The Central Bank of Nigeria has provided additional clarifications on the circular concerning the cash pooling of repatriated oil and gas export proceeds by international oil companies.

The apex bank specified the expenses that can be settled from 50 per cent of the repatriated fund, which includes petroleum tax, royalty, domestic contractor invoices, cash calls, domestic loan payments, interest payments, education tax, transaction tax, and forex sales in the Nigerian foreign exchange market.

This announcement comes as a response to the queries raised by banks and other stakeholders regarding the previous circular in February.

This announcement was made through a circular with reference number TED/FEM/PUB/FPC/001/004 uploaded to its website and signed by the Director of the Trade and Exchange Department Dr Hassan Mahmud on Tuesday.

The statement read, “Following recent inquiries by banks and other stakeholders on our circular referenced TED/FEM/PUB/FPC/001/004, in respect of Cash Pooling requests by banks on behalf of IOCs, we provide further clarifications as:

“The initial 50% of the repatriated proceeds can be pooled immediately or as when required. Banks may submit the request for cash pooling ahead of the expected date of receipt, supported by the required documentation, for approval by the Central Bank of Nigeria.

“The 50% balance of the repatriated export proceeds could be used to settle financial obligations in Nigeria, whenever required, during the prescribed 90-day period.

source: https://punchng.com/cbn-clarifies-education-petroleum-tax-for-cash-pooling-settlement/