Scope of the Law on Public Accounting
This Law defines the rules governing the preparation of the State budget, its implementation, the closing of its accounts, the management of public funds, and the funds deposited with the Treasury.
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Public Accounting
Decree · 1963-12-30 · 249 articles
The President of the Lebanese Republic, Having regard to the Lebanese Constitution, and in particular Article 58 thereof, Whereas the Government referred to the Chamber of Deputies, by Decree No. 14315 of 4 November 1963, the urgent draft law aimed at defining the rules of public accounting, Whereas more than forty days have elapsed since the referral of this draft to the Chamber of Deputies without its having been decided upon, On the proposal of the Minister of Finance, And with the approval of the Council of Ministers in its session of 30 December 1963, Decrees the following: Article 1 – Entry into Force The urgent draft law referred to the Chamber of Deputies by Decree No. 14315 of 4 November 1963 is hereby enacted, the text of which reads as follows: Published in Official Gazette No. 104 of 30 December 1963.
Section 1General Provisions
General Provisions
Definition of Public Funds
Public funds are the funds of the State, municipalities, public institutions affiliated with the State or municipalities, and the funds of all other legal persons vested with public authority.
Definition of the Budget
The budget is a legislative instrument in which the expenditure and revenue of the State for a forthcoming year are estimated and by which the levy of taxes and the making of expenditure are authorised.
Contents of the Budget
The budget consists of the budget law together with the summary and detailed schedules appended thereto.
Contents of the Budget Law
The budget law is the text embodying the approval of the legislative authority for the draft budget. This law contains fundamental provisions ordering the estimation of expenditure and revenue, the authorisation of tax collection, and the opening of appropriations necessary for expenditure, as well as special provisions limited to matters directly related to budget implementation.
Contents of the State Budget
The State budget consists of the general budget, annexed budgets, and exceptional budgets. Anexed budgets(1) and exceptional budgets(2) shall be established by special laws, and the provisions of this Law shall apply to them, unless their special provisions contain different texts.
1. Annexed budgets are the budgets of public administrations granted financial and administrative autonomy without legal personality. These administrations are: the Civil Service Commission, the Grain and Sugar Beet Office, and the Directorate of Wire and Wireless Communications.
2. Exceptional budgets are drawn up to deal with an emergency affecting the security of society or public safety or the security of the State; their expenditure is usually covered by exceptional revenue.
Annual Nature of the Budget
The budget is drawn up for a financial year beginning on 1 January and ending on 31 December.
Recording of Revenue and Expenditure
Revenue and expenditure are recorded in the budget accounts of the year in which they were actually received or paid.
Correction of Material Errors
Material errors and classification errors may be corrected by a decision of the Minister of Finance issued at the request of the competent authority, up to the fifteenth day of March of the following year.
Divisions of the Budget
The budget is divided into two sections:
- 1)The expenditure section, comprising the appropriations opened to cover such expenditure.
- 2)The revenue section, comprising the revenues allocated to cover those appropriations.
Types of Appropriations
Appropriations are of two kinds: - Original: those opened by the budget law. - Supplementary: those added to the original appropriations after publication of the budget. Supplementary appropriations are in turn of two kinds: - Complementary: opened to cover a shortfall in a specific budget line. - Exceptional: opened to cover expenditure for which no appropriation whatsoever existed in the budget.
Rules for Opening Appropriations
Appropriations shall only be opened within the budgets referred to in Article 6. However, by way of exception, an appropriation may be opened in a budget before its approval if there is a need to do so.
Section 2Preparation of the General Budget
Preparation of the General Budget
Subsection 1Expenditure
Expenditure
Parts of the Expenditure Budget
The expenditure budget is divided into two parts: - Part One: comprising ordinary expenditure. - Part Two: comprising equipment and construction expenditure and the State's investment contributions. The content of each of the two aforementioned parts shall be defined by a decision of the Minister of Finance.
Amended 1966Amended 1968
Division of Expenditure into Chapters
Each of the two aforementioned parts of the expenditure section shall be divided into chapters. The number of chapters in each part shall be determined by a decision of the Minister of Finance.
Division of Chapters into Sections, Lines and Paragraphs
Each chapter shall be divided into sections, each assigned to a single administration or group of administrations or a single project or group of projects. Each section shall be divided into budget lines, each assigned to expenditure of a single type or similar nature, and each line shall be divided, where appropriate, into paragraphs. A model table for the division of appropriations shall be established by a decision of the Minister of Finance.
Contents of the Salaries Budget Line
The salaries budget line shall indicate: 1. With respect to permanent and temporary staff: - The total number of staff by grade, together with the total of their salaries and supplements. 2. With respect to retirees: - Their number together with the total of their pensions and supplements.
- 1)With respect to workers:
- 2)For permanent workers:
- 3)Their number together with the total of their wages and supplements.
- 4)For non-permanent workers:
- 5)The total of their wages and supplements.
Transfer of Appropriation from One Paragraph to Another
Appropriations for similar works may be distributed among paragraphs within a single budget line. The following rules shall apply in such cases:
- 1)The appropriation earmarked for each project shall be treated as a separate paragraph.
- 2)Transfer from the appropriation earmarked for one project to another project may be made:
- 3)After works have commenced, provided at least fifteen per cent of the original appropriation is retained.
- 4)After completion of the project and settlement of the contract.
- 5)Transfer shall only be permitted to a project similar to the first project and located in the same area.
Special Expenditure Incumbent on the State
1. A separate section shall be set aside in each chapter of the expenditure section from which the value of monetary judgments rendered against the State and settlements concluded by it shall be paid, when no appropriations are available in the relevant budget lines for such expenditure. This section shall be funded by transferring from the global appropriation set aside in the budget reserve chapter in accordance with Article 26 below.
2. Amounts collected by the Treasury in error or without legal basis shall be refunded by deducting them from the budget revenue account in which they were originally received, i.e. by entering them on the debit side of the revenue account; no appropriation shall be opened in the budget for this purpose.(1) Only balances shall be recorded in the field of amounts collected from the budget closing of accounts for revenue accounts.
3. A separate section shall be set aside in each chapter of the expenditure section, during a transitional period ending in 1966, called 'prior years' expenditure', from which amounts that accrued in favour of third parties in years prior to 1963 and were not paid during those years shall be drawn. No appropriation shall be entered in the aforementioned section when the budget is prepared; instead, expenditure paid from it shall be covered by amounts taken from the reserve fund endorsed by the closing of accounts law.
1. By virtue of the above-mentioned laws, this paragraph was repealed and replaced by a paragraph that was supposed to be new; however, the new paragraph was always identical to the repealed one.
Amended 1973Amended 1974Amended 1975Amended 1976Amended 1977Amended 1966
Budget Reserve
- 1)The following shall be set aside in the budget reserve chapter:
- 2)Reserve appropriations for expenditure shared among several ministries, such as sickness and death assistance, monetary judgments, settlements, etc.
- 3)A contingency reserve appropriation to be used to replenish budget lines whose appropriations have been exhausted, or to open exceptional appropriations, provided that this reserve appropriation shall not be less than one per cent of the total appropriations of Parts One and Two of the budget.
2. Should the appropriations earmarked for monetary judgments and settlements be exhausted, the Government may, by decree adopted in the Council of Ministers, open the necessary complementary appropriations and cover them from the reserve fund, to be ratified by the closing of accounts law. The provisions of this paragraph shall also apply when appropriations earmarked for pensions and severance pay are exhausted.
3. No expenditure shall be paid directly from the appropriations of this chapter; instead, these appropriations shall be transferred when needed to the relevant budget lines as follows: - By decision of the Minister of Finance, on the proposal of the competent authority and after endorsement by the Central Controller of Expenditure Commitments, with respect to the appropriations referred to in sub-paragraph (a) of the preceding paragraph. - By decree issued on the proposal of the competent minister and the Minister of Finance, with respect to the appropriations referred to in sub-paragraph (b) of the preceding paragraph.
Opening of Supplementary Appropriations and Their Coverage
1. Subject to the provisions of Article 85 of the Constitution and Article 26 of this Law, supplementary appropriations shall only be opened by law. Such appropriations shall be covered by transfer from other budget lines, or from the budget reserve chapter, or by drawing from the reserve fund, or by new revenues.
- 1)Subject to the provisions of Article 26 of this Law, appropriations shall only be transferred from one budget line to another by law.
- 2)Subject to Article 114 of this Law, appropriations shall only be carried over from one year's budget to the following year's budget by law.
Procedure for Transfer from One Paragraph to Another
- 1)Subject to the provisions of Article 24 of this Law, appropriations shall be transferred from one paragraph to another within the same budget line by decision of the competent minister after endorsement by the Central Controller of Expenditure Commitments. Transfer by the same procedure to a new paragraph shall also be permitted where that paragraph covers a type of expenditure assigned to the budget line.
- 2)Appropriations earmarked in the chapters on debt service and budget reserve shall be transferred from one paragraph to another within the same budget line by decision of the Minister of Finance after endorsement by the Central Controller of Expenditure Commitments.
- 3)Transfer from one paragraph to another within a given year's budget may be effected up to 31 January of the following year.
Rules for Assessment of Taxes and Fees
The following rules shall apply to the assessment of taxes and fees unless the law provides otherwise.
Authority Competent to Assess Taxes and Fees
The assessment of direct taxes collected by means of assessment schedules shall be carried out by the competent central financial directorate or the competent financial directorate in the governorate; the Director of Revenue shall endow these schedules with executive force. The assessment of other taxes and fees shall be carried out by the head of the financial directorate or competent unit in each governorate by means of judicial orders issued by him.
Amended 2003
Concealment or Shortfall in Tax Assessment
Any concealment or shortfall in the assessment of direct and indirect taxes and fees may be remedied up to the end of the third year following the year in which the assessment should have been made, by means of additional assessment schedules or judicial orders for concealed assessments, and by means of supplementary assessment schedules or judicial orders for deficient assessments.
In addition to the remedy period referred to in the first paragraph of this article, the competent financial directorates shall benefit from an additional exceptional period to remedy the Treasury's right to impose a tax or fee on any profit, income, revenue or instrument revealed by a judicial ruling, an arbitral award, a probate proceeding or a settlement agreement, and likewise to correct any assessment ordered to be annulled.
This exceptional period shall end on 31 December of the year following the year in which the annulment was decreed or the profit, income, revenue or taxable instrument was discovered.
Amended 1973
Publication of Assessment Schedules Placed under Collection
The placing of basic assessment schedules under collection shall be announced through the Official Gazette, radio and local newspapers. Announcements to this effect shall be posted, where appropriate, at the offices of collectors and in public gathering places and squares. The announcement shall specify the deadline for payment, the entitlement to the legal discount, the right of objection, and the date on which each begins.
Deadline for Objecting to Taxes and Fees
The deadline for objecting to taxes imposed by means of basic assessment schedules shall begin on the day following the date of publication of the relevant announcement in the Official Gazette.
The deadline for objecting to taxes imposed by means of additional or supplementary assessment schedules, and to taxes and fees imposed by judicial orders, shall begin on the day following the date on which the taxpayer is notified of these documents.
Such notification shall be effected by registered letter with acknowledgment of receipt. If the taxpayer is absent or refuses to accept delivery, notification shall be effected through the competent administration in accordance with the notification rules provided for in the Code of Civil Procedure.
The objection deadline shall be two months for direct taxes assessed by means of assessment schedules, and one month for other taxes and fees.
Rules for Objecting to Taxes and Fees
1. The procedures for objecting to the various taxes and fees and the time limits for their determination by the administration and objection committees shall be established by decree issued on the proposal of the Ministers of Finance and Justice within three months of the date of publication of this Law in the Official Gazette.
2. The procedures and time limits established in the aforementioned decree shall supersede all special provisions relating to objections contained in the various tax and fee laws.
Cancellation or Reduction of Tax Assessments
Notwithstanding any other provision, the tax directorates in the General Directorate of Finance may not order the cancellation or reduction of tax and fee assessments except with the approval of the head of the Revenue Service, unless the matter involves a material error or an amount not exceeding 50 per cent of the assessment value, provided the amount does not in any case exceed 500 L.L. per assessment.
Tax Assessment Monitoring Unit
A tax assessment monitoring unit shall be established to ensure supervision of the various tax and fee assessment operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.
Law on Collection of Taxes and Fees
No tax or fee may be collected unless the legislative authority has authorised this by virtue of the budget law or any other law.(1) Violators shall be prosecuted in accordance with Article 361 of the Penal Code.
1. The principle of 'no taxation without a law' is enshrined in Article 81 of the Constitution.
Persons Responsible for Collecting Taxes and Fees
Taxes and fees shall be collected on the basis of assessment schedules or collection orders by which they were assessed, unless they are of the type paid by the taxpayer directly by affixing stamps or equivalent instruments. Persons other than accountants and their staff may not undertake the collection of taxes, fees and other public revenues.
Statute of Limitations for Taxes and Fees
Taxes and fees of all kinds shall lapse against taxpayers by operation of the statute of limitations on 31 December of the fourth year following the year in which the assessment was made. The running of the limitation period shall be interrupted by the commencement of judicial proceedings provided for in the law. An injunction shall be deemed the commencement of proceedings provided it is notified in accordance with the provisions of Legislative Decree No. 147 of 12 June 1959. The injunction shall be renewed where necessary before the expiry of four years from the date of its notification to the person concerned.
Amended 1966
Retention of Assessment Schedules and Collection Orders
Assessment schedules shall be retained for a period of ten years, and collection orders for a period of five years, unless the Court of Audit orders, prior to the expiry of the retention period, a discharge of liability for those responsible for collection.(2)
2. The Court of Audit issues a discharge of liability for those responsible for collection within the framework of its judicial oversight of accounts (Articles 59 to 65 of the Law on the Organisation of the Court of Audit).
Collection Monitoring
A collection monitoring unit shall be established to ensure supervision of the tax and fee collection operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 16843 of 10 July 1964 defining the powers and duties of the Collection Monitoring Division within the Treasury Service.
Collection by Means of a Collection Instrument
The specific rules applicable to each type of State debt and other revenue, other than taxes and fees, shall govern their settlement and collection and the procedures for pursuing them. For debts and revenues in respect of which the applicable laws do not define the manner of their settlement and collection and the related proceedings, they shall be settled by means of collection orders issued by the head of the competent authority and collected in accordance with the procedures followed for the collection of direct taxes and equivalent fees. Objection to collection orders may be lodged before the competent administrative court at the place of residence of the debtor within two months of the date of notification of the order to him or at his place of residence. Filing an objection shall not suspend enforcement of collection orders unless the court so orders in whole or in part.
Sale of Immovable State Property
Immovable State property shall be sold in accordance with the special provisions applicable thereto.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Sale of Movable State Property
Movable State property shall be sold:
- 1)By mutual agreement if its assessed value does not exceed 3,000,000 L.L. (three million Lebanese pounds).
- 2)By invitation to tender if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
- 3)By public auction and by other available methods if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
Amended 1978Amended 1987Amended 1990Amended 2004
Authority Competent to Decide on the Sale of Movable State Property
Contracts for the sale of movable property shall be decided upon by: 1. In central administration: - The competent director, if the contract value does not exceed 150,000 L.L. - The competent director general, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L. 2. In governorates and districts: - The district commissioner (Qaimaqam), if the contract value does not exceed 150,000 L.L. - The governor, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L.
Amended 2004
Valuation of Movable Property
Movable property shall be valued by a committee established in each administration by decision of the authority competent to decide on the contract.
Oversight by the Court of Audit
Sale transactions subject to its oversight shall be submitted to the Court of Audit by the authority competent to decide on the contract.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Comprehensiveness of Revenue
All revenues received shall be recorded in their entirety in the revenue section of the budget.(2)
2. Recording all revenue in the revenue section confirms the adoption of the gross principle, i.e. the absence of netting between revenue and expenditure and the consequent application of the gross recording principle to both.
Gifts and Property Donated to the State
- 1)Cash and in-kind gifts offered to the State by legal or natural persons shall be accepted by decree issued on the proposal of the competent minister and the Minister of Finance if their value does not exceed 250,000,000 Lebanese pounds.
- 2)Cash and/or in-kind gifts offered to the State by legal or natural persons shall be accepted by decree adopted in the Council of Ministers if their value exceeds 250,000,000 Lebanese pounds.
- 3)Cash gifts received by the Lebanese Treasury shall be recorded in the revenue section of the budget; if these gifts have a specified destination for expenditure, appropriations shall be opened for them in the expenditure section in accordance with established procedures.
- 4)The Ministry of Finance shall prepare a quarterly statement of the gifts referred to in paragraphs (1) and (2) above that have been received by the Lebanese Treasury and shall submit it to the Council of Ministers for information.
Amended 2019
Revenue Accounts
The Ministry of Finance shall maintain, for each category of budget revenue and for each year separately, an independent account showing: - Prior years' balances, year by year. - Total revenues realised pursuant to assessment schedules and collection orders issued during the year. - Total collections up to 31 December of the year, broken down between the current year and each prior year. - Legal discounts utilised by taxpayers. - Uncollected balances at the end of the year. Each ministry shall also maintain a detailed account of the revenues it handles, for each year separately, on the basis of the collection orders it issues or that are issued at its request.
Functions of the State Treasury
The State Treasury shall handle all receipt and payment operations required for the implementation of the State budget and shall manage the accounts opened outside the budget.
Functions of the Accountant
Receipt and payment operations on behalf of the Treasury shall be carried out by officials each known as an accountant; however, the accountant may delegate certain of his powers to one of the accountants under his authority with the approval of the Head of the Treasury Service.(2)
2. The accountant was granted additional powers by Legislative Decree No. 25 of 17 January 1955.
Amended 1966
Categories of Accountants
Accountants are of two categories: central and local.
- 1)The central accountant is responsible for budget revenues and expenditure, and for off-budget operations.
- 2)The local accountant is responsible for off-budget operations and locally provides for the receipt of budget revenues and the payment of budget expenditure on behalf of the central accountant to whom he is attached.
- 3)In certain public administrations, the central accountant may be tasked with centralising all operations of the local accountants under his authority, whether these operations are within or outside the budget.
- 4)If a public administration has only one accountant, that accountant shall be treated as a central accountant for the purposes of this Law.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Central Accountants
Central accountants are: - The Central Finance Accountant. - The Central Customs Accountant. - The Central Post and Telegraph Accountant. - The central accountant of each administration with an annexed budget. - Any official assigned this status by decree.
Local Accountants
Local accountants are: - Finance accountants. - Customs accountants. - Post and telegraph accountants. - Accountants of administrations with annexed budgets. - Any official assigned this status by decree.
2. See, with regard to customs accountants, the following texts: Decree No. 4024 of 4 May 1960; Decree No. 11028 of 6 November 1962; Decree No. 11029 of 6 November 1962; Decree No. 11030 of 6 November 1962; Decision No. 173 of 8 May 1964.
General Chart of Accounts
Operations carried out by the accountant shall be recorded in accounts maintained in accordance with a general chart of accounts established by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 10388 of 9 June 1997 on the general chart of accounts for the State, public institutions and municipalities.
Methods of Bookkeeping
Public funds accounts shall be maintained by central accountants and the General Accounting Service on the basis of the double-entry method, and by local accountants on the basis of the single-entry method.(4)
4. With regard to defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements, see Decree No. 3373 of 11 December 1965.
Obligation to Maintain and Correct Entries in Ink
Entries shall be made in ink compulsorily and shall under no circumstances be made in pencil; erasure, insertion, obliteration or correction fluid in papers, tables, documents, entries, ledgers or records shall also be prohibited. However, any error therein may be corrected, provided the correction is made in a visible manner by crossing out the deleted letters and figures, using ink of a colour different from that used in the original, and that the correction is accompanied by the date and the signature of the person making it.
Salary and Allowance Appropriations
Salary and allowance appropriations relating to army personnel and members of the Internal Security Forces and General Security shall be entered in a single budget line without breakdown.
Award Committee
Contracting shall be handled by a special committee established in accordance with a system determined by decree on the proposal of the competent minister.
Mutual Agreements
Mutual agreements may be concluded for the supplies, works and services required by the army, the Internal Security Forces, the General Security and the customs detachments in times of war, emergencies and exceptional circumstances requiring immediate measures, on the basis of a reasoned order from the army commander.
Exemption from Certain Contract Conditions
When the Ministry of National Defence concludes contracts with foreign governments or institutions affiliated to them, or when such governments recommend them, for the purchase of weapons, ammunition, equipment and apparatus, it may exempt the counterpart from conditions relating to place of residence, security, penalties, and the obligation of delivery before receipt.
Possibility of Re-using Certain Appropriations
The Ministry of National Defence may request, in accordance with the procedures established in Article 117 of this Law, the re-use of the corresponding appropriations:
- 1)For the value of materials supplied by the army administration at a price to officers and personnel in their personal capacity.
- 2)For the value of materials charged to officers and personnel responsible for their loss or damage.
- 3)For the value of weapons, ammunition, equipment and apparatus sold by the army command to any administration or public institution.
- 4)For the value of materials used and the value of services rendered on behalf of public administrations and institutions or for the benefit of any natural or legal persons.
Amounts Paid in Error or Without Legal Basis
The Ministry of National Defence may deduct from entitlements to salaries paid from current year appropriations amounts paid in error or without legal basis in prior years.
Amounts Received in Excess
Salaries and supplements thereto, and transport and movement advances received by units in a given year in excess of their rights, and returned to the Treasury before the end of the following year, shall be entered by their return date in the current year's revenue in accordance with Article 8 of this Law. Additional appropriations equivalent to the value of the returned amounts may be opened by decision of the Minister of Finance in the salaries budget line of the army, provided they are covered by a corresponding increase in revenues.
Possibility of Committing Expenditure against the Following Year
Commencing from 1 August of each year, the Minister of National Defence may commit against the following year equipment expenditure amounting to two-thirds of the appropriations earmarked for this purpose for the current year in the army, Internal Security Forces and General Security budgets and those allocated to the customs detachments in the Ministry of Finance budget. Expenditure in respect of items not previously approved by the legislative authority may not be committed in this way. The provisions of Articles 137 and 138 of this Law may also be applied to the contracts referred to in this article even before the new year begins.
Amended 1966
Article 227 was repealed by Article 17 of Law No. 72/5 of 1 February 1972.
Amended 1972
Appointment of Materials Accountants
Materials accountants in the army shall be appointed by decision of the army commander.
Security Requirements
Army accountants shall be subject to the security system applicable to all accountants.(1)
1. Military accountants were exempted from providing legal securities by the Law of 20 August 1956.
Limits of the Court of Audit's Oversight
The Court of Audit and financial inspectors may not request access to or review documents and information relating to military secrets, unless the army commander consents. The Court of Audit shall exercise its oversight of the army's materials accounts locally and on the basis of the records maintained by the units and the supporting documents they produce.
Provisions Applicable to the Internal Security Forces and General Security
The provisions of Articles 220 to 230 inclusive of this Law shall apply to the Internal Security Forces, with each of the Minister of Interior and the Director General of the Internal Security Forces exercising the powers granted to the Minister of National Defence and the army commander respectively, each as far as it concerns him. With regard to the General Security and the customs detachments, the provisions of Articles 220, 222, 228, 229 and 230 of this Law shall apply, subject to the special organisation of each of these two bodies.
Amended 1979Amended 1983Amended 1985
Subsection 2Revenue
Revenue
Parts of Budget Revenue
The revenue section of the budget consists of two parts: First: comprising ordinary revenues allocated to cover the expenditure of Parts One and Two of the expenditure section. Second: comprising revenues allocated to cover the expenditure of Part Three of the expenditure section. The latter revenues consist of:
- 1)Drawings from the reserve fund.
- 2)Revenues assigned or created by special laws.
Division of Revenue Parts
Each part of the revenue section shall be divided into chapters, and each chapter shall be divided into sections, each assigned to a category of revenues; each section shall be divided into budget lines, each assigned to a specific revenue item. A special section shall be set aside in each part in which funds paid by the Treasury in error or without legal basis and subsequently recovered shall be recorded. A model table for the division of revenues shall be established by a decision of the Minister of Finance.
Reserve Fund
A special chapter with a single section for drawings from the reserve fund shall be set aside in each part of the revenue section. This section shall be divided into budget lines in accordance with the model table referred to in the preceding article.
Stages of Expenditure Implementation
The implementation of expenditure passes through four stages:
- 1)Commitment.
- 2)Liquidation.
- 3)Issuance of the payment order.
- 4)Payment.(1)
1. Article 34 of the Law on the Organisation of the Court of Audit provides that transactions for the sale of immovable property are subject to prior administrative oversight.
Definition of Expenditure Commitment
An expenditure commitment is any act that is capable of creating a debt obligation on the State.
Authority Competent to Make a Commitment
Expenditure shall be committed by the competent minister unless the law provides otherwise.
Requirement of a Specific Appropriation
No expenditure shall be committed unless a budget appropriation is available for it,(2) and no appropriation may be used for any purpose other than that for which it was earmarked.
2. See, regarding the principle of the prohibition on committing expenditure prior to the availability of an appropriation, paragraph 2 of Article 59 of this Law.
Suspension of Commitment of Supplies and Works Expenditure
Commitment operations for supplies and works expenditure(3) shall cease on 30 November of each year; however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases(4) assessed by the competent minister and the Minister of Finance.
3. Expenditure commitments for services do not cease on 30 November because Article 58 above restricts the suspension of commitment operations to supplies and works expenditure only.
4. The phrase 'however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases...' was added by correction of a material error published in Official Gazette No. 94 of 24 November 1966, p. 1728.
Amended 1966
Commitment of Expenditure against a Financial Year before Its Start
No expenditure shall be committed against a financial year before its commencement. However, commencing from 1 October of each year, permanent expenditure whose continuity is required by the public interest may be committed against the following year within the limits of the appropriations earmarked for it in the current year's budget; likewise, during the period preceding the publication of the budget, such expenditure may be committed after the new year has begun within the limits of the appropriations earmarked for it in the previous year's budget. Furthermore, liquidation, payment order and payment transactions may be carried out during the relevant financial year.(5)
5. This article permitted the executive authority to bypass the legislative authority by allowing it to take all stages of expenditure before the legislative authority approves the budget; in other words, this bypass leads to a violation of the principle of the prohibition on committing expenditure before an appropriation is available, as provided in Article 57 of this Law.
Amended 1987
The Twelfth Rule
1. Twelfth budgets shall be drawn up on the basis of the permanent appropriations earmarked in the previous year's budget, taking into account additions to and deletions from permanent appropriations. Appropriations transferred from the budget reserve shall not be treated as lapsed.
- 1)The Government shall have the right, by decree adopted in the Council of Ministers on the proposal of the competent minister and the Minister of Finance, to distribute the total construction and equipment appropriations in each twelfth budget among the various public administrations in accordance with their needs, while remaining bound by the appropriations allocated to each public administration in the draft budget for the current year.
- 2)Prior to the approval of the budget, the Government shall have the right, by decree adopted in the Council of Ministers, to transfer appropriations on the basis of the twelfth rule from the budget reserve in order to fund various budget lines.
1. The Minister of Finance was authorised, with respect to contracts for works or supply of equipment, to choose between the method of advance payment and the method of deferred payment pursuant to Article 12 of Law No. 78/16 of 2 May 1978 (Budget Law 1978).
Amended 1988Amended 1980
Requirement of Endorsement by the Controller of Expenditure Commitments
Every transaction leading to an expenditure commitment must, before it is signed, be endorsed by the Controller of Expenditure Commitments. However, in urgent emergency situations, the competent authority may proceed with committing expenditure within the limits of the appropriations earmarked for it prior to obtaining the endorsement of the Controller of Expenditure Commitments, provided it submits the transaction to him for review within at most one week of the date of commitment, together with a statement of the reasons that warranted this course of action; the committing officer shall remain responsible for the expenditure until it has been regularised in legal form. Every transaction leading to an expenditure commitment shall be accompanied by an appropriation reservation request (expenditure commitment request).
Appropriation Reservation Request
The appropriation reservation request required for an expenditure commitment shall be signed by the accountant of the competent administration or by his authorised delegate with the approval of his hierarchical superior.
Procedure for Issuing Appropriation Reservation Requests
Appropriation reservation requests shall be organised: - For the whole year, when they relate to salaries and similar staff expenditure. - For three or six months, when they relate to other permanent expenditure. - An individual request shall be organised whenever circumstances require. A blanket contingency request for reserving the appropriation required for permanent expenditure may also be organised when the nature of the expenditure allows it to be covered by a single individual request each time.
Authority Competent to Control Expenditure Commitments
1. Control of expenditure commitments shall be carried out in the name of the Minister of Finance by: - The Head of the Budget and Expenditure Control Service, acting as Central Controller of Expenditure Commitments. - Controllers seconded to ministries who represent the Central Controller.
- 1)The Central Controller may delegate his representation in certain ministries to staff members under his authority who will handle the review of transactions referred to him. He may also delegate certain of his powers to them.
- 2)The procedures for controlling expenditure commitments shall be established by decree issued on the proposal of the Minister of Finance;(1) the powers of controllers seconded to ministries shall be determined by decision of the Minister of Finance.
- 3)Controllers shall be assigned among ministries by decision of the Minister of Finance on the proposal of the Director General.
- 4)No controller seconded to a ministry may begin his assignment before completing a training period of at least three months in the Budget and Expenditure Control Service.
1. See Decree No. 324 of 13 November 1964 defining the procedures for controlling expenditure commitments.
Duties of the Controller of Expenditure Commitments
The purpose of the controller's review is to verify the following two matters: - The availability of the expenditure appropriation and the correctness of its classification. - The conformity of the transaction with the applicable laws and regulations, unless it is subject to oversight by the Civil Service Council, in which case it shall not be reviewed by the controller from a financial standpoint.
Time Limit for Endorsing a Transaction
The controller shall endorse the appropriation reservation request and the transaction and return the documents to their source within at most five days of the date of their receipt. If this period expires without a decision being made, the competent administration may retrieve the transaction and implement it at his own responsibility. If the controller requires written clarifications from the competent administration, the five-day period shall be extended commencing from the date of receipt of such clarifications. This may be done only once. If the transaction is subject to prior review by the Court of Audit, the controller shall forward it to the Court after endorsement, accompanied by his comments.
Cases where Endorsement of the Appropriation Reservation Request is Sufficient
The controller's endorsement of the appropriation reservation request shall be deemed equivalent to endorsement of the subsequent transaction in the following cases:
- 1)Expenditure committed by means of a statement or invoice pursuant to the provisions of the first paragraph of Article 151 of this Law.
- 2)Staff assignment orders.
- 3)Staff reclassification.
- 4)In general, expenditure for which a blanket appropriation reserve has been made in accordance with the provisions of the last paragraph of Article 63 of this Law.
Types of Endorsement
The controller's endorsement is of two kinds: - Total: covering the full value of the expenditure for which a commitment is requested. - Partial: limited to a portion of the expenditure for which a commitment is requested. In the event of a partial endorsement or a refusal of endorsement, the controller must state the reasons for his position. A partial endorsement shall not be given when it results in a reduction of the requested expenditure due to a material or arithmetic error.
Effects of Partial Endorsement
- 1)If the Central Controller gives a partial endorsement or refuses endorsement, he must refer the transaction to the Minister of Finance. If the Minister of Finance agrees with his position, the competent minister may refer the matter to the Council of Ministers for decision. If the Minister of Finance does not agree with the said position, the Central Controller must comply with the minister's decision subject to the provisions of the Law on the Court of Audit.
- 2)If the controller seconded to a ministry gives a partial endorsement or refuses endorsement, he must refer the transaction to the Central Controller. If the Central Controller agrees with his position, he shall refer the transaction to the Minister of Finance in accordance with the provisions of the preceding paragraph. If he does not agree, the controller must comply with the Central Controller's decision.
Refusal of Endorsement due to Insufficiency of Appropriation
The Council of Ministers may not approve the commitment of expenditure in respect of which the controller has refused endorsement due to the absence of a sufficient appropriation.(1)
1. Reading Articles 70 and 71 together reveals that a fortiori the Minister of Finance is entitled to overrule the position of the Controller of Expenditure Commitments when the latter refuses endorsement due to insufficiency of appropriation.
Advisory Role of the Controller of Expenditure Commitments
The competent administration may seek the opinion of the controller seconded to it on its financial matters, in particular on the draft budget and the supplementary appropriation requests it submits.
Amendment of Previously Committed Expenditure
The authority competent to make a commitment may request an increase or reduction in previously committed expenditure, provided that all necessary supporting documents are attached to the amendment request.
Definition of Expenditure Liquidation
Liquidation of expenditure is the verification of the crystallisation of the debt obligation on the State, the determination of its amount, its due date and the fact that it has not lapsed by operation of the statute of limitations or for any other reason.(2)
2. The debt does not lapse, for example, by payment or set-off.
Authority Competent for Liquidation
Liquidation shall be carried out by the competent accountant or by the person to whom he delegates this task with the approval of his hierarchical superior. The accountant of the General Directorate of Finance shall carry out the liquidation of expenditure paid from the debt service chapter.
Documents on which Liquidation is Based
Liquidation shall be based on documents capable of proving the existence of the debt. These documents shall be specified for each category of expenditure by decision of the Minister of Finance adopted after consulting the Court of Audit, and published in the Official Gazette.(3) A statement certified by the head of the unit responsible for implementing the expenditure shall also be required when the expenditure exceeds 50,000 L.L. Schedules issued by the electronic centre of the General Directorate of Finance equivalent to salaries, wages, pensions and their supplements, and monthly allowances of all kinds, shall have the force of certified documents and shall not require the signature of the relevant authorising officials. The details of application of this paragraph shall be defined, where appropriate, by decision of the Minister of Finance.
3. See Decision No. 1/59 of 7 January 1966 defining the documents capable of proving the existence of a debt.
Amended 1987Amended 1990Amended 1994Amended 1991Amended 1992Amended 1993
Liquidation Procedures
- 1)Liquidation shall be carried out spontaneously and, if this is not possible, at the request of the creditor.
- 2)The liquidating official must complete the liquidation within at most five days of the date on which the relevant supporting documents are received.
- 3)The creditor shall have the right to request from the liquidating official a certificate indicating the date of submission of his request and the list of supporting documents provided.
Determination of the Liquidation Instrument
Liquidation shall be carried out on the basis of the instrument specifying the debt in detail.
Definition of the Payment Order
A payment order is a document authorising the payment of its value.
Authority Competent to Issue Payment Orders and its Duties
- 1)Payment orders shall be issued, in the name of the Minister of Finance, by the Head of the Payment Service in the Ministry of Finance. This official may delegate certain of his powers to staff of his service, provided they are of at least the third grade. He may also delegate his representation in certain ministries to members of his service who will handle the review and preparation of payment orders locally.
