CENTRAL BANK OF SEYCHELLES ACT, 2004

CENTRAL BANK OF SEYCHELLES ACT, 2004

Arrangement of Sections

PART I

PRELIMINARY

1.Short title.

2.Interpretation.

PART II

ESTABLISHMENT, AUTONOMY, OBJECTIVES AND FUNCTIONS OF THE BANK

3.Establishment of the Central Bank of Seychelles.

4.Objectives of the Bank.

4A.Functions.

PART III

BOARD OF DIRECTORS, HEAD OFFICE AND BRANCHES

5.The Board of Directors.

6.The Governor, Deputy Governors, Members.

7.Disqualification removal, resignation etc. of members.

8.Rules.

9.Proceedings of the Board.

10.Avoidance of conflict of interests.

11.Confidentiality.

12.Protection of acts in good faith.

13.Head office and branches of Bank.

PART IV

CAPITAL, PROFITS AND RESERVES

14.Authorised capital of Bank.

15.General Reserve.

16.Distributable earnings.

PART V

SEYCHELLES CURRENCY

17.Unit of currency.

18.Legal tender.

19.Bank sole authority.

20.Issue of notes and coins.

21.Design etc. of currency.

22.Proceedings relating to currency notes and coins.

23.Demonetisation.

24.No right to recover value of lost or mutilated notes or coins.

PART VI

OFFICIAL FOREIGN RESERVES, FOREIGN EXCHANGE RATE REGIME AND
FOREIGN EXCHANGE OPERATIONS

25.Official foreign reserves.

26.[Repealed]

27.Transactions of the Bank.

28.[Repealed]

PART VII

RELATIONS WITH BANKS AND OTHER FINANCIAL INSTITUTIONS

29.Deposits with and lending by the Bank.

30.Clearing and payment systems.

31.Monetary reserve requirements.

PART VIII

COLLECTION OF INFORMATION AND STATISTICAL DATA

32.Bank’s power to collect information.

32A.Credit Information System.

PART IX

VERIFICATIONS, EXAMINATIONS AND INSPECTIONS

33.Verification of information.

PART X

RELATIONS WITH THE GOVERNMENT AND GOVERNMENT AGENCIES

34.Functions as agent of Government.

35.[Repealed].

36.International cooperation.

37.Mutual consultation.

38.Advice and report by the Bank.

39.Consultation on budget.

40.Advances to Government.

40A .–

41.Purchase of treasury bills etc.

42.Debt securities issued by Bank.

43.Bank’s market operations.

PART XI

OTHER ACTIVITIES

44.Activities Bank may not engage in.

PART XII

BUDGET AND ACCOUNTING

45.The budget of the Bank.

PART XIII

INTERNAL AUDIT

46.Internal audit.

PART XIV

AUDIT OF ACCOUNTS

47.Audit of accounts.

48.Reports for public information.

PART XV

Taxes, REGULATORY POWERS AND APPEALS

49.Exemption from taxes.

50.Regulations.

51.Repeal of Cap 26.

12 of 2004,

25 of 2008,

8 of 2009,

12 of 2009,

13 of 2009,

13 of 2011.

AN ACT to repeal and replace the Central Bank of Seychelles Act, 1982.

[Date of commencement: 28th December 2004]

PART I

PRELIMINARY

1. Short title.

This Act may be cited as the Central Bank of Seychelles Act, 2004.

2. Interpretation.

In this Act—

“authorised capital” means the authorised capital defined in section 14;

[Ins by s 2(a)(i) of Act 8 of 2009 w.e.f. 1 June 2009.]

“the Bank” means the Central Bank of Seychelles established by section 3;

“bank” means a bank as defined in the Financial Institutions Act;

“the Board” means the Board of Directors of the Central Bank of Seychelles appointed under section 5;

“Consolidated Fund” means the fund established by article 151 of the Constitution of the Republic of Seychelles;

“Credit Information System” means the credit information system established under section 32A;

[Ins by s 2(a)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

“distributable earnings” means the realised income as determined pursuant to section 16;

[Ins by s 2(a)(ii) of Act 8 of 2009 w.e.f. 1 June 2009.]

“financial institution” means a financial institution as defined in the Financial Institutions Act and, for the purpose of this Act, all branches, agencies and offices of a financial institution in Seychelles are deemed to be one financial institution;

“foreign currency” means the national currency of a foreign country that is fully convertible to other internationally accepted currencies;

“Deputy Governors” means the First Deputy Governor and Second Deputy Governor of the Bank appointed under section 6;

[“Deputy Governor” rep and subs by “Deputy Governors” by s 2(a)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

“General Reserve” means the General Reserve established under section 15;

[Am by s 2(a)(iii) of Act 8 of 2009 w.e.f. 1 June 2009.]

