Are there any laws or regulations relating to the disbursement of foreign currency loan proceeds into, or the repayment of principal, interest or fees in foreign currency from, your jurisdiction?

Lending & Secured Finance

Croatia Small Flag Croatia

The disbursement of foreign currency loan proceeds into and repayment of principal, interest or fees in foreign currency between residents and non-residents is generally allowed. However, in accordance with the Decision on Payments and Collections in Foreign Means of Payment in the Country enacted by the Council of the Croatian National Bank, the payments and collections in relation to the:

a) purchase and sale of real estate in the Republic of Croatia and stakes in companies headquartered in the Republic of Croatia;

b) purchase and sale of securities listed or issued in the Republic of Croatia, irrespective of their denomination in kuna or in foreign exchange, except securities issued in the Republic of Croatia which are listed abroad (but not applicable to any purchase or sale transactions in the primary market of securities issued by the Republic of Croatia denominated in foreign currency);

has to be made in Croatian kuna.

Czech Republic Small Flag Czech Republic

In general, there are no such regulations. Nevertheless, laws protecting consumers (e.g. consumer shall be informed about the consequences of such disbursement or repayment modalities and possible fees) shall be obeyed.

Finland Small Flag Finland

No, subject to anti-money laundering rules and sanctions.

Germany Small Flag Germany

There are certain notification requirements for certain payments to foreign parties for statistical purposes. Additional restrictions may arise under EU/UN sanction rules. Other than that there are no such restrictions.

Spain Small Flag Spain

When a Spanish resident receives funds from a non-Spanish lender, the Spanish resident must comply with certain reporting requirements (mainly for statistical purposes).

The parties are free to agree the conditions and covenants they deem appropriate. The legal framework is established by Bank of Spain’s Circular 4/2012, which came into effect on January 1, 2013.

Individuals and entities residing in Spain (except payment service providers) engaging in transactions with non-residents in Spain or that have assets or liabilities in countries other than Spain, must inform the Bank of Spain of (i) any transactions they perform with non-residents; and (ii) the balances of assets and liabilities, and any changes in those foreign positions.

With regard to foreign financial loans, post-closing reporting obligations are set if the value of the transactions during the previous year, or the balance of assets and liabilities on December 31 of the previous year, is more than €1 million.

Philippines Small Flag Philippines

The BSP Manual of Regulations on Foreign Exchange Transactions (the “Manual”) governs the disbursement of foreign currency loan proceeds into, and the servicing of the loan principal, interest or fees in foreign currency from, the Philippines.

The Manual regulates the timing of disbursement of foreign currency loan proceeds. For instance, the Monetary Board, a seven member body through which the powers and functions of the BSP are exercised (the “Monetary Board”), requires the registration of foreign loans within 30 days from drawdown date of short term loans and within 6 months from utilization of medium and long term loans. For public sector foreign loans, no disbursement can be made until the loan is approved. In addition to such approval, post-authorization registration of publicly guaranteed private sector loans are required to be made within 6 months from utilization of proceeds.

The Manual also regulates the servicing foreign loans, requiring adherence to the requirements under the Appendix 1.3 of the Manual for servicing of loans reports on loan repayments made for registered loans. The Monetary Board provides the forms and guidelines to be followed in complying with the reporting requirements.

Sweden Small Flag Sweden

There are no restrictions applicable to the disbursement of foreign currency loan proceeds into, or the repayment of principal, interest or fees in foreign currency from, Sweden.

Turkey Small Flag Turkey

With the amendments to the Decree No. 32 and the Capital Movements Circular issued by the Central Bank (the "Capital Movements Circular") effective as of 2 May 2018, Turkish entities which do not generate foreign currency revenues are not allowed to utilise foreign currency denominated loans ("FX Loans"), unless they benefit from the exemptions listed exhaustively under the Decree No. 32 and the Capital Movements Circular.

Further, the Capital Movements Circular sets out that FX Loans may be utilised either in foreign currency or in Turkish Lira. Turkish Lira loans obtained by Turkish residents from abroad cannot be utilised as foreign currency indexed loans and must be repaid in Turkish Lira only.

United States Small Flag United States

Federal law does not impose any currency controls or foreign exchange restrictions. Please note that the U.S. Treasury’s Office of Foreign Assets Control (“OFAC”) administers a number of U.S. economic sanctions and embargoes that target geographic regions and governments, as well as other programs targeting individuals or entities that could be anywhere (such as narcotics traffickers, named terrorists, Foreign Terrorist Organizations, and designated foreign persons who have engaged in activities related to the proliferation of weapons of mass destruction). In addition to targeted countries, OFAC publishes a list of Specially Designated Nationals and Blocked Persons ("SDN list") with whom U.S. persons are prohibited from doing business.

Switzerland Small Flag Switzerland

There are no such laws or regulations in Switzerland.

United Kingdom Small Flag United Kingdom

No, there are no foreign exchange or currency restrictions in the UK which restrict loans being made or repaid in a foreign currency. The English courts do issue judgments in currencies other than pounds sterling, but they may not necessarily in every case award damages for a breach of a loan document in the relevant foreign currency or enforce the benefit of any currency conversion and indemnity provisions in the loan documents.

Jersey Small Flag Jersey

There is no exchange control legislation or regulation in Jersey.

Hong Kong Small Flag Hong Kong

No. There is no foreign exchange control in Hong Kong. There is also no limit or restriction on the disbursement of foreign currency loan proceeds into, or the repayment of principal, interest or fees in foreign currency from, Hong Kong.

Austria Small Flag Austria

There are no restrictions or regulations under Austrian law with respect to foreign currency exchange that deviate from the rules that would apply to an Austrian creditor. The Austrian Financial Market Authority released Minimum Standards with respect to foreign currency loans and expects credit institutions to comply with these Minimum Standards.

Mexico Small Flag Mexico

Parties may denominate loans, disbursements, repayments and fees in Mexican pesos (MXN), U.S. dollars (USD) or any other currency. However, pursuant to the provisions of the Mexican Monetary Law, a debtor (borrower) is entitled to pay and/or satisfy debt obligations by paying in MXN, at the exchange rate applicable to the foreign currency and on the payment date, in the event that such obligation is denominated in any currency other than MXN.

Bosnia & Herzegovina Small Flag Bosnia & Herzegovina

Yes, Law on the Policy of Foreign Direct Investment of BH (available in English), Law on Foreign Exchange Operations of FBH (available in English), Law on Foreign Exchange Operations of RS (available only in local language), Law on Foreign Exchange Operations of BD (available only in local language).

Updated: June 6, 2019