International Bank Account Number - Advice on Usage

The European Payments Council (EPC) had previously introduced Regulation 2560/2001 which stipulated that countries in the European Union (EU) and European Economic Area (EEA) must use the SWIFT BIC of the beneficiary bank, (or Payment Services Provider (PSP)) and the international bank account number (IBAN) as the only beneficiary account identifier for all euro denominated cross-border customer payments of €50,000 or under. It also stipulated that any fees levied for any intra-EEA cross-border payment under EUR 50,000 should be levied at a fee consistent with a domestic transfer.

Effective November 1, 2009 this Regulation was immediately succeeded by Regulation 924/2009 which embraces all of the conditions of Regulation 2560/2001 but it allows for each EEA Member State to introduce the Regulation into their own legislation to cover cross-border transactions in their own national currency, and to a limit of local currency equivalent to €50,000 — although this limit will be reviewed within 2 years from the introduction of this Regulation 924/2009. As at October 21, 2009, the only country to have done so has been Sweden but there is a high probability that the other EEA Member States will follow suit, particularly as they are having to pass related payment regulation in the form of the Payment Services Directive.

In order to avoid delay in payment, returned payments or additional charges, J.P. Morgan is recommending that for any payment in an EEA currency, irrespective of the amount, ensure that you quote the SWIFT BIC of the beneficiary's bank (or Payment Services Provider), and the IBAN of the beneficiary. Any third party bank charges incurred due to incorrectly formatted payments will be passed back to the originator.

In order to avoid delay in payment, returned payments or additional charges, please refer to the table below for the latest IBAN position adopted by each currency.

Currency

Country

IBAN Usage for Urgent (WIRE) Payments

Future Plans

Additional Comments

AED

United Arab Emirates

Mandatory wef November 1st 2011

3 month grace period startig from November 1st 2011

Beneficiaries in UAE have to be indentified using an IBAN.

CHF

Switzerland

Highly recommended

Swiss STP Resolution in 2007 seeks measures to promote the IBAN starting January 1, 2010

 

CZK

Czech Republic

Highly recommended

 

 

DKK

Denmark

Highly recommended

 

 

EEK

Estonia

Highly recommended

 

 

EUR

Euro-zone

Highly recommended

 

 

EUR

Italy

Mandatory

March 1, 2010

 

GBP

UK

Recommended

 

 

HUF

Hungary

Highly recommended

 

 

ILS

Israel

Mandatory

 

 

ISK

Iceland

Highly recommended

 

 

KWD

Kuwait

Mandatory

 

 

KZT

Republic of Kazakhstan

Mandatory

 

 

LBP

Lebanon

Mandatory

 

 

LTL

Lithuania

Mandatory

 

 

LVL

Latvia

Mandatory

 

 

NOK

Norway

Mandatory

 

 

PLN

Poland

Highly recommended

 

 

RON

Romania

Mandatory

 

 

SAR**

Saudi Arabia**

Mandatory

 

Mandatory with effect from September 1, 2009.

SEK*

Sweden*

Highly recommended

As of end of 2009, SEK will allow "regulated payments" in a similar way to euros. This change will require BIC and IBAN*.

 

TND

Tunisia

Highly recommended

 

 

TRY

Turkey

Mandatory

 

 


 

*SEK Regulated payments are handled in accordance with EU Regulation on cross-border payments (previously Reg 2560/2001, now Reg 924/2009) and therefore falling under the convention on Interbank Charging Principles. Those principles are as follows: payments to and from customer accounts maintained within the EU, for amounts up to SEK 500 000, charging option SHA only, STP required i.e. BIC code and IBAN number is required, with fields 23E and 72 left empty.

**Mandatory requirement for IBANs in Saudi Arabia extends to all currencies going to a beneficiary bank in Saudi Arabia.

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