Foreign Exchange Administration (FEA) Rules ➤Section A: You may make or receive payment: (including cheques issued and

ou may make or receive payment: (including cheques issued and deposited)

Important notice: I. In Malaysian Ringgit in the following scenarios :
You are advised to read and understand the FEA Rules and ensure all activities performed for
accounts maintained with OCBC Bank (Malaysia) Berhad and/or OCBC Al-Amin Bank Berhad Between Resident & Non-Resident Between Non-Residents
comply with the FEA Rules at all times. Settlement of a ringgit asset including any income Settlement of a ringgit asset including any income
and profit due from the ringgit asset and profit due from the ringgit asset
Please note that this is not a complete set of the FEA Rules and they may be revised from time to
time. You are advised to get the full and latest FEA Rules from Bank Negara Malaysia (BNM)’s Settlement of trade in goods Settlement of domestic trade in goods or services
website at [Link] in Malaysia
Settlement of services, in any manner
What is it? Income earned or expense incurred, in Malaysia Income earned or expense incurred, in Malaysia
The FEA rules are a set of rules that are administered by Bank Negara Malaysia (“BNM”) under the Settlement of a commodity murabahah Settlement of a commodity murabahah
Financial Services Act 2013 and Islamic Financial Services Act 2013 to safeguard the value of the transaction between a resident and non-resident transaction between non-resident participants
currency of Malaysia. participant undertaken through a resident undertaken through a resident commodity
commodity trading service provider trading service provider
What is required from me?
•Let us know about your residency status (you will need to declare your status whenever you open Settlement of reinsurance for domestic insurance
an account) business or retakaful for domestic takaful
•Ensure any payments and receipts to/from your account meet the permissible purposes business between a resident and a person
➤ Section A licensed to undertake Labuan insurance or takaful
•Tell us about (i) your domestic ringgit borrowing status and (ii) investment status, when you intend business
to invest in foreign currency assets ➤ Section B
•Ensure any transaction to/from your foreign currency account meets the permissible sources and Settlement of a non-financial guarantee
uses of funds ➤ Section C denominated in ringgit issued by a person
•Obtain BNM’s prior approval if your transaction does NOT meet the permissible purposes listed in licensed to undertake Labuan banking business in
Section A or the sources of funds and the allowable limits listed in Section B and Section C. favour of a resident
•Obtain BNM’s prior approval if you have any dealing or transaction with any Isreali residents or
Isreali-owned or controlled entities or involving the Isreali currency in any manner*. *Applicable to For any purpose between immediate family For any purpose between immediate family
resident and non-resident in Malaysia. More details at [Link] members members

You may submit your application online via BNM’s ‘Foreign Exchange Administration’ website under II. In Foreign Currency in the following scenarios :
the tab ‘Submission of Application and Report’ .
Between Residents
Who does it apply to? Settlement for purchase of onshore foreign currency investment product (offered by licensed onshore
• Residents who are dealing in foreign currencies banks, licensed merchant banks or R entities permitted by the Controller) subject to compliance to
• Non-Residents who are dealing in Malaysian Ringgit, in Malaysia Notice 3
Settlement for foreign currency denominated future contracts traded on Bursa Malaysia subject to
Definition of Resident: Definition of Non-Resident: compliance to Notice 3
Settlement to resident futures broker for purchase of foreign currency denominated derivatives (other
(a) Malaysian citizen; or (a) Non- Malaysian citizen; or than exchange rate derivatives ) on specified overseas exchanges under the Capital Markets and
Services Act 2007, undertaken by a resident with firm commitment subject to compliance to Notice 3
(b) Malaysian citizen with PR status of another (b) Malaysian citizen with PR status abroad and
Settlement of a commodity murabahah transaction between resident participants undertaken through
country but resides in Malaysia; or resides abroad; or
a resident commodity trading service provider
(c) Non- Malaysian citizen with PR status in (c) Foreign embassies, high commissions, Settlement for education or employment overseas
Malaysia and resides in Malaysia; or supranationals, central banks; or Settlement of domestic trade in goods and services by resident exporter to resident SME net importers
as per Supplementary Notice (No.5)
(d) Business enterprises / societies established (d) Business entities established abroad
/ operating in Malaysia

