Laws of Zambia Active 2012The Re-Denomination of Currency Act 2012
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Re-Denomination of Currency [No. 8 of 2012 181
THE RE-DENOMINATION OF CURRENCY ACT, 2012
ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY
1. Short title
2. Application and binding of Republic
3. Interpretation
PART II
RE-DENOMINATION OF CURRENCY
4. Re-denomination of Kwacha
5. Prohibition of charges for exchange
6. Circulation of re-denominated and existing currency
7. Risk management and money laundering
8. Display of prices and symbols
9. Treatment of subsisting obligations
10. Presentation of financial statements
11. Re-denomination not to constitute basis for non-performance
of contract
12. Validity of act performed under legal instrument
13. Rounding off
14. Accounting for rounding off differences
PART III
GENERAL PROVISIONS
15. Technological adaptation
16. Inspections
17. General offence and penalty
18. Directives and guidelines by Bank
19. Regulations
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Single copies of this Act may be obtained from the Government Printer.
P.O. Box 30136, 10101 Lusaka. Price K4,000 each
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Re-Denomination of Currency
[No. 8 of 2012 183
GOVERNMENT OF ZAMBIA
ACT
No. 8 of 2012
Date of Assent: 23rd November, 2012.
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Re-Denomination of Currency
[No. 8 of 2012 183
GOVERNMENT OF ZAMBIA
ACT
No. 8 of 2012
Date of Assent: 23rd November, 2012.
An Act to provide for the re-denomination of the existing
currency; effective date of application of the re-
denominated currency; circulation of the existing currency
and re-denominated currency; display of prices in both
the existing and re-denominated currency during the
effective period; application of the re-denominated
currency to acts performed under legal instruments;
treatment of debt obligations and rounding off rules;
technological adaptation connected with the re-
denominated currency; and matters connected with, or
incidental to, the foregoing.
[3rd December, 2012
ENACTED by the Parliament of Zambia.
PART I
PRELIMINARY
1. This Act may be cited as the Re-Denomination of Currency
Act, 2012. Short title
Act, 2012. Short title
2. (1) This Act shall apply to all currency transactions using
the legal tender.
(2) This Act shall bind the Republic. Application
and binding
of Republic
3. In this Act, unless the context otherwise requires—
"appointed date" means 1st January, 2013;
"Bank" means the Bank of Zambia established under the
Bank of Zambia Act; Interpretation
"circulation" means the supply of currency notes and coins
to financial institutions and consumers by the Bank; Act No. 43
of 1996
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184 No. 8 of 2012] Re-Denomination of Currency
Cap. 387
of 1996
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184 No. 8 of 2012] Re-Denomination of Currency
Cap. 387
“effective period” means the period commencing 1st January,
2013 and ending 30th June, 2013;
“existing currency” means the legal tender in circulation prior
to the appointed date which shall remain in circulation
until the expiry date;
“expiry date” means the 30th June, 2013;
“financial service provider” means a bank, financial institution
and financial business registered in terms of the Banking
and Financial Services Act;
“legal instrument” means a document with legal effect;
“legal tender” means the notes or coins made by or issued
under the authority of the Bank;
“re-denomination” means the process of converting the
existing currency whereby the face value of bank notes
and coins is divided by a multiplication of one thousand;
“re-denominated currency” means the legal tender which is
effective from the appointed date; and
“supervisory authority” means—
Cap. 321 (a) the Zambia Revenue Authority established under
the Zambia Revenue Authority Act;
isory authority” means—
Cap. 321 (a) the Zambia Revenue Authority established under
the Zambia Revenue Authority Act;
Act No. 15 of (b) the Registrar of Companies appointed under the
2010 Patents and Companies Registration Agency Act,
2010;
Cap. 387 (c) the Registrar of Banks and Financial Institutions
appointed under the Banking and Financial
Services Act;
Cap. 255 (d) the Registrar of Pensions and Insurance appointed
under the Pension Scheme Regulation Act;
Cap. 354 (e) the Secretary appointed under the Securities Act;
Cap. 119 (f) the Registrar of Societies appointed under the
Societies Act;
Act No. 20 (g) the Registrar of Co-operatives appointed under the
of 1998 Co-operative Societies Act, 1998; and
(h) such other authority as the Bank may, for purposes
of this Act, designate as a supervisory authority or
which may be established by law as a supervisory
authority.
