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Venezuela: Currency controls

Member Advisory

Applicability: Shipowners, Charterers and Traders

The development

The exchange of foreign currency, specifically the United States dollar, in Venezuela has been subject to government control since 2003. Subsequently a multi-tiered exchange rate system was put in to place including the "Sicad I" and "Sicard II" systems. At present there are three official exchange rate systems that operate simultaneously. The Sicad II system allowed national and foreign companies / persons (including P&I clubs) to sell US $ and purchase bolivars.

It has also been reported that there exists a black market in currency exchanges, which is operating outside of the scope of the law of Venezuela.

The Government of Venezuela has sought to reform this system by seeking to introduce a new floating, which started at 172 Bolivars to the US $ and is meant to float freely according to reports.

The three tiered system continues to remain in place, but the Sicad II system (which rated the US $ to 50 bolivars) is being overhauled by these changes.

For members calling at Venezuelan ports, and needing to make local payments, it will be important to continue to monitor these developments as access to currency, exchange markets and rates could be subject to further change.


Venezuelan currency (Source: Skuld correspondents)

Operational risk management

Members are advised to ensure that ships, crews and local agents only use officially sanctioned exchange markets for any currency exchanges. The use of non-government authorised exchanges, i.e.: the black market, is likely to offend against local laws and incur criminal penalties for offenders.

Furthermore, given the possible difficulties that may be experienced with respect to currency issues, it would be prudent for vessels and shore sides to plan ahead, in particular for matters including:

  1. purchase of bunkers
  2. purchase of stores
  3. supply of spares
  4. crew change overs
  5. crew repatriation
  6. attendances on the vessel by superintendents and others

In all circumstances it would be prudent to carefully plan these activities well in advance, particularly if they are likely to occur while making a call to a Venezuelan port.

Further reading

The Association has created a special insight section for Venezuelan related articles.

Members will in particular wish to consider the previous advisory on transportation issues as past issues with respect to currency controls and foreign currency outflows have caused a reduction in the number of international airlines that provide a service to and from Venezuela.

For further information please refer to your usual Skuld contact.

The Association is grateful to Messrs. Matheus & Ulloa, Venezuela as well as correspondents Venepandi for their input to this update.

Christian Ott, Vice President, Head of Claims Skuld Singapore

Kristoffer Kohmann, Vice President, Head of Claims Skuld Oslo 2

For more information about Loss Prevention at Skuld please visit Skuld.com: Skuld Loss Prevention 

Disclaimer

The above article has been produced by or in co-operation with correspondents or other external sources and is reproduced here with their kind permission for general information purposes only. Reference is made to the Legal disclaimer governing use of this website.

Contact

Kristoffer Kohmann

Senior Vice President, Head of Skuld Oslo 2
Direct: +47 22 00 22 43 Mobile: +47 952 92 243 E-mail:


Venezuela
Source: Google Maps