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 II. In Foreign Currency in the following scenarios (cont’d):
II. Investment abroad for your own account (cont’d)
Between Resident & Non-Resident
a) If you are a Resident entity:
A resident is allowed to make or receive payment to or from a non-resident in foreign currency for
any purpose, other than for- Without domestic ringgit borrowing you are allowed to invest in foreign currency assets of any
 A derivative denominated in foreign currency offered by the resident unless it has been amount; or
approved by BNM or allowed under Part B of Notice 5; With domestic ringgit borrowing1 you are allowed to invest in foreign currency assets of
 A derivative denominated in or referenced to ringgit unless it has been approved by BNM or  Any amount using foreign currency funds
allowed under Part B of Notice 5; or • from abroad;
 A derivative denominated in foreign currency offered by the non-resident, except for • from non-resident, other than foreign currency borrowing; or
o A derivative denominated in foreign currency, other than exchange rate derivative with • sourced from FCA (IFCA)
reference to ringgit; purchased by a licensed onshore bank for its own account;  Any amount using foreign currency borrowing obtained from a licensed onshore bank for direct
o An interest rate swap denominated in foreign currency between a resident and Labuan banks investment abroad;
to manage interest rate exposure arising from borrowing in foreign currency as set out in Part  Up to the amount of approved foreign currency borrowing obtained from a non-resident as set out
A of Notice 2; or in Part A of Notice 2;
o A derivative denominated in foreign currency, other than exchange rate derivatives, offered on  Up to the amount of the proceeds sourced from the listing of shares through an Initial Public
a Specified Exchange stipulated under the Capital Markets and Services Act 2007 [Act 671] Offering on the Main Market of Bursa Malaysia; or
undertaken through a resident futures broker by a resident with firm commitment.  Up to RM50 million equivalent in aggregate2 per calendar year
• using foreign currency funds sourced from Trade FCA (TFCA);
• using foreign currency funds sourced from conversion of ringgit; or
• foreign currency borrowing obtained from a licensed onshore bank for purposes other than
Section B: Investment in Foreign Currency Assets
direct investment abroad; or
Some examples of foreign currency (FCY) assets with OCBC Malaysia include FCY Call Account /
• through the swapping of financial assets.
Fixed Deposit, Dual Currency Investment (DCI), FCY Retail Bonds and Overseas Property Financing in
FCY.
1“domestic ringgit borrowing” means borrowing in ringgit obtained by a resident from another resident
excluding –
I. If you are a Resident individual, sole proprietor or general partnership:
a) a borrowing obtained by a resident entity from another resident entity within its group of entities
with parent –subsidiary relationship; and
Without domestic ringgit borrowing is allowed to undertake investment abroad of any amount; or
b) any credit facility or financing (including corporate credit card s and corporate charge cards), and
other facility obtained by a resident entity, which is used for sundry expenses ^ and employees’
With domestic ringgit borrowing is allowed to undertake an investment abroad of expenses ^^ only.
 Any amount using foreign currency funds
• from abroad; ^Sundry expenses refer to expenses that are small in amount and infrequent including office supplies
• from non-resident, other than foreign currency borrowing; or (e.g. stationeries), purchase of ancillary services (e.g. software and online subscription) and other minor
• sourced from FCA II expenses to facilitate daily business operations of the entity.
 Up to RM10million equivalent in aggregate of foreign currency borrowing obtained by the
resident from a licensed onshore bank or a non-resident; or ^^ Employees' expenses refer to business-related expenses which may include, but not limited to travel
 Up to RM1 million equivalent in aggregate per calendar year – (e.g. lodging and transportation), entertainment, health, insurance, Takaful and other employees'
• using foreign currency funds sourced from FCA (TFCA); expenses other than for investment.
• using foreign currency funds sourced from conversion of ringgit; or
2 the
• through the swapping of financial assets RM50 million equivalent refers to investment abroad by the resident entity and other resident
entities within its group of entities with parent-subsidiary relationship.

