[DRAFT #1b] Currency Transfer Compact

[Tinhampton]

Character count: 2,081
Word count: 328

Lydia Anderson, Assistant to the Delegate-Ambassador: Absent any feedback of substance, I will submit this on June 3rd 2022 - that's two weeks from now if you're taking notes. Despite some conflicts with my friend Ambassador Hepperle in the drafting stage that Article d(iii) may contradict the WA General Fund, I reminded him that Ambassador Tyvok's failed resolution about currency exchange, which forbade "any special taxation upon the process of exchanging any one nation’s currency for any other nation’s currency within [member states'] jurisdictions," was legal despite having passed a few months after WAGF.

OOC: There have been many attempts at regulating currency exchange (surely an international issue if there was one). The closest anyone got was two of Krioval's drafts being defeated at vote. On November 10th last year, Terra Animo wrote Currency Exchange Transparency Act, hereinafter CETA. It would have required member states to make the "approximated [exchange rate] determined by the International Securities and Exchange Commission (ISEC) at the end of the previous week," among other things, visible "where the exchange of currency takes place."
Terra Animo submitted CETA very rapidly, apparently for regional election purposes. CETA was widely criticised, and was ultimately pulled at 4am BST on 14th November - an hour before it was due to go to vote. Many people believed that Terra Animo would redraft CETA, but twelve hours after removing it, Terra Animo retired on the grounds that "I am a man of faith, and have come to realize that this website and its happenings are nothing but a distraction."
All glory goes to Honeydewistania and Scalizagasti for offering rather helpful feedback on the below proposal in the days after Terra Animo's retirement. Articles b and d in particular (except for the currency conversion provision) were present in an older, now-dormant draft that the three of us worked on, and they were completely okay with those particular extracts from the old draft existing in this proposal. Scal said he didn't have any more thoughts "right now" on November 25th. I summarily forgot about it for six months, revived it, and he still didn't have any thoughts. Honeydew was chill with it, too - so here we are. (Also, the player behind the nation of Tinhampton is an atheist. Assistant Anderson... isn't!)

Currency Transfer Compact
A resolution to reduce barriers to free trade and commerce.

Category: Free Trade

Strength: Mild

Proposed by: Tinhampton

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Aware that many people choose to leave their country from time to time (or even just once) for various reasons, and

Believing that such people should not be unduly discriminated against, either in seeking to exchange their home currency for that of their destination state or in sending remittances to family and friends in their home state...

The General Assembly enacts as follows.

1. Definition: In this resolution, the "exchange rate" between two currencies means the most recently published exchange rate between those currencies as determined on the market.
2. Equality in wage disposal rights: Member states must not restrict the ability of their inhabitants to dispose of their wages as they please based on their residency or immigration status, although this article must not be read as prohibiting all restrictions on wage disposal. To this end, each member must allow its inhabitants to:
   
   1. send part of their wages as remittances to another state where they have personal connections, and which is neither at war with that member nor affected by sanctions which it must impose pursuant to prior and standing international law,
   2. receive remittances from states which they are allowed to send remittances to, and to
   3. engage in currency conversion that complies with Article c.
3. Regulating currency exchange: Any entity in a member state which offers to convert any currency into any other currency must publicise and adhere to the exchange rate between those currencies.
4. Taxes and fees: Members:
   
   1. must avoid taxing any money (including remittances) simply because it has entered or left their jurisdiction, including any money that has entered their jurisdiction and has already been taxed by the nation it was sent from,
   2. are urged to ensure that any additional, non-tax fees imposed on the transfer of remittances from their jurisdiction are not excessive, and
   3. shall remove all taxes and fees imposed solely or primarily upon the exchange of currency within their jurisdiction.

