As of September 2020, holders of foreign assets and liabilities accounts have mandatory weekly and monthly reporting requirements to the Central Bank of Aruba (CBA).
Let us assist you with reporting the foreign exchange commission for payments abroad to CBA.
Introduction of mandatory weekly and monthly Foreign Assets and Liabilities Accounts Reports
Following the adverse economic and financial developments resulting from the COVID-19, resident holders of Foreign Assets and Liabilities Accounts (FALAs) have to submit a weekly and monthly FALAs report replacing the quarterly FALAs report as of September 2020. These reports will allow the CBA to monitor the development in the international reserves of Aruba more closely.
The weekly FALA consists of balances and transactions related to notified Foreign Bank Accounts, Foreign Intercompany Accounts, and Wealth Management Accounts. The deadline for the first submission will be on September 23, covering the information for September 1-20. Thereafter, the weekly FALA is due within three business days after the end of the reporting week (ending on Sunday).
The monthly FALA consists of all sheets of the quarterly FALA. The first submission, for the months of July and August 2020, will be due on September 23, 2020. Thereafter, the monthly FALA is due on the 15th of the subsequent month after the end of each reporting month.
Pursuant to article 2, paragraph 1, of the State Ordinance Foreign Exchange Commission (SOFEC), residents and companies of Aruba shall pay the Government of Aruba (GOA) a commission by the name of “foreign exchange commission” for payments to abroad.
Pursuant to article 5 of the SOFEC, the CBA is entrusted with the levy and collection of the FEC in accordance with the provisions of the SOFEC. Residents have to pay the FEC directly to the CBA or through an institution that has been designated pursuant to article 4 of the SOFEC by the CBA.
Payments to abroad are defined as:
- Payments with domestic instruments, e.g. cash Afl;
- Payments through the debit of an account denominated in Afl;
- Payments with foreign instruments of payment,e.g. USD/EUR;
- Payments through the debit of a foreign currency account, e.g. USD resident account;
- Payments made through the debit of an account denominated in foreign currency held abroad (foreign bank account), or through the debit of a current account with a person or company domiciled abroad (foreign intercompany account), whether electronically or not.
Rate of the FEC
Article 3 of the SOFEC states that the rate of the FEC amounts to 1.3 percent of the amount expressed in Aruban florin of the payment to a non-resident. Official selling rates are used for the conversion of foreign currency to Aruban florin (e.g. for USD 1 x Afl. 1.80).
Fine for non-compliance
Infringement of the above mentioned shall be punished with imprisonment not exceeding six months and/or a fine not exceeding twenty-five thousand florins.
The Central Bank of Aruba may impose a fine and/or freeze your bank account if you do not comply with these reporting requirements.
Companies that have to pay the FEC commission:
- A company established on Aruba that transfers money from Aruba to any foreign bank account;
- A company that makes payments from a denominated account held abroad (foreign bank account) to a person or company domiciled abroad (foreign intercompany account), whether electronically or not.
Let’s say company X transfers the equivalent of AWG 30,000 to their bank account in the United States, they will have to pay 1.3% over the AWG 30,000 to the central bank. This equates to AWG 390.-
Call to Action
Email us at email@example.com or call us at +297-527-5500 for a quotation regarding the compilation of the required FEC/FALA reports. We will compile the reports and tell you exactly what amount you have to pay the central bank.
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