- 2)Where appropriate, the duty of issuing payment orders may be delegated in public administrations and governorates, except the Governorate of Beirut, to officials of at least the third grade belonging to the Ministry of Finance staff, to be effected by decree.
- 3)The authorising officer must complete the payment order procedure within seven days of the date of its receipt, extendable to ten days for the last salary payment orders.
- 4)If the authorising officer requires written clarifications from the competent administration, the five-day period shall begin from the date of receipt of such clarifications. This may be done only once.
Possibility of Issuing Payment Orders during January of the Following Year
Payment orders for the financial year's expenditure may continue to be issued up to 31 January of the following year, provided they are dated 31 December of the year against which they are charged.
Concept of Prior Years' Expenditure
Amounts that accrued to third parties against the State during a given financial year but were not paid by the end of February of the following year, for any reason whatsoever, are called prior years' expenditure.
Amended 1966
Conditions for Issuing a Payment Order
A payment order may only be issued after verifying the following:
- 1)That the expenditure commitment transaction has been signed by the competent authority and endorsed by the Controller of Expenditure Commitments.
- 2)That the classification of the expenditure matches the commitment transaction.
- 3)That the expenditure calculations are correct.
- 4)That the liquidation transaction conforms to the financial laws and regulations only.
Issuance of a Separate Payment Order for Each Creditor
A separate payment order shall be issued for each creditor when payment is made from a single budget line or a single paragraph.
Persons in Whose Name the Payment Order is Issued
The payment order shall be issued in the name of the creditor or, on his behalf, in the name of his agent, secretary or proxy for collection, and in the name of his heirs in the event of his death. It shall be issued in the name of the head of the Treasury Service if the State is the creditor, and in the name of the competent accountant if the creditor is a municipality or a public institution. It shall be issued in the name of the competent governor if it relates to amounts due to minors who have no municipality, provided the amount is deposited in trust in the name of the said governor with the central district accountant.
Special Cases for Issuing Payment Orders
A payment order may be issued:
- 1)In the name of an authorised agent for collection designated by the competent administration, with respect to staff salaries, expenses and pensions.
- 2)In the name of the official who paid the amount from his own funds, with respect to transport allowances and certain petty expenses.
- 3)In the name of the seller on credit, with respect to expenditure paid from his own funds.
- 4)At the request of the beneficiary administration, payment orders relating to expropriation compensation may be issued in the name of the district accountant in whose district the expropriated properties are located, or the adjacent district, provided the conditions for payment of such compensation are established by decision of the Minister of Finance.
Obligation to Communicate Garnishment Orders and Deed of Assignment to the Authorising Officer
Garnishment orders and assignment instruments relating to debts owed by the State shall be communicated to the authority competent to issue payment orders. No notification addressed to any other person shall be deemed valid. The said authority must respond within the legal time limit to the party that notified it of the garnishment, and must record the garnishment or assignment on the payment order after its issuance.
Obligation to Sign the Payment Order
The payment order shall be signed by the competent authority and forwarded to the competent accountant for payment.
Amended 1966
Case of Loss of a Payment Order
If a payment order is lost, its holder shall be provided with a copy thereof upon his written request stating the reasons for the loss, together with a written certificate from the Central Accountant confirming that the payment order has not been paid and that notice has been taken of the obligation not to pay it.
Duties of the Accountant
A payment order becomes valid for payment after endorsement by the Central Accountant, or by the person to whom he delegates this task with the approval of the competent Director General. This official shall: a. Refuse endorsement and return the payment order to its source with a statement of reasons for the refusal in the following cases: First: if the payment order is not accompanied by the signature of the authority competent to issue it. Second: if the supporting documents for the expenditure are not attached to the payment order. Third: if the name of the creditor, the subject of the expenditure or its amount does not correspond to the supporting documents. b. Complete the transaction and place the relevant payment instrument under the disposal of the competent administration within three days of its receipt.
Amended 1966
Payment Orders Issued in the Governorates
The procedures for paying payment orders issued in the governorates shall be established by decrees adopted on the proposal of the Minister of Finance.
Amended 1966
Method of Paying Payment Orders
Payment orders shall be paid in cash from the cashbox where they are held. Payment may also be effected by bank transfer.
Payment of Staff Salaries
Staff salaries for the month of January shall, by way of exception, be paid during the last ten days of December.
Powers of Accountants
Accountants shall carry out: - Receipt of the assessment schedules, collection orders and recovery orders deposited with them by the relevant authorities, and ensuring their collection. - Receiving all receipts, of whatever nature. - Making all payments, either on the basis of payment orders or payment instructions issued by the competent authority, or in certain cases on the basis of payment instructions issued by them directly. - Safekeeping of the supporting documents relating to these operations and accounting records. - Maintenance of the accountancy accounts they manage.
Powers of the Central Finance Accountant
The Central Finance Accountant shall, in addition to the foregoing, centralise all revenue and expenditure operations relating to the general budget carried out by any central accountant, and shall also manage the State Treasury account held at the Central Bank.
Prohibition on Combining Administrative and Accounting Functions
The function of accountant may not be combined with any function relating to the assessment of revenues, or any function relating to the commitment, liquidation or payment order issuance of expenditure.
Conditions for an Accountant to Exercise his Functions
Before entering upon his duties, the accountant must provide a legal security whose value shall be determined by decision of the Minister of Finance, and must take an oath before the Court of Audit.(1)
1. The value of this security was set at twenty thousand Lebanese pounds by Decision No. 213 of 29 May 1986. See also Decree No. 2829 of 14 December 1959; Decision No. 1430 of 6 June 1974; Decision No. 1525 of 13 October 1977; and the Law of 20 August 1956.
Method of Providing the Security
The security shall be provided either in cash, or by bank guarantees issued by approved banks, or by registering immovable properties in the land registry. The papers and documents relating to the security provided shall be kept at the General Accounting Service of the Ministry of Finance, together with a copy of the text ordering the appointment of the accountant.
Ensuring Payment through a Cashier
The accountant may not personally receive or pay funds under his management; this shall be done through cashiers or tax collectors under his authority, except in cases established by special decree.(1)
1. With regard to the authorisation of certain accountants to personally receive funds, see: Decree No. 2837 of 14 December 1959; Decree No. 2840 of 14 December 1959; Decree No. 4024 of 4 May 1960.
Supervision of Cashiers' Activities
The accountant must supervise the work of the cashiers and tax collectors under his authority and must call them to account for any breach or delay in their work.
Personal Liability of the Accountant
The accountant shall be personally liable, from his own funds, for every receipt or payment operation carried out in the accountancy office he manages in contravention of the provisions of the law, in addition to any disciplinary or criminal penalties he may incur.
Limits of Liability
The accountant shall only be liable for his personal management.
Operations for which Liability is Borne
The accountant's duties cover all operations he carries out in his accountancy office from 1 January to 31 December of each year, or during the period he held his position, if that period is less than one year.
Account of Assignment
Central accountants, and likewise local accountants referred to in paragraph 2 of Article 160, shall submit their assignment accounts to the Court of Audit in their own names and on their own responsibility. Local accountants referred to in paragraph 3 of Article 160 shall submit their assignment accounts in their own names and on their own responsibility to the central accountant to whom they are attached, within conditions and time limits established by decree issued on the proposal of the Minister of Finance.(2)
2. The rules and deadlines for organising, auditing and consolidating assignment accounts and financial statements were established by Articles 16 to 19 of Decree No. 3373 of 11 December 1965.
Handover and Takeover Record
Upon the expiry of the accountant's assignment, a handover and takeover procedure shall be carried out between him and his successor by means of a record signed by both of them, in the presence of a financial inspector for central accountants and an official designated by the competent administration for local accountants. A copy of the record shall in both cases be sent to the Financial Inspectorate. A trial balance of accounts dated the day of the handover and takeover procedure must be attached to this record as a mandatory requirement.
Case Where the Successor Cannot Perform his Duties
In the event of the accountant's death, or his inability to present the handover and takeover record, the successor accountant shall draw up the assignment account of the predecessor accountant under the supervision of a financial inspector.
Return of the Accountant's Security
The security(1) shall be returned after the accountant obtains a discharge from the Court of Audit and shall be returned automatically after three years have elapsed since the accountant left his assignment, if the Court is late in issuing its decision beyond that period.
1. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Liability of Accountants and Financial Collectors
- 1)Local accountants and collectors shall be jointly and severally liable for direct taxes and other funds entrusted to them for collection.
- 2)The head of a tax collection directorate shall be personally liable for the direct taxes and other funds entrusted to him for collection; he is required to provide the security required of accountants.
- 3)The extent of the liability of the officials referred to in paragraphs 1 and 2 of this article, and the procedures to be followed to mitigate their liability or issue a discharge of their obligations, shall be established by decree adopted on the proposal of the Minister of Finance.(2)
2. The liability of accountants and collectors was established by Decree No. 5933 of 3 November 1966.
De Facto Accountant
Any person who intervenes in the management of public funds without holding the status of accountant shall be treated as an accountant responsible for his actions, like the official accountant, and shall be subject to the latter's obligations.
Expenditure of External Missions
Permanent budget advances shall be placed at the disposal of external missions, to be used by each mission to pay its expenditure for at least six months.
Special Award Committee
Contracting in external missions shall be handled by a special committee appointed by decision of the head of the mission wherever possible; otherwise it shall be carried out in accordance with procedures established by decision of the Minister of Foreign Affairs and Emigrants.
Expenditure of External Delegations
The expenditure of delegations abroad may be evidenced by detailed statements certified by the head of the delegation on his own responsibility.
Representation Expenditure Abroad and Administrative Expenditure
Representation expenditure abroad may be evidenced by detailed statements prepared by the head of the external mission and certified by the Secretary General of the Ministry of Foreign Affairs and Emigrants. Administrative expenditure incurred by external missions shall also be evidenced by the same method if the expenditure does not exceed 500 pounds each time.
Mechanisms for Committing and Disbursing Expenditure and Bookkeeping Procedures
Notwithstanding any other provision or measure, Lebanese diplomatic and consular missions shall apply the financial instructions issued by the joint decision of the Ministers of Finance and of Foreign Affairs and Emigrants dated 29 April 1999 and its amendments, with regard to the mechanisms for committing and disbursing expenditure, conditions for commitment, appropriation reservation and annual carry-over, bookkeeping procedures, organisation of entries, receipt of funds and their disbursement.
Amended 2017
Role of Ministries in Preparation
Each minister shall, before the end of May of each year, prepare draft expenditure estimates for his ministry for the following year and forward them to the Minister of Finance together with the supporting documents, statistics and explanations required to justify each of the requested appropriations,(1) in accordance with procedures to be established by the Minister of Finance.
1. The rules for preparing the budget were established by Decision No. 1/3028 of 16 April 1996.
Role of the Minister of Finance in Preparation
The Minister of Finance shall estimate revenues on the basis of his ministry's projections and those of the ministers responsible for assessing or collecting certain revenues on his account.
Direct Estimation of Revenue
Revenue for the new year shall be estimated on the basis of the following two elements:
- 1)Collections of the most recent year for which the draft closing of accounts has been completed.
- 2)Collections for the months of the current year that have elapsed.
- 3)The Minister of Finance may adjust the estimate on the basis of circumstances he assesses, provided he states his reasons.
Balancing Revenue and Expenditure
The Minister of Finance shall consolidate expenditure estimates, match them against revenue estimates and draw up the draft budget after ensuring its balance between the two sections. If the appropriations requested exceed the estimated revenues, the Minister of Finance shall ensure balance by proposing such of the following measures as he deems necessary:
- 1)Reduction of expenditure.
- 2)Covering the difference from the reserve fund, if feasible.
- 3)Creating new sources of revenue.
Submission of the Draft Budget to the Council of Ministers
The Minister of Finance shall submit the draft budget to the Council of Ministers before 1 September, accompanied by a report analysing the requested appropriations and the significant differences between the figures of the draft and those of the current year's budget.
Referral of the Draft Budget to the Chamber of Deputies
The Council of Ministers shall finalise the draft budget and submit it to the legislative authority within the time limit prescribed by the Constitution.(1) The Minister of Finance shall present to the legislative authority, before 1 November, a detailed report on the economic and financial situation in the country and on the principles adopted by the Government in the draft budget.(2)
1. See Article 83 of the Constitution, which requires the Government to submit the draft budget to the Chamber of Deputies at the opening of the October session (and in the same sense also Article 32 of the Constitution).
2. The Minister of Finance's report is known as the 'budget memorandum'.
Competence of the Finance and Budget Committee
No increase may be introduced to the draft budget, or to draft supplementary appropriations, during debate in the competent parliamentary committee or in the Chamber of Deputies, except after obtaining the written opinion of the Ministry of Finance and the approval of the Council of Ministers.
Section 3Implementation of the General Budget
Implementation of the General Budget
Subsection 1Implementation of Revenue
Implementation of Revenue
Subsection 1-1Assessment of Taxes and Fees
Subsection 1-2Collection of Taxes and Fees
Subsection 1-3Collection of State Debts and Other Revenue
Subsection 1-4Sale of State Property
Subsection 1-5General Provisions
Parts of the Expenditure Budget
The expenditure budget is divided into two parts: - Part One: comprising ordinary expenditure. - Part Two: comprising equipment and construction expenditure and the State's investment contributions. The content of each of the two aforementioned parts shall be defined by a decision of the Minister of Finance.
Amended 1966Amended 1968
Division of Expenditure into Chapters
Each of the two aforementioned parts of the expenditure section shall be divided into chapters. The number of chapters in each part shall be determined by a decision of the Minister of Finance.
Division of Chapters into Sections, Lines and Paragraphs
Each chapter shall be divided into sections, each assigned to a single administration or group of administrations or a single project or group of projects. Each section shall be divided into budget lines, each assigned to expenditure of a single type or similar nature, and each line shall be divided, where appropriate, into paragraphs. A model table for the division of appropriations shall be established by a decision of the Minister of Finance.
Contents of the Salaries Budget Line
The salaries budget line shall indicate: 1. With respect to permanent and temporary staff: - The total number of staff by grade, together with the total of their salaries and supplements. 2. With respect to retirees: - Their number together with the total of their pensions and supplements.
- 1)With respect to workers:
- 2)For permanent workers:
- 3)Their number together with the total of their wages and supplements.
- 4)For non-permanent workers:
- 5)The total of their wages and supplements.
Transfer of Appropriation from One Paragraph to Another
Appropriations for similar works may be distributed among paragraphs within a single budget line. The following rules shall apply in such cases:
- 1)The appropriation earmarked for each project shall be treated as a separate paragraph.
- 2)Transfer from the appropriation earmarked for one project to another project may be made:
- 3)After works have commenced, provided at least fifteen per cent of the original appropriation is retained.
- 4)After completion of the project and settlement of the contract.
- 5)Transfer shall only be permitted to a project similar to the first project and located in the same area.
Special Expenditure Incumbent on the State
1. A separate section shall be set aside in each chapter of the expenditure section from which the value of monetary judgments rendered against the State and settlements concluded by it shall be paid, when no appropriations are available in the relevant budget lines for such expenditure. This section shall be funded by transferring from the global appropriation set aside in the budget reserve chapter in accordance with Article 26 below.
2. Amounts collected by the Treasury in error or without legal basis shall be refunded by deducting them from the budget revenue account in which they were originally received, i.e. by entering them on the debit side of the revenue account; no appropriation shall be opened in the budget for this purpose.(1) Only balances shall be recorded in the field of amounts collected from the budget closing of accounts for revenue accounts.
3. A separate section shall be set aside in each chapter of the expenditure section, during a transitional period ending in 1966, called 'prior years' expenditure', from which amounts that accrued in favour of third parties in years prior to 1963 and were not paid during those years shall be drawn. No appropriation shall be entered in the aforementioned section when the budget is prepared; instead, expenditure paid from it shall be covered by amounts taken from the reserve fund endorsed by the closing of accounts law.
1. By virtue of the above-mentioned laws, this paragraph was repealed and replaced by a paragraph that was supposed to be new; however, the new paragraph was always identical to the repealed one.
Amended 1973Amended 1974Amended 1975Amended 1976Amended 1977Amended 1966
Budget Reserve
- 1)The following shall be set aside in the budget reserve chapter:
- 2)Reserve appropriations for expenditure shared among several ministries, such as sickness and death assistance, monetary judgments, settlements, etc.
- 3)A contingency reserve appropriation to be used to replenish budget lines whose appropriations have been exhausted, or to open exceptional appropriations, provided that this reserve appropriation shall not be less than one per cent of the total appropriations of Parts One and Two of the budget.
2. Should the appropriations earmarked for monetary judgments and settlements be exhausted, the Government may, by decree adopted in the Council of Ministers, open the necessary complementary appropriations and cover them from the reserve fund, to be ratified by the closing of accounts law. The provisions of this paragraph shall also apply when appropriations earmarked for pensions and severance pay are exhausted.
3. No expenditure shall be paid directly from the appropriations of this chapter; instead, these appropriations shall be transferred when needed to the relevant budget lines as follows: - By decision of the Minister of Finance, on the proposal of the competent authority and after endorsement by the Central Controller of Expenditure Commitments, with respect to the appropriations referred to in sub-paragraph (a) of the preceding paragraph. - By decree issued on the proposal of the competent minister and the Minister of Finance, with respect to the appropriations referred to in sub-paragraph (b) of the preceding paragraph.
Opening of Supplementary Appropriations and Their Coverage
1. Subject to the provisions of Article 85 of the Constitution and Article 26 of this Law, supplementary appropriations shall only be opened by law. Such appropriations shall be covered by transfer from other budget lines, or from the budget reserve chapter, or by drawing from the reserve fund, or by new revenues.
- 1)Subject to the provisions of Article 26 of this Law, appropriations shall only be transferred from one budget line to another by law.
- 2)Subject to Article 114 of this Law, appropriations shall only be carried over from one year's budget to the following year's budget by law.
Procedure for Transfer from One Paragraph to Another
- 1)Subject to the provisions of Article 24 of this Law, appropriations shall be transferred from one paragraph to another within the same budget line by decision of the competent minister after endorsement by the Central Controller of Expenditure Commitments. Transfer by the same procedure to a new paragraph shall also be permitted where that paragraph covers a type of expenditure assigned to the budget line.
- 2)Appropriations earmarked in the chapters on debt service and budget reserve shall be transferred from one paragraph to another within the same budget line by decision of the Minister of Finance after endorsement by the Central Controller of Expenditure Commitments.
- 3)Transfer from one paragraph to another within a given year's budget may be effected up to 31 January of the following year.
Rules for Assessment of Taxes and Fees
The following rules shall apply to the assessment of taxes and fees unless the law provides otherwise.
Authority Competent to Assess Taxes and Fees
The assessment of direct taxes collected by means of assessment schedules shall be carried out by the competent central financial directorate or the competent financial directorate in the governorate; the Director of Revenue shall endow these schedules with executive force. The assessment of other taxes and fees shall be carried out by the head of the financial directorate or competent unit in each governorate by means of judicial orders issued by him.
Amended 2003
Concealment or Shortfall in Tax Assessment
Any concealment or shortfall in the assessment of direct and indirect taxes and fees may be remedied up to the end of the third year following the year in which the assessment should have been made, by means of additional assessment schedules or judicial orders for concealed assessments, and by means of supplementary assessment schedules or judicial orders for deficient assessments.
In addition to the remedy period referred to in the first paragraph of this article, the competent financial directorates shall benefit from an additional exceptional period to remedy the Treasury's right to impose a tax or fee on any profit, income, revenue or instrument revealed by a judicial ruling, an arbitral award, a probate proceeding or a settlement agreement, and likewise to correct any assessment ordered to be annulled.
This exceptional period shall end on 31 December of the year following the year in which the annulment was decreed or the profit, income, revenue or taxable instrument was discovered.
Amended 1973
Publication of Assessment Schedules Placed under Collection
The placing of basic assessment schedules under collection shall be announced through the Official Gazette, radio and local newspapers. Announcements to this effect shall be posted, where appropriate, at the offices of collectors and in public gathering places and squares. The announcement shall specify the deadline for payment, the entitlement to the legal discount, the right of objection, and the date on which each begins.
Deadline for Objecting to Taxes and Fees
The deadline for objecting to taxes imposed by means of basic assessment schedules shall begin on the day following the date of publication of the relevant announcement in the Official Gazette.
The deadline for objecting to taxes imposed by means of additional or supplementary assessment schedules, and to taxes and fees imposed by judicial orders, shall begin on the day following the date on which the taxpayer is notified of these documents.
Such notification shall be effected by registered letter with acknowledgment of receipt. If the taxpayer is absent or refuses to accept delivery, notification shall be effected through the competent administration in accordance with the notification rules provided for in the Code of Civil Procedure.
The objection deadline shall be two months for direct taxes assessed by means of assessment schedules, and one month for other taxes and fees.
Rules for Objecting to Taxes and Fees
1. The procedures for objecting to the various taxes and fees and the time limits for their determination by the administration and objection committees shall be established by decree issued on the proposal of the Ministers of Finance and Justice within three months of the date of publication of this Law in the Official Gazette.
2. The procedures and time limits established in the aforementioned decree shall supersede all special provisions relating to objections contained in the various tax and fee laws.
Cancellation or Reduction of Tax Assessments
Notwithstanding any other provision, the tax directorates in the General Directorate of Finance may not order the cancellation or reduction of tax and fee assessments except with the approval of the head of the Revenue Service, unless the matter involves a material error or an amount not exceeding 50 per cent of the assessment value, provided the amount does not in any case exceed 500 L.L. per assessment.
Tax Assessment Monitoring Unit
A tax assessment monitoring unit shall be established to ensure supervision of the various tax and fee assessment operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.
Law on Collection of Taxes and Fees
No tax or fee may be collected unless the legislative authority has authorised this by virtue of the budget law or any other law.(1) Violators shall be prosecuted in accordance with Article 361 of the Penal Code.
1. The principle of 'no taxation without a law' is enshrined in Article 81 of the Constitution.
Persons Responsible for Collecting Taxes and Fees
Taxes and fees shall be collected on the basis of assessment schedules or collection orders by which they were assessed, unless they are of the type paid by the taxpayer directly by affixing stamps or equivalent instruments. Persons other than accountants and their staff may not undertake the collection of taxes, fees and other public revenues.
Statute of Limitations for Taxes and Fees
Taxes and fees of all kinds shall lapse against taxpayers by operation of the statute of limitations on 31 December of the fourth year following the year in which the assessment was made. The running of the limitation period shall be interrupted by the commencement of judicial proceedings provided for in the law. An injunction shall be deemed the commencement of proceedings provided it is notified in accordance with the provisions of Legislative Decree No. 147 of 12 June 1959. The injunction shall be renewed where necessary before the expiry of four years from the date of its notification to the person concerned.
Amended 1966
Retention of Assessment Schedules and Collection Orders
Assessment schedules shall be retained for a period of ten years, and collection orders for a period of five years, unless the Court of Audit orders, prior to the expiry of the retention period, a discharge of liability for those responsible for collection.(2)
2. The Court of Audit issues a discharge of liability for those responsible for collection within the framework of its judicial oversight of accounts (Articles 59 to 65 of the Law on the Organisation of the Court of Audit).
Collection Monitoring
A collection monitoring unit shall be established to ensure supervision of the tax and fee collection operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 16843 of 10 July 1964 defining the powers and duties of the Collection Monitoring Division within the Treasury Service.
Collection by Means of a Collection Instrument
The specific rules applicable to each type of State debt and other revenue, other than taxes and fees, shall govern their settlement and collection and the procedures for pursuing them. For debts and revenues in respect of which the applicable laws do not define the manner of their settlement and collection and the related proceedings, they shall be settled by means of collection orders issued by the head of the competent authority and collected in accordance with the procedures followed for the collection of direct taxes and equivalent fees. Objection to collection orders may be lodged before the competent administrative court at the place of residence of the debtor within two months of the date of notification of the order to him or at his place of residence. Filing an objection shall not suspend enforcement of collection orders unless the court so orders in whole or in part.
Sale of Immovable State Property
Immovable State property shall be sold in accordance with the special provisions applicable thereto.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Sale of Movable State Property
Movable State property shall be sold:
- 1)By mutual agreement if its assessed value does not exceed 3,000,000 L.L. (three million Lebanese pounds).
- 2)By invitation to tender if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
- 3)By public auction and by other available methods if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
Amended 1978Amended 1987Amended 1990Amended 2004
Authority Competent to Decide on the Sale of Movable State Property
Contracts for the sale of movable property shall be decided upon by: 1. In central administration: - The competent director, if the contract value does not exceed 150,000 L.L. - The competent director general, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L. 2. In governorates and districts: - The district commissioner (Qaimaqam), if the contract value does not exceed 150,000 L.L. - The governor, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L.
Amended 2004
Valuation of Movable Property
Movable property shall be valued by a committee established in each administration by decision of the authority competent to decide on the contract.
Oversight by the Court of Audit
Sale transactions subject to its oversight shall be submitted to the Court of Audit by the authority competent to decide on the contract.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Comprehensiveness of Revenue
All revenues received shall be recorded in their entirety in the revenue section of the budget.(2)
2. Recording all revenue in the revenue section confirms the adoption of the gross principle, i.e. the absence of netting between revenue and expenditure and the consequent application of the gross recording principle to both.
Gifts and Property Donated to the State
- 1)Cash and in-kind gifts offered to the State by legal or natural persons shall be accepted by decree issued on the proposal of the competent minister and the Minister of Finance if their value does not exceed 250,000,000 Lebanese pounds.
- 2)Cash and/or in-kind gifts offered to the State by legal or natural persons shall be accepted by decree adopted in the Council of Ministers if their value exceeds 250,000,000 Lebanese pounds.
- 3)Cash gifts received by the Lebanese Treasury shall be recorded in the revenue section of the budget; if these gifts have a specified destination for expenditure, appropriations shall be opened for them in the expenditure section in accordance with established procedures.
- 4)The Ministry of Finance shall prepare a quarterly statement of the gifts referred to in paragraphs (1) and (2) above that have been received by the Lebanese Treasury and shall submit it to the Council of Ministers for information.
Amended 2019
Revenue Accounts
The Ministry of Finance shall maintain, for each category of budget revenue and for each year separately, an independent account showing: - Prior years' balances, year by year. - Total revenues realised pursuant to assessment schedules and collection orders issued during the year. - Total collections up to 31 December of the year, broken down between the current year and each prior year. - Legal discounts utilised by taxpayers. - Uncollected balances at the end of the year. Each ministry shall also maintain a detailed account of the revenues it handles, for each year separately, on the basis of the collection orders it issues or that are issued at its request.
Functions of the State Treasury
The State Treasury shall handle all receipt and payment operations required for the implementation of the State budget and shall manage the accounts opened outside the budget.
Functions of the Accountant
Receipt and payment operations on behalf of the Treasury shall be carried out by officials each known as an accountant; however, the accountant may delegate certain of his powers to one of the accountants under his authority with the approval of the Head of the Treasury Service.(2)
2. The accountant was granted additional powers by Legislative Decree No. 25 of 17 January 1955.
Amended 1966
Categories of Accountants
Accountants are of two categories: central and local.
- 1)The central accountant is responsible for budget revenues and expenditure, and for off-budget operations.
- 2)The local accountant is responsible for off-budget operations and locally provides for the receipt of budget revenues and the payment of budget expenditure on behalf of the central accountant to whom he is attached.
- 3)In certain public administrations, the central accountant may be tasked with centralising all operations of the local accountants under his authority, whether these operations are within or outside the budget.
- 4)If a public administration has only one accountant, that accountant shall be treated as a central accountant for the purposes of this Law.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Central Accountants
Central accountants are: - The Central Finance Accountant. - The Central Customs Accountant. - The Central Post and Telegraph Accountant. - The central accountant of each administration with an annexed budget. - Any official assigned this status by decree.
Local Accountants
Local accountants are: - Finance accountants. - Customs accountants. - Post and telegraph accountants. - Accountants of administrations with annexed budgets. - Any official assigned this status by decree.
2. See, with regard to customs accountants, the following texts: Decree No. 4024 of 4 May 1960; Decree No. 11028 of 6 November 1962; Decree No. 11029 of 6 November 1962; Decree No. 11030 of 6 November 1962; Decision No. 173 of 8 May 1964.
General Chart of Accounts
Operations carried out by the accountant shall be recorded in accounts maintained in accordance with a general chart of accounts established by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 10388 of 9 June 1997 on the general chart of accounts for the State, public institutions and municipalities.
Methods of Bookkeeping
Public funds accounts shall be maintained by central accountants and the General Accounting Service on the basis of the double-entry method, and by local accountants on the basis of the single-entry method.(4)
4. With regard to defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements, see Decree No. 3373 of 11 December 1965.
Obligation to Maintain and Correct Entries in Ink
Entries shall be made in ink compulsorily and shall under no circumstances be made in pencil; erasure, insertion, obliteration or correction fluid in papers, tables, documents, entries, ledgers or records shall also be prohibited. However, any error therein may be corrected, provided the correction is made in a visible manner by crossing out the deleted letters and figures, using ink of a colour different from that used in the original, and that the correction is accompanied by the date and the signature of the person making it.
Salary and Allowance Appropriations
Salary and allowance appropriations relating to army personnel and members of the Internal Security Forces and General Security shall be entered in a single budget line without breakdown.
Award Committee
Contracting shall be handled by a special committee established in accordance with a system determined by decree on the proposal of the competent minister.
Mutual Agreements
Mutual agreements may be concluded for the supplies, works and services required by the army, the Internal Security Forces, the General Security and the customs detachments in times of war, emergencies and exceptional circumstances requiring immediate measures, on the basis of a reasoned order from the army commander.
Exemption from Certain Contract Conditions
When the Ministry of National Defence concludes contracts with foreign governments or institutions affiliated to them, or when such governments recommend them, for the purchase of weapons, ammunition, equipment and apparatus, it may exempt the counterpart from conditions relating to place of residence, security, penalties, and the obligation of delivery before receipt.
Possibility of Re-using Certain Appropriations
The Ministry of National Defence may request, in accordance with the procedures established in Article 117 of this Law, the re-use of the corresponding appropriations:
- 1)For the value of materials supplied by the army administration at a price to officers and personnel in their personal capacity.
- 2)For the value of materials charged to officers and personnel responsible for their loss or damage.
- 3)For the value of weapons, ammunition, equipment and apparatus sold by the army command to any administration or public institution.
- 4)For the value of materials used and the value of services rendered on behalf of public administrations and institutions or for the benefit of any natural or legal persons.
Amounts Paid in Error or Without Legal Basis
The Ministry of National Defence may deduct from entitlements to salaries paid from current year appropriations amounts paid in error or without legal basis in prior years.
Amounts Received in Excess
Salaries and supplements thereto, and transport and movement advances received by units in a given year in excess of their rights, and returned to the Treasury before the end of the following year, shall be entered by their return date in the current year's revenue in accordance with Article 8 of this Law. Additional appropriations equivalent to the value of the returned amounts may be opened by decision of the Minister of Finance in the salaries budget line of the army, provided they are covered by a corresponding increase in revenues.
Possibility of Committing Expenditure against the Following Year
Commencing from 1 August of each year, the Minister of National Defence may commit against the following year equipment expenditure amounting to two-thirds of the appropriations earmarked for this purpose for the current year in the army, Internal Security Forces and General Security budgets and those allocated to the customs detachments in the Ministry of Finance budget. Expenditure in respect of items not previously approved by the legislative authority may not be committed in this way. The provisions of Articles 137 and 138 of this Law may also be applied to the contracts referred to in this article even before the new year begins.
Amended 1966
Article 227 was repealed by Article 17 of Law No. 72/5 of 1 February 1972.
Amended 1972
Appointment of Materials Accountants
Materials accountants in the army shall be appointed by decision of the army commander.
Security Requirements
Army accountants shall be subject to the security system applicable to all accountants.(1)
1. Military accountants were exempted from providing legal securities by the Law of 20 August 1956.
Limits of the Court of Audit's Oversight
The Court of Audit and financial inspectors may not request access to or review documents and information relating to military secrets, unless the army commander consents. The Court of Audit shall exercise its oversight of the army's materials accounts locally and on the basis of the records maintained by the units and the supporting documents they produce.
Provisions Applicable to the Internal Security Forces and General Security
The provisions of Articles 220 to 230 inclusive of this Law shall apply to the Internal Security Forces, with each of the Minister of Interior and the Director General of the Internal Security Forces exercising the powers granted to the Minister of National Defence and the army commander respectively, each as far as it concerns him. With regard to the General Security and the customs detachments, the provisions of Articles 220, 222, 228, 229 and 230 of this Law shall apply, subject to the special organisation of each of these two bodies.
Amended 1979Amended 1983Amended 1985
Subsection 2Implementation of Expenditure
Implementation of Expenditure
Subsection 2-1Commitment of Expenditure
Subsection 2-2Liquidation of Expenditure
Subsection 2-3Issuance of Payment Orders
Subsection 2-4Payment of Expenditure
Parts of Budget Revenue
The revenue section of the budget consists of two parts: First: comprising ordinary revenues allocated to cover the expenditure of Parts One and Two of the expenditure section. Second: comprising revenues allocated to cover the expenditure of Part Three of the expenditure section. The latter revenues consist of:
- 1)Drawings from the reserve fund.
- 2)Revenues assigned or created by special laws.
Division of Revenue Parts
Each part of the revenue section shall be divided into chapters, and each chapter shall be divided into sections, each assigned to a category of revenues; each section shall be divided into budget lines, each assigned to a specific revenue item. A special section shall be set aside in each part in which funds paid by the Treasury in error or without legal basis and subsequently recovered shall be recorded. A model table for the division of revenues shall be established by a decision of the Minister of Finance.
Reserve Fund
A special chapter with a single section for drawings from the reserve fund shall be set aside in each part of the revenue section. This section shall be divided into budget lines in accordance with the model table referred to in the preceding article.
Stages of Expenditure Implementation
The implementation of expenditure passes through four stages:
- 1)Commitment.
- 2)Liquidation.
- 3)Issuance of the payment order.
- 4)Payment.(1)
1. Article 34 of the Law on the Organisation of the Court of Audit provides that transactions for the sale of immovable property are subject to prior administrative oversight.
Definition of Expenditure Commitment
An expenditure commitment is any act that is capable of creating a debt obligation on the State.
Authority Competent to Make a Commitment
Expenditure shall be committed by the competent minister unless the law provides otherwise.