“Government agency” means a statutory corporation or a limited liability company of which the Government holds more than 51 percent of the issued share capital or which is controlled by another limited liability company of which more than 51 percent of the issued share capital is held by the Government;

“Governor” means the Governor of the Bank appointed under section 6;

“marketable securities” means securities matching the prevailing interest and tenure of outstanding government securities;

[Ins by s 2(a)(iv) of Act 8 of 2009 w.e.f. 1 June 2009.]

“monetary liabilities” means notes and coins in circulation, liabilities issued by the Bank and deposits held by the Bank but excluding deposits of Government and international financial institutions.

[“total monetary liabilities” rep and “monetary liabilities” rep and subs by s 2(a)(iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

“notes and coins” means currency notes and coins issued or deemed to have been issued by the Bank;

“statutory capital” means an aggregate of the authorised capital and General Reserves.

[Ins by s 2(a)(iii) of Act 8 of 2009 w.e.f. 1 June 2009.]

PART II

ESTABLISHMENT, AUTONOMY, OBJECTIVES AND FUNCTIONS OF THE BANK

3. Establishment of the Central Bank of Seychelles.

(1) There is hereby established the Central Bank of Seychelles which shall be a body corporate with perpetual succession and a common seal.

(2) The Bank shall, in discharging its functions, act independently and no person shall seek improperly to influence the Board or any of the Bank’s employees, in the discharge of his or her functions or interfere in the activities of the Bank.

[S 3(2) am by s 2(b)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) A member of the Board, or employee of the Bank shall not be influenced in the discharge of his or her functions or seek or take instructions from any person other than the Bank.

[S 3(3) ins by s 2(b)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

4. Objectives of the Bank.

(1) The primary objective of the Bank is to promote domestic price stability;

(2) The other objectives of the Bank are—

(a) to advise the Government on banking, monetary and financial matters, including the monetary implications of proposed fiscal, credit policies or operations of the Government; and

(b) to promote a sound financial system.

[S 4 rep and subs by s 2(c) of Act 13 of 2011 w.e.f. 27 December 2011.]

4A. Functions.

The Bank shall perform functions given to it under this Act, and such other functions as may be given to it by any other written law.

[S 4A ins by s 2(c) of Act 8 of 2009 w.e.f. 1 June 2009.]

PART III

BOARD OF DIRECTORS, HEAD OFFICE AND BRANCHES

5. The Board of Directors.

(1) There shall be a Board of Directors of the Bank which shall be responsible for the policy and affairs of the Bank and in which all the powers of the Bank shall be vested.

(2) The Board shall consist of—

(a) the Governor;

(b) Deputy Governors;

[S 5(2)(b) am by s 2(d)(i) of Act 8 of 2009 w.e.f. 1 June 2009; s 2(d)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(c) the Attorney-General who shall be an ex-officio member of the Board; and

[S 5(2)(c) rep and subs by s 2(d)(i) of Act 8 of 2009 w.e.f. 1 June 2009.]

(d) four other members.

[S 5(2)(d) ins by s 2(d)(i) of Act 8 of 2009 w.e.f. 1 June 2009; am by s 2(d)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) The term of office of the Governor, Deputy Governors and other members of the Board shall be six years and they are eligible for reappointment.

[S 5(3) rep and subs by s 2(d)(iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

6. The Governor, Deputy Governors, Members.

[Am by s 2(e)(v) of Act 13 of 2011 w.e.f. 27 December 2011.]

(1) The Governor, Deputy Governors and the other members of the Board shall be persons of recognised standing and experience in financial matters who hold a professional qualification or university degree.

[S 6(1) am by s 2(e)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(2) The Governor and the Deputy Governors shall be appointed by the President on such terms and conditions as the President may determine and the other members of the Board shall be appointed by the President on the recommendation of the Governor on such terms and conditions as may be determined by the President.

[S 6(2) am by s 2(e)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) The Governor or, in his or her absence, the First Deputy Governor and in the absence of the Governor and the First Deputy Governor, the Second Deputy Governor shall—

(a) preside at the meetings of the Board;

(b) be the chief executive officer of the Bank responsible to the Board for the execution of its policy and the day-to-day management of the Bank; and

(c) subject to the provisions of this Act, Rules made in accordance with section 8(1) or any resolution of the Board, have the power to act, contract and sign instruments and documents on behalf of the Bank and to delegate such powers to other employees of the Bank.

[S 6(3) am by s 2(e)(iii) and (iv) of Act 13 of 2011 w.e.f. 27 December 2011.]