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Re-Denomination of Currency [No. 8 of 2012 185
hed by law as a supervisory
authority.
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Re-Denomination of Currency [No. 8 of 2012 185
Act No. 15 of (b) the Registrar of Companies appointed under the
2010 Patents and Companies Registration Agency Act,
2010;
Cap. 387 (c) the Registrar of Banks and Financial Institutions
appointed under the Banking and Financial
Services Act;
Cap. 255 (d) the Registrar of Pensions and Insurance appointed
under the Pension Scheme Regulation Act;
Cap. 354 (e) the Secretary appointed under the Securities Act;
Cap. 119 (f) the Registrar of Societies appointed under the
Societies Act;
Act No. 20 (g) the Registrar of Co-operatives appointed under the
of 1998 Co-operative Societies Act, 1998; and
(h) such other authority as the Bank may, for purposes
of this Act, designate as a supervisory authority or
which may be established by law as a supervisory
authority.
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Re-Denomination of Currency [No. 8 of 2012 185
hed by law as a supervisory
authority.
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Re-Denomination of Currency [No. 8 of 2012 185
PART II
RE-DENOMINATION OF CURRENCY
4. (1) The existing currency shall be re-denominated as
provided under this section. (2) The re-denomination of the existing currency shall be done
by dividing the nominal value of the existing currency by a
multiplicand of one thousand so that one thousand Kwacha shall
yield a face value of one Kwacha. (3) The re-denominated currency shall become legal tender
from the appointed date. (4) From the appointed date the existing currency shall be
exchanged for the re-denominated currency in accordance with
directives issued by the Bank. (5) The exchange of currency under subsection (4) shall be
made at a financial service provider or other institution designated
by the Bank and at any place designated by the Bank for that
purpose. 5. The exchange of the existing currency for the re-
denominated currency shall be done free of charge. 6. (1) On the appointed date, the Bank shall place the re-
denominated currency into circulation.
nominated currency shall be done free of charge. 6. (1) On the appointed date, the Bank shall place the re-
denominated currency into circulation.
(2) Notwithstanding anything contained in this Act or any other
written law, the existing currency shall continue to be legal tender
until the expiry date after which it shall cease to be legal tender. (3) Subject to subsection (2), the value of the existing currency
shall, until the expiry date, be calculated in accordance with
subsection (2) of section four. 7. Institutions engaged in the exchange of the existing currency
for the re-denominated currency shall establish appropriate risk
management systems and take adequate measures to address
money laundering, financing of terrorism and any other serious
offence. 8. (1) During the effective period, the prices and tariffs of
goods and services shall be displayed in both the existing and re-
denominated currency. Re-denomination of Kwacha
Prohibition of charges
for exchange
Circulation of re-denominated and existing currency
Risk management of money laundering
Display of prices and symbols
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isting currency
Risk management of money laundering
Display of prices and symbols
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186 No. 8 of 2012] Re-Denomination of Currency
(2) The symbol for the re-denominated currency during the
effective period shall be “KR” for purposes of dual display of prices
for goods and services.
Treatment of 9. (1) The value of goods, services, rights and obligations
subsisting existing prior to the appointed date shall be expressed to reflect
obligations the re-denominated currency.
ubsisting existing prior to the appointed date shall be expressed to reflect
obligations the re-denominated currency.
(2) The symbol for the re-denominated currency during the
effective period shall be “KR” for purposes of dual display of prices
for goods and services.
Treatment of 9. (1) The value of goods, services, rights and obligations
subsisting existing prior to the appointed date shall be expressed to reflect
obligations the re-denominated currency. (2) From the appointed date, any person, entity or institution
that maintains records relating to the value of goods, services,
proprietary rights and obligations shall record the values or cause
them to be recorded in the re-denominated currency.
ietary rights and obligations shall record the values or cause
them to be recorded in the re-denominated currency.
