property except so far as the Reserve Bank shall consider it necessary or expedient for the provision or future provision of premises for the conduct of its business and for the housing of, and amenities for, its staff and similar requirements incidental to the performance of its functions under the provisions of this Act:
Provided that the Reserve Bank may let real property or premises not immediately required for the conduct of its business or for the housing of and amenities for its staff and similar requirements.
Banking Act
60. The
Reserve Bank shall not be subject to any of the provisions of the Banking
Act. (Cap.212.)
Prohibited names
61. Save with the
written consent of the Minister on the recommendation of the Reserve Bank, no
bank shall hereafter be licensed under
the Banking Act by a name which includes
any of the words "Central", "Fiji", "Fijian National", "National", "Reserve" or
"State"
or their equivalent in any other language. (Cap.212.)
Bank holidays
62.–(1)
If the Reserve Bank considers it necessary or expedient in the public interest,
it may by order declare any day a non-business
day for financial institutions.
(2) Without
prejudice to subsection (1), the Reserve Bank may in the event of hurricane,
earthquake or other natural disaster declare
in such manner as it considers
appropriate any day a non-business day for financial institutions, which
declaration may relate to
any part of or to the whole of Fiji.
(3) Any day declared to be a non-business day under this section
shall be regarded as a bank holiday for the purposes of the Bills
of Exchange
Act. (Cap.227.)
PART XII REPEAL
Repeal and saving
63. The Central
Monetary Authority of Fiji Act, 1973 is repealed:
Provided that all
subsidiary legislation made thereunder and in force at the time of coming into
force of this Act shall be deemed
to have been made under this Act and shall
continue in force until other subsidiary legislation shall be made by virtue of
this Act.
Controlled by Ministry of Finance
------------------------------------------
PacLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.paclii.org/consol_act/rbofa179