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 ➤ Section C: Foreign Currency Account (FCA)
Effective 5 December 2016, existing FCA I and FCA II replaced by Trade Foreign Currency Account (Trade FCA) and Investment Foreign Currency Account
(Investment FCA) respectively. The source of funds and uses of funds permissible for each of the FCA is as follows:

I. Resident individual, sole proprietor or general partnership II. Resident Entities

Trade FCA Investment FCA Trade FCA Investment FCA

Source of funds A. Up to the higher of: A. Any amount using foreign A. Up to the higher of: A. Any amount using foreign currency funds –
• 25% of the export proceeds; or currency funds – • 25% of the export proceeds; or • From abroad, other than proceeds from
• an amount from the export proceeds • From abroad, other than • an amount from the export proceeds export of goods
sufficient to meet up to 6 months of its proceeds from export of goods sufficient to meet up to 6 months of its • From a non-resident, other than foreign
import payments with a non-resident, • From a non-resident, other than import payments with a non-resident, currency borrowing
loan/financing repayments, other foreign currency borrowing loan/financing repayments, other • Foreign currency borrowing from a licensed
current transactions in foreign currency B. Up to RM10 million equivalent of current transactions in foreign currency onshore bank for direct investment abroad
with a non-resident and payment by a foreign currency borrowing from a with a non-resident and payment by a (DIA)
resident exporter to resident SME net licensed onshore bank or a non- resident exporter to resident SME net B. Up to the amount of –
importer for settlement of domestic resident importer for settlement of domestic • Approved foreign currency borrowing from
trade in goods and services (“Foreign C. Up to RM1 million equivalent1 in trade in goods and services (“Foreign non-resident
Currency Obligations”). aggregate per calendar year using Currency Obligations”). • Foreign currency sourced from Initial Public
This is only applicable if the aggregate funds from – This is only applicable if the aggregate Offering on the Main Market of Bursa
amount of existing balance of your TFCA • Conversion of ringgit amount of existing balance of your TFCA Malaysia
(with OCBC Bank and other banks) and • Swapping of financial assets (with OCBC Bank and other banks) and C. Up to RM50 million equivalent2 in aggregate
the 25% export proceeds are insufficient • Transfer from Trade FCA the 25% export proceeds are insufficient per calendar year on a corporate group basis
to meet the aggregate of your 6 months to meet the aggregate of your 6 months from –
Foreign Currency Obligations. 1This is applicable to resident Foreign Currency Obligations. • Conversion of ringgit
individual, sole proprietor or general • Foreign currency borrowing from a licensed
B. Conversion of ringgit up to six months partnership with domestic ringgit B. Conversion of ringgit up to six months onshore bank for purposes other than DIA
foreign currency obligations on spot basis borrowing only. foreign currency obligations on spot basis • Swapping of financial assets
(excludes payment to resident SME net (excludes payment to resident SME net • Transfer from Trade FCA
importers). importers).
C. Settlement of FX forward contracts. C. Settlement of FX forward contracts. 2Thisis applicable to resident entities with
D. Other foreign currency funds. D. Receipt by a SME net importer for domestic ringgit borrowing only
settlement of domestic trade in goods and
services from a resident exporter.
E. Other foreign currency funds.
Uses of funds A. Foreign currency obligations Any purpose
• Import payment
• Foreign currency loan repayment
B. Transfer into Investment FCA subject to A. Foreign currency obligations Any purpose
investment limit • Import payment
C. Other current international transactions • Foreign currency loan repayment
D. Payment by a resident exporter to B. Transfer into Investment FCA subject to
resident SME net importer for settlement of investment limit
domestic trade in goods and services C. Other current international transactions
D. Payment by a resident exporter to
Disclaimer: resident SME net importer for settlement of
This information is for general reference only. If you require the information for any purposes, please refer to domestic trade in goods and services
the FEA Rules published at Bank Negara Malaysia’s website and obtain (as required) independent advice.
OCBC Bank (Malaysia) Berhad and OCBC Al-Amin Bank Berhad accept no liability for any part of this
document.
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Under the Supplementary Notice (No.4) of Foreign Exchange Administration Rules dated 17 August 2018 and Supplementary Notice (No.5) of Foreign Exchange Administration Rules dated 27 March 2019
read with the related FAQs (“FEA Rules”) where resident exporters are permitted to retain the foreign currency proceeds from export of goods in Trade Foreign Currency Account (“TFCA Account”) up to
the higher of:
• 25% of the export proceeds; or
• Aggregate of 6 months import payments with non-residents, foreign currency loan/financing repayments, other current account transactions in foreign currency with a non-resident and payment by a
resident exporter to resident SME net importers for settlement of domestic trade in goods and services (“Foreign Currency Obligations”).
This is only applicable if the aggregate amount of existing balance of your TFCA (with OCBC Bank and other banks) and the 25% export proceeds are insufficient to meet the aggregate of your 6 months
Foreign Currency Obligations.