Requirement of a Specific Appropriation
No expenditure shall be committed unless a budget appropriation is available for it,(2) and no appropriation may be used for any purpose other than that for which it was earmarked.
2. See, regarding the principle of the prohibition on committing expenditure prior to the availability of an appropriation, paragraph 2 of Article 59 of this Law.
Suspension of Commitment of Supplies and Works Expenditure
Commitment operations for supplies and works expenditure(3) shall cease on 30 November of each year; however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases(4) assessed by the competent minister and the Minister of Finance.
3. Expenditure commitments for services do not cease on 30 November because Article 58 above restricts the suspension of commitment operations to supplies and works expenditure only.
4. The phrase 'however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases...' was added by correction of a material error published in Official Gazette No. 94 of 24 November 1966, p. 1728.
Amended 1966
Commitment of Expenditure against a Financial Year before Its Start
No expenditure shall be committed against a financial year before its commencement. However, commencing from 1 October of each year, permanent expenditure whose continuity is required by the public interest may be committed against the following year within the limits of the appropriations earmarked for it in the current year's budget; likewise, during the period preceding the publication of the budget, such expenditure may be committed after the new year has begun within the limits of the appropriations earmarked for it in the previous year's budget. Furthermore, liquidation, payment order and payment transactions may be carried out during the relevant financial year.(5)
5. This article permitted the executive authority to bypass the legislative authority by allowing it to take all stages of expenditure before the legislative authority approves the budget; in other words, this bypass leads to a violation of the principle of the prohibition on committing expenditure before an appropriation is available, as provided in Article 57 of this Law.
Amended 1987
The Twelfth Rule
1. Twelfth budgets shall be drawn up on the basis of the permanent appropriations earmarked in the previous year's budget, taking into account additions to and deletions from permanent appropriations. Appropriations transferred from the budget reserve shall not be treated as lapsed.
- 1)The Government shall have the right, by decree adopted in the Council of Ministers on the proposal of the competent minister and the Minister of Finance, to distribute the total construction and equipment appropriations in each twelfth budget among the various public administrations in accordance with their needs, while remaining bound by the appropriations allocated to each public administration in the draft budget for the current year.
- 2)Prior to the approval of the budget, the Government shall have the right, by decree adopted in the Council of Ministers, to transfer appropriations on the basis of the twelfth rule from the budget reserve in order to fund various budget lines.
1. The Minister of Finance was authorised, with respect to contracts for works or supply of equipment, to choose between the method of advance payment and the method of deferred payment pursuant to Article 12 of Law No. 78/16 of 2 May 1978 (Budget Law 1978).
Amended 1988Amended 1980
Requirement of Endorsement by the Controller of Expenditure Commitments
Every transaction leading to an expenditure commitment must, before it is signed, be endorsed by the Controller of Expenditure Commitments. However, in urgent emergency situations, the competent authority may proceed with committing expenditure within the limits of the appropriations earmarked for it prior to obtaining the endorsement of the Controller of Expenditure Commitments, provided it submits the transaction to him for review within at most one week of the date of commitment, together with a statement of the reasons that warranted this course of action; the committing officer shall remain responsible for the expenditure until it has been regularised in legal form. Every transaction leading to an expenditure commitment shall be accompanied by an appropriation reservation request (expenditure commitment request).
Appropriation Reservation Request
The appropriation reservation request required for an expenditure commitment shall be signed by the accountant of the competent administration or by his authorised delegate with the approval of his hierarchical superior.
Procedure for Issuing Appropriation Reservation Requests
Appropriation reservation requests shall be organised: - For the whole year, when they relate to salaries and similar staff expenditure. - For three or six months, when they relate to other permanent expenditure. - An individual request shall be organised whenever circumstances require. A blanket contingency request for reserving the appropriation required for permanent expenditure may also be organised when the nature of the expenditure allows it to be covered by a single individual request each time.
Authority Competent to Control Expenditure Commitments
1. Control of expenditure commitments shall be carried out in the name of the Minister of Finance by: - The Head of the Budget and Expenditure Control Service, acting as Central Controller of Expenditure Commitments. - Controllers seconded to ministries who represent the Central Controller.
- 1)The Central Controller may delegate his representation in certain ministries to staff members under his authority who will handle the review of transactions referred to him. He may also delegate certain of his powers to them.
- 2)The procedures for controlling expenditure commitments shall be established by decree issued on the proposal of the Minister of Finance;(1) the powers of controllers seconded to ministries shall be determined by decision of the Minister of Finance.
- 3)Controllers shall be assigned among ministries by decision of the Minister of Finance on the proposal of the Director General.
- 4)No controller seconded to a ministry may begin his assignment before completing a training period of at least three months in the Budget and Expenditure Control Service.
1. See Decree No. 324 of 13 November 1964 defining the procedures for controlling expenditure commitments.
Duties of the Controller of Expenditure Commitments
The purpose of the controller's review is to verify the following two matters: - The availability of the expenditure appropriation and the correctness of its classification. - The conformity of the transaction with the applicable laws and regulations, unless it is subject to oversight by the Civil Service Council, in which case it shall not be reviewed by the controller from a financial standpoint.
Time Limit for Endorsing a Transaction
The controller shall endorse the appropriation reservation request and the transaction and return the documents to their source within at most five days of the date of their receipt. If this period expires without a decision being made, the competent administration may retrieve the transaction and implement it at his own responsibility. If the controller requires written clarifications from the competent administration, the five-day period shall be extended commencing from the date of receipt of such clarifications. This may be done only once. If the transaction is subject to prior review by the Court of Audit, the controller shall forward it to the Court after endorsement, accompanied by his comments.
Cases where Endorsement of the Appropriation Reservation Request is Sufficient
The controller's endorsement of the appropriation reservation request shall be deemed equivalent to endorsement of the subsequent transaction in the following cases:
- 1)Expenditure committed by means of a statement or invoice pursuant to the provisions of the first paragraph of Article 151 of this Law.
- 2)Staff assignment orders.
- 3)Staff reclassification.
- 4)In general, expenditure for which a blanket appropriation reserve has been made in accordance with the provisions of the last paragraph of Article 63 of this Law.
Types of Endorsement
The controller's endorsement is of two kinds: - Total: covering the full value of the expenditure for which a commitment is requested. - Partial: limited to a portion of the expenditure for which a commitment is requested. In the event of a partial endorsement or a refusal of endorsement, the controller must state the reasons for his position. A partial endorsement shall not be given when it results in a reduction of the requested expenditure due to a material or arithmetic error.
Effects of Partial Endorsement
- 1)If the Central Controller gives a partial endorsement or refuses endorsement, he must refer the transaction to the Minister of Finance. If the Minister of Finance agrees with his position, the competent minister may refer the matter to the Council of Ministers for decision. If the Minister of Finance does not agree with the said position, the Central Controller must comply with the minister's decision subject to the provisions of the Law on the Court of Audit.
- 2)If the controller seconded to a ministry gives a partial endorsement or refuses endorsement, he must refer the transaction to the Central Controller. If the Central Controller agrees with his position, he shall refer the transaction to the Minister of Finance in accordance with the provisions of the preceding paragraph. If he does not agree, the controller must comply with the Central Controller's decision.
Refusal of Endorsement due to Insufficiency of Appropriation
The Council of Ministers may not approve the commitment of expenditure in respect of which the controller has refused endorsement due to the absence of a sufficient appropriation.(1)
1. Reading Articles 70 and 71 together reveals that a fortiori the Minister of Finance is entitled to overrule the position of the Controller of Expenditure Commitments when the latter refuses endorsement due to insufficiency of appropriation.
Advisory Role of the Controller of Expenditure Commitments
The competent administration may seek the opinion of the controller seconded to it on its financial matters, in particular on the draft budget and the supplementary appropriation requests it submits.
Amendment of Previously Committed Expenditure
The authority competent to make a commitment may request an increase or reduction in previously committed expenditure, provided that all necessary supporting documents are attached to the amendment request.
Definition of Expenditure Liquidation
Liquidation of expenditure is the verification of the crystallisation of the debt obligation on the State, the determination of its amount, its due date and the fact that it has not lapsed by operation of the statute of limitations or for any other reason.(2)
2. The debt does not lapse, for example, by payment or set-off.
Authority Competent for Liquidation
Liquidation shall be carried out by the competent accountant or by the person to whom he delegates this task with the approval of his hierarchical superior. The accountant of the General Directorate of Finance shall carry out the liquidation of expenditure paid from the debt service chapter.
Documents on which Liquidation is Based
Liquidation shall be based on documents capable of proving the existence of the debt. These documents shall be specified for each category of expenditure by decision of the Minister of Finance adopted after consulting the Court of Audit, and published in the Official Gazette.(3) A statement certified by the head of the unit responsible for implementing the expenditure shall also be required when the expenditure exceeds 50,000 L.L. Schedules issued by the electronic centre of the General Directorate of Finance equivalent to salaries, wages, pensions and their supplements, and monthly allowances of all kinds, shall have the force of certified documents and shall not require the signature of the relevant authorising officials. The details of application of this paragraph shall be defined, where appropriate, by decision of the Minister of Finance.
3. See Decision No. 1/59 of 7 January 1966 defining the documents capable of proving the existence of a debt.
Amended 1987Amended 1990Amended 1994Amended 1991Amended 1992Amended 1993
Liquidation Procedures
- 1)Liquidation shall be carried out spontaneously and, if this is not possible, at the request of the creditor.
- 2)The liquidating official must complete the liquidation within at most five days of the date on which the relevant supporting documents are received.
- 3)The creditor shall have the right to request from the liquidating official a certificate indicating the date of submission of his request and the list of supporting documents provided.
Determination of the Liquidation Instrument
Liquidation shall be carried out on the basis of the instrument specifying the debt in detail.
Definition of the Payment Order
A payment order is a document authorising the payment of its value.
Authority Competent to Issue Payment Orders and its Duties
- 1)Payment orders shall be issued, in the name of the Minister of Finance, by the Head of the Payment Service in the Ministry of Finance. This official may delegate certain of his powers to staff of his service, provided they are of at least the third grade. He may also delegate his representation in certain ministries to members of his service who will handle the review and preparation of payment orders locally.
- 2)Where appropriate, the duty of issuing payment orders may be delegated in public administrations and governorates, except the Governorate of Beirut, to officials of at least the third grade belonging to the Ministry of Finance staff, to be effected by decree.
- 3)The authorising officer must complete the payment order procedure within seven days of the date of its receipt, extendable to ten days for the last salary payment orders.
- 4)If the authorising officer requires written clarifications from the competent administration, the five-day period shall begin from the date of receipt of such clarifications. This may be done only once.
Possibility of Issuing Payment Orders during January of the Following Year
Payment orders for the financial year's expenditure may continue to be issued up to 31 January of the following year, provided they are dated 31 December of the year against which they are charged.
Concept of Prior Years' Expenditure
Amounts that accrued to third parties against the State during a given financial year but were not paid by the end of February of the following year, for any reason whatsoever, are called prior years' expenditure.
Amended 1966
Conditions for Issuing a Payment Order
A payment order may only be issued after verifying the following:
- 1)That the expenditure commitment transaction has been signed by the competent authority and endorsed by the Controller of Expenditure Commitments.
- 2)That the classification of the expenditure matches the commitment transaction.
- 3)That the expenditure calculations are correct.
- 4)That the liquidation transaction conforms to the financial laws and regulations only.
Issuance of a Separate Payment Order for Each Creditor
A separate payment order shall be issued for each creditor when payment is made from a single budget line or a single paragraph.
Persons in Whose Name the Payment Order is Issued
The payment order shall be issued in the name of the creditor or, on his behalf, in the name of his agent, secretary or proxy for collection, and in the name of his heirs in the event of his death. It shall be issued in the name of the head of the Treasury Service if the State is the creditor, and in the name of the competent accountant if the creditor is a municipality or a public institution. It shall be issued in the name of the competent governor if it relates to amounts due to minors who have no municipality, provided the amount is deposited in trust in the name of the said governor with the central district accountant.
Special Cases for Issuing Payment Orders
A payment order may be issued:
- 1)In the name of an authorised agent for collection designated by the competent administration, with respect to staff salaries, expenses and pensions.
- 2)In the name of the official who paid the amount from his own funds, with respect to transport allowances and certain petty expenses.
- 3)In the name of the seller on credit, with respect to expenditure paid from his own funds.
- 4)At the request of the beneficiary administration, payment orders relating to expropriation compensation may be issued in the name of the district accountant in whose district the expropriated properties are located, or the adjacent district, provided the conditions for payment of such compensation are established by decision of the Minister of Finance.
Obligation to Communicate Garnishment Orders and Deed of Assignment to the Authorising Officer
Garnishment orders and assignment instruments relating to debts owed by the State shall be communicated to the authority competent to issue payment orders. No notification addressed to any other person shall be deemed valid. The said authority must respond within the legal time limit to the party that notified it of the garnishment, and must record the garnishment or assignment on the payment order after its issuance.
Obligation to Sign the Payment Order
The payment order shall be signed by the competent authority and forwarded to the competent accountant for payment.
Amended 1966
Case of Loss of a Payment Order
If a payment order is lost, its holder shall be provided with a copy thereof upon his written request stating the reasons for the loss, together with a written certificate from the Central Accountant confirming that the payment order has not been paid and that notice has been taken of the obligation not to pay it.
Duties of the Accountant
A payment order becomes valid for payment after endorsement by the Central Accountant, or by the person to whom he delegates this task with the approval of the competent Director General. This official shall: a. Refuse endorsement and return the payment order to its source with a statement of reasons for the refusal in the following cases: First: if the payment order is not accompanied by the signature of the authority competent to issue it. Second: if the supporting documents for the expenditure are not attached to the payment order. Third: if the name of the creditor, the subject of the expenditure or its amount does not correspond to the supporting documents. b. Complete the transaction and place the relevant payment instrument under the disposal of the competent administration within three days of its receipt.
Amended 1966
Payment Orders Issued in the Governorates
The procedures for paying payment orders issued in the governorates shall be established by decrees adopted on the proposal of the Minister of Finance.
Amended 1966
Method of Paying Payment Orders
Payment orders shall be paid in cash from the cashbox where they are held. Payment may also be effected by bank transfer.
Payment of Staff Salaries
Staff salaries for the month of January shall, by way of exception, be paid during the last ten days of December.
Powers of Accountants
Accountants shall carry out: - Receipt of the assessment schedules, collection orders and recovery orders deposited with them by the relevant authorities, and ensuring their collection. - Receiving all receipts, of whatever nature. - Making all payments, either on the basis of payment orders or payment instructions issued by the competent authority, or in certain cases on the basis of payment instructions issued by them directly. - Safekeeping of the supporting documents relating to these operations and accounting records. - Maintenance of the accountancy accounts they manage.
Powers of the Central Finance Accountant
The Central Finance Accountant shall, in addition to the foregoing, centralise all revenue and expenditure operations relating to the general budget carried out by any central accountant, and shall also manage the State Treasury account held at the Central Bank.
Prohibition on Combining Administrative and Accounting Functions
The function of accountant may not be combined with any function relating to the assessment of revenues, or any function relating to the commitment, liquidation or payment order issuance of expenditure.
Conditions for an Accountant to Exercise his Functions
Before entering upon his duties, the accountant must provide a legal security whose value shall be determined by decision of the Minister of Finance, and must take an oath before the Court of Audit.(1)
1. The value of this security was set at twenty thousand Lebanese pounds by Decision No. 213 of 29 May 1986. See also Decree No. 2829 of 14 December 1959; Decision No. 1430 of 6 June 1974; Decision No. 1525 of 13 October 1977; and the Law of 20 August 1956.
Method of Providing the Security
The security shall be provided either in cash, or by bank guarantees issued by approved banks, or by registering immovable properties in the land registry. The papers and documents relating to the security provided shall be kept at the General Accounting Service of the Ministry of Finance, together with a copy of the text ordering the appointment of the accountant.
Ensuring Payment through a Cashier
The accountant may not personally receive or pay funds under his management; this shall be done through cashiers or tax collectors under his authority, except in cases established by special decree.(1)
1. With regard to the authorisation of certain accountants to personally receive funds, see: Decree No. 2837 of 14 December 1959; Decree No. 2840 of 14 December 1959; Decree No. 4024 of 4 May 1960.
Supervision of Cashiers' Activities
The accountant must supervise the work of the cashiers and tax collectors under his authority and must call them to account for any breach or delay in their work.
Personal Liability of the Accountant
The accountant shall be personally liable, from his own funds, for every receipt or payment operation carried out in the accountancy office he manages in contravention of the provisions of the law, in addition to any disciplinary or criminal penalties he may incur.
Limits of Liability
The accountant shall only be liable for his personal management.
Operations for which Liability is Borne
The accountant's duties cover all operations he carries out in his accountancy office from 1 January to 31 December of each year, or during the period he held his position, if that period is less than one year.
Account of Assignment
Central accountants, and likewise local accountants referred to in paragraph 2 of Article 160, shall submit their assignment accounts to the Court of Audit in their own names and on their own responsibility. Local accountants referred to in paragraph 3 of Article 160 shall submit their assignment accounts in their own names and on their own responsibility to the central accountant to whom they are attached, within conditions and time limits established by decree issued on the proposal of the Minister of Finance.(2)
2. The rules and deadlines for organising, auditing and consolidating assignment accounts and financial statements were established by Articles 16 to 19 of Decree No. 3373 of 11 December 1965.
Handover and Takeover Record
Upon the expiry of the accountant's assignment, a handover and takeover procedure shall be carried out between him and his successor by means of a record signed by both of them, in the presence of a financial inspector for central accountants and an official designated by the competent administration for local accountants. A copy of the record shall in both cases be sent to the Financial Inspectorate. A trial balance of accounts dated the day of the handover and takeover procedure must be attached to this record as a mandatory requirement.
Case Where the Successor Cannot Perform his Duties
In the event of the accountant's death, or his inability to present the handover and takeover record, the successor accountant shall draw up the assignment account of the predecessor accountant under the supervision of a financial inspector.
Return of the Accountant's Security
The security(1) shall be returned after the accountant obtains a discharge from the Court of Audit and shall be returned automatically after three years have elapsed since the accountant left his assignment, if the Court is late in issuing its decision beyond that period.
1. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Liability of Accountants and Financial Collectors
- 1)Local accountants and collectors shall be jointly and severally liable for direct taxes and other funds entrusted to them for collection.
- 2)The head of a tax collection directorate shall be personally liable for the direct taxes and other funds entrusted to him for collection; he is required to provide the security required of accountants.
- 3)The extent of the liability of the officials referred to in paragraphs 1 and 2 of this article, and the procedures to be followed to mitigate their liability or issue a discharge of their obligations, shall be established by decree adopted on the proposal of the Minister of Finance.(2)
2. The liability of accountants and collectors was established by Decree No. 5933 of 3 November 1966.
De Facto Accountant
Any person who intervenes in the management of public funds without holding the status of accountant shall be treated as an accountant responsible for his actions, like the official accountant, and shall be subject to the latter's obligations.
Expenditure of External Missions
Permanent budget advances shall be placed at the disposal of external missions, to be used by each mission to pay its expenditure for at least six months.
Special Award Committee
Contracting in external missions shall be handled by a special committee appointed by decision of the head of the mission wherever possible; otherwise it shall be carried out in accordance with procedures established by decision of the Minister of Foreign Affairs and Emigrants.
Expenditure of External Delegations
The expenditure of delegations abroad may be evidenced by detailed statements certified by the head of the delegation on his own responsibility.
Representation Expenditure Abroad and Administrative Expenditure
Representation expenditure abroad may be evidenced by detailed statements prepared by the head of the external mission and certified by the Secretary General of the Ministry of Foreign Affairs and Emigrants. Administrative expenditure incurred by external missions shall also be evidenced by the same method if the expenditure does not exceed 500 pounds each time.
Mechanisms for Committing and Disbursing Expenditure and Bookkeeping Procedures
Notwithstanding any other provision or measure, Lebanese diplomatic and consular missions shall apply the financial instructions issued by the joint decision of the Ministers of Finance and of Foreign Affairs and Emigrants dated 29 April 1999 and its amendments, with regard to the mechanisms for committing and disbursing expenditure, conditions for commitment, appropriation reservation and annual carry-over, bookkeeping procedures, organisation of entries, receipt of funds and their disbursement.
Amended 2017
Subsection 3Payment of Expenditure Without Prior Payment Order
Payment of Expenditure Without Prior Payment Order
Subsection 3-1General Provisions
Subsection 3-2Budget Advances
Expenditure Paid without a Prior Payment Order
Certain expenditure may be paid without a prior payment order, provided that the payment order is subsequently issued as a regularisation measure. The expenditure that may be paid in the manner described above consists of:
- 1)Salaries, wages and their supplements, pensions, and military order medal allowances.
- 2)Ordinary petty expenditure, urgent expenditure, and other expenditure whose nature or urgency justifies its direct payment in the normal manner.
Conditions for Paying Expenditure without a Prior Payment Order
The procedures for paying the expenditure described in the first paragraph of the preceding article shall be established by decree. Expenditure described in the second paragraph shall be paid through a permanent or emergency advance known as a budget advance, to be disbursed in accordance with the provisions of the following articles within the appropriations earmarked in the budget.
Definition of Permanent and Emergency Advance
A permanent advance is one granted to public administrations to cover their recurring expenditure throughout the current year. An emergency advance is one granted to public administrations or to any assigned person to meet expenditure that may be impossible to renew.
Decision to Grant a Permanent Advance
A permanent advance of a fixed value shall be granted by joint decision of the Minister of Finance and the competent minister. This decision shall specify: - The amount of the advance, which must be equivalent to three times the recurring monthly expenditure. - The types of expenditure that may be paid from the advance. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. - The name of the advance administrator, his position, the type of security he is required to provide, and its amount.
1. See Decree No. 3149 of 16 November 1965 on the system for paying certain public expenditure through permanent advances.
Method of Operating a Permanent Advance
A permanent advance shall be disbursed without prior endorsement by the Controller of Expenditure Commitments. However, the administrator may pay from it only expenditure that has been previously committed and liquidated in accordance with established procedures.
Payment of the Permanent Advance
The Central Accountant shall pay the permanent advance to the administrator on the basis of the decision ordering its disbursement.
Replenishment of Expenditure Paid from the Permanent Advance
Expenditure paid from the advance shall be reimbursed by means of payment orders issued in the name of the administrator. The advance shall be replenished by the amount of the sums disbursed pursuant to these payment orders, without the need to issue any new decision.
Duties of the Permanent Advance Administrator
The advance administrator shall: - Receive the advance and the replenishment payment orders. - Ensure payments are made. - Collect the supporting documents for expenditure and submit them to the authority competent to issue payment orders on a regular basis at the end of each month. - Maintain an account of the advance whose procedures are to be defined by decision of the Minister of Finance.
Liquidation and Payment of Permanent Advance Expenditure
Normal liquidation and payment order procedures shall be carried out on the basis of the supporting documents submitted by the administrator. If the Payment Service finds that some supporting documents are not in order, it shall proceed to issue a payment order for the amount of the valid documents and return the other documents to the competent administration within at most five days. In the latter case, the value of the advance may be increased by the amount of the documents whose payment has been suspended.
Deposit of the Permanent Advance in State Cashboxes
Permanent advances exceeding a limit assessed by the Minister of Finance must be deposited in the name of the administrator in a State cashbox designated in the decision ordering the disbursement of the advance.
Procedures for Operating Permanent Advances
The procedures for operating permanent advances shall be established by decision of the Minister of Finance.
Decision to Grant an Emergency Advance
An emergency advance shall be granted by decision of the Director General of Finance after endorsement by the Controller of Expenditure Commitments. This decision shall specify: - The amount of the advance. - The purpose of expenditure. - The person in whose name the advance is granted. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. The appropriations reserved for permanent and emergency budget advances granted during a given year to meet obligations to be executed in that year (opening of exhausted appropriations to implement agreements with foreign governments or foreign and local agencies, or to pay for medical treatment abroad) may be carried over to the budgets of subsequent financial years.
Amended 1999
Disbursement of the Emergency Advance
The emergency advance shall be disbursed by means of a payment order issued by the authority competent to issue payment orders on the basis of the decision ordering the disbursement of the advance.
Issuance of the Repayment Payment Order for the Emergency Advance
The repayment payment order shall be issued in the name of the person to whom the advance was granted.
Conditions for Use of a Budget Advance
An advance shall not be used for any purpose other than that for which it was granted. The legal provisions governing the management of public funds shall be observed in its use.
Repayment of a Budget Advance
An advance shall be repaid either in cash by returning its value to the Treasury, or by supporting documents for the expenditure, or by both methods simultaneously, within the time limit specified in the decision ordering its disbursement.
Liability of the Budget Advance Administrator
The advance administrator shall be personally liable, from his own funds, for the value of the advance. He must demonstrate its existence to any inspector either in cash or in the form of supporting documents for amounts expended from it.
Auditing Budget Advance Accounts
The Head of the Treasury Service must ensure that advance accounts are audited at least once every six months. He may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that exceed the amount of the expenditure due, or that are repaid at incorrect times; he may also take direct legal action against the administrator to recover such amounts.
Exclusive Right to Handle and Hold Funds
The right to handle and hold funds in each accountancy office shall be exclusively vested in cashiers and collectors, except in cases established by the decree referred to in Article 171 of this Law.
Responsibility for Safekeeping Funds
Cashiers shall be responsible for the safekeeping of funds in the accountancy office in which they exercise their functions.
Collectors' Responsibility for Safekeeping and Remitting Funds
Collectors shall be responsible for the safekeeping of the funds they collect, and must remit them periodically to the cashboxes of the accountancy office to which they belong in accordance with conditions established by decision of the Minister of Finance. They shall also be jointly and severally liable with the accountant to whom they are attached for the collection of direct taxes in accordance with Article 180 of this Law. Collectors are absolutely prohibited from making any payment whatsoever.
Obligation to Provide Security
Cashiers and collectors shall be subject to the security system on the same basis as accountants.(3)
3. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Verification of the Identity and Signature of the Payee
Before making a payment, the cashier must verify on his own responsibility the identity of the payee and the authenticity of his signature.
Amount Due to a Deceased Person
If an amount is due to a deceased person, the cashier shall request from the heirs official documents proving their relationship to the deceased. A certificate from the local mukhtar (village chief) shall suffice if the amount is less than 500 pounds.
Case of Using a Thumbprint
If the payee is illiterate or unable to sign, a thumbprint shall be used in place of a signature, provided it is certified by the cashier and two witnesses if the payment order value exceeds one thousand pounds. In other cases, the cashier may require the thumbprint to be certified by a notary.
Issuance of Receipt for Amounts Received
A receipt shall be issued for every amount received by cashiers and collectors, whose form and method of organisation for each administration or unit shall be determined by the General Accounting Service of the Ministry of Finance.
Falsification of a Receipt
Any falsification of a receipt issued by a cashier or collector, or of any copy thereof, regardless of the cause, shall be presumed to have been committed with malicious intent, and the penalties provided in Articles 461 and 462 of the Penal Code shall apply to the perpetrator, unless the falsification caused no harm to public funds.
Formal Receipt
A formal receipt must be issued for every amount received from public funds, and anyone who collects public funds without issuing a formal receipt shall be deemed an embezzler.
Maximum Balances to be Retained
The Head of the General Accounting Service of the Ministry of Finance shall, on the proposal of the competent central accountant, establish the maximum balances that cashiers may retain,(1) requiring them to pay any amounts in excess of these balances to the banks or post offices assigned to them.
1. The maximum holdings for cashboxes at customs centres were established by Decision No. 173 of 8 May 1964.
Tasking Officials in Certain Administrations with Receiving Revenue
Administrations that collect certain revenues in cash must task one of their officials, with the approval of the General Accounting Service, with receiving such funds and maintaining their accounts. This service may also approve the method of receiving and remitting the said funds, as well as the register forms to be maintained. The said official shall remit the funds he has received at least once a month, either to the Central Finance Accountant or to the local Finance Accountant, on the basis of a schedule identifying the received items and the type of revenue collected. This official may be assisted in receipt operations, where appropriate, by one or more cashier's assistants. This official and those assisting him in receiving funds shall be subject to the obligations of cashiers and in particular to the provisions of Articles 185, 189 and 192.
Payment at the Beginning of Each Month
Allowances, salaries and monthly benefits specific to the post or attached to the salary shall be paid at the beginning of each month. This measure shall apply to all permanent and temporary officials, with the exception of contractors, and shall also apply to pensioners and their heirs.
Non-Recovery of Any Amount Paid
An amount paid in implementation of the provisions of the preceding paragraph shall remain a vested right of the recipient and shall not be recovered for the benefit of the Treasury in any circumstances.
Subsection 4Miscellaneous Provisions
Miscellaneous Provisions
Fate of Expenditure Committed without Prior Controller Endorsement
If expenditure is committed in accordance with the provisions of the law without obtaining the prior endorsement of the Controller of Expenditure Commitments, and an appropriation is available for it, it shall be paid as a regularisation measure, subject to the prosecution of those responsible before the Court of Audit.
Liability for Committing Expenditure in Excess of Appropriations
A minister shall be personally liable, from his own funds, for any expenditure he commits in excess of the appropriations opened for his ministry while being aware of such excess, and likewise for any measure that leads to an increase in expenditure paid from the said appropriations if that measure does not result from prior legislative provisions. This liability shall not prevent the prosecution of officials who were involved in committing, liquidating and issuing payment orders for the expenditure before the Court of Audit, unless they produce a written order capable of relieving them of liability.
Obligation to Inform the Prosecutor General of the Court of Audit
The Controller of Expenditure Commitments, and other authorities when necessary and as far as it concerns them, shall inform the Prosecutor General of the Court of Audit of the situations described in the two preceding articles.
Carry-Over of Appropriations
- 1)Appropriations of Part One of the budget that have not been committed by 31 December of the year shall lapse, except for appropriations earmarked for the allocations of the general Treasury.
- 2)Appropriations of Part Two that have not been committed by 31 December shall be carried over for one year, except for programme law appropriations.
- 3)Appropriations of Parts One and Two of the budget that have been committed but not issued with a payment order by 31 December of the year shall be carried over to the following year's budget if they relate to a third-party right.
- 4)The carry-over shall be effected by decision of the Minister of Finance issued at the request of the competent administration before 1 March of the following year in accordance with the applicable provisions.
- 5)This text shall take effect as from the 2017 budget.
1. Contrary to Article 114, the carry-over of uncommitted appropriations opened in 1990 and earlier was suspended by Article 17 of Law No. 490 of 15 February 1996 (Budget 1996), and similarly for 1991 and earlier by Article 16 of Budget Law 1997, and thereafter by successive decrees.
2. The first amendment to this article's paragraph was made by Article 48 of Law No. 89 of 7 September 1991, then repealed by Article 18 of Law No. 490 of 15 February 1996.
Amended 2017Amended 2019
Extinguishment of Debts by Statute of Limitations
Debts that have not been liquidated, for which no payment order has been issued, or that have not been paid by 31 December of the fifth year following the financial year in which they arose shall lapse by operation of the statute of limitations and shall be definitively extinguished in favour of the State, unless the delay was caused by the administration or by the failure to pursue legal proceedings.(1)
1. With regard to the treatment of deposits, guarantees and cash sureties that are more than ten years old as Treasury revenue, Article 30 of Law No. 81/14 of 15 July 1981 provides detailed rules in this regard.
Amended 1967
Prior Years' Expenditure
1. Prior years' expenditure that has not lapsed by statute of limitations shall be paid from the appropriations opened for this purpose in the current year's budget. It may also be paid, where the state of appropriations permits, from the current year's budget appropriations. 2. Subject to the provisions of paragraph 1 of this article, prior years' expenditure relating to the period prior to 1963 that has not lapsed by statute of limitations shall be paid from the prior years' expenditure section of the current year's budget in accordance with the provisions of paragraph 3 of Article 25.
Amended 1966
Fate of Amounts Paid in Error or Without Legal Basis
Amounts paid by the Treasury in error or without legal basis and recovered during the financial year in which they were paid may be added to the appropriation of the competent minister by decision of the Minister of Finance. The competent minister must submit a request to the Minister of Finance in this regard within a maximum period ending on 31 December of the same year.
Possibility of Suspending the Use of Certain Appropriations
The Minister of Finance may, if he deems it necessary, propose to the Council of Ministers the suspension of the use of certain appropriations earmarked in the budget. The Council of Ministers may decide to approve the proposal if the current circumstances justify taking such a measure.
Expenditure Accounts
The Ministry of Finance shall maintain separate accounts of all committed, issued for payment and paid expenditure. The competent administrations shall maintain corresponding accounts of expenditure they commit, liquidate and for which payment orders are issued.(1)
1. The Court of Audit reconciles the accounts of the Ministry of Finance with those of the administrations and issues, upon completion of its review, a 'reconciliation statement' showing whether the accounts are correct or not.
Functions of the General Accounting Service
The General Accounting Service shall audit the operations of accountants and administrative accountants and shall consolidate them.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Budget Closing of Accounts and General Assignment Account
The General Accounting Service shall prepare each year: - The budget closing of accounts, which must be submitted to the Court of Audit before 15 August of the year following the budget year. - The general assignment account, which must be submitted to the Court of Audit before 1 September of the year following the account year. - The preparation of the general assignment account shall begin with the account of the year in which the general chart of accounts referred to in Article 163 of this Law begins to apply.
2. Regarding the exemption from preparing the assignment account of central accountants and the general assignment account, Article 23 of Law No. 715 of 3 February 2006 (Budget 2005) provides detailed rules.
3. The deadlines for submission to the Court of Audit and the General Accounting Service of accounts and financial and administrative statements were extended by Article 1 of Legislative Decree No. 102 of 30 June 1977.
4. Regarding granting the General Accounting Service a deadline for preparing the assignment account, Articles 3 and 4 of Law No. 81/12 of 15 July 1981 (Closing of Accounts for 1977) provide detailed rules.
Amended 1966Amended 1977
Results of the Budget Closing of Accounts
If the budget closing of accounts shows a surplus in revenues, this surplus shall be transferred, by virtue of the closing law, to the 'reserve fund' account; if it shows a surplus in expenditure, the said law shall authorise the covering of the deficit from the reserve fund. If the reserve fund is insufficient, the deficit shall be recorded in the advances account and must be compulsorily repaid from the first subsequent budget that shows a surplus; if that surplus is insufficient, it shall be paid from surpluses of subsequent years in turn.
Referral of the Draft Closing of Accounts to the Chamber of Deputies
The Government must refer the draft budget closing of accounts law to the Chamber of Deputies before 1 November of the year following the budget year.
