DEPOSITED BY THE

UNITED STATES OF AMERICA

British Bank of Iran and the Middle East, with branches at Damascus and Aleppo.

Rafidain Bank, with branches at Damascus and Aleppo.

Arab National Bank, Ltd., at Damascus.

Albert Homsi Bank, at Aleppo.

Aswad Bank, at Aleppo.

Bank of Latakia, S.A.S., at Latakia.

Banque Commerciale, S.A.S., at Damascus.

Credit Lyonnais, with branches at Aleppo and Da

mascus.

Banque Libanaise pour le Commerce, S.A.L., at Da

mascus.

Societe des Banques Reunies, S.A.S., with branches at Damascus and Aleppo.

Banque al-Ahli, Fonciere, Commerciale et Industrielle, S.A.L., with branches at Damascus and Aleppo.

Banco di Roma, with branches at Damascus and Aleppo.

Cairo Bank, S.A.E., with branch at Damascus. Banque Intra, S.A., with branch at Damascus. Saudi National Commercial Bank, with branch at Damascus.

Cedrit Foncier d'Algerie et de Tunisie, with branches at Damascus, Aleppo, and Latakia.

The bank at which the letter of credit is opened must have the importer cover at least 15 percent of the value of the letter of credit if the goods intended to be imported are for industrial or agricultural purposes and at least 30 percent if the goods are for other commercial purposes.

The Syrian importer or the foreign exporter's agent should submit shipping documents to the Ministry of National Economy or to one of its regional offices, as well as a certificate issued by the Syrian bank with which the letter of credit was opened. This certificate should attest that the letter of credit was opened with the bank and that the shipping documents were sent direct to the bank from the foreign bank handling the letter of credit.

Imports to be paid through a bank against delivery of shipping documents.-If merchandise is imported without opening a letter of credit, but on agreement that the bank will receive full payment against delivery of the shipping documents, the shipping documents should be sent direct from the foreign bank to the Syrian bank, and payment should be made through the Syrian bank. If this procedure is followed, the Syrian importer should submit the following additional documents to the Ministry of National Economy or to one of its regional offices:

1. A certificate executed by the Syrian bank attesting that the shipping documents were sent direct from the country of origin and stating the method of payment used.

2. A certificate delivered by the foreign bank that sent the shipping documents, stating what method of payment the importer used.

3. A statement by the Syrian importer that he has not opened a letter of credit outside Syria.

Imports against delivery of the shipping documents through a bank, without payment.-If the import is to be made without opening a letter of credit, and the shipping documents are to be delivered through a bank without payment, the Syrian importer should submit the following documents to the Ministry of National Economy or to one of its regional offices, in addition to the shipping documents:

1. A certificate delivered by the Syrian bank handling the shipping documents, certifying that it has received them direct from the exporting country.

2. A certificate issued by the foreign bank that forwarded the shipping documents, specifying the country of origin of the merchandise and the method of payment used.

3. A statement from the importer supported by documents in evidence of the method of payment used.

4. A statement by the importer that he has not opened a letter of credit outside Syrian territory.

Imports against direct delivery of the shipping documents to the importer or exporter's agent, without the use of a bank. This example applies to imports of merchandise without opening a letter of credit, in which delivery of the shipping documents is made by the foreign exporter to the Syrian importer or to the foreign exporter's agent without using a bank and without receiving payment for the merchandise.

In such transactions, the foreign exporter agrees to postpone payment for a specified period, or accepts à promissory note from, or a draft drawn on, the Syrian importer. The Syrian importer should submit a statement of the facts, enclosing correspondence supporting any claimed postponement of payment, or giving evidence that he has signed promissory notes, or that drafts have been drawn on him.

If the shipping documents are forwarded direct and the Syrian importer has paid in advance or will pay in the future, the importer should furnish a statement on the method of payment that has been or will be followed (i.e., if by draft, check, or transfer of funds). He should specify the date of settlement and its methods, the name of the bank or the foreign exchange broker established in Syria through whose intermediary this settlement was or will be made, and the name of the bank abroad, together with pertinent documentary evidence.

In either of the two foregoing situations, the shipping documents must arrive either to the order of the Syrian importer or the foreign exporter's agent (representative)-not "to order," without further specification, or in the name of the exporter.