Please ensure that you have put in place systems/processes and internal controls to ensure compliance with the requirements before making any request below to the Bank. You must also maintain proper
documents/records of your transactions to substantiate your compliance with the Requirements. The Bank or BNM may request the production of such documents/records from time to time.

In consideration of OCBC Bank agreeing to comply with your retention instructions, you hereby warrant and undertake to OCBC Bank:

(a) That you have undertaken your own due diligence and confirm that your instructions previously made and which you may from time to time hereafter make to OCBC Bank to retain Ringgit proceeds
into foreign currency is in compliance with FEA Rules and OCBC Bank may rely on each such instruction to effect the retention;

(b) That you will only issue your retention instructions if the balances in your TFCA Account of OCBC Bank and other banks are insufficient to meet your Foreign Currency Obligations;

(c) That the Foreign Currency Export Proceeds from each of your retention instruction:
i. Will ONLY be used for the purpose of meeting your 6 months Foreign Currency Obligations; and
ii. when the aggregate amount of existing balance of your TFCA (with OCBC Bank and other banks) and the 25% export proceeds are insufficient to meet the aggregate of your 6 months Foreign
Currency Obligations; and

(d) You will retain and submit the supporting documentary evidence to substantiate our Foreign Currency Obligations upon request by OCBC Bank and that all these confirmations/documents given by
yourselves are true and accurate and that OCBC Bank may request for further documentation or evidence and you shall promptly provide such documents to OCBC Bank.

(e) For settlement of domestic trade in goods and services between Resident Exporter (“Resident Payor”) and Resident SME Net Importer (“Resident Payee”), subject to obtaining(1) and (2) below:
(1) Declaration from the Resident Payee that:
a. the Resident Payee is an SME as defined in the “Guideline for New SME Definition” issued by SME Corporation Malaysia in October 2013 (as amended from time to time);
b. the Resident Payee does not have foreign currency export earnings or its annual foreign export earnings are less than its annual foreign currency obligations;
c. the Resident Payee has invoiced or will invoice the Resident Payor in foreign currency

(2) Declaration from the Resident Payor that:

a) the Resident Payor has foreign currency export earnings;
b) the payment in foreign currency to Resident Payee is for the settlement of domestic trade in goods and services.

Source: BNM‘s Website/Foreign Exchange Administration

Please note that under the laws of Malaysia, any person who fails to comply with FEA Rules commits an offence and shall on conviction, be liable to imprisonment for a term not exceeding 10 years or to
a fine not exceeding RM50million or to both.

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