7.2 Realization Timelines, Overdue Reporting & Prosecution

Locked clocks — open the notification, not a 2018 photocopy

The realization clocks in this section are locked to the current Chapter 12 PDF and Notification No. F.E. 1/2022-SB dated 5 January 2022, implemented by FE Circular No. 01 of 5 January 2022 at https://www.sbp.org.pk/circulars/fe-circular-no-01-of-2022, unless a newer official instrument you actually open changes them. This independent OpenExamPrep section opened those sources. Do not answer from a photocopy that still treats 180 days as the default.

F.E. 1/2022-SB is the SBP notification under the Foreign Exchange Rules, 1952, that superseded F.E. 3/2001-SB. Chapter 12 paragraph 6(i) embodies it. FE Circular No. 01 told Authorized Dealers the new clocks apply to transactions they authorize — including electronic or manual Form-E or a PSW Financial Instrument — from 6 January 2022. Earlier transactions follow the instructions in force when they were executed. Payment other than the approved manner — convertible foreign currency in which the AD maintains accounts, or Pakistan rupees from a repatriable non-resident rupee account — needs prior approval of Exchange Policy Department.

The published matrix

Whichever is earlier is the phrase that fails candidates. A DA contract with a due date on day 60 must realize by day 60, not day 120. A sight shipment does not receive 120 days because “the default is 120.” Sight, DP, and CAD are 45 days from shipment.

Usance 120-day LC → 135 days. Current paragraph 6(i) — footnoted to EPD Circular Letter No. 02 dated 1 February 2022 — allows repatriation within 135 days from shipment where the terms of sale or the irrevocable LC provide for payment on 120 days’ usance from the date of shipment. It is not a general 135-day usance for every tenor, and it is not “120 plus the 45-day sight clock.”

180 days is not the default. Paragraph 6(iii), footnoted to EPD Circular Letter No. 05 dated 16 February 2022, is a narrow exception: full export value may be received up to 180 days from shipment only if export bills or export receivables are discounted and sold in forward by the exporter to the Authorized Dealer before shipment or within 14 days from the date of shipment. Booking a forward after day 14, or merely hoping to discount later, does not unlock 180 days. Do not confuse this exception with paragraph 41 B2B2C, which has its own 180-day clock for marketplace warehousing, or with the pre-2022 180-day default. Do not use an older “180-day B2B2C” shortcut as if it were the B2C courier rule. Current paragraph 39(iv) is due date or 60 days from shipment, whichever is earlier.

AD extensions — and the wall after overdue reporting

Paragraph 6(ii) is the only published branch-level extension for early-due terms. Where sale terms provide for payment earlier than 120 days, including DP, CAD, and sight bills, the AD may allow an extension if it is satisfied with a written explanation from the exporter supported by documents or communication from the foreign buyer, and the extension must not exceed 120 days from the date of shipment. Once the AD has reported the case as overdue to FEOD, SBP-BSC, the AD shall not allow a further extension. A Lahore branch that “gives 30 more days” after filing Appendix V-20 has no Chapter 12 power to do so.

That extension power does not rewrite a 45-day sight clock into a casual 120-day courtesy. It is a documented delay inside the 120-day outer wall, and it dies the moment the overdue statement goes to FEOD.

Three-working-day shop-around after realization (paragraph 7)

On realization, exporters may retain proceeds, including advances, in foreign currency with the receiving AD for three working days from the Nostro value date, and sell to any Authorized Dealer in that window. If the remittance message does not identify the purpose as export, the three days start once the AD determines the purpose. Unsold balances at the close of the third working day are purchased by the receiving AD at the prevailing market rate. Special Exporters’ Account balances sit outside the AD’s exposure limits during that window. Permissible Exporters’ Special Foreign Currency Account retention (section 7.3) is carved from this flow under paragraphs 12, 35, 36, and 37.

Overdue reporting — current fortnightly frequency

Paragraph 33(i) is the offence sentence: SBP prescribes the period within which full foreign exchange value must be realized. Non-realization or delay in realization without prior State Bank permission constitutes an offence and renders the exporter liable to action under FERA.

Paragraph 33(ii), as amended by EPD Circular Letter No. 11 dated 10 October 2024 (https://www.sbp.org.pk/circulars/epd-circular-letter-no-11-of-2024; Chapter 12 footnotes the letter as 11 October 2024), requires Head or Principal Offices to furnish to Foreign Exchange Operations Department (FEOD), SBP-BSC, on a fortnightly basis — 1st to 15th and 16th to end of the month:

• Appendix V-20 — export transactions that became overdue during that fortnight
• Appendix V-21 — items previously reported as overdue that were deleted in the period because proceeds were realized or SBP / SBP-BSC instructed deletion

File both in CSV format on the Data Acquisition Portal (DAP) within 5 days of the end of the reporting period, following FEOD’s instructions. The current Chapter 12 PDF also footnotes EPD Circular Letter No. 07 dated 12 August 2025 on this paragraph; if you are updating statement formats, open that letter. The fortnightly V-20 / V-21 + DAP + five-day rule is the live Manual text opened for this guide.

