IIEffective Insolvency and Creditor Rights Systems
There is insufficient publicly available information that directly addresses Tunisia's compliance with the World Bank's Principles and Guidelines for Effective Insolvency and Creditor Rights Systems. However, a 2004 study by P. A. Casero and A. Varoudakis attempted to quantify Tunisia's insolvency regime according to a number of measures. The authors concluded that creditor's rights in Tunisian bankruptcy proceedings are weak, business exit remains lengthy, and the courts reserve broad powers in insolvency proceedings. These broad court powers are found to work against the protection of creditor's rights, inasmuch as access to bankruptcy documents is restricted to the court and there is no meaningful creditor participation in the decision-making process because only the court can initiate a bankruptcy plan. While the structure of the courts and the content of insolvency related legislation has not changed over the years, the 2010 Doing Business report on Tunisia's performance in closing a business discloses that improvements have been made at least in terms of the time required to complete proceedings. In 2003, the year for which Casero and Varoudakis' data was derived, it took 2.5 years to close a business, whereas the 2010 report shows that the time has been nearly cut in half, averaging 1.3 years today. As for costs and recovery rates, however, little change has been noted over the years.
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IDInternational Financial Reporting Standards
A 2009 Institute of Chartered Accountants (OECT) Action Plan (prepared as part of the International Federation of Accountants self-assessment program) explicitly states that International Financial Reporting Standards (IFRSs) have not been adopted in Tunisia. However, the OECT promotes the adoption of IFRSs and the Tunisian Ministry of Finance has also been involved in analyzing the impact of applying IFRSs with the long-term goal of convergence with the international standards. Companies in Tunisia adhere to national accounting standards called the Tunisian Accounting Standards (TASs). The World Bank, in a 2004 assessment of accounting and auditing practices in Tunisia, observed that Tunisia's Law on the Enterprise Accounting System in 1997 changed TASs dramatically, achieving greater harmonization with IFRSs. However, significant differences persisted, because some of the TASs are based on an earlier version of IFRSs. Moreover, the World Bank pointed out that financial institutions and insurance companies demonstrated low compliance with TASs. It therefore recommended adopting IFRSs for all public interest entities while maintaining the use of TASs by Small and Medium-size Enterprises. The World Bank also recommended that Tunisia strengthen its legal framework and financial transparency requirements, as well as upgrade its academic and professional education and training in the field of accountancy.
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IIPrinciples of Corporate Governance
Tunisia has been actively cooperating with international organizations to improve its corporate governance framework and practices and successive efforts have been made to upgrade the regulatory system. The 2000 Commercial Code constitutes the main reference regarding corporate governance. According to a 2002 Financial System Stability Assessment (FSSA) on Securities Regulation by the IMF, legislation in Tunisia regarding the provision of public information on listed companies and the protection of shareholders' rights was perceived as "sound and clear." In its 2006 FSSA Update, the IMF stated that the banking law was revised in 2006 and governance of banks is improving. A 2007 IMF report notes that a financial securities law was adopted to enhance transparency and reliability of accounting, and a 2008 report by Matoussi and Chakroun found that the extent of voluntary disclosure had increased over time. The Tunisian Code of Best Practice of Corporate Governance was launched in 2008 by the Arab Institute of Business Managers. Despite these developments pointing toward the establishment of a sound legal framework, several sources, including a Center for International Private Enterprise 2005 report, note that there is a clear gap between Tunisia's corporate governance legislation and its implementation. Furthermore, there is insufficient information publicly available directly addressing Tunisia's compliance with the Organization for Economic Cooperation and Development's Principles of Corporate Governance.