7. Disqualification removal, resignation etc. of members.

(1) A person shall not be appointed or remain, as the case, may be, the Governor, Deputy Governors or member of the Board if the person—

[S 7(1) am by s 2(e)(i) of Act 8 of 2009 w.e.f. 1 June 2009; s 2(f)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(a) does not fulfil the requirements of section 6(1);

(b) is a director, employee or shareholder of any bank, other financial institution or other entity under the regulatory jurisdiction of the Bank;

[S 7(1)(b) am by s 2(f)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(c) is mentally or physically incapable of carrying out his or her functions under this Act;

(d) is insolvent or has been declared bankrupt whether in Seychelles or elsewhere or enters into an arrangement or composition with his creditors;

[S 7(1)(d) am by s 2(e)(ii) of Act 8 of 2009 w.e.f. 1 June 2009.]

(e) has been convicted of a felony involving dishonesty whether in Seychelles or elsewhere; or

[S 7(1)(e) am by s 2(e)(iii) of Act 8 of 2009 w.e.f. 1 June 2009.]

(f) is a member of the National Assembly;

[S 7(1)(f) ins by s 2(e)(iv) of Act 8 of 2009 w.e.f. 1 June 2009.]

(g) except for section 5(2)(c), is a person who is an employee of a public body; or

[S 7(1)(g) ins by s 2(e)(iv) of Act 8 of 2009 w.e.f. 1 June 2009; am by s 2(f)(iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(h) is in the service or employment of a political party.

[S 7(1)(h) ins by s 2(e)(iv) of Act 8 of 2009 w.e.f. 1 June 2009.]

(2) Where the Governor, Deputy Governors or a member of the Board, at any time after his or her appointment—

(i) becomes disqualified under subsection (1);

(ii) has been absent without good cause from two or more successive meetings of the Board during a period of twelve months; or

(iii) is convicted of an offence or is found to have committed an act of misconduct in the office which substantially prejudices the interests of the Bank,

the President shall remove him or her from office.

[S 7(2) am by s 2(f)(iv) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) No member of the Board shall be removed from office on any ground other than those specified in subsection (2).

(4) The removal of the Governor, Deputy Governors or other members of the Board shall be subject to judicial review.

[S 7(4) ins by s 2(f)(v) of Act 13 of 2011 w.e.f. 27 December 2011.]

(5) The Governor, the Deputy Governors or a member of the Board may resign his or her office by letter addressed to the President and—

(a) in the case of the Governor or the Deputy Governors giving not less than three months’ notice;

(b) in any other case, giving not less than one month’s notice.

[S 7(4) renumbered as s 7(5) by s 2(f)(vi) and am by s 2(f)(vii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(6) For the purpose of subsection (1)(g), “public body” means a Ministry, department, division or agency of the Government, which is carrying out a governmental function or service.

[S 7(5) ins by s 2(e)(v) of Act 8 of 2009 w.e.f. 1 June 2009; renumbered as s 7(6) by s 2(f)(vi) of Act 13 of 2011 w.e.f. 27 December 2011.]

8. Rules.

(1) The Board may, subject to this Act, make rules—

(a) regulating the meetings of the Board, the functions of members of the Board and such other matters relating to the conduct of the business of the Board as it thinks fit;

(b) regulating the organisation of the Bank, the distribution of functions and responsibilities within the Bank, providing for delegation of decision-making authority and such other internal matters as it considers necessary to ensure the proper and efficient management of the Bank.

(2) The Board may establish, in addition to the audit division referred to in section 46, such other divisions and units as it may deem necessary to assist it in the performance of its functions.

[S 8(2) am by s 2(f) of Act 8 of 2009 w.e.f. 1 June 2009.]

(3) The Board may appoint employees at such remuneration, terms and conditions as it may determine.

[S 8(3) rep and subs by s 2(g) of Act 13 of 2011 w.e.f. 27 December 2011.]

9. Proceedings of the Board.

(1) The Board may meet as often as is necessary for the discharge of its responsibilities under this Act but it shall meet not less than eight times in a year. Meetings of the Board shall be convened by the Governor, First Deputy Governor or Second Deputy Governor acting as the Governor and may also be convened upon the written request of two members of the Board.

[S 9(1) am by s 2(h)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(2) Meetings of the Board shall be convened by notice to members of the Board at least two working days before the date of the meeting except that an emergency meeting of the Board may be convened on shorter notice.

(3) A quorum for a meeting of the Board shall be four members entitled to vote provided that any matter requiring urgent action may be determined by three members entitled to vote present at a meeting acting unanimously. The Board may by rules provide for the holding of meetings of the Board and voting at such meetings by teleconferencing or by any other electronic means of communication.