Definition of the Reserve Fund
The reserve fund is constituted from the surplus of budget revenues over expenditure. The Central Finance Accountant shall maintain this account under the supervision of the General Accounting Service.
Use of the Reserve Fund
The reserve fund shall be used: - To cover prior years' expenditure during the transitional period referred to in Article 25 of this Law. - To cover opened appropriations. - To cover the budget deficit in accordance with Article 196 of this Law. - To cover supplementary appropriations (complementary and exceptional). - To finance construction projects.
Drawings from the Reserve Fund
No amount may be drawn from the reserve fund except by law. Every amount decided to be drawn from the reserve fund must be immediately entered in the accounts of the Central Finance Accountant. The method of creating these entries shall be established by decision of the Minister of Finance.
Delivery of Deposits and Guarantees to the Treasury
Deposits and guarantees shall be delivered to the Treasury on the basis of an instruction issued by the competent authority, and the reasons for the deposit shall be recorded in the relevant receipts; they shall only be returned to their owners on the basis of an instruction from the competent authority and after the receipts are recovered.
Loss of Deposit and Guarantee Receipts
If deposit or guarantee receipts are lost, they shall be replaced by an undertaking from their owner to bear any harm and damage that may result to a third party from the misuse of the lost receipt for a period of five years.
Definition of Treasury Advances
Treasury advances are funds disbursed from its holdings:
- 1)To constitute joint supply depots for public administrations for supplies shared among more than one administration.
- 2)To purchase storable materials intended for use in the current or following financial year.
- 3)To fund the cashboxes of public institutions and municipalities and also the independent cashboxes established by law.
1. See Law No. 89/5 of 5 January 1989 on the termination of provisions authorising the conclusion of loans or the granting of State guarantees, or the commitment of expenditure without available appropriations, and on the amendment of the conditions and procedures for granting Treasury advances.
Conditions for Granting Treasury Advances
The granting of Treasury advances to fund one of the cashboxes referred to in paragraph 3 of the preceding article requires:
- 1)The Minister of Finance to verify the beneficiary's ability to repay the advance in cash within the prescribed repayment period.
- 2)The beneficiary to undertake to compulsorily earmark in its budget the appropriations necessary for repaying the advance within the prescribed period.
- 3)The approval of the legislative authority if the repayment period exceeds twelve months.
Requirement that Treasury Advances be Granted by Decree
Treasury advances for the purposes specified in Article 203 of this Law shall be granted by decree on the proposal of the Minister of Finance and at the request of the competent administrations. The Government shall be required to inform the Chamber of Deputies of the advances decided upon by virtue of such decree.
2. The repealed second paragraph read: 'In exceptional emergency cases, Treasury advances may be granted by decree adopted in the Council of Ministers.'
Amended 1989Amended 1991Amended 1991
Contents of the Decree Granting Treasury Advances
A decree adopted in the Council of Ministers(3) shall specify the advance administrator for the cases referred to in paragraphs 1 and 2 of Article 203, and the beneficiary institution for the case referred to in paragraph 3 of the same article. It shall also specify the purpose of the advance, its amount, the method of its disbursement, the conditions for its repayment, and any other conditions the Minister of Finance deems necessary to impose.
3. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Disbursement of Treasury Advances
Treasury advances shall be disbursed on the basis of orders issued by the Central Accountant, which shall make reference to the decree adopted in the Council of Ministers(4) that authorised them.
4. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Restriction of the Use of Treasury Advances to Their Purpose
A Treasury advance shall not be used for any purpose other than that for which it was granted.
Repayment of Treasury Advances
Treasury advances referred to in paragraphs 1 and 2 of Article 203 of this Law shall be repaid by means of payment orders charged against the budget. Treasury advances referred to in paragraph 3 of the same article shall be repaid in cash to the Treasury within the periods prescribed for this purpose.
Role of the Accountant
The accountant must follow up on the repayment of Treasury advances in accordance with the conditions under which they were granted and within the prescribed periods.
Possibility of Deducting the Salary of the Treasury Advance Administrator
The accountant may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that are repaid at the incorrect times. He may also take direct legal action against the administrator to recover such amounts. The repayment period may be extended, by decree adopted in the Council of Ministers on the proposal of the Minister of Finance,(1) in exceptional and warranted cases.
1. The expression 'and the Minister of Finance may' in the second paragraph of Article 211 of the Public Accounting Law was replaced by 'and it may be done by decree adopted in the Council of Ministers on the proposal of the Minister of Finance' by Law No. 41 of 14 February 1991.
Amended 1991
Deduction from Funds of Administrations in Arrears
If any of the beneficiary administrations is in arrears in repaying the Treasury advance granted to it, the Central Finance Accountant shall have the right to deduct it formally from any funds that administration may hold with the Treasury.
Statement of Treasury Advances
A statement of Treasury advances granted in accordance with Article 203 of this Law and the amounts repaid during the budget year shall be appended to the draft budget closing of accounts law.
2. The General Accounting Service shall extract the statement of Treasury advances from the assignment accounts and supporting documents; see in this regard Article 34 of Decree No. 3373 of 11 December 1965 (defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements).
Special Regulations
The accounting of the Post, Telegraph and Telephone shall be governed by the special regulations applicable to it and by the provisions of this Law in all matters not inconsistent with those regulations.
Subsection 5Special Provisions on Expenditure for Supplies, Works and Services
Special Provisions on Expenditure for Supplies, Works and Services
Subsection 5-1Contracts for Supplies, Works and Services
Subsection 5-2Works by Direct Administration
Subsection 5-3Common Provisions
Methods of Implementing Expenditure
Supplies, works and services expenditure shall be implemented either by means of contracts concluded by the administration with third parties, or directly by the administration through the direct administration method (régie).
Principle of Public Tendering
Contracts for supplies, works and services shall be awarded by public tender. However, in the cases described below, contracts may be awarded by restricted tender, invitation to submit proposals, mutual agreement, or by means of a statement or invoice.
Tendering Programme
Public and restricted tenders shall be conducted on the basis of an annual programme announced on dates that may extend beyond the second month following publication of the budget.
Principle of Non-Splitting of Expenditure
Expenditure may not be split unless the authority competent to commit it considers that the nature of the works, supplies or services to be contracted warrants doing so.
Methods of Conducting Public Tenders
A public tender (hereinafter referred to as 'tender') shall be conducted either on the basis of a price submitted by the tenderer, or on the basis of a percentage reduction from the estimated prices in the provisional bill of quantities referred to in Article 126 of this Law.
General and Special Conditions Documents
Standard general conditions documents shall be prepared for contracts awarded by tender, approved by decree and published in the Official Gazette. A special conditions document shall be prepared for each such contract by the responsible administration and approved by the authority competent to decide on the contract.
Contents of the Special Conditions Document
The special conditions document shall specify the following information: - The types and descriptions of supplies, works or services to be contracted. - The qualifications and special conditions required of persons wishing to participate in the tender. - Award criteria: whenever the administration intends to be bound by the lowest price, these criteria shall be stated clearly and in detail; a separate weighting factor may be assigned to each of them where appropriate. - The basis on which the tender is to be conducted in accordance with Article 124. - Special execution conditions. - Delivery deadline. - The amount of the security required for participation in the tender and to guarantee the contractor's proper fulfilment of his obligations. A provisional bill of quantities showing quantities and prices shall be appended to the special conditions document where appropriate. The price established by the administration shall be deemed the upper ceiling for contracts conducted on the basis of a percentage reduction; the administration shall announce the maximum permissible reduction, which shall constitute the minimum contract price.
Amended 1982
Types of Security
Security may be:
- 1)Cash, paid into a Treasury cashbox directly, or into the cashbox of the competent administration where one exists, against a receipt attached to the bid, provided its value is transferred in the latter case to the central Finance cashbox upon award of the contract.
- 2)A bank guarantee issued by an approved bank, drawn up in the name of the competent administration or the State Treasury.
Announcement of Tenders
Each tender shall be announced in the Official Gazette and in at least three daily newspapers at least 15 days before the date fixed for award. The period may be reduced to at least five days in the event of a repeat tender, or in cases of necessity, provided the reduction is approved in advance by the authority competent to commit the expenditure. Any amendment to the conditions document after publication of the tender announcement shall likewise be announced following the same procedures.
Article 129 was repealed by Article 29 of Law No. 78/16 of 2 May 1978.
Amended 1978
Tender Committees
Tenders shall be conducted before committees established specifically for this purpose.
Provisional Award
The contract shall be provisionally awarded to the bidder submitting the lowest price, or to the one who submitted the best offer where the conditions document provides for award criteria other than price, subject to granting bids for goods manufactured in Lebanon a 10% preference(1) over bids for foreign goods, provided that national goods and the conditions they must meet to benefit from this preference are defined by decrees(2) adopted in the Council of Ministers on the proposal of the Minister of Economy and Trade.(3) For contracts conducted on the basis of a percentage reduction, the tender committee shall provisionally award the contract to the lowest bidder within the two estimated prices.
1. With regard to granting bids for goods manufactured in Lebanon a 15% preference over bids for foreign goods, see Legislative Decree No. 127 of 30 June 1977.
2. With regard to defining national goods and the conditions they must meet to benefit from this preference, see: Decree No. 6588 of 1 April 1995; Decree No. 10352 of 23 May 1975; Decree No. 4208 of 20 October 1972; Decree No. 9223 of 20 September 1996.
3. The conditions for applying paragraph 2 of Article 131 of the Public Accounting Law were established by Decree No. 6232 of 2 December 1966.
Amended 1972Amended 1978Amended 1982
Case of Equal Bids
If bids are equal after granting Lebanese goods the 10% preference referred to in Article 131, the tender shall be reopened in the form of sealed envelopes among the bidders concerned, at the same session, to the exclusion of others. If they refuse to submit new bids or their bids remain equal, the provisional contractor shall be designated by lot among the holders of equal bids. For contracts conducted on the basis of a percentage reduction, if bids are equal, the provisional contractor shall be designated by lot among the equal bids.
Amended 1972Amended 1982
Authority Competent to Decide on the Contract
1. The contract shall be decided upon by: - The competent director, or the head of the service in the absence of a director, if its value exceeds 10,000,000 L.L. - The competent director general, if its value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. 2. The contract shall become final only after the approval has been communicated to the contractor by administrative means.
Amended 1978Amended 1987Amended 1990Amended 1994
Importance of Site Possession Procedure
Works contracts may not be concluded before all legal procedures have been completed that enable the administration to take possession of the work site. However, award proceedings may commence before these procedures are completed, provided the contract is approved and communicated to the contractor only after possession of the said sites has been taken.
Contractor's Default
If an amount becomes due from the contractor in the course of execution pursuant to the conditions document, the administration shall have the right to deduct that amount from the security and to invite the contractor to replenish it within a specified period. If he fails to do so, he shall be deemed to have defaulted, and the administration shall proceed either to relaunch the tender or to execute the contract by direct administration. If the new tender or execution by direct administration results in a saving in costs, the saving shall revert to the Treasury. If it results in an increase in costs, the administration shall recover the increase from the defaulting contractor. In all cases, the security shall be provisionally confiscated pending settlement of the contract in accordance with the provisions of this article.
Contractor's Insolvency
The contract shall be automatically terminated between the administration and the contractor declared insolvent, and the following measures shall be immediately taken:
- 1)The security shall be provisionally confiscated for the account of the Treasury.
- 2)The administration shall inventory the completed works, supplies or services and the materials delivered as at the date of the insolvency declaration and draw up a schedule whose value shall be provisionally held in trust in the name of the Treasury.
- 3)The works, supplies or services, or the remainder thereof, shall be placed under direct administration or re-tendered. If the new tender or direct administration results in a saving in costs, the saving shall revert to the Treasury, and the security and the value of the schedule referred to in the preceding paragraph shall be paid to the receiver. If it results in an increase in costs, the increase shall be deducted from the security and the said schedule value, and the balance shall be paid to the receiver. If this is insufficient to cover the entire increase, the recourse shall be limited to confiscating the security and the schedule value.
Principle of Execution before Payment
The contract value may not be paid until after the contract has been executed. However, the Minister of Finance may, at the request of the competent minister, grant contractors advances against bank guarantees. If obtaining such guarantees proves impossible, the advance shall be granted without a guarantee upon approval of the Council of Ministers. The advance may not exceed 25 per cent of the contract value and shall not exceed 30,000,000 L.L. However, in exceptional cases, the Council of Ministers may, by decision, derogate from the foregoing provisions.
Amended 1966Amended 1987Amended 1990Amended 1994
Ten Per Cent Withholdings
If the conditions document so provides, instalment payments for completed works shall not exceed nine-tenths of the amount due, with one-tenth being withheld in the Treasury until final acceptance has taken place. These withholdings shall be returned upon final acceptance where the conditions document specifies a guarantee period for supplies or works, after the contractor has paid any penalties that have accrued under the conditions document. The administration may stop deducting the ten per cent withholdings when it considers that they have reached the level required for the guarantee.
Acceptance Committee
Supplies, works and services shall be accepted in each ministry by a committee appointed by decision of the director general, comprising three technical staff members, one from the unit for whose benefit the contract was awarded and two from outside it.(1)
1. See Decree No. 3906 of 29 April 2010 granting each of the two members of the supplies, works and services acceptance committee in the General Directorate of Finance from outside the unit for whose benefit the contract was awarded a flat-rate transfer allowance.
Consequences of Breach of the Conditions Document
If the contractor fails to comply with the conditions document or any of its provisions during contract execution, the competent administration shall formally notify him of the obligation to comply fully with his obligations within a specified period that it assesses. If the specified period expires without the contractor having performed what was required of him, the administration shall have the right, subject to the provisions of the general conditions document, to consider him in default and apply against him the provisions of Article 135 of this Law. In the event of a retender, the defaulting contractor shall have the right to participate again. If the acceptance committee finds that the contract has generally been executed in accordance with the conditions document but with certain minor defects or flaws preventing acceptance, it may proceed with acceptance subject to conditions established by decree(2) adopted in the Council of Ministers.
2. The conditions for accepting contracts with minor defects or flaws were established by Decree No. 14601 of 30 May 1970.
Return of Security
The security shall be returned to the contractor on the basis of a memorandum from the competent administration within at most one month of the date of final acceptance. However, the administration may, before the expiry of the execution period, or after provisional acceptance if the state of the works permits, return to the contractor, at his request, all or part of the security.
Exclusion from Tenders
A contractor whose works are placed under direct administration or whose contract is re-awarded at his expense pursuant to this Law or the general conditions document shall be excluded from tenders: - For three months when these measures are applied against him for the first time. - For a full year when applied against him a second time within twelve months. - Permanently when applied against him a third time within five years. The aforementioned periods shall begin from the date of the first decision ordering the works to be placed under direct administration or the contract to be re-awarded at the contractor's expense.(1)
1. The exclusion from participation in public contract execution was organised by Decree No. 8117 of 29 August 1968.
Cases for Adopting Restricted Tender
The administration may, where the nature of the supplies, works or services allows competition to be opened to all, restrict the tender to a limited category of tenderers who possess the required financial, technical and professional qualifications. These qualifications shall be specified in detail in the general conditions document, as shall the basis for the guarantees required of tenderers and the specifications that the works or materials requested must meet.
Provisions of the Restricted Tender
All provisions applicable to public tenders shall apply to restricted tenders.
Cases for Adopting Invitation to Submit Proposals
Contracts may be awarded by invitation to submit proposals:
- 1)If their value does not exceed 100,000,000 L.L.
- 2)If their value exceeds 100,000,000 L.L. and they relate to:
- 3)Works carried out by the administration on an experimental or study basis, provided the competent minister so decides.
- 4)Equipment, materials and commodities that must be acquired at their place of production owing to their special nature.
- 5)Shipping, transport and insurance.
- 6)Supplies, works and services for which no price was submitted in the tender or for which the prices submitted were unacceptable.
- 7)Supplies, works and services for which certain urgent situations arising from emergency circumstances do not allow public tendering, provided the competent minister so decides.
- 8)Technical supplies, works and services whose nature does not allow public tendering, provided the competent minister so decides.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions for Invitation to Submit Proposals
The provisions applicable to public tenders shall apply to the invitation to submit proposals subject to the following:
- 1)The announcement may be replaced by communicating the necessary information confidentially and by registered letter to traders in the relevant line or professionals considered by the administration as capable of executing the contract.
- 2)Invitation to submit proposals for a contract whose value exceeds 100,000,000 L.L. shall be conducted before a special committee established in each public administration by decision of the minister; other contracts shall be handled by the tender committee.
Amended 1978Amended 1987Amended 1990Amended 1994
Cases for Adopting Mutual Agreement
Agreements may be concluded by mutual agreement regardless of the contract value, where they relate to:
- 1)Supplies, works and services that may be placed in a tender, either because secrecy is necessary, or because public safety requirements preclude it, provided the competent minister so decides.
- 2)Additional supplies, works and services that must be entrusted to the original contractor lest their execution be delayed, and where bringing in a new contractor during contract execution would not be appropriate; this is permissible:
- 3)- If the supplies, works and services were not anticipated when the original contract was awarded, are related consequences thereof and form an integral part of it.
- 4)- If the supplies, works and services must be executed using the equipment and installations specifically used by the contractor at the work site, provided they were not anticipated when the contract was awarded and do not form an integral part of it.
- 5)Equipment whose manufacture is exclusively held by the holder of its patent.
- 6)Equipment held by a single entity.
- 7)Technical supplies, works and services that may be entrusted to experienced Lebanese specialists, craftsmen or artisans whose capabilities have been demonstrated.
- 8)Supplies and works manufactured by persons with disabilities who require social welfare assistance from the Ministry of Labour and Social Affairs, provided their prices do not exceed market prices.
- 9)Hospitality and protocol expenditure and similar representation expenditure.
- 10)Supplies, works and services for which the following have been conducted:
- 11)- Two consecutive public tenders.
- 12)- Or two consecutive invitations to submit proposals.
- 13)- Or a tender followed by an invitation to submit proposals.
- 14)Without any of these processes yielding a positive result.
- 15)In such cases, the mutual agreement must result in a price not exceeding the ratio of prices submitted during the award process, except in exceptional circumstances justified by the administration in a reasoned report.
- 16)Supplies, works and services that may be entrusted to public institutions or municipalities.
- 17)Supplies and services provided by the administration through international organisations.
- 18)Supplies, works and services that the Council of Ministers approves entrusting, upon the proposal of the competent minister, to foreign governments or institutions affiliated to them. In such cases, the Government may exempt the counterpart from conditions relating to place of residence, security, penalties and the obligation of delivery before receipt.
- 19)Supplies, works and services whose procurement by mutual agreement is decided by the Council of Ministers on the proposal of the competent minister.
Authority Competent to Conclude Mutual Agreements
Mutual agreements shall be concluded by: - The director, or the head of the service in the absence of a director, if the contract value does not exceed 10,000,000 L.L. - The director general, if the value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. The transaction shall be conducted by one of the following methods:
- 1)A contract between the competent authority and the party concerned.
- 2)An undertaking signed by the party concerned on the general conditions document.
- 3)A proposal from the party concerned approved by the competent authority.
- 4)An exchange of correspondence between the party concerned and the competent authority, in accordance with commercial custom.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions of Mutual Agreements
Mutual agreements shall be governed by the provisions of the general conditions document and a special conditions document shall be prepared for them where appropriate. In addition to the provisions of the two preceding articles, the provisions of Articles 137 to 141 of this Law shall apply to mutual agreements.
Technical Services Contracts
Mutual agreement may be used for technical services contracts (studies, preparation of conditions documents, supervision of works execution, projects, etc.) regardless of their value where they exceed the administration's own capacity. The following provisions shall apply to these contracts:
- 1)Contracting may only be done with those who possess the required technical qualifications, which must be described in detail in a study prepared by the administration before the contract is concluded.
- 2)An agreement may be concluded where appropriate after a consultation process among those who possess the said qualifications.
- 3)These contracts shall be governed by the other provisions applicable to mutual agreements.
Cases for Using Statements and Invoices
Contracts may be concluded by means of a statement or invoice:
- 1)If their value does not exceed three million pounds. This procedure shall apply to the implementation of the Lebanese University's budget without the need to issue any additional text.
- 2)If the prices of the materials to be purchased are fixed in a tariff issued by the administration or by a recognised international body and it is not possible to obtain a lower price.
- 3)If the contract relates to the hire of public works in accordance with a general tariff established by decision of the competent minister.
- 4)The contract shall be concluded by the head of the competent unit and acceptance shall be ensured by the committee provided for in Article 139.
- 5)The heads of competent units authorised to conclude contracts shall be designated by decision of the competent minister in public administrations, and by decision of the head of the executive authority in public institutions and municipalities subject to the Public Accounting Law.(1)
1. The Director General of the Central Statistics Administration was authorised to commit expenditure by means of a statement or invoice as provided in this article, by Article 1 of Decision No. 134/2009 of 24 December 2009.
Amended 1978Amended 1984Amended 1987Amended 1990Amended 1993
Definition of Works by Direct Administration
Works by direct administration are works that the administration itself undertakes to execute.
Authority Competent to Authorise Works by Direct Administration
Works by direct administration shall be authorised by: - The head of the competent unit, if their value does not exceed 3,000,000 L.L. - The director, or the head of the service in the absence of a director, if their value exceeds 3,000,000 L.L. but does not exceed 10,000,000 L.L. - The director general, if their value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister, if their value exceeds 35,000,000 L.L. but does not exceed 150,000,000 L.L. - The Council of Ministers in other cases. The normal procedures for procuring the materials required for executing these works shall apply.
Amended 1978Amended 1987Amended 1990Amended 1994
Monitoring Unit for Works by Direct Administration
A special unit must be established in every administration undertaking works by direct administration, whose task is to monitor the execution of such works. This unit shall be attached directly to the head of the administration and shall not carry out any execution activities.
Detailed Statement of the Results of Direct Administration Execution
The head of the unit that undertook the execution of works by direct administration must submit to its administration, upon completion of the works, a detailed statement of the quantities executed and the costs incurred of all kinds. The monitoring unit shall review this statement and forward it, together with its comments, to the Central Inspectorate.
Powers of the District Commissioner and Governor
The district commissioner shall exercise within his district the powers conferred by this chapter's provisions on the director. The governor shall exercise within his governorate the powers conferred by this chapter's provisions on the director general, with respect to supplies, works and services contracts concluded in the district or governorate.
Detailed Rules for Applying Contract Provisions
Detailed rules for applying the provisions of this Law relating to supplies, works and services contracts, in particular the conditions for classifying and admitting contractors to participate in tenders, shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.(1)
1. See Decree No. 2866 of 16 December 1959 on the tender system and Decree No. 3688 of 25 January 1966 defining the conditions for participation in public contract execution.
Definition of Materials Accounting
Materials accounting covers all the entries and documents necessary for establishing the inventory of materials owned by public administrations and for recording their movements.
Application of Materials Accounting to All Public Administrations
All public administrations must maintain materials accounts. All institutions subject to State supervision must also maintain materials accounts that enable this supervision to be exercised.
Liability of the Materials Custodian or User
Any person tasked with the safekeeping or use of the materials referred to in Article 214 of this Law shall be financially liable for them. The same liability may also be imposed on officials tasked with maintaining and supervising materials accounts.
Territorial Scope of Materials Accounting
The application of the provisions of this chapter shall be limited to materials located within Lebanese territory or in Lebanese missions abroad. It shall not apply to equipment of active service units or to equipment used on naval or air vessels.
Materials Accounting Decree
Detailed rules for applying the provisions of this chapter shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.
1. Detailed rules for applying this chapter were established by Decree No. 8620 of 12 June 1996.
Municipal Provisions
The conditions for applying this Law to municipalities shall be established by decrees issued on the proposal of the Ministers of Interior and Finance.
1. Funds belonging to municipalities under the Law of 4 August 1954 were made subject to the provisions of the Public Accounting Law by Article 1 of Decree No. 12915 of 3 June 1963, which reads: 'Funds belonging to municipalities under the Law of 4 August 1954 shall be subject to the provisions of the Public Accounting Law with regard to the stages of committing, liquidating, issuing payment orders for and paying expenditure, and shall be exempt from the annual budget rule.'
Section 4The Treasury
The Treasury
Subsection 1Basic Provisions
Basic Provisions
Parts of the Expenditure Budget
The expenditure budget is divided into two parts: - Part One: comprising ordinary expenditure. - Part Two: comprising equipment and construction expenditure and the State's investment contributions. The content of each of the two aforementioned parts shall be defined by a decision of the Minister of Finance.
Amended 1966Amended 1968
Division of Expenditure into Chapters
Each of the two aforementioned parts of the expenditure section shall be divided into chapters. The number of chapters in each part shall be determined by a decision of the Minister of Finance.
Division of Chapters into Sections, Lines and Paragraphs
Each chapter shall be divided into sections, each assigned to a single administration or group of administrations or a single project or group of projects. Each section shall be divided into budget lines, each assigned to expenditure of a single type or similar nature, and each line shall be divided, where appropriate, into paragraphs. A model table for the division of appropriations shall be established by a decision of the Minister of Finance.
Contents of the Salaries Budget Line
The salaries budget line shall indicate: 1. With respect to permanent and temporary staff: - The total number of staff by grade, together with the total of their salaries and supplements. 2. With respect to retirees: - Their number together with the total of their pensions and supplements.
- 1)With respect to workers:
- 2)For permanent workers:
- 3)Their number together with the total of their wages and supplements.
- 4)For non-permanent workers:
- 5)The total of their wages and supplements.
Transfer of Appropriation from One Paragraph to Another
Appropriations for similar works may be distributed among paragraphs within a single budget line. The following rules shall apply in such cases:
- 1)The appropriation earmarked for each project shall be treated as a separate paragraph.
- 2)Transfer from the appropriation earmarked for one project to another project may be made:
- 3)After works have commenced, provided at least fifteen per cent of the original appropriation is retained.
- 4)After completion of the project and settlement of the contract.
- 5)Transfer shall only be permitted to a project similar to the first project and located in the same area.
Special Expenditure Incumbent on the State
1. A separate section shall be set aside in each chapter of the expenditure section from which the value of monetary judgments rendered against the State and settlements concluded by it shall be paid, when no appropriations are available in the relevant budget lines for such expenditure. This section shall be funded by transferring from the global appropriation set aside in the budget reserve chapter in accordance with Article 26 below.
2. Amounts collected by the Treasury in error or without legal basis shall be refunded by deducting them from the budget revenue account in which they were originally received, i.e. by entering them on the debit side of the revenue account; no appropriation shall be opened in the budget for this purpose.(1) Only balances shall be recorded in the field of amounts collected from the budget closing of accounts for revenue accounts.
3. A separate section shall be set aside in each chapter of the expenditure section, during a transitional period ending in 1966, called 'prior years' expenditure', from which amounts that accrued in favour of third parties in years prior to 1963 and were not paid during those years shall be drawn. No appropriation shall be entered in the aforementioned section when the budget is prepared; instead, expenditure paid from it shall be covered by amounts taken from the reserve fund endorsed by the closing of accounts law.
1. By virtue of the above-mentioned laws, this paragraph was repealed and replaced by a paragraph that was supposed to be new; however, the new paragraph was always identical to the repealed one.
Amended 1973Amended 1974Amended 1975Amended 1976Amended 1977Amended 1966
Budget Reserve
- 1)The following shall be set aside in the budget reserve chapter:
- 2)Reserve appropriations for expenditure shared among several ministries, such as sickness and death assistance, monetary judgments, settlements, etc.
- 3)A contingency reserve appropriation to be used to replenish budget lines whose appropriations have been exhausted, or to open exceptional appropriations, provided that this reserve appropriation shall not be less than one per cent of the total appropriations of Parts One and Two of the budget.
2. Should the appropriations earmarked for monetary judgments and settlements be exhausted, the Government may, by decree adopted in the Council of Ministers, open the necessary complementary appropriations and cover them from the reserve fund, to be ratified by the closing of accounts law. The provisions of this paragraph shall also apply when appropriations earmarked for pensions and severance pay are exhausted.
3. No expenditure shall be paid directly from the appropriations of this chapter; instead, these appropriations shall be transferred when needed to the relevant budget lines as follows: - By decision of the Minister of Finance, on the proposal of the competent authority and after endorsement by the Central Controller of Expenditure Commitments, with respect to the appropriations referred to in sub-paragraph (a) of the preceding paragraph. - By decree issued on the proposal of the competent minister and the Minister of Finance, with respect to the appropriations referred to in sub-paragraph (b) of the preceding paragraph.
Opening of Supplementary Appropriations and Their Coverage
1. Subject to the provisions of Article 85 of the Constitution and Article 26 of this Law, supplementary appropriations shall only be opened by law. Such appropriations shall be covered by transfer from other budget lines, or from the budget reserve chapter, or by drawing from the reserve fund, or by new revenues.
- 1)Subject to the provisions of Article 26 of this Law, appropriations shall only be transferred from one budget line to another by law.
- 2)Subject to Article 114 of this Law, appropriations shall only be carried over from one year's budget to the following year's budget by law.
Procedure for Transfer from One Paragraph to Another
- 1)Subject to the provisions of Article 24 of this Law, appropriations shall be transferred from one paragraph to another within the same budget line by decision of the competent minister after endorsement by the Central Controller of Expenditure Commitments. Transfer by the same procedure to a new paragraph shall also be permitted where that paragraph covers a type of expenditure assigned to the budget line.
- 2)Appropriations earmarked in the chapters on debt service and budget reserve shall be transferred from one paragraph to another within the same budget line by decision of the Minister of Finance after endorsement by the Central Controller of Expenditure Commitments.
- 3)Transfer from one paragraph to another within a given year's budget may be effected up to 31 January of the following year.
Rules for Assessment of Taxes and Fees
The following rules shall apply to the assessment of taxes and fees unless the law provides otherwise.
Authority Competent to Assess Taxes and Fees
The assessment of direct taxes collected by means of assessment schedules shall be carried out by the competent central financial directorate or the competent financial directorate in the governorate; the Director of Revenue shall endow these schedules with executive force. The assessment of other taxes and fees shall be carried out by the head of the financial directorate or competent unit in each governorate by means of judicial orders issued by him.
Amended 2003
Concealment or Shortfall in Tax Assessment
Any concealment or shortfall in the assessment of direct and indirect taxes and fees may be remedied up to the end of the third year following the year in which the assessment should have been made, by means of additional assessment schedules or judicial orders for concealed assessments, and by means of supplementary assessment schedules or judicial orders for deficient assessments.
In addition to the remedy period referred to in the first paragraph of this article, the competent financial directorates shall benefit from an additional exceptional period to remedy the Treasury's right to impose a tax or fee on any profit, income, revenue or instrument revealed by a judicial ruling, an arbitral award, a probate proceeding or a settlement agreement, and likewise to correct any assessment ordered to be annulled.
This exceptional period shall end on 31 December of the year following the year in which the annulment was decreed or the profit, income, revenue or taxable instrument was discovered.
Amended 1973
Publication of Assessment Schedules Placed under Collection
The placing of basic assessment schedules under collection shall be announced through the Official Gazette, radio and local newspapers. Announcements to this effect shall be posted, where appropriate, at the offices of collectors and in public gathering places and squares. The announcement shall specify the deadline for payment, the entitlement to the legal discount, the right of objection, and the date on which each begins.
Deadline for Objecting to Taxes and Fees
The deadline for objecting to taxes imposed by means of basic assessment schedules shall begin on the day following the date of publication of the relevant announcement in the Official Gazette.
The deadline for objecting to taxes imposed by means of additional or supplementary assessment schedules, and to taxes and fees imposed by judicial orders, shall begin on the day following the date on which the taxpayer is notified of these documents.
Such notification shall be effected by registered letter with acknowledgment of receipt. If the taxpayer is absent or refuses to accept delivery, notification shall be effected through the competent administration in accordance with the notification rules provided for in the Code of Civil Procedure.
The objection deadline shall be two months for direct taxes assessed by means of assessment schedules, and one month for other taxes and fees.
Rules for Objecting to Taxes and Fees
1. The procedures for objecting to the various taxes and fees and the time limits for their determination by the administration and objection committees shall be established by decree issued on the proposal of the Ministers of Finance and Justice within three months of the date of publication of this Law in the Official Gazette.
2. The procedures and time limits established in the aforementioned decree shall supersede all special provisions relating to objections contained in the various tax and fee laws.
Cancellation or Reduction of Tax Assessments
Notwithstanding any other provision, the tax directorates in the General Directorate of Finance may not order the cancellation or reduction of tax and fee assessments except with the approval of the head of the Revenue Service, unless the matter involves a material error or an amount not exceeding 50 per cent of the assessment value, provided the amount does not in any case exceed 500 L.L. per assessment.
Tax Assessment Monitoring Unit
A tax assessment monitoring unit shall be established to ensure supervision of the various tax and fee assessment operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.
Law on Collection of Taxes and Fees
No tax or fee may be collected unless the legislative authority has authorised this by virtue of the budget law or any other law.(1) Violators shall be prosecuted in accordance with Article 361 of the Penal Code.
1. The principle of 'no taxation without a law' is enshrined in Article 81 of the Constitution.
Persons Responsible for Collecting Taxes and Fees
Taxes and fees shall be collected on the basis of assessment schedules or collection orders by which they were assessed, unless they are of the type paid by the taxpayer directly by affixing stamps or equivalent instruments. Persons other than accountants and their staff may not undertake the collection of taxes, fees and other public revenues.
Statute of Limitations for Taxes and Fees
Taxes and fees of all kinds shall lapse against taxpayers by operation of the statute of limitations on 31 December of the fourth year following the year in which the assessment was made. The running of the limitation period shall be interrupted by the commencement of judicial proceedings provided for in the law. An injunction shall be deemed the commencement of proceedings provided it is notified in accordance with the provisions of Legislative Decree No. 147 of 12 June 1959. The injunction shall be renewed where necessary before the expiry of four years from the date of its notification to the person concerned.
Amended 1966
Retention of Assessment Schedules and Collection Orders
Assessment schedules shall be retained for a period of ten years, and collection orders for a period of five years, unless the Court of Audit orders, prior to the expiry of the retention period, a discharge of liability for those responsible for collection.(2)
2. The Court of Audit issues a discharge of liability for those responsible for collection within the framework of its judicial oversight of accounts (Articles 59 to 65 of the Law on the Organisation of the Court of Audit).
Collection Monitoring
A collection monitoring unit shall be established to ensure supervision of the tax and fee collection operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 16843 of 10 July 1964 defining the powers and duties of the Collection Monitoring Division within the Treasury Service.
