Zambia
Bank of Zambia Act, 2022
Act 5 of 2022
- Published on 29 July 2022
- Assented to on 29 July 2022
- Commenced
- [This is the version of this document from 29 July 2022.]
Part I – Preliminary provisions
1. Short title and commencement
This Act may be cited as the Bank of Zambia Act, 2022, and shall come into operation on the date appointed by the Minister by statutory instrument.2. Interpretation
In this Act, unless the context otherwise requires—"active politics" has the meaning assigned to the words in the Benefits of Former Presidents Act;[Cap. 15]"associate" has the meaning assigned to the word in the Anti-Corruption Act, 2012;[Act No. 3 of 2012]"Bank" means the Bank of Zambia established under the Constitution and continued in existence under section 3;[Cap. 1]"bank" has the meaning assigned to the word in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"banking business" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"Board" means the Board of Directors of the Bank constituted under the Constitution;[Cap. 1]"emoluments" has the meaning assigned to the word in the Constitution;[Cap. 1]"Emoluments Commission" mean the Emoluments Commission established by the Constitution;[Cap. 1]"financial business" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"financial institution" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"financial service" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"financial service provider" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"financial intermediary" means an entity that provides a financial service and facilitates a financial transaction among persons;"Financial Stability Committee" means the Financial Stability Committee established under section 31;"financial system" means a set of financial intermediaries, financial markets and financial infrastructure that facilitates the exchange of funds and assets among persons;"financial system stability" means the financial system's resilience to shocks and its ability to smoothly conduct its core tasks of intermediation of financing, transmission of payments, pricing of instruments and redistribution of risks;"general reserve fund" means the general reserve fund of the Bank continued and maintained under paragraph 10 of the First Schedule;"legally disqualified" means the absence of legal capacity as provided under section 4 of the Mental Health Act, 2019;[Act No. 6 of 2019]"macro-prudential" means the use of prudential tools to limit systemic risks by strengthening the resilience of the financial system and decreasing the build-up of vulnerabilities, there by ensuring a sustainable contribution of the financial sector to economic growth;"member" means a person appointed as a director of the Board in accordance with section 7;"Monetary Policy Committee" means the Monetary Policy Committee established under section 27;"official international reserves" means the reserves specified under section 53;"ordinary revenue" means revenue from taxes, levies, royalties, fees, duties, rents, profits and income from any investment or any undertaking by the Government, Government institutions and agencies, statutory bodies and local authorities, but does not include any funds raised by way of borrowing, grants in cash or in kind, or any other form of economic assistance""payment service provider" means a person licensed or authorized by the Bank under the National Payment Systems Act, 2007, to provide a service or system that facilitates the transfer of funds from one person to another using various forms of payment instruments;[Act No. 1 of 2007]"payment system" has the meaning assigned to the words in the National Payment Systems Act, 2007;[Act No. 1 of 2007]"public officer" has the meaning assigned to the words in the Constitution;[Cap. 1]"regulated entity" means a person licensed under the Banking and Financial Services Act, 2017, the National Payment Systems Act, 2007, and the Credit Reporting Act, 2018 to carry out a licensed activity;[Act No. 7 of 2007; Act No. 1 of 2007; Act No. 8 of 2018]"regulatory statement" has the meaning assigned to the words in the Banking and Financial Services Act, 2017;[Act No. 7 of 2017]"relative" has the meaning assigned to the word in the Anti-Corruption Act, 2012;[Act No. 3 of 2012]"repealed Act" means the Bank of Zambia Act, 1996;[Act No. 43 of 1996]"revaluation reserve account" means a reserve account maintained in the financial records of the Bank to which unrealised gains and losses from gold, special drawing rights, foreign currency or other financial instruments are transferred from the income statement;"secondary market" means the market where persons trade the previously issued debt securities;"securities" has the meaning assigned to the word in the Securities Act, 2016;[Act No. 41 of 2016]"superior court" has the meaning assigned to the words in the Constitution;[Cap. 1]"supervisory authority" has the meaning assigned to the words in the Financial Intelligence Centre Act, 2010; and[Act No. 46 of 2010]"systemic risk" means the risk of disruptions to the provision of banking and financial services that is caused by an impairment of all or parts of the financial system and can cause serious negative consequences for the real economy.Part II – Administration of the Bank of Zambia
3. Bank of Zambia
4. Capital and ownership of Bank
5. Additional functions of Bank
6. Prohibited activities
Except as otherwise expressly authorized by this Act, the Bank shall not—7. Board of Directors
8. Functions of Board
9. Delegation of functions of Board
The Board may delegate to the Governor any of the Board's functions under this Act.10. Governor
11. Deputy-Governor
12. Prohibition of Governor and Deputy-Governor to engage in other business, profession or employment
13. Resignation or removal of Governor or Deputy-Governor
14. Staff of Bank
The Board shall appoint the staff of the Bank that the Bank considers necessary for the performance of its functions.15. Emoluments and other terms and conditions of service of Governor, Deputy-Governor and other staff
Part III – Monetary unit, banknotes and coin issue
16. Currency of Republic
17. Authority to issue bank notes and coins
18. Legal tender
19. Currency features
The Bank shall, in consultation with the Minister, determine by regulation the face value, measures, weights, designs and other features of a banknote and coin that is legal tender.20. Currency production safekeeping and inventory
21. Currency exchange
22. Management of unfit currency
23. Exchange of forged, lost, or stolen banknotes or coins