[S 9(3) am by s 2(h)(ii) and (iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(4) Each member of the Board shall, except for the Attorney-General who shall not have the right to vote, have one vote and the decisions of the Board shall be made by a simple majority of the votes cast by the members present at a meeting. In the event of an equality of votes, the Governor or the First or Second Deputy Governor presiding at the meeting shall have a casting vote.

[S 9(4) am by s 2(g)(i) of Act 8 of 2009 w.e.f. 1 June 2009; s 2(h)(iv) of Act 13 of 2011 w.e.f. 27 December 2011.]

(5) Notwithstanding the Second Deputy Governor has a right of participation at the meetings of the Board he or she shall not have the right to vote except in the absence of the Governor or First Deputy Governor or both.

[S 9(5) ins by s 2(h)(v) of Act 13 of 2011 w.e.f. 27 December 2011.]

(6) The Board may appoint such committees as may be necessary, on such terms and conditions, for the efficient performance, exercise and discharge of its functions, powers and duties.

[S 9(6) ins by s 2(h)(v) of Act 13 of 2011 w.e.f. 27 December 2011.]

(7) Subject to section 48(1), the proceedings of the Board shall be confidential unless the Board decides to publish all or any part of its deliberations or decisions.

[S 9(5) am by s 2(g)(ii) of Act 8 of 2009 w.e.f. 1 June 2009; renumbered as s 9(7) by s 2(h)(vi) of Act 13 of 2011 w.e.f. 27 December 2011.]

(8) Minutes shall be kept of each Board meeting and shall be signed by the Governor, First Deputy Governor or Second Deputy Governor and the secretary of the Board.

[S 9(6) renumbered as s 9(8) by s 2(h)(vi) and am by s 2(h)(vii) of Act 13 of 2011 w.e.f. 27 December 2011.]

10. Avoidance of conflict of interests.

(1) No member of the Board shall act as a delegate or representative of any commercial, financial, agricultural, industrial or other entity or accept directions therefrom in respect of the member’s functions under this Act.

(2) —

(a) The Governor, Deputy Governors and any employee of the Bank shall not accept or perform any assignment outside his or her functions at the Bank without the written approval of the Board;

(b) An approval of the Board in paragraph (a) may be granted only where the assignments do not compromise the functions of the Governor, Deputy Governors or employee and where there is no inconsistency with the other provisions of the Act.

[S 10(2) rep and subs by s 2(i)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) All members of the Board shall fully disclose to the Board any commercial, financial, agricultural, industrial or other interest that they may have in any matter which becomes the subject of consideration or action by the Board. If such interest appears to the Board to constitute a conflict of interests, the relevant member shall refrain from taking any part whatsoever in any decision affecting that matter.

(4) No person, being a member of the Board or employee of the Bank, shall accept any gift, be it in the form of a credit on favourable terms and conditions or otherwise or other monetary or non-monetary advantage for himself or herself or any person with whom he or she may have any family, business or financial connection, which would, if accepted, affect or appear to affect the proper performance of his or her duties under this Act.

[S 10(4) am by s 2(i)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(5) Any person who contravenes any provision of this section commits an offence and is liable on conviction to a fine of R10,000 and to imprisonment for six months.

[S 10(5) am by s 2(i)(iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

11. Confidentiality.

(1) A member of the Board or employee of the Bank shall not disclose to any person any confidential information relating to the affairs of the Bank or any bank or other financial institution or other person, which he or she has acquired in the performance of his or her duties under this Act or any other law, except for the purpose of the performance of his or her duties or when required by law or ordered by a court to do so.

[S 11(1) am by s 2(j)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(2) Any person who contravenes subsection (1) commits an offence and is liable on conviction to a fine of R20,000 and to imprisonment for 1 year.

[S 11(2) am by s 2(j)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

12. Protection of acts in good faith.

(1) A member of the Board or an employee or agent of the Bank shall not be liable for damages for anything done or omitted to be done in good faith in the discharge or purported discharge of his or her functions under this Act or any other Act.

[S 12(1) am by s 2(k)(i) of Act 13 of 2011 w.e.f. 27 December 2011.]

(2) A member of the Board or an employee or agent of the Bank shall be indemnified by the Bank against all costs, losses and expenses incurred by such person in respect of any liability arising from the discharge or purported discharge, in good faith, of any function under this Act.

[S 12(2) am by s 2(k)(ii) of Act 13 of 2011 w.e.f. 27 December 2011.]

(3) The Bank may take such action as it may think fit under the circumstances against any member of the Board or an employee or agent of the Bank referred to in subsection (1) or (2).

[S 12(3) am by s 2(k)(iii) of Act 13 of 2011 w.e.f. 27 December 2011.]

13. Head office and branches of Bank.

(1) The Bank shall have its head office on Mahe and may establish branch offices at other places in Seychelles.

(2) The Bank may appoint agents or correspondents from time to time.

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