Collection by Means of a Collection Instrument
The specific rules applicable to each type of State debt and other revenue, other than taxes and fees, shall govern their settlement and collection and the procedures for pursuing them. For debts and revenues in respect of which the applicable laws do not define the manner of their settlement and collection and the related proceedings, they shall be settled by means of collection orders issued by the head of the competent authority and collected in accordance with the procedures followed for the collection of direct taxes and equivalent fees. Objection to collection orders may be lodged before the competent administrative court at the place of residence of the debtor within two months of the date of notification of the order to him or at his place of residence. Filing an objection shall not suspend enforcement of collection orders unless the court so orders in whole or in part.
Sale of Immovable State Property
Immovable State property shall be sold in accordance with the special provisions applicable thereto.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Sale of Movable State Property
Movable State property shall be sold:
- 1)By mutual agreement if its assessed value does not exceed 3,000,000 L.L. (three million Lebanese pounds).
- 2)By invitation to tender if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
- 3)By public auction and by other available methods if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
Amended 1978Amended 1987Amended 1990Amended 2004
Authority Competent to Decide on the Sale of Movable State Property
Contracts for the sale of movable property shall be decided upon by: 1. In central administration: - The competent director, if the contract value does not exceed 150,000 L.L. - The competent director general, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L. 2. In governorates and districts: - The district commissioner (Qaimaqam), if the contract value does not exceed 150,000 L.L. - The governor, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L.
Amended 2004
Valuation of Movable Property
Movable property shall be valued by a committee established in each administration by decision of the authority competent to decide on the contract.
Oversight by the Court of Audit
Sale transactions subject to its oversight shall be submitted to the Court of Audit by the authority competent to decide on the contract.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Comprehensiveness of Revenue
All revenues received shall be recorded in their entirety in the revenue section of the budget.(2)
2. Recording all revenue in the revenue section confirms the adoption of the gross principle, i.e. the absence of netting between revenue and expenditure and the consequent application of the gross recording principle to both.
Gifts and Property Donated to the State
- 1)Cash and in-kind gifts offered to the State by legal or natural persons shall be accepted by decree issued on the proposal of the competent minister and the Minister of Finance if their value does not exceed 250,000,000 Lebanese pounds.
- 2)Cash and/or in-kind gifts offered to the State by legal or natural persons shall be accepted by decree adopted in the Council of Ministers if their value exceeds 250,000,000 Lebanese pounds.
- 3)Cash gifts received by the Lebanese Treasury shall be recorded in the revenue section of the budget; if these gifts have a specified destination for expenditure, appropriations shall be opened for them in the expenditure section in accordance with established procedures.
- 4)The Ministry of Finance shall prepare a quarterly statement of the gifts referred to in paragraphs (1) and (2) above that have been received by the Lebanese Treasury and shall submit it to the Council of Ministers for information.
Amended 2019
Revenue Accounts
The Ministry of Finance shall maintain, for each category of budget revenue and for each year separately, an independent account showing: - Prior years' balances, year by year. - Total revenues realised pursuant to assessment schedules and collection orders issued during the year. - Total collections up to 31 December of the year, broken down between the current year and each prior year. - Legal discounts utilised by taxpayers. - Uncollected balances at the end of the year. Each ministry shall also maintain a detailed account of the revenues it handles, for each year separately, on the basis of the collection orders it issues or that are issued at its request.
Functions of the State Treasury
The State Treasury shall handle all receipt and payment operations required for the implementation of the State budget and shall manage the accounts opened outside the budget.
Functions of the Accountant
Receipt and payment operations on behalf of the Treasury shall be carried out by officials each known as an accountant; however, the accountant may delegate certain of his powers to one of the accountants under his authority with the approval of the Head of the Treasury Service.(2)
2. The accountant was granted additional powers by Legislative Decree No. 25 of 17 January 1955.
Amended 1966
Categories of Accountants
Accountants are of two categories: central and local.
- 1)The central accountant is responsible for budget revenues and expenditure, and for off-budget operations.
- 2)The local accountant is responsible for off-budget operations and locally provides for the receipt of budget revenues and the payment of budget expenditure on behalf of the central accountant to whom he is attached.
- 3)In certain public administrations, the central accountant may be tasked with centralising all operations of the local accountants under his authority, whether these operations are within or outside the budget.
- 4)If a public administration has only one accountant, that accountant shall be treated as a central accountant for the purposes of this Law.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Central Accountants
Central accountants are: - The Central Finance Accountant. - The Central Customs Accountant. - The Central Post and Telegraph Accountant. - The central accountant of each administration with an annexed budget. - Any official assigned this status by decree.
Local Accountants
Local accountants are: - Finance accountants. - Customs accountants. - Post and telegraph accountants. - Accountants of administrations with annexed budgets. - Any official assigned this status by decree.
2. See, with regard to customs accountants, the following texts: Decree No. 4024 of 4 May 1960; Decree No. 11028 of 6 November 1962; Decree No. 11029 of 6 November 1962; Decree No. 11030 of 6 November 1962; Decision No. 173 of 8 May 1964.
General Chart of Accounts
Operations carried out by the accountant shall be recorded in accounts maintained in accordance with a general chart of accounts established by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 10388 of 9 June 1997 on the general chart of accounts for the State, public institutions and municipalities.
Methods of Bookkeeping
Public funds accounts shall be maintained by central accountants and the General Accounting Service on the basis of the double-entry method, and by local accountants on the basis of the single-entry method.(4)
4. With regard to defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements, see Decree No. 3373 of 11 December 1965.
Obligation to Maintain and Correct Entries in Ink
Entries shall be made in ink compulsorily and shall under no circumstances be made in pencil; erasure, insertion, obliteration or correction fluid in papers, tables, documents, entries, ledgers or records shall also be prohibited. However, any error therein may be corrected, provided the correction is made in a visible manner by crossing out the deleted letters and figures, using ink of a colour different from that used in the original, and that the correction is accompanied by the date and the signature of the person making it.
Salary and Allowance Appropriations
Salary and allowance appropriations relating to army personnel and members of the Internal Security Forces and General Security shall be entered in a single budget line without breakdown.
Award Committee
Contracting shall be handled by a special committee established in accordance with a system determined by decree on the proposal of the competent minister.
Mutual Agreements
Mutual agreements may be concluded for the supplies, works and services required by the army, the Internal Security Forces, the General Security and the customs detachments in times of war, emergencies and exceptional circumstances requiring immediate measures, on the basis of a reasoned order from the army commander.
Exemption from Certain Contract Conditions
When the Ministry of National Defence concludes contracts with foreign governments or institutions affiliated to them, or when such governments recommend them, for the purchase of weapons, ammunition, equipment and apparatus, it may exempt the counterpart from conditions relating to place of residence, security, penalties, and the obligation of delivery before receipt.
Possibility of Re-using Certain Appropriations
The Ministry of National Defence may request, in accordance with the procedures established in Article 117 of this Law, the re-use of the corresponding appropriations:
- 1)For the value of materials supplied by the army administration at a price to officers and personnel in their personal capacity.
- 2)For the value of materials charged to officers and personnel responsible for their loss or damage.
- 3)For the value of weapons, ammunition, equipment and apparatus sold by the army command to any administration or public institution.
- 4)For the value of materials used and the value of services rendered on behalf of public administrations and institutions or for the benefit of any natural or legal persons.
Amounts Paid in Error or Without Legal Basis
The Ministry of National Defence may deduct from entitlements to salaries paid from current year appropriations amounts paid in error or without legal basis in prior years.
Amounts Received in Excess
Salaries and supplements thereto, and transport and movement advances received by units in a given year in excess of their rights, and returned to the Treasury before the end of the following year, shall be entered by their return date in the current year's revenue in accordance with Article 8 of this Law. Additional appropriations equivalent to the value of the returned amounts may be opened by decision of the Minister of Finance in the salaries budget line of the army, provided they are covered by a corresponding increase in revenues.
Possibility of Committing Expenditure against the Following Year
Commencing from 1 August of each year, the Minister of National Defence may commit against the following year equipment expenditure amounting to two-thirds of the appropriations earmarked for this purpose for the current year in the army, Internal Security Forces and General Security budgets and those allocated to the customs detachments in the Ministry of Finance budget. Expenditure in respect of items not previously approved by the legislative authority may not be committed in this way. The provisions of Articles 137 and 138 of this Law may also be applied to the contracts referred to in this article even before the new year begins.
Amended 1966
Article 227 was repealed by Article 17 of Law No. 72/5 of 1 February 1972.
Amended 1972
Appointment of Materials Accountants
Materials accountants in the army shall be appointed by decision of the army commander.
Security Requirements
Army accountants shall be subject to the security system applicable to all accountants.(1)
1. Military accountants were exempted from providing legal securities by the Law of 20 August 1956.
Limits of the Court of Audit's Oversight
The Court of Audit and financial inspectors may not request access to or review documents and information relating to military secrets, unless the army commander consents. The Court of Audit shall exercise its oversight of the army's materials accounts locally and on the basis of the records maintained by the units and the supporting documents they produce.
Provisions Applicable to the Internal Security Forces and General Security
The provisions of Articles 220 to 230 inclusive of this Law shall apply to the Internal Security Forces, with each of the Minister of Interior and the Director General of the Internal Security Forces exercising the powers granted to the Minister of National Defence and the army commander respectively, each as far as it concerns him. With regard to the General Security and the customs detachments, the provisions of Articles 220, 222, 228, 229 and 230 of this Law shall apply, subject to the special organisation of each of these two bodies.
Amended 1979Amended 1983Amended 1985
Subsection 2Accountants
Accountants
Subsection 2-1Powers and Duties of Accountants
Subsection 2-2Liability of the Accountant
Parts of Budget Revenue
The revenue section of the budget consists of two parts: First: comprising ordinary revenues allocated to cover the expenditure of Parts One and Two of the expenditure section. Second: comprising revenues allocated to cover the expenditure of Part Three of the expenditure section. The latter revenues consist of:
- 1)Drawings from the reserve fund.
- 2)Revenues assigned or created by special laws.
Division of Revenue Parts
Each part of the revenue section shall be divided into chapters, and each chapter shall be divided into sections, each assigned to a category of revenues; each section shall be divided into budget lines, each assigned to a specific revenue item. A special section shall be set aside in each part in which funds paid by the Treasury in error or without legal basis and subsequently recovered shall be recorded. A model table for the division of revenues shall be established by a decision of the Minister of Finance.
Reserve Fund
A special chapter with a single section for drawings from the reserve fund shall be set aside in each part of the revenue section. This section shall be divided into budget lines in accordance with the model table referred to in the preceding article.
Stages of Expenditure Implementation
The implementation of expenditure passes through four stages:
- 1)Commitment.
- 2)Liquidation.
- 3)Issuance of the payment order.
- 4)Payment.(1)
1. Article 34 of the Law on the Organisation of the Court of Audit provides that transactions for the sale of immovable property are subject to prior administrative oversight.
Definition of Expenditure Commitment
An expenditure commitment is any act that is capable of creating a debt obligation on the State.
Authority Competent to Make a Commitment
Expenditure shall be committed by the competent minister unless the law provides otherwise.
Requirement of a Specific Appropriation
No expenditure shall be committed unless a budget appropriation is available for it,(2) and no appropriation may be used for any purpose other than that for which it was earmarked.
2. See, regarding the principle of the prohibition on committing expenditure prior to the availability of an appropriation, paragraph 2 of Article 59 of this Law.
Suspension of Commitment of Supplies and Works Expenditure
Commitment operations for supplies and works expenditure(3) shall cease on 30 November of each year; however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases(4) assessed by the competent minister and the Minister of Finance.
3. Expenditure commitments for services do not cease on 30 November because Article 58 above restricts the suspension of commitment operations to supplies and works expenditure only.
4. The phrase 'however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases...' was added by correction of a material error published in Official Gazette No. 94 of 24 November 1966, p. 1728.
Amended 1966
Commitment of Expenditure against a Financial Year before Its Start
No expenditure shall be committed against a financial year before its commencement. However, commencing from 1 October of each year, permanent expenditure whose continuity is required by the public interest may be committed against the following year within the limits of the appropriations earmarked for it in the current year's budget; likewise, during the period preceding the publication of the budget, such expenditure may be committed after the new year has begun within the limits of the appropriations earmarked for it in the previous year's budget. Furthermore, liquidation, payment order and payment transactions may be carried out during the relevant financial year.(5)
5. This article permitted the executive authority to bypass the legislative authority by allowing it to take all stages of expenditure before the legislative authority approves the budget; in other words, this bypass leads to a violation of the principle of the prohibition on committing expenditure before an appropriation is available, as provided in Article 57 of this Law.
Amended 1987
The Twelfth Rule
1. Twelfth budgets shall be drawn up on the basis of the permanent appropriations earmarked in the previous year's budget, taking into account additions to and deletions from permanent appropriations. Appropriations transferred from the budget reserve shall not be treated as lapsed.
- 1)The Government shall have the right, by decree adopted in the Council of Ministers on the proposal of the competent minister and the Minister of Finance, to distribute the total construction and equipment appropriations in each twelfth budget among the various public administrations in accordance with their needs, while remaining bound by the appropriations allocated to each public administration in the draft budget for the current year.
- 2)Prior to the approval of the budget, the Government shall have the right, by decree adopted in the Council of Ministers, to transfer appropriations on the basis of the twelfth rule from the budget reserve in order to fund various budget lines.
1. The Minister of Finance was authorised, with respect to contracts for works or supply of equipment, to choose between the method of advance payment and the method of deferred payment pursuant to Article 12 of Law No. 78/16 of 2 May 1978 (Budget Law 1978).
Amended 1988Amended 1980
Requirement of Endorsement by the Controller of Expenditure Commitments
Every transaction leading to an expenditure commitment must, before it is signed, be endorsed by the Controller of Expenditure Commitments. However, in urgent emergency situations, the competent authority may proceed with committing expenditure within the limits of the appropriations earmarked for it prior to obtaining the endorsement of the Controller of Expenditure Commitments, provided it submits the transaction to him for review within at most one week of the date of commitment, together with a statement of the reasons that warranted this course of action; the committing officer shall remain responsible for the expenditure until it has been regularised in legal form. Every transaction leading to an expenditure commitment shall be accompanied by an appropriation reservation request (expenditure commitment request).
Appropriation Reservation Request
The appropriation reservation request required for an expenditure commitment shall be signed by the accountant of the competent administration or by his authorised delegate with the approval of his hierarchical superior.
Procedure for Issuing Appropriation Reservation Requests
Appropriation reservation requests shall be organised: - For the whole year, when they relate to salaries and similar staff expenditure. - For three or six months, when they relate to other permanent expenditure. - An individual request shall be organised whenever circumstances require. A blanket contingency request for reserving the appropriation required for permanent expenditure may also be organised when the nature of the expenditure allows it to be covered by a single individual request each time.
Authority Competent to Control Expenditure Commitments
1. Control of expenditure commitments shall be carried out in the name of the Minister of Finance by: - The Head of the Budget and Expenditure Control Service, acting as Central Controller of Expenditure Commitments. - Controllers seconded to ministries who represent the Central Controller.
- 1)The Central Controller may delegate his representation in certain ministries to staff members under his authority who will handle the review of transactions referred to him. He may also delegate certain of his powers to them.
- 2)The procedures for controlling expenditure commitments shall be established by decree issued on the proposal of the Minister of Finance;(1) the powers of controllers seconded to ministries shall be determined by decision of the Minister of Finance.
- 3)Controllers shall be assigned among ministries by decision of the Minister of Finance on the proposal of the Director General.
- 4)No controller seconded to a ministry may begin his assignment before completing a training period of at least three months in the Budget and Expenditure Control Service.
1. See Decree No. 324 of 13 November 1964 defining the procedures for controlling expenditure commitments.
Duties of the Controller of Expenditure Commitments
The purpose of the controller's review is to verify the following two matters: - The availability of the expenditure appropriation and the correctness of its classification. - The conformity of the transaction with the applicable laws and regulations, unless it is subject to oversight by the Civil Service Council, in which case it shall not be reviewed by the controller from a financial standpoint.
Time Limit for Endorsing a Transaction
The controller shall endorse the appropriation reservation request and the transaction and return the documents to their source within at most five days of the date of their receipt. If this period expires without a decision being made, the competent administration may retrieve the transaction and implement it at his own responsibility. If the controller requires written clarifications from the competent administration, the five-day period shall be extended commencing from the date of receipt of such clarifications. This may be done only once. If the transaction is subject to prior review by the Court of Audit, the controller shall forward it to the Court after endorsement, accompanied by his comments.
Cases where Endorsement of the Appropriation Reservation Request is Sufficient
The controller's endorsement of the appropriation reservation request shall be deemed equivalent to endorsement of the subsequent transaction in the following cases:
- 1)Expenditure committed by means of a statement or invoice pursuant to the provisions of the first paragraph of Article 151 of this Law.
- 2)Staff assignment orders.
- 3)Staff reclassification.
- 4)In general, expenditure for which a blanket appropriation reserve has been made in accordance with the provisions of the last paragraph of Article 63 of this Law.
Types of Endorsement
The controller's endorsement is of two kinds: - Total: covering the full value of the expenditure for which a commitment is requested. - Partial: limited to a portion of the expenditure for which a commitment is requested. In the event of a partial endorsement or a refusal of endorsement, the controller must state the reasons for his position. A partial endorsement shall not be given when it results in a reduction of the requested expenditure due to a material or arithmetic error.
Effects of Partial Endorsement
- 1)If the Central Controller gives a partial endorsement or refuses endorsement, he must refer the transaction to the Minister of Finance. If the Minister of Finance agrees with his position, the competent minister may refer the matter to the Council of Ministers for decision. If the Minister of Finance does not agree with the said position, the Central Controller must comply with the minister's decision subject to the provisions of the Law on the Court of Audit.
- 2)If the controller seconded to a ministry gives a partial endorsement or refuses endorsement, he must refer the transaction to the Central Controller. If the Central Controller agrees with his position, he shall refer the transaction to the Minister of Finance in accordance with the provisions of the preceding paragraph. If he does not agree, the controller must comply with the Central Controller's decision.
Refusal of Endorsement due to Insufficiency of Appropriation
The Council of Ministers may not approve the commitment of expenditure in respect of which the controller has refused endorsement due to the absence of a sufficient appropriation.(1)
1. Reading Articles 70 and 71 together reveals that a fortiori the Minister of Finance is entitled to overrule the position of the Controller of Expenditure Commitments when the latter refuses endorsement due to insufficiency of appropriation.
Advisory Role of the Controller of Expenditure Commitments
The competent administration may seek the opinion of the controller seconded to it on its financial matters, in particular on the draft budget and the supplementary appropriation requests it submits.
Amendment of Previously Committed Expenditure
The authority competent to make a commitment may request an increase or reduction in previously committed expenditure, provided that all necessary supporting documents are attached to the amendment request.
Definition of Expenditure Liquidation
Liquidation of expenditure is the verification of the crystallisation of the debt obligation on the State, the determination of its amount, its due date and the fact that it has not lapsed by operation of the statute of limitations or for any other reason.(2)
2. The debt does not lapse, for example, by payment or set-off.
Authority Competent for Liquidation
Liquidation shall be carried out by the competent accountant or by the person to whom he delegates this task with the approval of his hierarchical superior. The accountant of the General Directorate of Finance shall carry out the liquidation of expenditure paid from the debt service chapter.
Documents on which Liquidation is Based
Liquidation shall be based on documents capable of proving the existence of the debt. These documents shall be specified for each category of expenditure by decision of the Minister of Finance adopted after consulting the Court of Audit, and published in the Official Gazette.(3) A statement certified by the head of the unit responsible for implementing the expenditure shall also be required when the expenditure exceeds 50,000 L.L. Schedules issued by the electronic centre of the General Directorate of Finance equivalent to salaries, wages, pensions and their supplements, and monthly allowances of all kinds, shall have the force of certified documents and shall not require the signature of the relevant authorising officials. The details of application of this paragraph shall be defined, where appropriate, by decision of the Minister of Finance.
3. See Decision No. 1/59 of 7 January 1966 defining the documents capable of proving the existence of a debt.
Amended 1987Amended 1990Amended 1994Amended 1991Amended 1992Amended 1993
Liquidation Procedures
- 1)Liquidation shall be carried out spontaneously and, if this is not possible, at the request of the creditor.
- 2)The liquidating official must complete the liquidation within at most five days of the date on which the relevant supporting documents are received.
- 3)The creditor shall have the right to request from the liquidating official a certificate indicating the date of submission of his request and the list of supporting documents provided.
Determination of the Liquidation Instrument
Liquidation shall be carried out on the basis of the instrument specifying the debt in detail.
Definition of the Payment Order
A payment order is a document authorising the payment of its value.
Authority Competent to Issue Payment Orders and its Duties
- 1)Payment orders shall be issued, in the name of the Minister of Finance, by the Head of the Payment Service in the Ministry of Finance. This official may delegate certain of his powers to staff of his service, provided they are of at least the third grade. He may also delegate his representation in certain ministries to members of his service who will handle the review and preparation of payment orders locally.
- 2)Where appropriate, the duty of issuing payment orders may be delegated in public administrations and governorates, except the Governorate of Beirut, to officials of at least the third grade belonging to the Ministry of Finance staff, to be effected by decree.
- 3)The authorising officer must complete the payment order procedure within seven days of the date of its receipt, extendable to ten days for the last salary payment orders.
- 4)If the authorising officer requires written clarifications from the competent administration, the five-day period shall begin from the date of receipt of such clarifications. This may be done only once.
Possibility of Issuing Payment Orders during January of the Following Year
Payment orders for the financial year's expenditure may continue to be issued up to 31 January of the following year, provided they are dated 31 December of the year against which they are charged.
Concept of Prior Years' Expenditure
Amounts that accrued to third parties against the State during a given financial year but were not paid by the end of February of the following year, for any reason whatsoever, are called prior years' expenditure.
Amended 1966
Conditions for Issuing a Payment Order
A payment order may only be issued after verifying the following:
- 1)That the expenditure commitment transaction has been signed by the competent authority and endorsed by the Controller of Expenditure Commitments.
- 2)That the classification of the expenditure matches the commitment transaction.
- 3)That the expenditure calculations are correct.
- 4)That the liquidation transaction conforms to the financial laws and regulations only.
Issuance of a Separate Payment Order for Each Creditor
A separate payment order shall be issued for each creditor when payment is made from a single budget line or a single paragraph.
Persons in Whose Name the Payment Order is Issued
The payment order shall be issued in the name of the creditor or, on his behalf, in the name of his agent, secretary or proxy for collection, and in the name of his heirs in the event of his death. It shall be issued in the name of the head of the Treasury Service if the State is the creditor, and in the name of the competent accountant if the creditor is a municipality or a public institution. It shall be issued in the name of the competent governor if it relates to amounts due to minors who have no municipality, provided the amount is deposited in trust in the name of the said governor with the central district accountant.
Special Cases for Issuing Payment Orders
A payment order may be issued:
- 1)In the name of an authorised agent for collection designated by the competent administration, with respect to staff salaries, expenses and pensions.
- 2)In the name of the official who paid the amount from his own funds, with respect to transport allowances and certain petty expenses.
- 3)In the name of the seller on credit, with respect to expenditure paid from his own funds.
- 4)At the request of the beneficiary administration, payment orders relating to expropriation compensation may be issued in the name of the district accountant in whose district the expropriated properties are located, or the adjacent district, provided the conditions for payment of such compensation are established by decision of the Minister of Finance.
Obligation to Communicate Garnishment Orders and Deed of Assignment to the Authorising Officer
Garnishment orders and assignment instruments relating to debts owed by the State shall be communicated to the authority competent to issue payment orders. No notification addressed to any other person shall be deemed valid. The said authority must respond within the legal time limit to the party that notified it of the garnishment, and must record the garnishment or assignment on the payment order after its issuance.
Obligation to Sign the Payment Order
The payment order shall be signed by the competent authority and forwarded to the competent accountant for payment.
Amended 1966
Case of Loss of a Payment Order
If a payment order is lost, its holder shall be provided with a copy thereof upon his written request stating the reasons for the loss, together with a written certificate from the Central Accountant confirming that the payment order has not been paid and that notice has been taken of the obligation not to pay it.
Duties of the Accountant
A payment order becomes valid for payment after endorsement by the Central Accountant, or by the person to whom he delegates this task with the approval of the competent Director General. This official shall: a. Refuse endorsement and return the payment order to its source with a statement of reasons for the refusal in the following cases: First: if the payment order is not accompanied by the signature of the authority competent to issue it. Second: if the supporting documents for the expenditure are not attached to the payment order. Third: if the name of the creditor, the subject of the expenditure or its amount does not correspond to the supporting documents. b. Complete the transaction and place the relevant payment instrument under the disposal of the competent administration within three days of its receipt.
Amended 1966
Payment Orders Issued in the Governorates
The procedures for paying payment orders issued in the governorates shall be established by decrees adopted on the proposal of the Minister of Finance.
Amended 1966
Method of Paying Payment Orders
Payment orders shall be paid in cash from the cashbox where they are held. Payment may also be effected by bank transfer.
Payment of Staff Salaries
Staff salaries for the month of January shall, by way of exception, be paid during the last ten days of December.
Powers of Accountants
Accountants shall carry out: - Receipt of the assessment schedules, collection orders and recovery orders deposited with them by the relevant authorities, and ensuring their collection. - Receiving all receipts, of whatever nature. - Making all payments, either on the basis of payment orders or payment instructions issued by the competent authority, or in certain cases on the basis of payment instructions issued by them directly. - Safekeeping of the supporting documents relating to these operations and accounting records. - Maintenance of the accountancy accounts they manage.
Powers of the Central Finance Accountant
The Central Finance Accountant shall, in addition to the foregoing, centralise all revenue and expenditure operations relating to the general budget carried out by any central accountant, and shall also manage the State Treasury account held at the Central Bank.
Prohibition on Combining Administrative and Accounting Functions
The function of accountant may not be combined with any function relating to the assessment of revenues, or any function relating to the commitment, liquidation or payment order issuance of expenditure.
Conditions for an Accountant to Exercise his Functions
Before entering upon his duties, the accountant must provide a legal security whose value shall be determined by decision of the Minister of Finance, and must take an oath before the Court of Audit.(1)
1. The value of this security was set at twenty thousand Lebanese pounds by Decision No. 213 of 29 May 1986. See also Decree No. 2829 of 14 December 1959; Decision No. 1430 of 6 June 1974; Decision No. 1525 of 13 October 1977; and the Law of 20 August 1956.
Method of Providing the Security
The security shall be provided either in cash, or by bank guarantees issued by approved banks, or by registering immovable properties in the land registry. The papers and documents relating to the security provided shall be kept at the General Accounting Service of the Ministry of Finance, together with a copy of the text ordering the appointment of the accountant.
Ensuring Payment through a Cashier
The accountant may not personally receive or pay funds under his management; this shall be done through cashiers or tax collectors under his authority, except in cases established by special decree.(1)
1. With regard to the authorisation of certain accountants to personally receive funds, see: Decree No. 2837 of 14 December 1959; Decree No. 2840 of 14 December 1959; Decree No. 4024 of 4 May 1960.
Supervision of Cashiers' Activities
The accountant must supervise the work of the cashiers and tax collectors under his authority and must call them to account for any breach or delay in their work.
Personal Liability of the Accountant
The accountant shall be personally liable, from his own funds, for every receipt or payment operation carried out in the accountancy office he manages in contravention of the provisions of the law, in addition to any disciplinary or criminal penalties he may incur.
Limits of Liability
The accountant shall only be liable for his personal management.
Operations for which Liability is Borne
The accountant's duties cover all operations he carries out in his accountancy office from 1 January to 31 December of each year, or during the period he held his position, if that period is less than one year.
Account of Assignment
Central accountants, and likewise local accountants referred to in paragraph 2 of Article 160, shall submit their assignment accounts to the Court of Audit in their own names and on their own responsibility. Local accountants referred to in paragraph 3 of Article 160 shall submit their assignment accounts in their own names and on their own responsibility to the central accountant to whom they are attached, within conditions and time limits established by decree issued on the proposal of the Minister of Finance.(2)
2. The rules and deadlines for organising, auditing and consolidating assignment accounts and financial statements were established by Articles 16 to 19 of Decree No. 3373 of 11 December 1965.
Handover and Takeover Record
Upon the expiry of the accountant's assignment, a handover and takeover procedure shall be carried out between him and his successor by means of a record signed by both of them, in the presence of a financial inspector for central accountants and an official designated by the competent administration for local accountants. A copy of the record shall in both cases be sent to the Financial Inspectorate. A trial balance of accounts dated the day of the handover and takeover procedure must be attached to this record as a mandatory requirement.
Case Where the Successor Cannot Perform his Duties
In the event of the accountant's death, or his inability to present the handover and takeover record, the successor accountant shall draw up the assignment account of the predecessor accountant under the supervision of a financial inspector.
Return of the Accountant's Security
The security(1) shall be returned after the accountant obtains a discharge from the Court of Audit and shall be returned automatically after three years have elapsed since the accountant left his assignment, if the Court is late in issuing its decision beyond that period.
1. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Liability of Accountants and Financial Collectors
- 1)Local accountants and collectors shall be jointly and severally liable for direct taxes and other funds entrusted to them for collection.
- 2)The head of a tax collection directorate shall be personally liable for the direct taxes and other funds entrusted to him for collection; he is required to provide the security required of accountants.
- 3)The extent of the liability of the officials referred to in paragraphs 1 and 2 of this article, and the procedures to be followed to mitigate their liability or issue a discharge of their obligations, shall be established by decree adopted on the proposal of the Minister of Finance.(2)
2. The liability of accountants and collectors was established by Decree No. 5933 of 3 November 1966.
De Facto Accountant
Any person who intervenes in the management of public funds without holding the status of accountant shall be treated as an accountant responsible for his actions, like the official accountant, and shall be subject to the latter's obligations.
Expenditure of External Missions
Permanent budget advances shall be placed at the disposal of external missions, to be used by each mission to pay its expenditure for at least six months.
Special Award Committee
Contracting in external missions shall be handled by a special committee appointed by decision of the head of the mission wherever possible; otherwise it shall be carried out in accordance with procedures established by decision of the Minister of Foreign Affairs and Emigrants.
Expenditure of External Delegations
The expenditure of delegations abroad may be evidenced by detailed statements certified by the head of the delegation on his own responsibility.
Representation Expenditure Abroad and Administrative Expenditure
Representation expenditure abroad may be evidenced by detailed statements prepared by the head of the external mission and certified by the Secretary General of the Ministry of Foreign Affairs and Emigrants. Administrative expenditure incurred by external missions shall also be evidenced by the same method if the expenditure does not exceed 500 pounds each time.
Mechanisms for Committing and Disbursing Expenditure and Bookkeeping Procedures
Notwithstanding any other provision or measure, Lebanese diplomatic and consular missions shall apply the financial instructions issued by the joint decision of the Ministers of Finance and of Foreign Affairs and Emigrants dated 29 April 1999 and its amendments, with regard to the mechanisms for committing and disbursing expenditure, conditions for commitment, appropriation reservation and annual carry-over, bookkeeping procedures, organisation of entries, receipt of funds and their disbursement.
Amended 2017
Subsection 3Powers and Responsibilities of Cashiers and Tax Collectors
Powers and Responsibilities of Cashiers and Tax Collectors
Expenditure Paid without a Prior Payment Order
Certain expenditure may be paid without a prior payment order, provided that the payment order is subsequently issued as a regularisation measure. The expenditure that may be paid in the manner described above consists of:
- 1)Salaries, wages and their supplements, pensions, and military order medal allowances.
- 2)Ordinary petty expenditure, urgent expenditure, and other expenditure whose nature or urgency justifies its direct payment in the normal manner.
Conditions for Paying Expenditure without a Prior Payment Order
The procedures for paying the expenditure described in the first paragraph of the preceding article shall be established by decree. Expenditure described in the second paragraph shall be paid through a permanent or emergency advance known as a budget advance, to be disbursed in accordance with the provisions of the following articles within the appropriations earmarked in the budget.
Definition of Permanent and Emergency Advance
A permanent advance is one granted to public administrations to cover their recurring expenditure throughout the current year. An emergency advance is one granted to public administrations or to any assigned person to meet expenditure that may be impossible to renew.
Decision to Grant a Permanent Advance
A permanent advance of a fixed value shall be granted by joint decision of the Minister of Finance and the competent minister. This decision shall specify: - The amount of the advance, which must be equivalent to three times the recurring monthly expenditure. - The types of expenditure that may be paid from the advance. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. - The name of the advance administrator, his position, the type of security he is required to provide, and its amount.
1. See Decree No. 3149 of 16 November 1965 on the system for paying certain public expenditure through permanent advances.
Method of Operating a Permanent Advance
A permanent advance shall be disbursed without prior endorsement by the Controller of Expenditure Commitments. However, the administrator may pay from it only expenditure that has been previously committed and liquidated in accordance with established procedures.
Payment of the Permanent Advance
The Central Accountant shall pay the permanent advance to the administrator on the basis of the decision ordering its disbursement.
Replenishment of Expenditure Paid from the Permanent Advance
Expenditure paid from the advance shall be reimbursed by means of payment orders issued in the name of the administrator. The advance shall be replenished by the amount of the sums disbursed pursuant to these payment orders, without the need to issue any new decision.
Duties of the Permanent Advance Administrator
The advance administrator shall: - Receive the advance and the replenishment payment orders. - Ensure payments are made. - Collect the supporting documents for expenditure and submit them to the authority competent to issue payment orders on a regular basis at the end of each month. - Maintain an account of the advance whose procedures are to be defined by decision of the Minister of Finance.
Liquidation and Payment of Permanent Advance Expenditure
Normal liquidation and payment order procedures shall be carried out on the basis of the supporting documents submitted by the administrator. If the Payment Service finds that some supporting documents are not in order, it shall proceed to issue a payment order for the amount of the valid documents and return the other documents to the competent administration within at most five days. In the latter case, the value of the advance may be increased by the amount of the documents whose payment has been suspended.
Deposit of the Permanent Advance in State Cashboxes
Permanent advances exceeding a limit assessed by the Minister of Finance must be deposited in the name of the administrator in a State cashbox designated in the decision ordering the disbursement of the advance.
Procedures for Operating Permanent Advances
The procedures for operating permanent advances shall be established by decision of the Minister of Finance.