Related reporting the desk mixes up:

• Appendix V-11, monthly, by the 15th: certified Form-E or EFE where shipping documents never arrived, and WeBOC cases still missing documents 30 days after shipment.
• Paragraph 10(iii): report all Electronic Form-Es that became overdue during the previous month on V-20 even if shipping documents were never obtained. “We never got the bill of lading” is not a V-20 exemption. WeBOC may already show the EFE as overdue.
• B2C paragraph 39(viii): monitor non-realization beyond 60 days in WeBOC. If outstanding B2C bills aggregating USD 20,000 or more remain unrealized for 60 days or more from shipment as at month-end, mark the exporter Suspended in the e-commerce module by the 15th of the following month, after taking the exporter’s monthly realization statement. Restore to Active when those 60-day-plus outstanding bills fall below USD 20,000. Report as overdue to SBP-BSC when non-realization exceeds 90 days from shipment as of month-end (Annexure C), excluding items marked realized from the monthly statement. The exporter’s monthly statement is due within five working days of month-end.
• B2B2C paragraph 41(iv): follow up after 180 days; report overdue at 270 days from shipment. That is not the B2C courier rule.

Follow-up on a Pakistani AD desk

A typical Karachi trade-ops week, mapped to the Manual:

1. Day 0 — shipment / Goods Declaration. Start the 14-day document clock (section 7.1) and the realization clock that matches the payment term.
2. By day 14 — documents in. Compare invoice and transport document with the Form-E / PSW declaration (paragraph 20). Legitimate short-weight or actual freight may be adjusted and authenticated. Unexplained short value is not “market discount.”
3. Before due date, 45, 120, 135, or 60 days. SWIFT chasers to the collecting or issuing bank. Written buyer correspondence if a paragraph 6(ii) extension is even possible.
4. On becoming overdue. Head Office includes the bill in the next V-20 fortnight. The branch cannot privately extend after that filing.
5. DA / T.R. default after delivery (paragraph 29). Consider litigation. The undertaking taken when the FI was shared is why counsel can move. Alternate-buyer settlements below 90% of original value minus demurrage still need SBP-BSC approval.
6. Lost in transit (paragraph 26). Insurance claim immediately. Report insurer, amount, currency, and place of claim to SBP-BSC for Form-E / declaration closure, then pursue encashment or rupee-payment certificates.
7. Short shipment / shut-out (paragraphs 24–25). Customs-certified short-shipment notice; shut-out without reshipment cancels the Form-E. Produce the shut-out notice within 21 days of Form-E certification.
8. Advance unused (paragraph 27). If goods are not shipped within one year, the exporter through the AD asks FEOD for an extension with documents. Sitting on an unidentified inward remittance is not an informal advance.

EFS / IERS data uploads (section 7.1) include exports overdue position and proceeds realization. A V-20 item is therefore both a FERA operations file and a refinance-data event. Do not tell the exporter that “the overdue is only a FEOD spreadsheet.”

Prosecution: FERA, FEOD, then FEAD

Non-realization is not a late ITRS filing. Chapter 12 paragraph 33(i) calls it an offence under the Act. The legal chapter of this guide maps three FERA tracks: section 23 criminal proceedings before a Tribunal on an authorized complaint; section 23B adjudication by Foreign Exchange Adjudication Department (FEAD) for selected provisions including section 12(1) (the export declaration and value provision); and section 23K SBP monetary penalties on regulatees of up to Rs 500,000 per contravention plus Rs 10,000 per day continuing, with directors, managers, officers, and agents capable of being deemed guilty.

FEOD, SBP-BSC runs the operational chase: fortnightly statements, field-office files, and extensions that still sit with operations. Chapter 1 Annexure B, as taught in this program’s institutional-roles section, routes export overdue cases and related litigation to FEOD until litigation starts, after which the file points to FEAD. A Faisalabad officer who emails Exchange Policy Department for a routine overdue chase has used the wrong inbox. A branch that stops following up “because FEAD will handle it” before any complaint is filed has abandoned paragraph 8’s undertaking to ensure receipt.

Pakistani scenarios

Scenario A — sight at day 50. A Karachi textile sight bill shipped 1 March is unpaid on 20 April. The clock was 45 days from shipment, not 120. If the item is not yet on V-20, a paragraph 6(ii) extension needs buyer documents and cannot pass day 120 from shipment. If it is already on V-20, the AD cannot extend.

Scenario B — “we will discount next month.” The exporter wants 180 days. Discount and forward sale did not occur before shipment or within 14 days. Paragraph 6(iii) is closed. Apply the term-specific clock.

Scenario C — B2C seller quoting 180 days. Courier house airway bill, USD 1,200 garment, WeBOC e-commerce module. Paragraph 39: due date or 60 days, whichever is earlier. The paragraph 41 B2B2C 180 / 270 framework is a different product.

Scenario D — 120-day usance LC. The officer diaries realization at day 120. Current paragraph 6(i) permits 135 days from shipment for that published usance structure.

Scenario E — due date day 30. DA terms state payment 30 days from shipment. “Whichever is earlier” means day 30, not day 120.

Scenario F — documents never lodged, EFE overdue in WeBOC. Operations omits V-20 because “we have no bill of lading.” Paragraph 10(iii) still requires V-20 for EFEs that became overdue last month.

Scenario G — B2C suspension. Outstanding courier bills over 60 days total USD 22,000 at month-end. Mark Suspended by the 15th of the next month after the monthly statement. That debarment is in addition to the 90-day overdue report to SBP-BSC.

Traps

• Treating 120 days as a floor rather than a cap paired with the due date
• Giving B2C courier exports the B2B2C 180-day clock
• Unlocking 180 days without a timely discount-and-forward sale
• Extending after the case is on V-20
• Skipping V-20 because shipping documents never arrived
• Sending routine overdues to EPD, or to FEAD, before litigation has started