Foreign Exchange (Temporary Restrictions) Act, 1998

This 1998 Act imposed emergency restrictions on foreign currency holdings in Pakistan, effectively freezing the ability to withdraw or transfer foreign exchange people held as of a specific date -- part of the government's response to the economic pressure following Pakistan's May 1998 nuclear tests. Section 2 is the core restriction: notwithstanding the Protection of Economic Reforms Act 1992 or any other law, agreement, or contract, the right to hold, sell, withdraw, transfer, pay, or take out foreign exchange held by any person in Pakistan as of 28 May 1998 (the "specified date") is suspended unless the State Bank of Pakistan gives prior permission. A proviso allows converting that foreign exchange into rupees at the officially notified rate without restriction.

Section 3 preserves the protections and immunities under the Protection of Economic Reforms Act 1992, and allows the Federal Government to grant further concessions on amounts converted from the frozen foreign exchange into rupees, or to issue financial instruments (including bonds) against that foreign exchange, carrying similar entitlements except for the right to immediate repayment in foreign currency.

Section 4 lets the Federal Government make rules empowering the State Bank to suspend repayment rights (except in rupees), arrange profit payments to affected account holders, and classify people by residency or nationality status for these purposes. Until such rules are made, withdrawals and remittances required the State Bank's prior permission.

Section 5 repealed the earlier Foreign Exchange (Temporary Restrictions) Ordinance, 1998 and carried forward existing rules and instructions not inconsistent with the Act.

This is an old, crisis-era statute (1998) tied to a specific historical freeze of foreign currency accounts, and it should be read alongside the later Foreign Currency Accounts (Protection) Ordinance, 2001, which restored many of these rights -- so its restrictions should not be assumed to still be in active effect without checking current law.