The Central Bank of Nigeria has taken a decisive step to strengthen adherence to foreign exchange regulations by suspending requests for extensions on the repatriation of export proceeds. In a circular addressed to Authorized Dealers and the general public, the Acting Director of the Trade and Exchange Department, Dr. W.J. Kanya, announced this latest directive.
Dr. Kanya explained that the decision aligns with the provisions outlined in Memorandum 10A (23a) and Memorandum 10B (20a) of the Foreign Exchange Manual, Revised Edition of March 2018. These provisions govern the repatriation of export proceeds for both oil and non-oil exports.
The move is part of the Central Bank’s broader efforts to ensure strict compliance with foreign exchange rules and stabilize the nation’s economic framework.
The circular said, “With effect from the date of this circular, the Central Bank of Nigeria will no longer approve requests for extension of repatriation of export proceeds by authorized dealers on behalf of their customers. To avoid doubt, proceeds of oil and non-oil exports are to be repatriated and credited into the exporters’ export proceeds domiciliary accounts within 180 days and 90 days from the bill of lading date for non-oil and oil & gas exports respectively.”
This new directive places stricter responsibilities on exporters and their authorized dealer banks to adhere to repatriation rules. Banks must inform their clients of the updated regulations and enforce compliance, with the CBN warning that violations may result in penalties or other regulatory actions.
The CBN cautioned that failure to comply with the policy could lead to sanctions or other regulatory measures. This initiative is part of the bank’s strategy to improve foreign exchange inflows and strengthen the nation’s reserves.
In 2024, the Central Bank of Nigeria introduced stricter forex rules for international oil companies (IOCs), requiring them to repatriate 50% of proceeds immediately and the remaining 50% within 90 days. The CBN also mandated prior approval for cash pooling and detailed expenditure reports, allowing only half of the export proceeds to be pooled while the rest must settle local financial obligations within 90 days.
The CBN’s enforcement of timely export proceeds repatriation is aimed at stabilizing the naira and bolstering foreign reserves, both vital for economic growth and resilience. This directive puts exporters and financial institutions under heightened monitoring, underscoring the CBN’s dedication to maintaining order in foreign exchange management.
