Title: Timor-Leste’s Financial Compliance Regulations: Central Payments Office Issues Bank Licensing Regulation

Subtitle: UNTAET Regulation No. 2000/8 on Bank Licensing and Supervision Strengthens East Timor’s Financial Sector

The United Nations Transitional Administration in East Timor (UNTAET), represented by the Special Representative, has announced the issuance of a new regulation, UNTAET Regulation No. 2000/8, on Bank Licensing and Supervision. This regulation takes a pivotal step towards strengthening the economy in Timor-Leste by providing measures to safeguard bank depositors, prevent systemic risks, and promote a competitive and sound banking sector.

Key Provisions

The new regulations apply to:

Banks
Their shareholders
Administrators
Employees
Agents
Affiliated entities

No unlicensed entities can engage in banking activities in Timor-Leste, including using the term ‘bank’ or its derivatives.

Central Payments Office

The Central Payments Office is solely responsible for:

Issuing bank licenses
Setting minimum capital requirements for licensed banks
Determining financial activities in which they can engage

Minimum Capital Requirements

New banks must meet a minimum capital requirement of $2 million.

Application Process

Applicants must submit the following information for license approval:

Qualifications
Business plans
Financial statements
Other required information

Objectives and Benefits

These measures aim to:

Establish a legal framework for effective bank oversight
Minimize fraudulent activities
Ensure the stability of the financial sector
Attract foreign investors
Contribute to the development of a robust and competitive banking sector in Timor-Leste

For further information, please contact:

The Central Payments Office
The United Nations Transitional Administration in East Timor