Decision to Grant an Emergency Advance
An emergency advance shall be granted by decision of the Director General of Finance after endorsement by the Controller of Expenditure Commitments. This decision shall specify: - The amount of the advance. - The purpose of expenditure. - The person in whose name the advance is granted. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. The appropriations reserved for permanent and emergency budget advances granted during a given year to meet obligations to be executed in that year (opening of exhausted appropriations to implement agreements with foreign governments or foreign and local agencies, or to pay for medical treatment abroad) may be carried over to the budgets of subsequent financial years.
Amended 1999
Disbursement of the Emergency Advance
The emergency advance shall be disbursed by means of a payment order issued by the authority competent to issue payment orders on the basis of the decision ordering the disbursement of the advance.
Issuance of the Repayment Payment Order for the Emergency Advance
The repayment payment order shall be issued in the name of the person to whom the advance was granted.
Conditions for Use of a Budget Advance
An advance shall not be used for any purpose other than that for which it was granted. The legal provisions governing the management of public funds shall be observed in its use.
Repayment of a Budget Advance
An advance shall be repaid either in cash by returning its value to the Treasury, or by supporting documents for the expenditure, or by both methods simultaneously, within the time limit specified in the decision ordering its disbursement.
Liability of the Budget Advance Administrator
The advance administrator shall be personally liable, from his own funds, for the value of the advance. He must demonstrate its existence to any inspector either in cash or in the form of supporting documents for amounts expended from it.
Auditing Budget Advance Accounts
The Head of the Treasury Service must ensure that advance accounts are audited at least once every six months. He may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that exceed the amount of the expenditure due, or that are repaid at incorrect times; he may also take direct legal action against the administrator to recover such amounts.
Exclusive Right to Handle and Hold Funds
The right to handle and hold funds in each accountancy office shall be exclusively vested in cashiers and collectors, except in cases established by the decree referred to in Article 171 of this Law.
Responsibility for Safekeeping Funds
Cashiers shall be responsible for the safekeeping of funds in the accountancy office in which they exercise their functions.
Collectors' Responsibility for Safekeeping and Remitting Funds
Collectors shall be responsible for the safekeeping of the funds they collect, and must remit them periodically to the cashboxes of the accountancy office to which they belong in accordance with conditions established by decision of the Minister of Finance. They shall also be jointly and severally liable with the accountant to whom they are attached for the collection of direct taxes in accordance with Article 180 of this Law. Collectors are absolutely prohibited from making any payment whatsoever.
Obligation to Provide Security
Cashiers and collectors shall be subject to the security system on the same basis as accountants.(3)
3. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Verification of the Identity and Signature of the Payee
Before making a payment, the cashier must verify on his own responsibility the identity of the payee and the authenticity of his signature.
Amount Due to a Deceased Person
If an amount is due to a deceased person, the cashier shall request from the heirs official documents proving their relationship to the deceased. A certificate from the local mukhtar (village chief) shall suffice if the amount is less than 500 pounds.
Case of Using a Thumbprint
If the payee is illiterate or unable to sign, a thumbprint shall be used in place of a signature, provided it is certified by the cashier and two witnesses if the payment order value exceeds one thousand pounds. In other cases, the cashier may require the thumbprint to be certified by a notary.
Issuance of Receipt for Amounts Received
A receipt shall be issued for every amount received by cashiers and collectors, whose form and method of organisation for each administration or unit shall be determined by the General Accounting Service of the Ministry of Finance.
Falsification of a Receipt
Any falsification of a receipt issued by a cashier or collector, or of any copy thereof, regardless of the cause, shall be presumed to have been committed with malicious intent, and the penalties provided in Articles 461 and 462 of the Penal Code shall apply to the perpetrator, unless the falsification caused no harm to public funds.
Formal Receipt
A formal receipt must be issued for every amount received from public funds, and anyone who collects public funds without issuing a formal receipt shall be deemed an embezzler.
Maximum Balances to be Retained
The Head of the General Accounting Service of the Ministry of Finance shall, on the proposal of the competent central accountant, establish the maximum balances that cashiers may retain,(1) requiring them to pay any amounts in excess of these balances to the banks or post offices assigned to them.
1. The maximum holdings for cashboxes at customs centres were established by Decision No. 173 of 8 May 1964.
Tasking Officials in Certain Administrations with Receiving Revenue
Administrations that collect certain revenues in cash must task one of their officials, with the approval of the General Accounting Service, with receiving such funds and maintaining their accounts. This service may also approve the method of receiving and remitting the said funds, as well as the register forms to be maintained. The said official shall remit the funds he has received at least once a month, either to the Central Finance Accountant or to the local Finance Accountant, on the basis of a schedule identifying the received items and the type of revenue collected. This official may be assisted in receipt operations, where appropriate, by one or more cashier's assistants. This official and those assisting him in receiving funds shall be subject to the obligations of cashiers and in particular to the provisions of Articles 185, 189 and 192.
Payment at the Beginning of Each Month
Allowances, salaries and monthly benefits specific to the post or attached to the salary shall be paid at the beginning of each month. This measure shall apply to all permanent and temporary officials, with the exception of contractors, and shall also apply to pensioners and their heirs.
Non-Recovery of Any Amount Paid
An amount paid in implementation of the provisions of the preceding paragraph shall remain a vested right of the recipient and shall not be recovered for the benefit of the Treasury in any circumstances.
Subsection 4Accounts of Funds
Accounts of Funds
Subsection 4-1General Provisions
Subsection 4-2Special Provisions on Certain Accounts
Fate of Expenditure Committed without Prior Controller Endorsement
If expenditure is committed in accordance with the provisions of the law without obtaining the prior endorsement of the Controller of Expenditure Commitments, and an appropriation is available for it, it shall be paid as a regularisation measure, subject to the prosecution of those responsible before the Court of Audit.
Liability for Committing Expenditure in Excess of Appropriations
A minister shall be personally liable, from his own funds, for any expenditure he commits in excess of the appropriations opened for his ministry while being aware of such excess, and likewise for any measure that leads to an increase in expenditure paid from the said appropriations if that measure does not result from prior legislative provisions. This liability shall not prevent the prosecution of officials who were involved in committing, liquidating and issuing payment orders for the expenditure before the Court of Audit, unless they produce a written order capable of relieving them of liability.
Obligation to Inform the Prosecutor General of the Court of Audit
The Controller of Expenditure Commitments, and other authorities when necessary and as far as it concerns them, shall inform the Prosecutor General of the Court of Audit of the situations described in the two preceding articles.
Carry-Over of Appropriations
- 1)Appropriations of Part One of the budget that have not been committed by 31 December of the year shall lapse, except for appropriations earmarked for the allocations of the general Treasury.
- 2)Appropriations of Part Two that have not been committed by 31 December shall be carried over for one year, except for programme law appropriations.
- 3)Appropriations of Parts One and Two of the budget that have been committed but not issued with a payment order by 31 December of the year shall be carried over to the following year's budget if they relate to a third-party right.
- 4)The carry-over shall be effected by decision of the Minister of Finance issued at the request of the competent administration before 1 March of the following year in accordance with the applicable provisions.
- 5)This text shall take effect as from the 2017 budget.
1. Contrary to Article 114, the carry-over of uncommitted appropriations opened in 1990 and earlier was suspended by Article 17 of Law No. 490 of 15 February 1996 (Budget 1996), and similarly for 1991 and earlier by Article 16 of Budget Law 1997, and thereafter by successive decrees.
2. The first amendment to this article's paragraph was made by Article 48 of Law No. 89 of 7 September 1991, then repealed by Article 18 of Law No. 490 of 15 February 1996.
Amended 2017Amended 2019
Extinguishment of Debts by Statute of Limitations
Debts that have not been liquidated, for which no payment order has been issued, or that have not been paid by 31 December of the fifth year following the financial year in which they arose shall lapse by operation of the statute of limitations and shall be definitively extinguished in favour of the State, unless the delay was caused by the administration or by the failure to pursue legal proceedings.(1)
1. With regard to the treatment of deposits, guarantees and cash sureties that are more than ten years old as Treasury revenue, Article 30 of Law No. 81/14 of 15 July 1981 provides detailed rules in this regard.
Amended 1967
Prior Years' Expenditure
1. Prior years' expenditure that has not lapsed by statute of limitations shall be paid from the appropriations opened for this purpose in the current year's budget. It may also be paid, where the state of appropriations permits, from the current year's budget appropriations. 2. Subject to the provisions of paragraph 1 of this article, prior years' expenditure relating to the period prior to 1963 that has not lapsed by statute of limitations shall be paid from the prior years' expenditure section of the current year's budget in accordance with the provisions of paragraph 3 of Article 25.
Amended 1966
Fate of Amounts Paid in Error or Without Legal Basis
Amounts paid by the Treasury in error or without legal basis and recovered during the financial year in which they were paid may be added to the appropriation of the competent minister by decision of the Minister of Finance. The competent minister must submit a request to the Minister of Finance in this regard within a maximum period ending on 31 December of the same year.
Possibility of Suspending the Use of Certain Appropriations
The Minister of Finance may, if he deems it necessary, propose to the Council of Ministers the suspension of the use of certain appropriations earmarked in the budget. The Council of Ministers may decide to approve the proposal if the current circumstances justify taking such a measure.
Expenditure Accounts
The Ministry of Finance shall maintain separate accounts of all committed, issued for payment and paid expenditure. The competent administrations shall maintain corresponding accounts of expenditure they commit, liquidate and for which payment orders are issued.(1)
1. The Court of Audit reconciles the accounts of the Ministry of Finance with those of the administrations and issues, upon completion of its review, a 'reconciliation statement' showing whether the accounts are correct or not.
Functions of the General Accounting Service
The General Accounting Service shall audit the operations of accountants and administrative accountants and shall consolidate them.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Budget Closing of Accounts and General Assignment Account
The General Accounting Service shall prepare each year: - The budget closing of accounts, which must be submitted to the Court of Audit before 15 August of the year following the budget year. - The general assignment account, which must be submitted to the Court of Audit before 1 September of the year following the account year. - The preparation of the general assignment account shall begin with the account of the year in which the general chart of accounts referred to in Article 163 of this Law begins to apply.
2. Regarding the exemption from preparing the assignment account of central accountants and the general assignment account, Article 23 of Law No. 715 of 3 February 2006 (Budget 2005) provides detailed rules.
3. The deadlines for submission to the Court of Audit and the General Accounting Service of accounts and financial and administrative statements were extended by Article 1 of Legislative Decree No. 102 of 30 June 1977.
4. Regarding granting the General Accounting Service a deadline for preparing the assignment account, Articles 3 and 4 of Law No. 81/12 of 15 July 1981 (Closing of Accounts for 1977) provide detailed rules.
Amended 1966Amended 1977
Results of the Budget Closing of Accounts
If the budget closing of accounts shows a surplus in revenues, this surplus shall be transferred, by virtue of the closing law, to the 'reserve fund' account; if it shows a surplus in expenditure, the said law shall authorise the covering of the deficit from the reserve fund. If the reserve fund is insufficient, the deficit shall be recorded in the advances account and must be compulsorily repaid from the first subsequent budget that shows a surplus; if that surplus is insufficient, it shall be paid from surpluses of subsequent years in turn.
Referral of the Draft Closing of Accounts to the Chamber of Deputies
The Government must refer the draft budget closing of accounts law to the Chamber of Deputies before 1 November of the year following the budget year.
Definition of the Reserve Fund
The reserve fund is constituted from the surplus of budget revenues over expenditure. The Central Finance Accountant shall maintain this account under the supervision of the General Accounting Service.
Use of the Reserve Fund
The reserve fund shall be used: - To cover prior years' expenditure during the transitional period referred to in Article 25 of this Law. - To cover opened appropriations. - To cover the budget deficit in accordance with Article 196 of this Law. - To cover supplementary appropriations (complementary and exceptional). - To finance construction projects.
Drawings from the Reserve Fund
No amount may be drawn from the reserve fund except by law. Every amount decided to be drawn from the reserve fund must be immediately entered in the accounts of the Central Finance Accountant. The method of creating these entries shall be established by decision of the Minister of Finance.
Delivery of Deposits and Guarantees to the Treasury
Deposits and guarantees shall be delivered to the Treasury on the basis of an instruction issued by the competent authority, and the reasons for the deposit shall be recorded in the relevant receipts; they shall only be returned to their owners on the basis of an instruction from the competent authority and after the receipts are recovered.
Loss of Deposit and Guarantee Receipts
If deposit or guarantee receipts are lost, they shall be replaced by an undertaking from their owner to bear any harm and damage that may result to a third party from the misuse of the lost receipt for a period of five years.
Definition of Treasury Advances
Treasury advances are funds disbursed from its holdings:
- 1)To constitute joint supply depots for public administrations for supplies shared among more than one administration.
- 2)To purchase storable materials intended for use in the current or following financial year.
- 3)To fund the cashboxes of public institutions and municipalities and also the independent cashboxes established by law.
1. See Law No. 89/5 of 5 January 1989 on the termination of provisions authorising the conclusion of loans or the granting of State guarantees, or the commitment of expenditure without available appropriations, and on the amendment of the conditions and procedures for granting Treasury advances.
Conditions for Granting Treasury Advances
The granting of Treasury advances to fund one of the cashboxes referred to in paragraph 3 of the preceding article requires:
- 1)The Minister of Finance to verify the beneficiary's ability to repay the advance in cash within the prescribed repayment period.
- 2)The beneficiary to undertake to compulsorily earmark in its budget the appropriations necessary for repaying the advance within the prescribed period.
- 3)The approval of the legislative authority if the repayment period exceeds twelve months.
Requirement that Treasury Advances be Granted by Decree
Treasury advances for the purposes specified in Article 203 of this Law shall be granted by decree on the proposal of the Minister of Finance and at the request of the competent administrations. The Government shall be required to inform the Chamber of Deputies of the advances decided upon by virtue of such decree.
2. The repealed second paragraph read: 'In exceptional emergency cases, Treasury advances may be granted by decree adopted in the Council of Ministers.'
Amended 1989Amended 1991Amended 1991
Contents of the Decree Granting Treasury Advances
A decree adopted in the Council of Ministers(3) shall specify the advance administrator for the cases referred to in paragraphs 1 and 2 of Article 203, and the beneficiary institution for the case referred to in paragraph 3 of the same article. It shall also specify the purpose of the advance, its amount, the method of its disbursement, the conditions for its repayment, and any other conditions the Minister of Finance deems necessary to impose.
3. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Disbursement of Treasury Advances
Treasury advances shall be disbursed on the basis of orders issued by the Central Accountant, which shall make reference to the decree adopted in the Council of Ministers(4) that authorised them.
4. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Restriction of the Use of Treasury Advances to Their Purpose
A Treasury advance shall not be used for any purpose other than that for which it was granted.
Repayment of Treasury Advances
Treasury advances referred to in paragraphs 1 and 2 of Article 203 of this Law shall be repaid by means of payment orders charged against the budget. Treasury advances referred to in paragraph 3 of the same article shall be repaid in cash to the Treasury within the periods prescribed for this purpose.
Role of the Accountant
The accountant must follow up on the repayment of Treasury advances in accordance with the conditions under which they were granted and within the prescribed periods.
Possibility of Deducting the Salary of the Treasury Advance Administrator
The accountant may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that are repaid at the incorrect times. He may also take direct legal action against the administrator to recover such amounts. The repayment period may be extended, by decree adopted in the Council of Ministers on the proposal of the Minister of Finance,(1) in exceptional and warranted cases.
1. The expression 'and the Minister of Finance may' in the second paragraph of Article 211 of the Public Accounting Law was replaced by 'and it may be done by decree adopted in the Council of Ministers on the proposal of the Minister of Finance' by Law No. 41 of 14 February 1991.
Amended 1991
Deduction from Funds of Administrations in Arrears
If any of the beneficiary administrations is in arrears in repaying the Treasury advance granted to it, the Central Finance Accountant shall have the right to deduct it formally from any funds that administration may hold with the Treasury.
Statement of Treasury Advances
A statement of Treasury advances granted in accordance with Article 203 of this Law and the amounts repaid during the budget year shall be appended to the draft budget closing of accounts law.
2. The General Accounting Service shall extract the statement of Treasury advances from the assignment accounts and supporting documents; see in this regard Article 34 of Decree No. 3373 of 11 December 1965 (defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements).
Special Regulations
The accounting of the Post, Telegraph and Telephone shall be governed by the special regulations applicable to it and by the provisions of this Law in all matters not inconsistent with those regulations.
Subsection 5Materials Accounting
Materials Accounting
Methods of Implementing Expenditure
Supplies, works and services expenditure shall be implemented either by means of contracts concluded by the administration with third parties, or directly by the administration through the direct administration method (régie).
Principle of Public Tendering
Contracts for supplies, works and services shall be awarded by public tender. However, in the cases described below, contracts may be awarded by restricted tender, invitation to submit proposals, mutual agreement, or by means of a statement or invoice.
Tendering Programme
Public and restricted tenders shall be conducted on the basis of an annual programme announced on dates that may extend beyond the second month following publication of the budget.
Principle of Non-Splitting of Expenditure
Expenditure may not be split unless the authority competent to commit it considers that the nature of the works, supplies or services to be contracted warrants doing so.
Methods of Conducting Public Tenders
A public tender (hereinafter referred to as 'tender') shall be conducted either on the basis of a price submitted by the tenderer, or on the basis of a percentage reduction from the estimated prices in the provisional bill of quantities referred to in Article 126 of this Law.
General and Special Conditions Documents
Standard general conditions documents shall be prepared for contracts awarded by tender, approved by decree and published in the Official Gazette. A special conditions document shall be prepared for each such contract by the responsible administration and approved by the authority competent to decide on the contract.
Contents of the Special Conditions Document
The special conditions document shall specify the following information: - The types and descriptions of supplies, works or services to be contracted. - The qualifications and special conditions required of persons wishing to participate in the tender. - Award criteria: whenever the administration intends to be bound by the lowest price, these criteria shall be stated clearly and in detail; a separate weighting factor may be assigned to each of them where appropriate. - The basis on which the tender is to be conducted in accordance with Article 124. - Special execution conditions. - Delivery deadline. - The amount of the security required for participation in the tender and to guarantee the contractor's proper fulfilment of his obligations. A provisional bill of quantities showing quantities and prices shall be appended to the special conditions document where appropriate. The price established by the administration shall be deemed the upper ceiling for contracts conducted on the basis of a percentage reduction; the administration shall announce the maximum permissible reduction, which shall constitute the minimum contract price.
Amended 1982
Types of Security
Security may be:
- 1)Cash, paid into a Treasury cashbox directly, or into the cashbox of the competent administration where one exists, against a receipt attached to the bid, provided its value is transferred in the latter case to the central Finance cashbox upon award of the contract.
- 2)A bank guarantee issued by an approved bank, drawn up in the name of the competent administration or the State Treasury.
Announcement of Tenders
Each tender shall be announced in the Official Gazette and in at least three daily newspapers at least 15 days before the date fixed for award. The period may be reduced to at least five days in the event of a repeat tender, or in cases of necessity, provided the reduction is approved in advance by the authority competent to commit the expenditure. Any amendment to the conditions document after publication of the tender announcement shall likewise be announced following the same procedures.
Article 129 was repealed by Article 29 of Law No. 78/16 of 2 May 1978.
Amended 1978
Tender Committees
Tenders shall be conducted before committees established specifically for this purpose.
Provisional Award
The contract shall be provisionally awarded to the bidder submitting the lowest price, or to the one who submitted the best offer where the conditions document provides for award criteria other than price, subject to granting bids for goods manufactured in Lebanon a 10% preference(1) over bids for foreign goods, provided that national goods and the conditions they must meet to benefit from this preference are defined by decrees(2) adopted in the Council of Ministers on the proposal of the Minister of Economy and Trade.(3) For contracts conducted on the basis of a percentage reduction, the tender committee shall provisionally award the contract to the lowest bidder within the two estimated prices.
1. With regard to granting bids for goods manufactured in Lebanon a 15% preference over bids for foreign goods, see Legislative Decree No. 127 of 30 June 1977.
2. With regard to defining national goods and the conditions they must meet to benefit from this preference, see: Decree No. 6588 of 1 April 1995; Decree No. 10352 of 23 May 1975; Decree No. 4208 of 20 October 1972; Decree No. 9223 of 20 September 1996.
3. The conditions for applying paragraph 2 of Article 131 of the Public Accounting Law were established by Decree No. 6232 of 2 December 1966.
Amended 1972Amended 1978Amended 1982
Case of Equal Bids
If bids are equal after granting Lebanese goods the 10% preference referred to in Article 131, the tender shall be reopened in the form of sealed envelopes among the bidders concerned, at the same session, to the exclusion of others. If they refuse to submit new bids or their bids remain equal, the provisional contractor shall be designated by lot among the holders of equal bids. For contracts conducted on the basis of a percentage reduction, if bids are equal, the provisional contractor shall be designated by lot among the equal bids.
Amended 1972Amended 1982
Authority Competent to Decide on the Contract
1. The contract shall be decided upon by: - The competent director, or the head of the service in the absence of a director, if its value exceeds 10,000,000 L.L. - The competent director general, if its value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. 2. The contract shall become final only after the approval has been communicated to the contractor by administrative means.
Amended 1978Amended 1987Amended 1990Amended 1994
Importance of Site Possession Procedure
Works contracts may not be concluded before all legal procedures have been completed that enable the administration to take possession of the work site. However, award proceedings may commence before these procedures are completed, provided the contract is approved and communicated to the contractor only after possession of the said sites has been taken.
Contractor's Default
If an amount becomes due from the contractor in the course of execution pursuant to the conditions document, the administration shall have the right to deduct that amount from the security and to invite the contractor to replenish it within a specified period. If he fails to do so, he shall be deemed to have defaulted, and the administration shall proceed either to relaunch the tender or to execute the contract by direct administration. If the new tender or execution by direct administration results in a saving in costs, the saving shall revert to the Treasury. If it results in an increase in costs, the administration shall recover the increase from the defaulting contractor. In all cases, the security shall be provisionally confiscated pending settlement of the contract in accordance with the provisions of this article.
Contractor's Insolvency
The contract shall be automatically terminated between the administration and the contractor declared insolvent, and the following measures shall be immediately taken:
- 1)The security shall be provisionally confiscated for the account of the Treasury.
- 2)The administration shall inventory the completed works, supplies or services and the materials delivered as at the date of the insolvency declaration and draw up a schedule whose value shall be provisionally held in trust in the name of the Treasury.
- 3)The works, supplies or services, or the remainder thereof, shall be placed under direct administration or re-tendered. If the new tender or direct administration results in a saving in costs, the saving shall revert to the Treasury, and the security and the value of the schedule referred to in the preceding paragraph shall be paid to the receiver. If it results in an increase in costs, the increase shall be deducted from the security and the said schedule value, and the balance shall be paid to the receiver. If this is insufficient to cover the entire increase, the recourse shall be limited to confiscating the security and the schedule value.
Principle of Execution before Payment
The contract value may not be paid until after the contract has been executed. However, the Minister of Finance may, at the request of the competent minister, grant contractors advances against bank guarantees. If obtaining such guarantees proves impossible, the advance shall be granted without a guarantee upon approval of the Council of Ministers. The advance may not exceed 25 per cent of the contract value and shall not exceed 30,000,000 L.L. However, in exceptional cases, the Council of Ministers may, by decision, derogate from the foregoing provisions.
Amended 1966Amended 1987Amended 1990Amended 1994
Ten Per Cent Withholdings
If the conditions document so provides, instalment payments for completed works shall not exceed nine-tenths of the amount due, with one-tenth being withheld in the Treasury until final acceptance has taken place. These withholdings shall be returned upon final acceptance where the conditions document specifies a guarantee period for supplies or works, after the contractor has paid any penalties that have accrued under the conditions document. The administration may stop deducting the ten per cent withholdings when it considers that they have reached the level required for the guarantee.
Acceptance Committee
Supplies, works and services shall be accepted in each ministry by a committee appointed by decision of the director general, comprising three technical staff members, one from the unit for whose benefit the contract was awarded and two from outside it.(1)
1. See Decree No. 3906 of 29 April 2010 granting each of the two members of the supplies, works and services acceptance committee in the General Directorate of Finance from outside the unit for whose benefit the contract was awarded a flat-rate transfer allowance.
Consequences of Breach of the Conditions Document
If the contractor fails to comply with the conditions document or any of its provisions during contract execution, the competent administration shall formally notify him of the obligation to comply fully with his obligations within a specified period that it assesses. If the specified period expires without the contractor having performed what was required of him, the administration shall have the right, subject to the provisions of the general conditions document, to consider him in default and apply against him the provisions of Article 135 of this Law. In the event of a retender, the defaulting contractor shall have the right to participate again. If the acceptance committee finds that the contract has generally been executed in accordance with the conditions document but with certain minor defects or flaws preventing acceptance, it may proceed with acceptance subject to conditions established by decree(2) adopted in the Council of Ministers.
2. The conditions for accepting contracts with minor defects or flaws were established by Decree No. 14601 of 30 May 1970.
Return of Security
The security shall be returned to the contractor on the basis of a memorandum from the competent administration within at most one month of the date of final acceptance. However, the administration may, before the expiry of the execution period, or after provisional acceptance if the state of the works permits, return to the contractor, at his request, all or part of the security.
Exclusion from Tenders
A contractor whose works are placed under direct administration or whose contract is re-awarded at his expense pursuant to this Law or the general conditions document shall be excluded from tenders: - For three months when these measures are applied against him for the first time. - For a full year when applied against him a second time within twelve months. - Permanently when applied against him a third time within five years. The aforementioned periods shall begin from the date of the first decision ordering the works to be placed under direct administration or the contract to be re-awarded at the contractor's expense.(1)
1. The exclusion from participation in public contract execution was organised by Decree No. 8117 of 29 August 1968.
Cases for Adopting Restricted Tender
The administration may, where the nature of the supplies, works or services allows competition to be opened to all, restrict the tender to a limited category of tenderers who possess the required financial, technical and professional qualifications. These qualifications shall be specified in detail in the general conditions document, as shall the basis for the guarantees required of tenderers and the specifications that the works or materials requested must meet.
Provisions of the Restricted Tender
All provisions applicable to public tenders shall apply to restricted tenders.
Cases for Adopting Invitation to Submit Proposals
Contracts may be awarded by invitation to submit proposals:
- 1)If their value does not exceed 100,000,000 L.L.
- 2)If their value exceeds 100,000,000 L.L. and they relate to:
- 3)Works carried out by the administration on an experimental or study basis, provided the competent minister so decides.
- 4)Equipment, materials and commodities that must be acquired at their place of production owing to their special nature.
- 5)Shipping, transport and insurance.
- 6)Supplies, works and services for which no price was submitted in the tender or for which the prices submitted were unacceptable.
- 7)Supplies, works and services for which certain urgent situations arising from emergency circumstances do not allow public tendering, provided the competent minister so decides.
- 8)Technical supplies, works and services whose nature does not allow public tendering, provided the competent minister so decides.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions for Invitation to Submit Proposals
The provisions applicable to public tenders shall apply to the invitation to submit proposals subject to the following:
- 1)The announcement may be replaced by communicating the necessary information confidentially and by registered letter to traders in the relevant line or professionals considered by the administration as capable of executing the contract.
- 2)Invitation to submit proposals for a contract whose value exceeds 100,000,000 L.L. shall be conducted before a special committee established in each public administration by decision of the minister; other contracts shall be handled by the tender committee.
Amended 1978Amended 1987Amended 1990Amended 1994
Cases for Adopting Mutual Agreement
Agreements may be concluded by mutual agreement regardless of the contract value, where they relate to:
- 1)Supplies, works and services that may be placed in a tender, either because secrecy is necessary, or because public safety requirements preclude it, provided the competent minister so decides.
- 2)Additional supplies, works and services that must be entrusted to the original contractor lest their execution be delayed, and where bringing in a new contractor during contract execution would not be appropriate; this is permissible:
- 3)- If the supplies, works and services were not anticipated when the original contract was awarded, are related consequences thereof and form an integral part of it.
- 4)- If the supplies, works and services must be executed using the equipment and installations specifically used by the contractor at the work site, provided they were not anticipated when the contract was awarded and do not form an integral part of it.
- 5)Equipment whose manufacture is exclusively held by the holder of its patent.
- 6)Equipment held by a single entity.
- 7)Technical supplies, works and services that may be entrusted to experienced Lebanese specialists, craftsmen or artisans whose capabilities have been demonstrated.
- 8)Supplies and works manufactured by persons with disabilities who require social welfare assistance from the Ministry of Labour and Social Affairs, provided their prices do not exceed market prices.
- 9)Hospitality and protocol expenditure and similar representation expenditure.
- 10)Supplies, works and services for which the following have been conducted:
- 11)- Two consecutive public tenders.
- 12)- Or two consecutive invitations to submit proposals.
- 13)- Or a tender followed by an invitation to submit proposals.
- 14)Without any of these processes yielding a positive result.
- 15)In such cases, the mutual agreement must result in a price not exceeding the ratio of prices submitted during the award process, except in exceptional circumstances justified by the administration in a reasoned report.
- 16)Supplies, works and services that may be entrusted to public institutions or municipalities.
- 17)Supplies and services provided by the administration through international organisations.
- 18)Supplies, works and services that the Council of Ministers approves entrusting, upon the proposal of the competent minister, to foreign governments or institutions affiliated to them. In such cases, the Government may exempt the counterpart from conditions relating to place of residence, security, penalties and the obligation of delivery before receipt.
- 19)Supplies, works and services whose procurement by mutual agreement is decided by the Council of Ministers on the proposal of the competent minister.
Authority Competent to Conclude Mutual Agreements
Mutual agreements shall be concluded by: - The director, or the head of the service in the absence of a director, if the contract value does not exceed 10,000,000 L.L. - The director general, if the value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. The transaction shall be conducted by one of the following methods:
- 1)A contract between the competent authority and the party concerned.
- 2)An undertaking signed by the party concerned on the general conditions document.
- 3)A proposal from the party concerned approved by the competent authority.
- 4)An exchange of correspondence between the party concerned and the competent authority, in accordance with commercial custom.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions of Mutual Agreements
Mutual agreements shall be governed by the provisions of the general conditions document and a special conditions document shall be prepared for them where appropriate. In addition to the provisions of the two preceding articles, the provisions of Articles 137 to 141 of this Law shall apply to mutual agreements.
Technical Services Contracts
Mutual agreement may be used for technical services contracts (studies, preparation of conditions documents, supervision of works execution, projects, etc.) regardless of their value where they exceed the administration's own capacity. The following provisions shall apply to these contracts:
- 1)Contracting may only be done with those who possess the required technical qualifications, which must be described in detail in a study prepared by the administration before the contract is concluded.
- 2)An agreement may be concluded where appropriate after a consultation process among those who possess the said qualifications.
- 3)These contracts shall be governed by the other provisions applicable to mutual agreements.
Cases for Using Statements and Invoices
Contracts may be concluded by means of a statement or invoice:
- 1)If their value does not exceed three million pounds. This procedure shall apply to the implementation of the Lebanese University's budget without the need to issue any additional text.
- 2)If the prices of the materials to be purchased are fixed in a tariff issued by the administration or by a recognised international body and it is not possible to obtain a lower price.
- 3)If the contract relates to the hire of public works in accordance with a general tariff established by decision of the competent minister.
- 4)The contract shall be concluded by the head of the competent unit and acceptance shall be ensured by the committee provided for in Article 139.
- 5)The heads of competent units authorised to conclude contracts shall be designated by decision of the competent minister in public administrations, and by decision of the head of the executive authority in public institutions and municipalities subject to the Public Accounting Law.(1)
1. The Director General of the Central Statistics Administration was authorised to commit expenditure by means of a statement or invoice as provided in this article, by Article 1 of Decision No. 134/2009 of 24 December 2009.
Amended 1978Amended 1984Amended 1987Amended 1990Amended 1993
Definition of Works by Direct Administration
Works by direct administration are works that the administration itself undertakes to execute.
Authority Competent to Authorise Works by Direct Administration
Works by direct administration shall be authorised by: - The head of the competent unit, if their value does not exceed 3,000,000 L.L. - The director, or the head of the service in the absence of a director, if their value exceeds 3,000,000 L.L. but does not exceed 10,000,000 L.L. - The director general, if their value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister, if their value exceeds 35,000,000 L.L. but does not exceed 150,000,000 L.L. - The Council of Ministers in other cases. The normal procedures for procuring the materials required for executing these works shall apply.
Amended 1978Amended 1987Amended 1990Amended 1994
Monitoring Unit for Works by Direct Administration
A special unit must be established in every administration undertaking works by direct administration, whose task is to monitor the execution of such works. This unit shall be attached directly to the head of the administration and shall not carry out any execution activities.
Detailed Statement of the Results of Direct Administration Execution
The head of the unit that undertook the execution of works by direct administration must submit to its administration, upon completion of the works, a detailed statement of the quantities executed and the costs incurred of all kinds. The monitoring unit shall review this statement and forward it, together with its comments, to the Central Inspectorate.
Powers of the District Commissioner and Governor
The district commissioner shall exercise within his district the powers conferred by this chapter's provisions on the director. The governor shall exercise within his governorate the powers conferred by this chapter's provisions on the director general, with respect to supplies, works and services contracts concluded in the district or governorate.
Detailed Rules for Applying Contract Provisions
Detailed rules for applying the provisions of this Law relating to supplies, works and services contracts, in particular the conditions for classifying and admitting contractors to participate in tenders, shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.(1)
1. See Decree No. 2866 of 16 December 1959 on the tender system and Decree No. 3688 of 25 January 1966 defining the conditions for participation in public contract execution.
Definition of Materials Accounting
Materials accounting covers all the entries and documents necessary for establishing the inventory of materials owned by public administrations and for recording their movements.
Application of Materials Accounting to All Public Administrations
All public administrations must maintain materials accounts. All institutions subject to State supervision must also maintain materials accounts that enable this supervision to be exercised.
Liability of the Materials Custodian or User
Any person tasked with the safekeeping or use of the materials referred to in Article 214 of this Law shall be financially liable for them. The same liability may also be imposed on officials tasked with maintaining and supervising materials accounts.
Territorial Scope of Materials Accounting
The application of the provisions of this chapter shall be limited to materials located within Lebanese territory or in Lebanese missions abroad. It shall not apply to equipment of active service units or to equipment used on naval or air vessels.
Materials Accounting Decree
Detailed rules for applying the provisions of this chapter shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.
1. Detailed rules for applying this chapter were established by Decree No. 8620 of 12 June 1996.
Municipal Provisions
The conditions for applying this Law to municipalities shall be established by decrees issued on the proposal of the Ministers of Interior and Finance.
