Foreign Currency Accounts (Protection) Ordinance, 2001

This 2001 Ordinance protects people who hold foreign currency bank accounts in Pakistan from having those accounts frozen, restricted, or interfered with by the government. Section 2 defines an "authorised dealer" as someone licensed by the State Bank to deal in foreign exchange, and a "foreign currency account" as one opened with such a dealer after 28 May 1998 (the date of Pakistan's nuclear tests, after which such accounts had previously been frozen).

Section 3 is the core protection: no one holding a foreign currency account can be deprived of the right to hold or operate it, or be restricted -- temporarily or permanently -- from lawfully selling, withdrawing, remitting, transferring, using as security, or taking the foreign currency out of Pakistan, whether within or outside the country.

Section 4 shields the Federal Government and any person from lawsuits over actions taken in good faith under the Ordinance. Section 5 gives the Ordinance overriding effect over the Foreign Exchange Regulation Act 1947, the Customs Act 1969, the Income Tax Ordinance 1979, and any other law, while clarifying that its protections are in addition to, not instead of, those already provided by the Protection of Economic Reforms Act, 1992. Section 6 lets the Federal Government make rules in consultation with the State Bank, and the State Bank itself can issue consistent regulations; pre-existing rules and instructions on foreign currency accounts continue to apply where not inconsistent with the Ordinance.

This is an older ordinance (2001) enacted in the aftermath of the 1998 account-freezing episode, so current State Bank regulations and any later amendments should be checked for the up-to-date operational rules governing these accounts.