Violations

Any violation of the above regulations will make the offending party liable to refusal of permission to effect entry of the merchandise involved into Syria and to application of the dispositions and penalties provided in the regulations of the Ministry of National Economy. If the goods are shipped prior to the importer's acquisition of an import license, clearance of the goods involved will be delayed for 1 month in the customs depots to which they are destined to arrive. This penalty does not apply to goods shipped to the Free Zone and to the following items:

1. Goods imported by diplomatic, consular, and international missions and their staff.

2. Presents.

3. Commercial samples and advertising materials. 4. Travelers' effects that accompany passengers. 5. Goods returned from abroad.

6. Goods imported by Government agencies, Iraq Petroleum Co., Ltd., and Latakia Port Co. and its contractor.

7. Agricultural and industrial machinery spare parts imported for private use.

8. Petroleum products.

9. Goods imported from Turkey, Iraq, Iran, Kuwait, Bahrein, Jordan, and Saudi Arabia via customs posts on Syrian borders.

Syria's Exchange Controls

Foreign exchange controls were introduced in Syria in the first months of World War II. After a number of changes, they were gradually relaxed and in April 1952 were completely recodified. The recodification, with a few subsequent amendments, is still in effect.

Administration of Controls

The Syrian Central Bank is the final authority on all matters pertaining to exchange policy and controls. The Syrian Exchange Office, working under the directives of the Syrian Central Bank and in accordance with the policy drawn by the Council of Money and Credit, applies and executes the laws and regulations in force regarding exchange controls.

The office is headed by a board consisting of a president, designated by the Minister of Finance; of the Governor of the Syrian Central Bank as vice president; of one delegate each of the Ministries of Finance and National Economy as members; and of the Chief of Foreign Relations Department in the Syrian Central Bank as rapporteur.

The Exchange Office's main objectives are to:

1. Stabilize the value of the Syrian pound vis-a-vis foreign exchange by fixing foreign exchange rates.

2. Purchase all excess foreign exchange derived from exports during the export seasons in order to maintain the free market rates at levels fixed by it and preserve foreign exchange in the country.

3. Supply the needs of the various Government agencies to cover the value of their imports and other miscellaneous obligations.

4. Cover the deficit of trade balances resulting from the application of trade and payments agreements concluded between Syria and other countries.

5. Eventually to create a stronger support of the Syrian currency cover.

All imports, with a few exceptions, are subject to a prior license. Foreign exchange for these imports is normally available on the free market. Daily rates of purchase and sale of foreign exchange on the free market are established by the Exchange Office to insure a more stable rate for the Syrian pound throughout the seasons of fluctuations of foreign exchange. All excess foreign exchange, derived from exports, tourism, or remittances, that cannot be absorbed by the free market or banks is purchased by the Syrian Exchange Office. Rates are fixed for the United States dollar, Swiss franc, Belgian franc, pound sterling, French franc, and Egyptian pound. Only when foreign exchange is requested from the Exchange Office to cover an import transaction does the related import license need endorsement by the Exchange Office.

The export of certain commodities (see list in the section, Syria's Export Controls) is subject to guaranty by the exporter that foreign exchange derived from these transactions shall be repatriated and sold to an approved bank in Syria. Only if transportation of exported goods takes place by road to Iraq, Saudi Arabia, Jordan, Bahrein, Kuwait, Yemen, Aden, and

Persian Gulf Protectorates is this guaranty not requested from the Syrian exporter.

Proceeds of export transactions must be obtained in the following currencies prescribed by the Exchange Office: United States dollar, pound sterling, Swiss franc, Belgian franc, French franc, and Egyptian pound. The exporter may use the foreign exchange proceeds to cover his own imports. If he is not engaged in the import trade or cannot utilize all the proceeds, he must sell them or their balance to an approved bank in Syria.

Foreign importers of Syrian products are permitted to maintain nonresident accounts in Syrian banks, and to pay Syrian businessmen for their imports directly from these accounts.

Exchange Rates

Syria has two foreign exchange rates: An official rate, applicable to importations of petroleum products and purchases of local currency by oil companies; and a free market rate. The official rate per United States dollar is £S2.19 for buying and £S2.21 for selling.

