Legislative treatment of current account interest and the role of custom
Abstract
Focusing on the legislative policy on current account interest requires examining this policy, which has been pulled in different directions between prohibition and permissibility in Libya since the issuance of the Law Prohibiting Interest on Deferred Payment (Law No. 74 of 1972) to the present day. The added value of this topic lies in the fact that banking operations are not limited to Libya, but have an international reach. These laws are supposed to influence and be influenced by these operations both inside and outside Libya. Therefore, the study of this topic must be conducted within a clear, transparent, and consistent integrated framework, as it relates to legal positions that should not be subject to change from moment to moment. The successive laws issued after 2011 in Libya [Law No. 1 of 2013 on the Prohibition of Usury Transactions; Law No. 35 of 2023 amending some provisions of Law No. 1 of 2013] touched upon the application of interest on current accounts in general, and on bank current accounts in particular, without a clear vision of the legislator's approach to this matter.
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