1. Funds belonging to municipalities under the Law of 4 August 1954 were made subject to the provisions of the Public Accounting Law by Article 1 of Decree No. 12915 of 3 June 1963, which reads: 'Funds belonging to municipalities under the Law of 4 August 1954 shall be subject to the provisions of the Public Accounting Law with regard to the stages of committing, liquidating, issuing payment orders for and paying expenditure, and shall be exempt from the annual budget rule.'
Section 5Special Provisions
Special Provisions
Subsection 1Special Provisions for the Army, Internal Security Forces, General Security and Customs Detachments
Special Provisions for the Army, Internal Security Forces, General Security and Customs Detachments
Parts of the Expenditure Budget
The expenditure budget is divided into two parts: - Part One: comprising ordinary expenditure. - Part Two: comprising equipment and construction expenditure and the State's investment contributions. The content of each of the two aforementioned parts shall be defined by a decision of the Minister of Finance.
Amended 1966Amended 1968
Division of Expenditure into Chapters
Each of the two aforementioned parts of the expenditure section shall be divided into chapters. The number of chapters in each part shall be determined by a decision of the Minister of Finance.
Division of Chapters into Sections, Lines and Paragraphs
Each chapter shall be divided into sections, each assigned to a single administration or group of administrations or a single project or group of projects. Each section shall be divided into budget lines, each assigned to expenditure of a single type or similar nature, and each line shall be divided, where appropriate, into paragraphs. A model table for the division of appropriations shall be established by a decision of the Minister of Finance.
Contents of the Salaries Budget Line
The salaries budget line shall indicate: 1. With respect to permanent and temporary staff: - The total number of staff by grade, together with the total of their salaries and supplements. 2. With respect to retirees: - Their number together with the total of their pensions and supplements.
- 1)With respect to workers:
- 2)For permanent workers:
- 3)Their number together with the total of their wages and supplements.
- 4)For non-permanent workers:
- 5)The total of their wages and supplements.
Transfer of Appropriation from One Paragraph to Another
Appropriations for similar works may be distributed among paragraphs within a single budget line. The following rules shall apply in such cases:
- 1)The appropriation earmarked for each project shall be treated as a separate paragraph.
- 2)Transfer from the appropriation earmarked for one project to another project may be made:
- 3)After works have commenced, provided at least fifteen per cent of the original appropriation is retained.
- 4)After completion of the project and settlement of the contract.
- 5)Transfer shall only be permitted to a project similar to the first project and located in the same area.
Special Expenditure Incumbent on the State
1. A separate section shall be set aside in each chapter of the expenditure section from which the value of monetary judgments rendered against the State and settlements concluded by it shall be paid, when no appropriations are available in the relevant budget lines for such expenditure. This section shall be funded by transferring from the global appropriation set aside in the budget reserve chapter in accordance with Article 26 below.
2. Amounts collected by the Treasury in error or without legal basis shall be refunded by deducting them from the budget revenue account in which they were originally received, i.e. by entering them on the debit side of the revenue account; no appropriation shall be opened in the budget for this purpose.(1) Only balances shall be recorded in the field of amounts collected from the budget closing of accounts for revenue accounts.
3. A separate section shall be set aside in each chapter of the expenditure section, during a transitional period ending in 1966, called 'prior years' expenditure', from which amounts that accrued in favour of third parties in years prior to 1963 and were not paid during those years shall be drawn. No appropriation shall be entered in the aforementioned section when the budget is prepared; instead, expenditure paid from it shall be covered by amounts taken from the reserve fund endorsed by the closing of accounts law.
1. By virtue of the above-mentioned laws, this paragraph was repealed and replaced by a paragraph that was supposed to be new; however, the new paragraph was always identical to the repealed one.
Amended 1973Amended 1974Amended 1975Amended 1976Amended 1977Amended 1966
Budget Reserve
- 1)The following shall be set aside in the budget reserve chapter:
- 2)Reserve appropriations for expenditure shared among several ministries, such as sickness and death assistance, monetary judgments, settlements, etc.
- 3)A contingency reserve appropriation to be used to replenish budget lines whose appropriations have been exhausted, or to open exceptional appropriations, provided that this reserve appropriation shall not be less than one per cent of the total appropriations of Parts One and Two of the budget.
2. Should the appropriations earmarked for monetary judgments and settlements be exhausted, the Government may, by decree adopted in the Council of Ministers, open the necessary complementary appropriations and cover them from the reserve fund, to be ratified by the closing of accounts law. The provisions of this paragraph shall also apply when appropriations earmarked for pensions and severance pay are exhausted.
3. No expenditure shall be paid directly from the appropriations of this chapter; instead, these appropriations shall be transferred when needed to the relevant budget lines as follows: - By decision of the Minister of Finance, on the proposal of the competent authority and after endorsement by the Central Controller of Expenditure Commitments, with respect to the appropriations referred to in sub-paragraph (a) of the preceding paragraph. - By decree issued on the proposal of the competent minister and the Minister of Finance, with respect to the appropriations referred to in sub-paragraph (b) of the preceding paragraph.
Opening of Supplementary Appropriations and Their Coverage
1. Subject to the provisions of Article 85 of the Constitution and Article 26 of this Law, supplementary appropriations shall only be opened by law. Such appropriations shall be covered by transfer from other budget lines, or from the budget reserve chapter, or by drawing from the reserve fund, or by new revenues.
- 1)Subject to the provisions of Article 26 of this Law, appropriations shall only be transferred from one budget line to another by law.
- 2)Subject to Article 114 of this Law, appropriations shall only be carried over from one year's budget to the following year's budget by law.
Procedure for Transfer from One Paragraph to Another
- 1)Subject to the provisions of Article 24 of this Law, appropriations shall be transferred from one paragraph to another within the same budget line by decision of the competent minister after endorsement by the Central Controller of Expenditure Commitments. Transfer by the same procedure to a new paragraph shall also be permitted where that paragraph covers a type of expenditure assigned to the budget line.
- 2)Appropriations earmarked in the chapters on debt service and budget reserve shall be transferred from one paragraph to another within the same budget line by decision of the Minister of Finance after endorsement by the Central Controller of Expenditure Commitments.
- 3)Transfer from one paragraph to another within a given year's budget may be effected up to 31 January of the following year.
Rules for Assessment of Taxes and Fees
The following rules shall apply to the assessment of taxes and fees unless the law provides otherwise.
Authority Competent to Assess Taxes and Fees
The assessment of direct taxes collected by means of assessment schedules shall be carried out by the competent central financial directorate or the competent financial directorate in the governorate; the Director of Revenue shall endow these schedules with executive force. The assessment of other taxes and fees shall be carried out by the head of the financial directorate or competent unit in each governorate by means of judicial orders issued by him.
Amended 2003
Concealment or Shortfall in Tax Assessment
Any concealment or shortfall in the assessment of direct and indirect taxes and fees may be remedied up to the end of the third year following the year in which the assessment should have been made, by means of additional assessment schedules or judicial orders for concealed assessments, and by means of supplementary assessment schedules or judicial orders for deficient assessments.
In addition to the remedy period referred to in the first paragraph of this article, the competent financial directorates shall benefit from an additional exceptional period to remedy the Treasury's right to impose a tax or fee on any profit, income, revenue or instrument revealed by a judicial ruling, an arbitral award, a probate proceeding or a settlement agreement, and likewise to correct any assessment ordered to be annulled.
This exceptional period shall end on 31 December of the year following the year in which the annulment was decreed or the profit, income, revenue or taxable instrument was discovered.
Amended 1973
Publication of Assessment Schedules Placed under Collection
The placing of basic assessment schedules under collection shall be announced through the Official Gazette, radio and local newspapers. Announcements to this effect shall be posted, where appropriate, at the offices of collectors and in public gathering places and squares. The announcement shall specify the deadline for payment, the entitlement to the legal discount, the right of objection, and the date on which each begins.
Deadline for Objecting to Taxes and Fees
The deadline for objecting to taxes imposed by means of basic assessment schedules shall begin on the day following the date of publication of the relevant announcement in the Official Gazette.
The deadline for objecting to taxes imposed by means of additional or supplementary assessment schedules, and to taxes and fees imposed by judicial orders, shall begin on the day following the date on which the taxpayer is notified of these documents.
Such notification shall be effected by registered letter with acknowledgment of receipt. If the taxpayer is absent or refuses to accept delivery, notification shall be effected through the competent administration in accordance with the notification rules provided for in the Code of Civil Procedure.
The objection deadline shall be two months for direct taxes assessed by means of assessment schedules, and one month for other taxes and fees.
Rules for Objecting to Taxes and Fees
1. The procedures for objecting to the various taxes and fees and the time limits for their determination by the administration and objection committees shall be established by decree issued on the proposal of the Ministers of Finance and Justice within three months of the date of publication of this Law in the Official Gazette.
2. The procedures and time limits established in the aforementioned decree shall supersede all special provisions relating to objections contained in the various tax and fee laws.
Cancellation or Reduction of Tax Assessments
Notwithstanding any other provision, the tax directorates in the General Directorate of Finance may not order the cancellation or reduction of tax and fee assessments except with the approval of the head of the Revenue Service, unless the matter involves a material error or an amount not exceeding 50 per cent of the assessment value, provided the amount does not in any case exceed 500 L.L. per assessment.
Tax Assessment Monitoring Unit
A tax assessment monitoring unit shall be established to ensure supervision of the various tax and fee assessment operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.
Law on Collection of Taxes and Fees
No tax or fee may be collected unless the legislative authority has authorised this by virtue of the budget law or any other law.(1) Violators shall be prosecuted in accordance with Article 361 of the Penal Code.
1. The principle of 'no taxation without a law' is enshrined in Article 81 of the Constitution.
Persons Responsible for Collecting Taxes and Fees
Taxes and fees shall be collected on the basis of assessment schedules or collection orders by which they were assessed, unless they are of the type paid by the taxpayer directly by affixing stamps or equivalent instruments. Persons other than accountants and their staff may not undertake the collection of taxes, fees and other public revenues.
Statute of Limitations for Taxes and Fees
Taxes and fees of all kinds shall lapse against taxpayers by operation of the statute of limitations on 31 December of the fourth year following the year in which the assessment was made. The running of the limitation period shall be interrupted by the commencement of judicial proceedings provided for in the law. An injunction shall be deemed the commencement of proceedings provided it is notified in accordance with the provisions of Legislative Decree No. 147 of 12 June 1959. The injunction shall be renewed where necessary before the expiry of four years from the date of its notification to the person concerned.
Amended 1966
Retention of Assessment Schedules and Collection Orders
Assessment schedules shall be retained for a period of ten years, and collection orders for a period of five years, unless the Court of Audit orders, prior to the expiry of the retention period, a discharge of liability for those responsible for collection.(2)
2. The Court of Audit issues a discharge of liability for those responsible for collection within the framework of its judicial oversight of accounts (Articles 59 to 65 of the Law on the Organisation of the Court of Audit).
Collection Monitoring
A collection monitoring unit shall be established to ensure supervision of the tax and fee collection operations handled by the General Directorate of Finance; its powers and the manner of exercising its functions shall be determined by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 16843 of 10 July 1964 defining the powers and duties of the Collection Monitoring Division within the Treasury Service.
Collection by Means of a Collection Instrument
The specific rules applicable to each type of State debt and other revenue, other than taxes and fees, shall govern their settlement and collection and the procedures for pursuing them. For debts and revenues in respect of which the applicable laws do not define the manner of their settlement and collection and the related proceedings, they shall be settled by means of collection orders issued by the head of the competent authority and collected in accordance with the procedures followed for the collection of direct taxes and equivalent fees. Objection to collection orders may be lodged before the competent administrative court at the place of residence of the debtor within two months of the date of notification of the order to him or at his place of residence. Filing an objection shall not suspend enforcement of collection orders unless the court so orders in whole or in part.
Sale of Immovable State Property
Immovable State property shall be sold in accordance with the special provisions applicable thereto.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Sale of Movable State Property
Movable State property shall be sold:
- 1)By mutual agreement if its assessed value does not exceed 3,000,000 L.L. (three million Lebanese pounds).
- 2)By invitation to tender if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
- 3)By public auction and by other available methods if its assessed value exceeds 6,000,000 L.L. (six million Lebanese pounds).
Amended 1978Amended 1987Amended 1990Amended 2004
Authority Competent to Decide on the Sale of Movable State Property
Contracts for the sale of movable property shall be decided upon by: 1. In central administration: - The competent director, if the contract value does not exceed 150,000 L.L. - The competent director general, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L. 2. In governorates and districts: - The district commissioner (Qaimaqam), if the contract value does not exceed 150,000 L.L. - The governor, if the contract value exceeds 150,000 L.L. but does not exceed 600,000 L.L. - The competent minister, if the contract value exceeds 600,000 L.L.
Amended 2004
Valuation of Movable Property
Movable property shall be valued by a committee established in each administration by decision of the authority competent to decide on the contract.
Oversight by the Court of Audit
Sale transactions subject to its oversight shall be submitted to the Court of Audit by the authority competent to decide on the contract.(1)
1. See, with regard to immovable public assets, Order No. 144 of 10 June 1925 on public State property and Order No. 275 of 25 May 1926 on the administration and sale of private State property.
Comprehensiveness of Revenue
All revenues received shall be recorded in their entirety in the revenue section of the budget.(2)
2. Recording all revenue in the revenue section confirms the adoption of the gross principle, i.e. the absence of netting between revenue and expenditure and the consequent application of the gross recording principle to both.
Gifts and Property Donated to the State
- 1)Cash and in-kind gifts offered to the State by legal or natural persons shall be accepted by decree issued on the proposal of the competent minister and the Minister of Finance if their value does not exceed 250,000,000 Lebanese pounds.
- 2)Cash and/or in-kind gifts offered to the State by legal or natural persons shall be accepted by decree adopted in the Council of Ministers if their value exceeds 250,000,000 Lebanese pounds.
- 3)Cash gifts received by the Lebanese Treasury shall be recorded in the revenue section of the budget; if these gifts have a specified destination for expenditure, appropriations shall be opened for them in the expenditure section in accordance with established procedures.
- 4)The Ministry of Finance shall prepare a quarterly statement of the gifts referred to in paragraphs (1) and (2) above that have been received by the Lebanese Treasury and shall submit it to the Council of Ministers for information.
Amended 2019
Revenue Accounts
The Ministry of Finance shall maintain, for each category of budget revenue and for each year separately, an independent account showing: - Prior years' balances, year by year. - Total revenues realised pursuant to assessment schedules and collection orders issued during the year. - Total collections up to 31 December of the year, broken down between the current year and each prior year. - Legal discounts utilised by taxpayers. - Uncollected balances at the end of the year. Each ministry shall also maintain a detailed account of the revenues it handles, for each year separately, on the basis of the collection orders it issues or that are issued at its request.
Functions of the State Treasury
The State Treasury shall handle all receipt and payment operations required for the implementation of the State budget and shall manage the accounts opened outside the budget.
Functions of the Accountant
Receipt and payment operations on behalf of the Treasury shall be carried out by officials each known as an accountant; however, the accountant may delegate certain of his powers to one of the accountants under his authority with the approval of the Head of the Treasury Service.(2)
2. The accountant was granted additional powers by Legislative Decree No. 25 of 17 January 1955.
Amended 1966
Categories of Accountants
Accountants are of two categories: central and local.
- 1)The central accountant is responsible for budget revenues and expenditure, and for off-budget operations.
- 2)The local accountant is responsible for off-budget operations and locally provides for the receipt of budget revenues and the payment of budget expenditure on behalf of the central accountant to whom he is attached.
- 3)In certain public administrations, the central accountant may be tasked with centralising all operations of the local accountants under his authority, whether these operations are within or outside the budget.
- 4)If a public administration has only one accountant, that accountant shall be treated as a central accountant for the purposes of this Law.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Central Accountants
Central accountants are: - The Central Finance Accountant. - The Central Customs Accountant. - The Central Post and Telegraph Accountant. - The central accountant of each administration with an annexed budget. - Any official assigned this status by decree.
Local Accountants
Local accountants are: - Finance accountants. - Customs accountants. - Post and telegraph accountants. - Accountants of administrations with annexed budgets. - Any official assigned this status by decree.
2. See, with regard to customs accountants, the following texts: Decree No. 4024 of 4 May 1960; Decree No. 11028 of 6 November 1962; Decree No. 11029 of 6 November 1962; Decree No. 11030 of 6 November 1962; Decision No. 173 of 8 May 1964.
General Chart of Accounts
Operations carried out by the accountant shall be recorded in accounts maintained in accordance with a general chart of accounts established by decree issued on the proposal of the Minister of Finance.(3)
3. See Decree No. 10388 of 9 June 1997 on the general chart of accounts for the State, public institutions and municipalities.
Methods of Bookkeeping
Public funds accounts shall be maintained by central accountants and the General Accounting Service on the basis of the double-entry method, and by local accountants on the basis of the single-entry method.(4)
4. With regard to defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements, see Decree No. 3373 of 11 December 1965.
Obligation to Maintain and Correct Entries in Ink
Entries shall be made in ink compulsorily and shall under no circumstances be made in pencil; erasure, insertion, obliteration or correction fluid in papers, tables, documents, entries, ledgers or records shall also be prohibited. However, any error therein may be corrected, provided the correction is made in a visible manner by crossing out the deleted letters and figures, using ink of a colour different from that used in the original, and that the correction is accompanied by the date and the signature of the person making it.
Salary and Allowance Appropriations
Salary and allowance appropriations relating to army personnel and members of the Internal Security Forces and General Security shall be entered in a single budget line without breakdown.
Award Committee
Contracting shall be handled by a special committee established in accordance with a system determined by decree on the proposal of the competent minister.
Mutual Agreements
Mutual agreements may be concluded for the supplies, works and services required by the army, the Internal Security Forces, the General Security and the customs detachments in times of war, emergencies and exceptional circumstances requiring immediate measures, on the basis of a reasoned order from the army commander.
Exemption from Certain Contract Conditions
When the Ministry of National Defence concludes contracts with foreign governments or institutions affiliated to them, or when such governments recommend them, for the purchase of weapons, ammunition, equipment and apparatus, it may exempt the counterpart from conditions relating to place of residence, security, penalties, and the obligation of delivery before receipt.
Possibility of Re-using Certain Appropriations
The Ministry of National Defence may request, in accordance with the procedures established in Article 117 of this Law, the re-use of the corresponding appropriations:
- 1)For the value of materials supplied by the army administration at a price to officers and personnel in their personal capacity.
- 2)For the value of materials charged to officers and personnel responsible for their loss or damage.
- 3)For the value of weapons, ammunition, equipment and apparatus sold by the army command to any administration or public institution.
- 4)For the value of materials used and the value of services rendered on behalf of public administrations and institutions or for the benefit of any natural or legal persons.
Amounts Paid in Error or Without Legal Basis
The Ministry of National Defence may deduct from entitlements to salaries paid from current year appropriations amounts paid in error or without legal basis in prior years.
Amounts Received in Excess
Salaries and supplements thereto, and transport and movement advances received by units in a given year in excess of their rights, and returned to the Treasury before the end of the following year, shall be entered by their return date in the current year's revenue in accordance with Article 8 of this Law. Additional appropriations equivalent to the value of the returned amounts may be opened by decision of the Minister of Finance in the salaries budget line of the army, provided they are covered by a corresponding increase in revenues.
Possibility of Committing Expenditure against the Following Year
Commencing from 1 August of each year, the Minister of National Defence may commit against the following year equipment expenditure amounting to two-thirds of the appropriations earmarked for this purpose for the current year in the army, Internal Security Forces and General Security budgets and those allocated to the customs detachments in the Ministry of Finance budget. Expenditure in respect of items not previously approved by the legislative authority may not be committed in this way. The provisions of Articles 137 and 138 of this Law may also be applied to the contracts referred to in this article even before the new year begins.
Amended 1966
Article 227 was repealed by Article 17 of Law No. 72/5 of 1 February 1972.
Amended 1972
Appointment of Materials Accountants
Materials accountants in the army shall be appointed by decision of the army commander.
Security Requirements
Army accountants shall be subject to the security system applicable to all accountants.(1)
1. Military accountants were exempted from providing legal securities by the Law of 20 August 1956.
Limits of the Court of Audit's Oversight
The Court of Audit and financial inspectors may not request access to or review documents and information relating to military secrets, unless the army commander consents. The Court of Audit shall exercise its oversight of the army's materials accounts locally and on the basis of the records maintained by the units and the supporting documents they produce.
Provisions Applicable to the Internal Security Forces and General Security
The provisions of Articles 220 to 230 inclusive of this Law shall apply to the Internal Security Forces, with each of the Minister of Interior and the Director General of the Internal Security Forces exercising the powers granted to the Minister of National Defence and the army commander respectively, each as far as it concerns him. With regard to the General Security and the customs detachments, the provisions of Articles 220, 222, 228, 229 and 230 of this Law shall apply, subject to the special organisation of each of these two bodies.
Amended 1979Amended 1983Amended 1985
Subsection 2Special Provisions for Expenditure Abroad
Special Provisions for Expenditure Abroad
Parts of Budget Revenue
The revenue section of the budget consists of two parts: First: comprising ordinary revenues allocated to cover the expenditure of Parts One and Two of the expenditure section. Second: comprising revenues allocated to cover the expenditure of Part Three of the expenditure section. The latter revenues consist of:
- 1)Drawings from the reserve fund.
- 2)Revenues assigned or created by special laws.
Division of Revenue Parts
Each part of the revenue section shall be divided into chapters, and each chapter shall be divided into sections, each assigned to a category of revenues; each section shall be divided into budget lines, each assigned to a specific revenue item. A special section shall be set aside in each part in which funds paid by the Treasury in error or without legal basis and subsequently recovered shall be recorded. A model table for the division of revenues shall be established by a decision of the Minister of Finance.
Reserve Fund
A special chapter with a single section for drawings from the reserve fund shall be set aside in each part of the revenue section. This section shall be divided into budget lines in accordance with the model table referred to in the preceding article.
Stages of Expenditure Implementation
The implementation of expenditure passes through four stages:
- 1)Commitment.
- 2)Liquidation.
- 3)Issuance of the payment order.
- 4)Payment.(1)
1. Article 34 of the Law on the Organisation of the Court of Audit provides that transactions for the sale of immovable property are subject to prior administrative oversight.
Definition of Expenditure Commitment
An expenditure commitment is any act that is capable of creating a debt obligation on the State.
Authority Competent to Make a Commitment
Expenditure shall be committed by the competent minister unless the law provides otherwise.
Requirement of a Specific Appropriation
No expenditure shall be committed unless a budget appropriation is available for it,(2) and no appropriation may be used for any purpose other than that for which it was earmarked.
2. See, regarding the principle of the prohibition on committing expenditure prior to the availability of an appropriation, paragraph 2 of Article 59 of this Law.
Suspension of Commitment of Supplies and Works Expenditure
Commitment operations for supplies and works expenditure(3) shall cease on 30 November of each year; however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases(4) assessed by the competent minister and the Minister of Finance.
3. Expenditure commitments for services do not cease on 30 November because Article 58 above restricts the suspension of commitment operations to supplies and works expenditure only.
4. The phrase 'however, they may be committed during the month of December if their execution is possible before the expiry of the year or in urgent emergency cases...' was added by correction of a material error published in Official Gazette No. 94 of 24 November 1966, p. 1728.
Amended 1966
Commitment of Expenditure against a Financial Year before Its Start
No expenditure shall be committed against a financial year before its commencement. However, commencing from 1 October of each year, permanent expenditure whose continuity is required by the public interest may be committed against the following year within the limits of the appropriations earmarked for it in the current year's budget; likewise, during the period preceding the publication of the budget, such expenditure may be committed after the new year has begun within the limits of the appropriations earmarked for it in the previous year's budget. Furthermore, liquidation, payment order and payment transactions may be carried out during the relevant financial year.(5)
5. This article permitted the executive authority to bypass the legislative authority by allowing it to take all stages of expenditure before the legislative authority approves the budget; in other words, this bypass leads to a violation of the principle of the prohibition on committing expenditure before an appropriation is available, as provided in Article 57 of this Law.
Amended 1987
The Twelfth Rule
1. Twelfth budgets shall be drawn up on the basis of the permanent appropriations earmarked in the previous year's budget, taking into account additions to and deletions from permanent appropriations. Appropriations transferred from the budget reserve shall not be treated as lapsed.
- 1)The Government shall have the right, by decree adopted in the Council of Ministers on the proposal of the competent minister and the Minister of Finance, to distribute the total construction and equipment appropriations in each twelfth budget among the various public administrations in accordance with their needs, while remaining bound by the appropriations allocated to each public administration in the draft budget for the current year.
- 2)Prior to the approval of the budget, the Government shall have the right, by decree adopted in the Council of Ministers, to transfer appropriations on the basis of the twelfth rule from the budget reserve in order to fund various budget lines.
1. The Minister of Finance was authorised, with respect to contracts for works or supply of equipment, to choose between the method of advance payment and the method of deferred payment pursuant to Article 12 of Law No. 78/16 of 2 May 1978 (Budget Law 1978).
Amended 1988Amended 1980
Requirement of Endorsement by the Controller of Expenditure Commitments
Every transaction leading to an expenditure commitment must, before it is signed, be endorsed by the Controller of Expenditure Commitments. However, in urgent emergency situations, the competent authority may proceed with committing expenditure within the limits of the appropriations earmarked for it prior to obtaining the endorsement of the Controller of Expenditure Commitments, provided it submits the transaction to him for review within at most one week of the date of commitment, together with a statement of the reasons that warranted this course of action; the committing officer shall remain responsible for the expenditure until it has been regularised in legal form. Every transaction leading to an expenditure commitment shall be accompanied by an appropriation reservation request (expenditure commitment request).
Appropriation Reservation Request
The appropriation reservation request required for an expenditure commitment shall be signed by the accountant of the competent administration or by his authorised delegate with the approval of his hierarchical superior.
Procedure for Issuing Appropriation Reservation Requests
Appropriation reservation requests shall be organised: - For the whole year, when they relate to salaries and similar staff expenditure. - For three or six months, when they relate to other permanent expenditure. - An individual request shall be organised whenever circumstances require. A blanket contingency request for reserving the appropriation required for permanent expenditure may also be organised when the nature of the expenditure allows it to be covered by a single individual request each time.
Authority Competent to Control Expenditure Commitments
1. Control of expenditure commitments shall be carried out in the name of the Minister of Finance by: - The Head of the Budget and Expenditure Control Service, acting as Central Controller of Expenditure Commitments. - Controllers seconded to ministries who represent the Central Controller.
- 1)The Central Controller may delegate his representation in certain ministries to staff members under his authority who will handle the review of transactions referred to him. He may also delegate certain of his powers to them.
- 2)The procedures for controlling expenditure commitments shall be established by decree issued on the proposal of the Minister of Finance;(1) the powers of controllers seconded to ministries shall be determined by decision of the Minister of Finance.
- 3)Controllers shall be assigned among ministries by decision of the Minister of Finance on the proposal of the Director General.
- 4)No controller seconded to a ministry may begin his assignment before completing a training period of at least three months in the Budget and Expenditure Control Service.
1. See Decree No. 324 of 13 November 1964 defining the procedures for controlling expenditure commitments.
Duties of the Controller of Expenditure Commitments
The purpose of the controller's review is to verify the following two matters: - The availability of the expenditure appropriation and the correctness of its classification. - The conformity of the transaction with the applicable laws and regulations, unless it is subject to oversight by the Civil Service Council, in which case it shall not be reviewed by the controller from a financial standpoint.
Time Limit for Endorsing a Transaction
The controller shall endorse the appropriation reservation request and the transaction and return the documents to their source within at most five days of the date of their receipt. If this period expires without a decision being made, the competent administration may retrieve the transaction and implement it at his own responsibility. If the controller requires written clarifications from the competent administration, the five-day period shall be extended commencing from the date of receipt of such clarifications. This may be done only once. If the transaction is subject to prior review by the Court of Audit, the controller shall forward it to the Court after endorsement, accompanied by his comments.
Cases where Endorsement of the Appropriation Reservation Request is Sufficient
The controller's endorsement of the appropriation reservation request shall be deemed equivalent to endorsement of the subsequent transaction in the following cases:
- 1)Expenditure committed by means of a statement or invoice pursuant to the provisions of the first paragraph of Article 151 of this Law.
- 2)Staff assignment orders.
- 3)Staff reclassification.
- 4)In general, expenditure for which a blanket appropriation reserve has been made in accordance with the provisions of the last paragraph of Article 63 of this Law.
Types of Endorsement
The controller's endorsement is of two kinds: - Total: covering the full value of the expenditure for which a commitment is requested. - Partial: limited to a portion of the expenditure for which a commitment is requested. In the event of a partial endorsement or a refusal of endorsement, the controller must state the reasons for his position. A partial endorsement shall not be given when it results in a reduction of the requested expenditure due to a material or arithmetic error.
Effects of Partial Endorsement
- 1)If the Central Controller gives a partial endorsement or refuses endorsement, he must refer the transaction to the Minister of Finance. If the Minister of Finance agrees with his position, the competent minister may refer the matter to the Council of Ministers for decision. If the Minister of Finance does not agree with the said position, the Central Controller must comply with the minister's decision subject to the provisions of the Law on the Court of Audit.
- 2)If the controller seconded to a ministry gives a partial endorsement or refuses endorsement, he must refer the transaction to the Central Controller. If the Central Controller agrees with his position, he shall refer the transaction to the Minister of Finance in accordance with the provisions of the preceding paragraph. If he does not agree, the controller must comply with the Central Controller's decision.
Refusal of Endorsement due to Insufficiency of Appropriation
The Council of Ministers may not approve the commitment of expenditure in respect of which the controller has refused endorsement due to the absence of a sufficient appropriation.(1)
1. Reading Articles 70 and 71 together reveals that a fortiori the Minister of Finance is entitled to overrule the position of the Controller of Expenditure Commitments when the latter refuses endorsement due to insufficiency of appropriation.
Advisory Role of the Controller of Expenditure Commitments
The competent administration may seek the opinion of the controller seconded to it on its financial matters, in particular on the draft budget and the supplementary appropriation requests it submits.
Amendment of Previously Committed Expenditure
The authority competent to make a commitment may request an increase or reduction in previously committed expenditure, provided that all necessary supporting documents are attached to the amendment request.
Definition of Expenditure Liquidation
Liquidation of expenditure is the verification of the crystallisation of the debt obligation on the State, the determination of its amount, its due date and the fact that it has not lapsed by operation of the statute of limitations or for any other reason.(2)
2. The debt does not lapse, for example, by payment or set-off.
Authority Competent for Liquidation
Liquidation shall be carried out by the competent accountant or by the person to whom he delegates this task with the approval of his hierarchical superior. The accountant of the General Directorate of Finance shall carry out the liquidation of expenditure paid from the debt service chapter.
Documents on which Liquidation is Based
Liquidation shall be based on documents capable of proving the existence of the debt. These documents shall be specified for each category of expenditure by decision of the Minister of Finance adopted after consulting the Court of Audit, and published in the Official Gazette.(3) A statement certified by the head of the unit responsible for implementing the expenditure shall also be required when the expenditure exceeds 50,000 L.L. Schedules issued by the electronic centre of the General Directorate of Finance equivalent to salaries, wages, pensions and their supplements, and monthly allowances of all kinds, shall have the force of certified documents and shall not require the signature of the relevant authorising officials. The details of application of this paragraph shall be defined, where appropriate, by decision of the Minister of Finance.
3. See Decision No. 1/59 of 7 January 1966 defining the documents capable of proving the existence of a debt.
Amended 1987Amended 1990Amended 1994Amended 1991Amended 1992Amended 1993
Liquidation Procedures
- 1)Liquidation shall be carried out spontaneously and, if this is not possible, at the request of the creditor.
- 2)The liquidating official must complete the liquidation within at most five days of the date on which the relevant supporting documents are received.
- 3)The creditor shall have the right to request from the liquidating official a certificate indicating the date of submission of his request and the list of supporting documents provided.
Determination of the Liquidation Instrument
Liquidation shall be carried out on the basis of the instrument specifying the debt in detail.
Definition of the Payment Order
A payment order is a document authorising the payment of its value.
Authority Competent to Issue Payment Orders and its Duties
- 1)Payment orders shall be issued, in the name of the Minister of Finance, by the Head of the Payment Service in the Ministry of Finance. This official may delegate certain of his powers to staff of his service, provided they are of at least the third grade. He may also delegate his representation in certain ministries to members of his service who will handle the review and preparation of payment orders locally.
- 2)Where appropriate, the duty of issuing payment orders may be delegated in public administrations and governorates, except the Governorate of Beirut, to officials of at least the third grade belonging to the Ministry of Finance staff, to be effected by decree.
- 3)The authorising officer must complete the payment order procedure within seven days of the date of its receipt, extendable to ten days for the last salary payment orders.
- 4)If the authorising officer requires written clarifications from the competent administration, the five-day period shall begin from the date of receipt of such clarifications. This may be done only once.
Possibility of Issuing Payment Orders during January of the Following Year
Payment orders for the financial year's expenditure may continue to be issued up to 31 January of the following year, provided they are dated 31 December of the year against which they are charged.
Concept of Prior Years' Expenditure
Amounts that accrued to third parties against the State during a given financial year but were not paid by the end of February of the following year, for any reason whatsoever, are called prior years' expenditure.
Amended 1966
Conditions for Issuing a Payment Order
A payment order may only be issued after verifying the following:
- 1)That the expenditure commitment transaction has been signed by the competent authority and endorsed by the Controller of Expenditure Commitments.
- 2)That the classification of the expenditure matches the commitment transaction.
- 3)That the expenditure calculations are correct.
- 4)That the liquidation transaction conforms to the financial laws and regulations only.
Issuance of a Separate Payment Order for Each Creditor
A separate payment order shall be issued for each creditor when payment is made from a single budget line or a single paragraph.
Persons in Whose Name the Payment Order is Issued
The payment order shall be issued in the name of the creditor or, on his behalf, in the name of his agent, secretary or proxy for collection, and in the name of his heirs in the event of his death. It shall be issued in the name of the head of the Treasury Service if the State is the creditor, and in the name of the competent accountant if the creditor is a municipality or a public institution. It shall be issued in the name of the competent governor if it relates to amounts due to minors who have no municipality, provided the amount is deposited in trust in the name of the said governor with the central district accountant.
Special Cases for Issuing Payment Orders
A payment order may be issued:
- 1)In the name of an authorised agent for collection designated by the competent administration, with respect to staff salaries, expenses and pensions.
- 2)In the name of the official who paid the amount from his own funds, with respect to transport allowances and certain petty expenses.
- 3)In the name of the seller on credit, with respect to expenditure paid from his own funds.