24. Accounting treatment of currency issued
The aggregate amount of circulating banknotes and coins shall be noted in the accounts of the Bank as a liability of the Bank, which liability shall not include banknotes and coins in the currency reserve inventory.25. Currency recall
26. Counterfeit notes and coins
Part IV – Monetary policy
27. Monetary Policy Committee
28. Composition of Monetary Policy Committee
29. Publication of statement of decisions
30. Publication of minutes
The Monetary Policy Committee may, after each meeting, publish minutes of the meeting in a manner that the Bank considers appropriate.Part V – Financial stability
31. Financial Stability Committee
32. Composition of Financial Stability Committee
33. Cooperation with other supervisory authorities
The Bank may, for the purposes of promoting financial stability under this Part—34. Publication of Financial Stability Report
Part VI – Bank's relationship with Government
35. Advisor to Government
36. Banker to Government
37. Fiscal Agent
The Bank—38. Advances to Government
The Bank shall not advance funds to the Government except as provided in section 39 and on terms and conditions that may be agreed between the Bank and the Minister.39. Limitations on lending to Government
40. Acquisition of securities issued or guaranteed by Government
41. Management of public debt
The Bank shall act as an agent for the Government in the payment of interest and principal debt in respect of the issue and management of the public debt of the Republic, when authorized by the Minister or by law to do so, and on terms and conditions that may be agreed by the Minister and the Bank.42. Consultation and exchange of information
Part VII – Bank's relationship with financial service providers
43. Banker to banks and financial institutions
The Bank may operate accounts for banks and financial institutions on terms and conditions, that the Board may determine.44. Bank's service to financial service providers
45. Publication of Bank's rates
The Bank may fix and publicly announce the rates for discounts, re-discounts, advances, loans or overdrafts.46. Cash reserve requirement for financial service provider
47. Minimum liquidity asset ratios and reserve requirements
48. Disclosures by financial service providers
49. Consultation with financial service providers
The Bank may, at any time, consult with financial service providers on any matter that the Bank considers necessary.50. Money market and foreign exchange market
51. Regulation and supervision of financial service providers
The Bank may perform regulatory and supervisory functions and exercise powers that may be assigned to, or conferred on the Bank, by the Banking and Financial Services Act, 2017 or any other written law.[Act No. 7 of 2017]Part VIII – International reserves and foreign exchange operations
52. Exchange rate policy
53. Maintenance of official international reserves
54. Bank depository of external assets
The Bank shall be the sole depository of official international reserves and may designate agents with whom these reserves may be held.55. Authorized transactions and limitation of contracting parties
Part IX – Regulation and supervision of payment systems
56. Mandate over payment system
57. Regulation and supervision of payment system
The Bank may perform regulatory and supervisory functions and exercise powers that may be assigned to, or conferred on the Bank by the National Payment Systems Act, 2007 or any other written law regulating payment systems.[Act No. 1 of 2007]Part X – General provisions
58. Furnishing of information
59. Oath or affirmation of secrecy
A person appointed under this Act or employed by the Bank shall take and subscribe before a Commissioner of Oaths an oath or affirmation of secrecy as set out in the Fifth Schedule of this Act.60. Confidentiality
61. Examination of financial or payment system service providers
The Bank shall carry out, periodically or at times that the Bank may consider necessary, an examination of any financial service provider or payment system provider in accordance with the Banking and Financial Services Act, 2017, the National Payment Systems Act, 2007 or any other written law.[Act No. 7 of 2017; Act No. 1 of 2007]62. Exemption from taxes
63. Restriction on execution against property and assets of the Bank
Despite anything to the contrary contained in any written law, where any judgement or order has been obtained against the Bank, an execution or attachment, or similar process shall not be issued against the Bank or against any property or asset of the Bank, except that the Bank may cause to be paid amounts that may, by the judgement or order, be awarded against the Bank to the person entitled to the judgment or order.64. Restriction of liability
A liability shall not lie against the Bank for exercising a statutory duty imposed on the Bank under this Act or by any written law.65. Fees and recovery of expenses
The Bank may prescribe the fees to be charged and expenses to be recovered by the Bank arising from the carrying out of the Bank's duties or operations under this Act or any other written law.66. Offences relating to directorship and acceptance of gifts
67. Offences relating to currency
68. Offences relating to non-disclosure of information or furnishing of false information
69. General penalty
A person who commits an offence under this Act for which no penalty is provided is liable, on conviction, to a fine not exceeding five hundred thousand penalty units or to a term of imprisonment not exceeding five years, or to both.70. Administrative penalties
71. Offences by principal officers of body corporate or unincorporate body
Where an offence under this Act is committed by a body corporate or unincorporate body, with the knowledge, consent or connivance of a director, manager or shareholder of that body corporate or unincorporate body that director, manager or shareholder is liable, on conviction, to the penalty specified for the offence.72. Liquidation, dissolution or winding up of Bank
The Bank shall not be liquidated, dissolved or wound up other than by the Constitution.[Cap. 1]73. Regulatory statement
The Bank may issue regulatory statements for or with respect to any matter that by this Act is required or permitted by the Bank, or that is necessary to be prescribed for purposes of carrying out or giving effect to this Act.74. Regulations
75. Repeal of Act No. 43 of 1996 and savings and transitional provisions
History of this document
29 July 2022 this version
Assented to