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IDInternational Standards on Auditing
In a 2004 World Bank assessment (updated in 2006), it was observed that Tunisia has two professional accountancy bodies that are authorized to conduct statutory audits. Originally, the Institute of Chartered Accountants of Tunisia (OECT) had the exclusive right to conduct audits, but this right was later extended to another professional body, the Society of Accountants. Per the World Bank, the OECT adopted International Standards on Auditing (ISAs) issued by the International Auditing and Assurance Standards Board (IAASB) way back in 1999, effective for periods beginning in 2000. The Society of Accountants, on the other hand, at the time of the assessment had not adopted ISAs and there is no recent information on their future strategy with respect to convergence. The World Bank, therefore, had recommended all statutory audits be conducted in accordance with ISAs. It also pointed out discrepancies in the legal and regulatory framework, stressed the necessity to resolve these discrepancies, and recommended upgrading academic and professional education and training. More recently, a 2009 OECT Action Plan (developed as part of the International Federation of Accountants self-assessment program) notes that to incorporate the subsequent changes made to ISAs, the OECT is now planning to adopt the most recent French translation of the ISAs as well as the other pronouncements of the IAASB, with limited modifications. Per the Action Plan, by December 2009, the OECT is expected to incorporate new and amended Clarified ISAs translated by a francophone IFAC associate or member body into a new set of national standards known as the Tunisian Auditing Standards (TASs).
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IDAnti-Money Laundering/Combating Terrorist Financing Standard
Tunisia is a founding member of the Middle East and North Africa Financial Action Task Force (MENAFATF), which is an associate member of the Financial Action Task Force (FATF). Members of the MENAFATF signed a memorandum of understanding in 2004 where they pledged to adopt and implement the FATF's recommendations. Law 2003-75 was enacted in Tunisia on December 15, 2003, forming the core of the country’s anti-money laundering and combating the financing of terrorism (AML/CFT) legal framework. This law also established a financial intelligence unit (FIU) within the Central Bank of Tunisia. The MENAFATF conducted a mutual evaluation on Tunisia’s AML/CFT regime against the FATF 40+9 recommendations and special recommendations. The MENAFATF findings were published in a 2008 report, which notes that Tunisia’s AML/CFT framework is generally in line with international standards. However weaknesses remain in the legal framework with regard to: (1) customer due diligence (CDD); (2) feedback mechanisms and statistics; (3) the coverage of designated non-financial businesses and professions; and (4) suspicious transaction reports (STRs). The report deems Tunisia at least “largely compliant” with all the FATF Core Recommendations, with the exception of the 2 recommendations on CDD and STRs. Overall, Tunisia was found to be either “compliant” or “largely compliant” with 22 recommendations and 4 special recommendations, with 1 recommendation being inapplicable in the Tunisian context. The FATF, in its 2008-2009 Annual Report, names Tunisia as one of the jurisdictions that have endorsed the FATF's 40+9 recommendations.
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IDCore Principles for Systemically Important Payment Systems
As reported in the IMF's 2002 Report on the Observance of Standards and Codes (ROSC) on Payment Systems in Tunisia, the national check clearing and settlement system was the country's systemically important payment system, handling more than 90 percent of payments in terms of value. The system, however, was not compliant with Core Principles for Systematically Important Payment Systems (CPSIPS) IV and V, developed by the Committee on Payment and Settlement Systems. The 2006 IMF Financial System Stability Assessment (FSSA) Update asserted that the (then) forthcoming real-time gross settlement (RTGS) system would meet international best practice requirements, including settlement finality, fully collateralized intraday central bank advances, and optimization procedures for queues. The Tunisian Central Bank's 2006 annual report stated that a RTGS system, called the Gross Amount System of Tunisia (SGMT), came into operation in November 2006. According to a presentation made by Ramzy Hamadeh at a World Bank conference on payment systems in April 2009, the RTGS system is the main system used for large-value funds transfers in Tunisia. A 2008 report by the Middle East & North Africa Financial Action Task Force comments that Tunisia has adopted modern payment systems and encourages the use of electronic cash. However, since the implementation of the SGMT, there is insufficient information publicly available as to Tunisia's compliance with the CPSIPS. Nor is there published information as to whether the national check clearing system still remains systemically important. Tunisia is a member country of the Arab Monetary Fund and participates in its Arab Payments and Securities Settlement Initiative, which aims to assess and strengthen payment systems to improve their safety, efficiency and integrity. Despite the lack of recent assessments, the country has shown intent to improve its payment system architecture to fit international best practices as evident from the IMF's 2006 FSSA Update.
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