Co-authors: Honeydewistania, Scalizagasti

[Tinhampton]

If it's an old, antiquated, or otherwise not-going-to-be-submitted draft of this resolution, odds are you'll find it in this post

[Makko Oko]

"Pray tell how exactly two nations agree upon and establish an exchange rate for their respective currencies, because from here, we see mentions of the 'established exchange rate' but yet nothing on how that would look like" - The Makko Oko Ministry Of Diplomatic Affairs, World Assembly Affairs Division

[Tinhampton]

"Pray tell how exactly two nations agree upon and establish an exchange rate for their respective currencies, because from here, we see mentions of the 'established exchange rate' but yet nothing on how that would look like" - The Makko Oko Ministry Of Diplomatic Affairs, World Assembly Affairs Division

Anderson: Please read Article a again. The exchange rate is "determined on the market."

[Makko Oko]

"Pray tell how exactly two nations agree upon and establish an exchange rate for their respective currencies, because from here, we see mentions of the 'established exchange rate' but yet nothing on how that would look like" - The Makko Oko Ministry Of Diplomatic Affairs, World Assembly Affairs Division

Anderson: Please read Article a again. The exchange rate is "determined on the market."

"We see we did miss that in our review, our mistake. One follow-up question however Ambassador, how are you sure the market is not biased towards any particular nation or currency? There is room for error there and while we don't object to this resolution and would love to see it pass, we want to ensure economic stability and ensure manipulation of currencies to benefit a specific entity does not happen." - The Makko Oko Ministry Of Diplomatic Affairs, World Assembly Affairs Division

[Imperium Anglorum]

C Marcius Blythe. I don't think the proposing delegation understands price discovery.

[Tinhampton]

Anderson: Could Marcius Blythe please explain how "price discovery" affects, or at least should affect, Article a?

[Anne of Cleves in TNP]

“This proposal seems fine in principle.”
-Ms. Charlotte Schafer, WA Ambassador for the Clevesian Empire

[Simone Republic]

Bullet (B) - what about between two hostile nations that are (at war or with sanctions at each other)

Bullet (C) - are we talking about (1) price discovery in FX markets, or (2) the situation with regards to "official" vs (black market) exchange rates (and this leads on to questions about states where the "official" exchange rate markedly differs from reality, and leads back to your definition on Bullet (A)) or are we talking about (3) displaying (say) the mid price traded last on a recognized exchange, so we don't get situations like (IRL) Oxford Circus (in London) FX dealers charging 40% spreads on unsuspecting tourists? What about states with foreign exchange controls? Are you trying to effectively guarantee that workers are permitted to transfer out ALL of their earnings regardless?

[Tinhampton]

A question for everyone which I raised in the OP but see fit to raise again: Do you believe that Article d(iii) targets an "unfair discriminatory practice" as per Article 8 of GA#17? (If not, I'll remove it.)

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Bullet (B) - what about between two hostile nations that are (at war or with sanctions at each other)

Not necessarily covered. Article b has been expanded to clarify this and to make clear that remittances can be received as well as sent.

What about states with foreign exchange controls? Are you trying to effectively guarantee that workers are permitted to transfer out ALL of their earnings regardless?

I do not say that member states must lift all restrictions on wage disposal; merely that they must not restrict wage disposal based on the residency or nationality of the prospective disposer. b's been clarified to this effect anyway.

Bullet (C) - are we talking about
(1) price discovery in FX markets, or
(2) the situation with regards to "official" vs (black market) exchange rates (and this leads on to questions about states where the "official" exchange rate markedly differs from reality, and leads back to your definition on Bullet (A)) or are we talking about
(3) displaying (say) the mid price traded last on a recognized exchange, so we don't get situations like (IRL) Oxford Circus (in London) FX dealers charging 40% spreads on unsuspecting tourists?

(I broke up Simone Republic's original quotes into small chunks for readability purposes.) Which one do you think we should be talking about, and why - given that Article c requires the publication of "the most recently published exchange rate between those currencies as determined on the market" wherever those currencies are exchanged?

[Bears Armed]

OOC: What about cases where an exchange rate has not yet been established? Bearing in mind the number of nations in the W.A. (let alone in NS as a whole), compared to the number of nations on Earth-RL, it seems to me that such cases are likely to occur significantly more frequently here than they do in RL...