(3) From the appointed date, any amount expressed in the
existing currency provided for in an Act of Parliament enacted
prior to the appointed date shall be deemed to be an amount
expressed in the re-denominated currency. (4) From the appointed date, a reference to the existing
currency in any circular, guideline, directive or legal instrument
shall be deemed to be a reference to the re-denominated currency. Presentation of 10. From the appointed date, financial statements for the period
financial prior to the appointed date shall be prepared in the existing currency
statements and all balances brought forward from that period shall be converted
into the re-denominated currency. Re- 11.
ht forward from that period shall be converted
into the re-denominated currency. Re- 11.
(1) A party to a contract shall not rely on the fact of the
denomination re-denomination of currency as an event of frustration or force
not to majeure so as to constitute a reason or excuse for the non-
constitute performance or breach of a contract or payment of compensation. basis for
non- (2) The re-denomination of the currency shall not, for the
performance purposes of this Act or any other written law, be relied upon as an
of contract unforeseeable event relating to the time when an existing contract
was entered into.
of contract unforeseeable event relating to the time when an existing contract
was entered into.
Validity of 12. (1) An act to be performed under a legal instrument shall
act performed continue to be a valid act after the re-denomination of the currency
under legal and shall be given legal effect.
instrument
(2) In this section, “acts to be performed” includes all acts
which are governed by statutory obligations, the submission of tax
declarations, the publication of accounts and the registration of
legal instruments.
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Re-Denomination of Currency [No. 8 of 2012 187
on of accounts and the registration of
legal instruments.
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Re-Denomination of Currency [No. 8 of 2012 187
13. (1) An amount converted from the existing currency to the
re-denominated currency shall be rounded off to two decimal
places unless otherwise provided in this Act.
(2) The rounding off referred to in subsection (1) shall be as
follows:
(a) where the third decimal of an amount converted to the
re-denominated currency is equal to or higher than five,
the second decimal shall be raised by one unit; and
(b) where the third decimal of an amount converted to the
re-denominated currency is lower than five, the second
decimal shall remain unchanged.
(3) Wages, salaries, pensions, retirement funds, personal
emoluments and other social benefits of employees accrued in the
existing currency which are paid after the appointed date shall, if
rounded off in accordance with subsection (1), be rounded
upwards.
ich are paid after the appointed date shall, if
rounded off in accordance with subsection (1), be rounded
upwards.
14. Any difference caused by the rounding off of an amount
in any accounting process shall be incorporated into the results of
the financial year to which the accounting process is applied in
accordance with generally accepted accounting principles.
PART III
GENERAL PROVISIONS
15. A person, entity or institution shall, from the appointed date,
ensure that technological systems and infrastructure are adjusted
so that all transactions made and referring to the existing currency
are expressed in the re-denominated currency.
16. (1) The Bank may, in conjunction with any supervisory
authority, carry-out inspections of business entities to ensure
compliance with this Act.
(2) The Bank may require a business entity to provide
compliance reports on their state of readiness for the re-denominated
currency.
he Bank may require a business entity to provide
compliance reports on their state of readiness for the re-denominated
currency.
17. (1) A person shall not exchange existing currency for re-
denominated currency in contravention of this Act.
(2) A person who breaches any condition or requirement under
this Act or contravenes subsection (1) commits an offence and is
liable, upon conviction, to a fine not exceeding five hundred thousand
penalty units or to imprisonment for a period not exceeding five
years, or to both.
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Directives 18. (1) The Bank may, by Gazette notice, in the exercise of
and its functions under this Act, issue guidelines or directives as are
guidelines by necessary for the better carrying out of the provisions of this Act.
Bank
(2) The Bank may, in consultation with supervisory authorities,
make sector specific guidelines or directives as are necessary for
the better carrying out of the provisions of this Act.
ke sector specific guidelines or directives as are necessary for
the better carrying out of the provisions of this Act.
Regulations 19. (1) The Minister may, by statutory instrument, in
consultation with the Bank, make regulations that are necessary to
give effect to the provisions of this Act.
(2) Without prejudice to the generality of subsection (1), the
regulations made thereunder may prescribe offences and penalties
for contravention of, or failure to comply with, the regulations made
pursuant to this Act, not exceeding a fine of five hundred thousand
penalty units or a period of imprisonment not exceeding five years,
or both.Have questions about this law?
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