The free market rate was pegged in August 1953 at approximately £S3.545 for buying and £S3.585 for selling. The buying rate was raised on November 5, 1956, to £S3.565 per U.S. dollar. These free market rates do not include a legal commission allowed to banks by the Government of £S0.025 for both selling and buying rates.

Syria's Export Controls

Export restrictions were established in Syria in 1952 to safeguard domestic supplies; to control export shipments (to improve and standardize the quality of exported cereals, for instance); to insure the entry into Syria of foreign exchange derived from exports; and to prohibit the export of commodities directly or indirectly to a "hostile country."

Export licenses are obtained from the Ministry of National Economy and are valid for 2 months from the date granted.

In general, locally produced agricultural commodities are subject to export licenses but requirements vary with fluctuations in local and foreign production and demand.

Several of the chief export products, such as cotton (tariff 518), lentils (51b), vetch (51c), wheat (68), barley (71), millet (74), cottonseed (83b12), raw wool (493), vegetable oilseed cake (165), and goat and sheep skin (348 a,b), can be exported only through the port of Latakia.

However, cotton and cereals produced in the Provinces of Homs, Hama, and Damascus and those transported by rail from the Provinces of Deraa, Suweida, Aleppo, Deir-ez-Zor, and Hassetcheh may be exempted from this condition. Cotton and cottonseed may be exported via the port of Beirut during October and December only.

Exports of agricultural products may be made by road to the neighboring countries of Iraq, Jordan, Kuwait, and Saudi Arabia within the limits of 100 metric tons per license.

A list of the goods, including agricultural commodities, that are subject to export licensing and other restrictions follows:

United States Controls

Exports

At present all exports from the United States or its possessions to Syria are subject to the rules and regulations of the Bureau of Foreign Commerce, U.S. Department of Commerce, except for exports of arms, ammunition, and implements of war, which are licensed by the U.S. Department of State; gold and narcotics, licensed by the U.S. Department of the Treasury; and certain source material and facilities for the production of fissionable material, licensed by the Atomic Energy Commission.

Department of Commerce export licenses fall into two categories-general and validated licenses. A general license is a privilege which permits exporters to make certain shipments without applying for or receiving a validated license document. The commodities subject to validated license requirements, as well as all other regulations concerning export control, are shown in the Comprehensive Export Schedule, which is avail

able for examination at any Department of Commerce Field Office, The Comprehensive Export Schedule and amending Current Export Bulletins may be purchased from any Field Office or from the Superintendent of Documents, U.S. Government Printing Office, Washington 25, D.C., at an annual subscription rate, beginning each March 31, of 86 ($1.50 additional for foreign mailing),

Additional information concerning export control requirements for shipments to Syria may be obtained direct, from the Bureau of Foreign Commerce, U.S. Department of Commerce, Washington 25, D.C., or from any of the Department's Field Offices.

Import"

Information on United States import duties is obtainable from the Commissioner of Customs, U.S. Department of the Treasury, Washington 25, D.C., or from local collectors of customs.

Absolute import quota restrictions on commercial products are limited, for the most part, to certain farm products for which officially supported prices in the United States are provided by law. Information on import quotas on controlled dairy products, and on

permits for imports of oats, rye, barley, and wheat for planting purposes, may be obtained from the Import Division, Foreign Agricultural Service, U.S. Department of Agriculture, Washington 25, D.C. Information regarding import quotas on sugar is furnished by the Sugar Division, Commodity Stabilization Service, U.S. Department of Agriculture. Information on other commodities subject to import quotas is available from the Bureau of Customs, U.S. Department of the Treasury. For imports of arms, ammunition, and implements of war, an import license must be obtained from the Office of Munitions Control, U.S. Department of State, Washington 25, D.C.

Other Controls

The Division of Foreign Assets Control, U.S. Department of the Treasury, should be consulted for information on: (1) Foreign Assets Control Regulations, which deal with any trade or financial transactions with communist China or North Korea or with nationals of either country; and (2) Transaction Control Regulations, which prohibit persons in the United States from shipping strategic materials from any foreign country to a Soviet bloc country.

March 1957.

Prepared for publication by Mary P. Forster, Near Eastern and African Division, Office of Economic Affairs; based on a report from Damascus, prepared by F. Tawill and James E. Akins, American Embassy.