- 4)At the request of the beneficiary administration, payment orders relating to expropriation compensation may be issued in the name of the district accountant in whose district the expropriated properties are located, or the adjacent district, provided the conditions for payment of such compensation are established by decision of the Minister of Finance.
Obligation to Communicate Garnishment Orders and Deed of Assignment to the Authorising Officer
Garnishment orders and assignment instruments relating to debts owed by the State shall be communicated to the authority competent to issue payment orders. No notification addressed to any other person shall be deemed valid. The said authority must respond within the legal time limit to the party that notified it of the garnishment, and must record the garnishment or assignment on the payment order after its issuance.
Obligation to Sign the Payment Order
The payment order shall be signed by the competent authority and forwarded to the competent accountant for payment.
Amended 1966
Case of Loss of a Payment Order
If a payment order is lost, its holder shall be provided with a copy thereof upon his written request stating the reasons for the loss, together with a written certificate from the Central Accountant confirming that the payment order has not been paid and that notice has been taken of the obligation not to pay it.
Duties of the Accountant
A payment order becomes valid for payment after endorsement by the Central Accountant, or by the person to whom he delegates this task with the approval of the competent Director General. This official shall: a. Refuse endorsement and return the payment order to its source with a statement of reasons for the refusal in the following cases: First: if the payment order is not accompanied by the signature of the authority competent to issue it. Second: if the supporting documents for the expenditure are not attached to the payment order. Third: if the name of the creditor, the subject of the expenditure or its amount does not correspond to the supporting documents. b. Complete the transaction and place the relevant payment instrument under the disposal of the competent administration within three days of its receipt.
Amended 1966
Payment Orders Issued in the Governorates
The procedures for paying payment orders issued in the governorates shall be established by decrees adopted on the proposal of the Minister of Finance.
Amended 1966
Method of Paying Payment Orders
Payment orders shall be paid in cash from the cashbox where they are held. Payment may also be effected by bank transfer.
Payment of Staff Salaries
Staff salaries for the month of January shall, by way of exception, be paid during the last ten days of December.
Powers of Accountants
Accountants shall carry out: - Receipt of the assessment schedules, collection orders and recovery orders deposited with them by the relevant authorities, and ensuring their collection. - Receiving all receipts, of whatever nature. - Making all payments, either on the basis of payment orders or payment instructions issued by the competent authority, or in certain cases on the basis of payment instructions issued by them directly. - Safekeeping of the supporting documents relating to these operations and accounting records. - Maintenance of the accountancy accounts they manage.
Powers of the Central Finance Accountant
The Central Finance Accountant shall, in addition to the foregoing, centralise all revenue and expenditure operations relating to the general budget carried out by any central accountant, and shall also manage the State Treasury account held at the Central Bank.
Prohibition on Combining Administrative and Accounting Functions
The function of accountant may not be combined with any function relating to the assessment of revenues, or any function relating to the commitment, liquidation or payment order issuance of expenditure.
Conditions for an Accountant to Exercise his Functions
Before entering upon his duties, the accountant must provide a legal security whose value shall be determined by decision of the Minister of Finance, and must take an oath before the Court of Audit.(1)
1. The value of this security was set at twenty thousand Lebanese pounds by Decision No. 213 of 29 May 1986. See also Decree No. 2829 of 14 December 1959; Decision No. 1430 of 6 June 1974; Decision No. 1525 of 13 October 1977; and the Law of 20 August 1956.
Method of Providing the Security
The security shall be provided either in cash, or by bank guarantees issued by approved banks, or by registering immovable properties in the land registry. The papers and documents relating to the security provided shall be kept at the General Accounting Service of the Ministry of Finance, together with a copy of the text ordering the appointment of the accountant.
Ensuring Payment through a Cashier
The accountant may not personally receive or pay funds under his management; this shall be done through cashiers or tax collectors under his authority, except in cases established by special decree.(1)
1. With regard to the authorisation of certain accountants to personally receive funds, see: Decree No. 2837 of 14 December 1959; Decree No. 2840 of 14 December 1959; Decree No. 4024 of 4 May 1960.
Supervision of Cashiers' Activities
The accountant must supervise the work of the cashiers and tax collectors under his authority and must call them to account for any breach or delay in their work.
Personal Liability of the Accountant
The accountant shall be personally liable, from his own funds, for every receipt or payment operation carried out in the accountancy office he manages in contravention of the provisions of the law, in addition to any disciplinary or criminal penalties he may incur.
Limits of Liability
The accountant shall only be liable for his personal management.
Operations for which Liability is Borne
The accountant's duties cover all operations he carries out in his accountancy office from 1 January to 31 December of each year, or during the period he held his position, if that period is less than one year.
Account of Assignment
Central accountants, and likewise local accountants referred to in paragraph 2 of Article 160, shall submit their assignment accounts to the Court of Audit in their own names and on their own responsibility. Local accountants referred to in paragraph 3 of Article 160 shall submit their assignment accounts in their own names and on their own responsibility to the central accountant to whom they are attached, within conditions and time limits established by decree issued on the proposal of the Minister of Finance.(2)
2. The rules and deadlines for organising, auditing and consolidating assignment accounts and financial statements were established by Articles 16 to 19 of Decree No. 3373 of 11 December 1965.
Handover and Takeover Record
Upon the expiry of the accountant's assignment, a handover and takeover procedure shall be carried out between him and his successor by means of a record signed by both of them, in the presence of a financial inspector for central accountants and an official designated by the competent administration for local accountants. A copy of the record shall in both cases be sent to the Financial Inspectorate. A trial balance of accounts dated the day of the handover and takeover procedure must be attached to this record as a mandatory requirement.
Case Where the Successor Cannot Perform his Duties
In the event of the accountant's death, or his inability to present the handover and takeover record, the successor accountant shall draw up the assignment account of the predecessor accountant under the supervision of a financial inspector.
Return of the Accountant's Security
The security(1) shall be returned after the accountant obtains a discharge from the Court of Audit and shall be returned automatically after three years have elapsed since the accountant left his assignment, if the Court is late in issuing its decision beyond that period.
1. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Liability of Accountants and Financial Collectors
- 1)Local accountants and collectors shall be jointly and severally liable for direct taxes and other funds entrusted to them for collection.
- 2)The head of a tax collection directorate shall be personally liable for the direct taxes and other funds entrusted to him for collection; he is required to provide the security required of accountants.
- 3)The extent of the liability of the officials referred to in paragraphs 1 and 2 of this article, and the procedures to be followed to mitigate their liability or issue a discharge of their obligations, shall be established by decree adopted on the proposal of the Minister of Finance.(2)
2. The liability of accountants and collectors was established by Decree No. 5933 of 3 November 1966.
De Facto Accountant
Any person who intervenes in the management of public funds without holding the status of accountant shall be treated as an accountant responsible for his actions, like the official accountant, and shall be subject to the latter's obligations.
Expenditure of External Missions
Permanent budget advances shall be placed at the disposal of external missions, to be used by each mission to pay its expenditure for at least six months.
Special Award Committee
Contracting in external missions shall be handled by a special committee appointed by decision of the head of the mission wherever possible; otherwise it shall be carried out in accordance with procedures established by decision of the Minister of Foreign Affairs and Emigrants.
Expenditure of External Delegations
The expenditure of delegations abroad may be evidenced by detailed statements certified by the head of the delegation on his own responsibility.
Representation Expenditure Abroad and Administrative Expenditure
Representation expenditure abroad may be evidenced by detailed statements prepared by the head of the external mission and certified by the Secretary General of the Ministry of Foreign Affairs and Emigrants. Administrative expenditure incurred by external missions shall also be evidenced by the same method if the expenditure does not exceed 500 pounds each time.
Mechanisms for Committing and Disbursing Expenditure and Bookkeeping Procedures
Notwithstanding any other provision or measure, Lebanese diplomatic and consular missions shall apply the financial instructions issued by the joint decision of the Ministers of Finance and of Foreign Affairs and Emigrants dated 29 April 1999 and its amendments, with regard to the mechanisms for committing and disbursing expenditure, conditions for commitment, appropriation reservation and annual carry-over, bookkeeping procedures, organisation of entries, receipt of funds and their disbursement.
Amended 2017
Subsection 3Special Provisions for Payment of Salaries and Pensions
Special Provisions for Payment of Salaries and Pensions
Expenditure Paid without a Prior Payment Order
Certain expenditure may be paid without a prior payment order, provided that the payment order is subsequently issued as a regularisation measure. The expenditure that may be paid in the manner described above consists of:
- 1)Salaries, wages and their supplements, pensions, and military order medal allowances.
- 2)Ordinary petty expenditure, urgent expenditure, and other expenditure whose nature or urgency justifies its direct payment in the normal manner.
Conditions for Paying Expenditure without a Prior Payment Order
The procedures for paying the expenditure described in the first paragraph of the preceding article shall be established by decree. Expenditure described in the second paragraph shall be paid through a permanent or emergency advance known as a budget advance, to be disbursed in accordance with the provisions of the following articles within the appropriations earmarked in the budget.
Definition of Permanent and Emergency Advance
A permanent advance is one granted to public administrations to cover their recurring expenditure throughout the current year. An emergency advance is one granted to public administrations or to any assigned person to meet expenditure that may be impossible to renew.
Decision to Grant a Permanent Advance
A permanent advance of a fixed value shall be granted by joint decision of the Minister of Finance and the competent minister. This decision shall specify: - The amount of the advance, which must be equivalent to three times the recurring monthly expenditure. - The types of expenditure that may be paid from the advance. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. - The name of the advance administrator, his position, the type of security he is required to provide, and its amount.
1. See Decree No. 3149 of 16 November 1965 on the system for paying certain public expenditure through permanent advances.
Method of Operating a Permanent Advance
A permanent advance shall be disbursed without prior endorsement by the Controller of Expenditure Commitments. However, the administrator may pay from it only expenditure that has been previously committed and liquidated in accordance with established procedures.
Payment of the Permanent Advance
The Central Accountant shall pay the permanent advance to the administrator on the basis of the decision ordering its disbursement.
Replenishment of Expenditure Paid from the Permanent Advance
Expenditure paid from the advance shall be reimbursed by means of payment orders issued in the name of the administrator. The advance shall be replenished by the amount of the sums disbursed pursuant to these payment orders, without the need to issue any new decision.
Duties of the Permanent Advance Administrator
The advance administrator shall: - Receive the advance and the replenishment payment orders. - Ensure payments are made. - Collect the supporting documents for expenditure and submit them to the authority competent to issue payment orders on a regular basis at the end of each month. - Maintain an account of the advance whose procedures are to be defined by decision of the Minister of Finance.
Liquidation and Payment of Permanent Advance Expenditure
Normal liquidation and payment order procedures shall be carried out on the basis of the supporting documents submitted by the administrator. If the Payment Service finds that some supporting documents are not in order, it shall proceed to issue a payment order for the amount of the valid documents and return the other documents to the competent administration within at most five days. In the latter case, the value of the advance may be increased by the amount of the documents whose payment has been suspended.
Deposit of the Permanent Advance in State Cashboxes
Permanent advances exceeding a limit assessed by the Minister of Finance must be deposited in the name of the administrator in a State cashbox designated in the decision ordering the disbursement of the advance.
Procedures for Operating Permanent Advances
The procedures for operating permanent advances shall be established by decision of the Minister of Finance.
Decision to Grant an Emergency Advance
An emergency advance shall be granted by decision of the Director General of Finance after endorsement by the Controller of Expenditure Commitments. This decision shall specify: - The amount of the advance. - The purpose of expenditure. - The person in whose name the advance is granted. - The maximum time limit for submitting supporting documents and for the final repayment of the advance, not to exceed 31 January of the following year. The appropriations reserved for permanent and emergency budget advances granted during a given year to meet obligations to be executed in that year (opening of exhausted appropriations to implement agreements with foreign governments or foreign and local agencies, or to pay for medical treatment abroad) may be carried over to the budgets of subsequent financial years.
Amended 1999
Disbursement of the Emergency Advance
The emergency advance shall be disbursed by means of a payment order issued by the authority competent to issue payment orders on the basis of the decision ordering the disbursement of the advance.
Issuance of the Repayment Payment Order for the Emergency Advance
The repayment payment order shall be issued in the name of the person to whom the advance was granted.
Conditions for Use of a Budget Advance
An advance shall not be used for any purpose other than that for which it was granted. The legal provisions governing the management of public funds shall be observed in its use.
Repayment of a Budget Advance
An advance shall be repaid either in cash by returning its value to the Treasury, or by supporting documents for the expenditure, or by both methods simultaneously, within the time limit specified in the decision ordering its disbursement.
Liability of the Budget Advance Administrator
The advance administrator shall be personally liable, from his own funds, for the value of the advance. He must demonstrate its existence to any inspector either in cash or in the form of supporting documents for amounts expended from it.
Auditing Budget Advance Accounts
The Head of the Treasury Service must ensure that advance accounts are audited at least once every six months. He may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that exceed the amount of the expenditure due, or that are repaid at incorrect times; he may also take direct legal action against the administrator to recover such amounts.
Exclusive Right to Handle and Hold Funds
The right to handle and hold funds in each accountancy office shall be exclusively vested in cashiers and collectors, except in cases established by the decree referred to in Article 171 of this Law.
Responsibility for Safekeeping Funds
Cashiers shall be responsible for the safekeeping of funds in the accountancy office in which they exercise their functions.
Collectors' Responsibility for Safekeeping and Remitting Funds
Collectors shall be responsible for the safekeeping of the funds they collect, and must remit them periodically to the cashboxes of the accountancy office to which they belong in accordance with conditions established by decision of the Minister of Finance. They shall also be jointly and severally liable with the accountant to whom they are attached for the collection of direct taxes in accordance with Article 180 of this Law. Collectors are absolutely prohibited from making any payment whatsoever.
Obligation to Provide Security
Cashiers and collectors shall be subject to the security system on the same basis as accountants.(3)
3. The security of accountants and other officials subject to the security system was established by Decision No. 1/1430 of 6 June 1974.
Verification of the Identity and Signature of the Payee
Before making a payment, the cashier must verify on his own responsibility the identity of the payee and the authenticity of his signature.
Amount Due to a Deceased Person
If an amount is due to a deceased person, the cashier shall request from the heirs official documents proving their relationship to the deceased. A certificate from the local mukhtar (village chief) shall suffice if the amount is less than 500 pounds.
Case of Using a Thumbprint
If the payee is illiterate or unable to sign, a thumbprint shall be used in place of a signature, provided it is certified by the cashier and two witnesses if the payment order value exceeds one thousand pounds. In other cases, the cashier may require the thumbprint to be certified by a notary.
Issuance of Receipt for Amounts Received
A receipt shall be issued for every amount received by cashiers and collectors, whose form and method of organisation for each administration or unit shall be determined by the General Accounting Service of the Ministry of Finance.
Falsification of a Receipt
Any falsification of a receipt issued by a cashier or collector, or of any copy thereof, regardless of the cause, shall be presumed to have been committed with malicious intent, and the penalties provided in Articles 461 and 462 of the Penal Code shall apply to the perpetrator, unless the falsification caused no harm to public funds.
Formal Receipt
A formal receipt must be issued for every amount received from public funds, and anyone who collects public funds without issuing a formal receipt shall be deemed an embezzler.
Maximum Balances to be Retained
The Head of the General Accounting Service of the Ministry of Finance shall, on the proposal of the competent central accountant, establish the maximum balances that cashiers may retain,(1) requiring them to pay any amounts in excess of these balances to the banks or post offices assigned to them.
1. The maximum holdings for cashboxes at customs centres were established by Decision No. 173 of 8 May 1964.
Tasking Officials in Certain Administrations with Receiving Revenue
Administrations that collect certain revenues in cash must task one of their officials, with the approval of the General Accounting Service, with receiving such funds and maintaining their accounts. This service may also approve the method of receiving and remitting the said funds, as well as the register forms to be maintained. The said official shall remit the funds he has received at least once a month, either to the Central Finance Accountant or to the local Finance Accountant, on the basis of a schedule identifying the received items and the type of revenue collected. This official may be assisted in receipt operations, where appropriate, by one or more cashier's assistants. This official and those assisting him in receiving funds shall be subject to the obligations of cashiers and in particular to the provisions of Articles 185, 189 and 192.
Payment at the Beginning of Each Month
Allowances, salaries and monthly benefits specific to the post or attached to the salary shall be paid at the beginning of each month. This measure shall apply to all permanent and temporary officials, with the exception of contractors, and shall also apply to pensioners and their heirs.
Non-Recovery of Any Amount Paid
An amount paid in implementation of the provisions of the preceding paragraph shall remain a vested right of the recipient and shall not be recovered for the benefit of the Treasury in any circumstances.
Subsection 4Special Provisions for the Ministry of Post, Telegraph and Telephone
Special Provisions for the Ministry of Post, Telegraph and Telephone
Fate of Expenditure Committed without Prior Controller Endorsement
If expenditure is committed in accordance with the provisions of the law without obtaining the prior endorsement of the Controller of Expenditure Commitments, and an appropriation is available for it, it shall be paid as a regularisation measure, subject to the prosecution of those responsible before the Court of Audit.
Liability for Committing Expenditure in Excess of Appropriations
A minister shall be personally liable, from his own funds, for any expenditure he commits in excess of the appropriations opened for his ministry while being aware of such excess, and likewise for any measure that leads to an increase in expenditure paid from the said appropriations if that measure does not result from prior legislative provisions. This liability shall not prevent the prosecution of officials who were involved in committing, liquidating and issuing payment orders for the expenditure before the Court of Audit, unless they produce a written order capable of relieving them of liability.
Obligation to Inform the Prosecutor General of the Court of Audit
The Controller of Expenditure Commitments, and other authorities when necessary and as far as it concerns them, shall inform the Prosecutor General of the Court of Audit of the situations described in the two preceding articles.
Carry-Over of Appropriations
- 1)Appropriations of Part One of the budget that have not been committed by 31 December of the year shall lapse, except for appropriations earmarked for the allocations of the general Treasury.
- 2)Appropriations of Part Two that have not been committed by 31 December shall be carried over for one year, except for programme law appropriations.
- 3)Appropriations of Parts One and Two of the budget that have been committed but not issued with a payment order by 31 December of the year shall be carried over to the following year's budget if they relate to a third-party right.
- 4)The carry-over shall be effected by decision of the Minister of Finance issued at the request of the competent administration before 1 March of the following year in accordance with the applicable provisions.
- 5)This text shall take effect as from the 2017 budget.
1. Contrary to Article 114, the carry-over of uncommitted appropriations opened in 1990 and earlier was suspended by Article 17 of Law No. 490 of 15 February 1996 (Budget 1996), and similarly for 1991 and earlier by Article 16 of Budget Law 1997, and thereafter by successive decrees.
2. The first amendment to this article's paragraph was made by Article 48 of Law No. 89 of 7 September 1991, then repealed by Article 18 of Law No. 490 of 15 February 1996.
Amended 2017Amended 2019
Extinguishment of Debts by Statute of Limitations
Debts that have not been liquidated, for which no payment order has been issued, or that have not been paid by 31 December of the fifth year following the financial year in which they arose shall lapse by operation of the statute of limitations and shall be definitively extinguished in favour of the State, unless the delay was caused by the administration or by the failure to pursue legal proceedings.(1)
1. With regard to the treatment of deposits, guarantees and cash sureties that are more than ten years old as Treasury revenue, Article 30 of Law No. 81/14 of 15 July 1981 provides detailed rules in this regard.
Amended 1967
Prior Years' Expenditure
1. Prior years' expenditure that has not lapsed by statute of limitations shall be paid from the appropriations opened for this purpose in the current year's budget. It may also be paid, where the state of appropriations permits, from the current year's budget appropriations. 2. Subject to the provisions of paragraph 1 of this article, prior years' expenditure relating to the period prior to 1963 that has not lapsed by statute of limitations shall be paid from the prior years' expenditure section of the current year's budget in accordance with the provisions of paragraph 3 of Article 25.
Amended 1966
Fate of Amounts Paid in Error or Without Legal Basis
Amounts paid by the Treasury in error or without legal basis and recovered during the financial year in which they were paid may be added to the appropriation of the competent minister by decision of the Minister of Finance. The competent minister must submit a request to the Minister of Finance in this regard within a maximum period ending on 31 December of the same year.
Possibility of Suspending the Use of Certain Appropriations
The Minister of Finance may, if he deems it necessary, propose to the Council of Ministers the suspension of the use of certain appropriations earmarked in the budget. The Council of Ministers may decide to approve the proposal if the current circumstances justify taking such a measure.
Expenditure Accounts
The Ministry of Finance shall maintain separate accounts of all committed, issued for payment and paid expenditure. The competent administrations shall maintain corresponding accounts of expenditure they commit, liquidate and for which payment orders are issued.(1)
1. The Court of Audit reconciles the accounts of the Ministry of Finance with those of the administrations and issues, upon completion of its review, a 'reconciliation statement' showing whether the accounts are correct or not.
Functions of the General Accounting Service
The General Accounting Service shall audit the operations of accountants and administrative accountants and shall consolidate them.
1. See Decree No. 4001 of 12 May 2010 on the system for transmitting the accounts of public administrations and related documents and information to the Court of Audit.
Budget Closing of Accounts and General Assignment Account
The General Accounting Service shall prepare each year: - The budget closing of accounts, which must be submitted to the Court of Audit before 15 August of the year following the budget year. - The general assignment account, which must be submitted to the Court of Audit before 1 September of the year following the account year. - The preparation of the general assignment account shall begin with the account of the year in which the general chart of accounts referred to in Article 163 of this Law begins to apply.
2. Regarding the exemption from preparing the assignment account of central accountants and the general assignment account, Article 23 of Law No. 715 of 3 February 2006 (Budget 2005) provides detailed rules.
3. The deadlines for submission to the Court of Audit and the General Accounting Service of accounts and financial and administrative statements were extended by Article 1 of Legislative Decree No. 102 of 30 June 1977.
4. Regarding granting the General Accounting Service a deadline for preparing the assignment account, Articles 3 and 4 of Law No. 81/12 of 15 July 1981 (Closing of Accounts for 1977) provide detailed rules.
Amended 1966Amended 1977
Results of the Budget Closing of Accounts
If the budget closing of accounts shows a surplus in revenues, this surplus shall be transferred, by virtue of the closing law, to the 'reserve fund' account; if it shows a surplus in expenditure, the said law shall authorise the covering of the deficit from the reserve fund. If the reserve fund is insufficient, the deficit shall be recorded in the advances account and must be compulsorily repaid from the first subsequent budget that shows a surplus; if that surplus is insufficient, it shall be paid from surpluses of subsequent years in turn.
Referral of the Draft Closing of Accounts to the Chamber of Deputies
The Government must refer the draft budget closing of accounts law to the Chamber of Deputies before 1 November of the year following the budget year.
Definition of the Reserve Fund
The reserve fund is constituted from the surplus of budget revenues over expenditure. The Central Finance Accountant shall maintain this account under the supervision of the General Accounting Service.
Use of the Reserve Fund
The reserve fund shall be used: - To cover prior years' expenditure during the transitional period referred to in Article 25 of this Law. - To cover opened appropriations. - To cover the budget deficit in accordance with Article 196 of this Law. - To cover supplementary appropriations (complementary and exceptional). - To finance construction projects.
Drawings from the Reserve Fund
No amount may be drawn from the reserve fund except by law. Every amount decided to be drawn from the reserve fund must be immediately entered in the accounts of the Central Finance Accountant. The method of creating these entries shall be established by decision of the Minister of Finance.
Delivery of Deposits and Guarantees to the Treasury
Deposits and guarantees shall be delivered to the Treasury on the basis of an instruction issued by the competent authority, and the reasons for the deposit shall be recorded in the relevant receipts; they shall only be returned to their owners on the basis of an instruction from the competent authority and after the receipts are recovered.
Loss of Deposit and Guarantee Receipts
If deposit or guarantee receipts are lost, they shall be replaced by an undertaking from their owner to bear any harm and damage that may result to a third party from the misuse of the lost receipt for a period of five years.
Definition of Treasury Advances
Treasury advances are funds disbursed from its holdings:
- 1)To constitute joint supply depots for public administrations for supplies shared among more than one administration.
- 2)To purchase storable materials intended for use in the current or following financial year.
- 3)To fund the cashboxes of public institutions and municipalities and also the independent cashboxes established by law.
1. See Law No. 89/5 of 5 January 1989 on the termination of provisions authorising the conclusion of loans or the granting of State guarantees, or the commitment of expenditure without available appropriations, and on the amendment of the conditions and procedures for granting Treasury advances.
Conditions for Granting Treasury Advances
The granting of Treasury advances to fund one of the cashboxes referred to in paragraph 3 of the preceding article requires:
- 1)The Minister of Finance to verify the beneficiary's ability to repay the advance in cash within the prescribed repayment period.
- 2)The beneficiary to undertake to compulsorily earmark in its budget the appropriations necessary for repaying the advance within the prescribed period.
- 3)The approval of the legislative authority if the repayment period exceeds twelve months.
Requirement that Treasury Advances be Granted by Decree
Treasury advances for the purposes specified in Article 203 of this Law shall be granted by decree on the proposal of the Minister of Finance and at the request of the competent administrations. The Government shall be required to inform the Chamber of Deputies of the advances decided upon by virtue of such decree.
2. The repealed second paragraph read: 'In exceptional emergency cases, Treasury advances may be granted by decree adopted in the Council of Ministers.'
Amended 1989Amended 1991Amended 1991
Contents of the Decree Granting Treasury Advances
A decree adopted in the Council of Ministers(3) shall specify the advance administrator for the cases referred to in paragraphs 1 and 2 of Article 203, and the beneficiary institution for the case referred to in paragraph 3 of the same article. It shall also specify the purpose of the advance, its amount, the method of its disbursement, the conditions for its repayment, and any other conditions the Minister of Finance deems necessary to impose.
3. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Disbursement of Treasury Advances
Treasury advances shall be disbursed on the basis of orders issued by the Central Accountant, which shall make reference to the decree adopted in the Council of Ministers(4) that authorised them.
4. In Articles 206 and 207 of the Public Accounting Law, the expression 'advance order or Minister of Finance's order' was replaced by 'decree adopted in the Council of Ministers' by Law No. 41 of 14 February 1991.
Amended 1991
Restriction of the Use of Treasury Advances to Their Purpose
A Treasury advance shall not be used for any purpose other than that for which it was granted.
Repayment of Treasury Advances
Treasury advances referred to in paragraphs 1 and 2 of Article 203 of this Law shall be repaid by means of payment orders charged against the budget. Treasury advances referred to in paragraph 3 of the same article shall be repaid in cash to the Treasury within the periods prescribed for this purpose.
Role of the Accountant
The accountant must follow up on the repayment of Treasury advances in accordance with the conditions under which they were granted and within the prescribed periods.
Possibility of Deducting the Salary of the Treasury Advance Administrator
The accountant may directly deduct from the advance administrator's salary and allowances any amounts whose misuse is proven, or that are repaid at the incorrect times. He may also take direct legal action against the administrator to recover such amounts. The repayment period may be extended, by decree adopted in the Council of Ministers on the proposal of the Minister of Finance,(1) in exceptional and warranted cases.
1. The expression 'and the Minister of Finance may' in the second paragraph of Article 211 of the Public Accounting Law was replaced by 'and it may be done by decree adopted in the Council of Ministers on the proposal of the Minister of Finance' by Law No. 41 of 14 February 1991.
Amended 1991
Deduction from Funds of Administrations in Arrears
If any of the beneficiary administrations is in arrears in repaying the Treasury advance granted to it, the Central Finance Accountant shall have the right to deduct it formally from any funds that administration may hold with the Treasury.
Statement of Treasury Advances
A statement of Treasury advances granted in accordance with Article 203 of this Law and the amounts repaid during the budget year shall be appended to the draft budget closing of accounts law.
2. The General Accounting Service shall extract the statement of Treasury advances from the assignment accounts and supporting documents; see in this regard Article 34 of Decree No. 3373 of 11 December 1965 (defining the rules and deadlines for organising, auditing and consolidating accounts and financial statements).
Special Regulations
The accounting of the Post, Telegraph and Telephone shall be governed by the special regulations applicable to it and by the provisions of this Law in all matters not inconsistent with those regulations.
Subsection 5Special Provisions for Municipalities
Special Provisions for Municipalities
Methods of Implementing Expenditure
Supplies, works and services expenditure shall be implemented either by means of contracts concluded by the administration with third parties, or directly by the administration through the direct administration method (régie).
Principle of Public Tendering
Contracts for supplies, works and services shall be awarded by public tender. However, in the cases described below, contracts may be awarded by restricted tender, invitation to submit proposals, mutual agreement, or by means of a statement or invoice.
Tendering Programme
Public and restricted tenders shall be conducted on the basis of an annual programme announced on dates that may extend beyond the second month following publication of the budget.
Principle of Non-Splitting of Expenditure
Expenditure may not be split unless the authority competent to commit it considers that the nature of the works, supplies or services to be contracted warrants doing so.
Methods of Conducting Public Tenders
A public tender (hereinafter referred to as 'tender') shall be conducted either on the basis of a price submitted by the tenderer, or on the basis of a percentage reduction from the estimated prices in the provisional bill of quantities referred to in Article 126 of this Law.
General and Special Conditions Documents
Standard general conditions documents shall be prepared for contracts awarded by tender, approved by decree and published in the Official Gazette. A special conditions document shall be prepared for each such contract by the responsible administration and approved by the authority competent to decide on the contract.
Contents of the Special Conditions Document
The special conditions document shall specify the following information: - The types and descriptions of supplies, works or services to be contracted. - The qualifications and special conditions required of persons wishing to participate in the tender. - Award criteria: whenever the administration intends to be bound by the lowest price, these criteria shall be stated clearly and in detail; a separate weighting factor may be assigned to each of them where appropriate. - The basis on which the tender is to be conducted in accordance with Article 124. - Special execution conditions. - Delivery deadline. - The amount of the security required for participation in the tender and to guarantee the contractor's proper fulfilment of his obligations. A provisional bill of quantities showing quantities and prices shall be appended to the special conditions document where appropriate. The price established by the administration shall be deemed the upper ceiling for contracts conducted on the basis of a percentage reduction; the administration shall announce the maximum permissible reduction, which shall constitute the minimum contract price.
Amended 1982
Types of Security
Security may be:
- 1)Cash, paid into a Treasury cashbox directly, or into the cashbox of the competent administration where one exists, against a receipt attached to the bid, provided its value is transferred in the latter case to the central Finance cashbox upon award of the contract.
- 2)A bank guarantee issued by an approved bank, drawn up in the name of the competent administration or the State Treasury.
Announcement of Tenders
Each tender shall be announced in the Official Gazette and in at least three daily newspapers at least 15 days before the date fixed for award. The period may be reduced to at least five days in the event of a repeat tender, or in cases of necessity, provided the reduction is approved in advance by the authority competent to commit the expenditure. Any amendment to the conditions document after publication of the tender announcement shall likewise be announced following the same procedures.
Article 129 was repealed by Article 29 of Law No. 78/16 of 2 May 1978.
Amended 1978
Tender Committees
Tenders shall be conducted before committees established specifically for this purpose.
Provisional Award
The contract shall be provisionally awarded to the bidder submitting the lowest price, or to the one who submitted the best offer where the conditions document provides for award criteria other than price, subject to granting bids for goods manufactured in Lebanon a 10% preference(1) over bids for foreign goods, provided that national goods and the conditions they must meet to benefit from this preference are defined by decrees(2) adopted in the Council of Ministers on the proposal of the Minister of Economy and Trade.(3) For contracts conducted on the basis of a percentage reduction, the tender committee shall provisionally award the contract to the lowest bidder within the two estimated prices.
1. With regard to granting bids for goods manufactured in Lebanon a 15% preference over bids for foreign goods, see Legislative Decree No. 127 of 30 June 1977.
2. With regard to defining national goods and the conditions they must meet to benefit from this preference, see: Decree No. 6588 of 1 April 1995; Decree No. 10352 of 23 May 1975; Decree No. 4208 of 20 October 1972; Decree No. 9223 of 20 September 1996.
3. The conditions for applying paragraph 2 of Article 131 of the Public Accounting Law were established by Decree No. 6232 of 2 December 1966.
Amended 1972Amended 1978Amended 1982
Case of Equal Bids
If bids are equal after granting Lebanese goods the 10% preference referred to in Article 131, the tender shall be reopened in the form of sealed envelopes among the bidders concerned, at the same session, to the exclusion of others. If they refuse to submit new bids or their bids remain equal, the provisional contractor shall be designated by lot among the holders of equal bids. For contracts conducted on the basis of a percentage reduction, if bids are equal, the provisional contractor shall be designated by lot among the equal bids.
Amended 1972Amended 1982
Authority Competent to Decide on the Contract
1. The contract shall be decided upon by: - The competent director, or the head of the service in the absence of a director, if its value exceeds 10,000,000 L.L. - The competent director general, if its value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. 2. The contract shall become final only after the approval has been communicated to the contractor by administrative means.
Amended 1978Amended 1987Amended 1990Amended 1994
Importance of Site Possession Procedure
Works contracts may not be concluded before all legal procedures have been completed that enable the administration to take possession of the work site. However, award proceedings may commence before these procedures are completed, provided the contract is approved and communicated to the contractor only after possession of the said sites has been taken.
Contractor's Default
If an amount becomes due from the contractor in the course of execution pursuant to the conditions document, the administration shall have the right to deduct that amount from the security and to invite the contractor to replenish it within a specified period. If he fails to do so, he shall be deemed to have defaulted, and the administration shall proceed either to relaunch the tender or to execute the contract by direct administration. If the new tender or execution by direct administration results in a saving in costs, the saving shall revert to the Treasury. If it results in an increase in costs, the administration shall recover the increase from the defaulting contractor. In all cases, the security shall be provisionally confiscated pending settlement of the contract in accordance with the provisions of this article.
Contractor's Insolvency
The contract shall be automatically terminated between the administration and the contractor declared insolvent, and the following measures shall be immediately taken:
- 1)The security shall be provisionally confiscated for the account of the Treasury.
- 2)The administration shall inventory the completed works, supplies or services and the materials delivered as at the date of the insolvency declaration and draw up a schedule whose value shall be provisionally held in trust in the name of the Treasury.
- 3)The works, supplies or services, or the remainder thereof, shall be placed under direct administration or re-tendered. If the new tender or direct administration results in a saving in costs, the saving shall revert to the Treasury, and the security and the value of the schedule referred to in the preceding paragraph shall be paid to the receiver. If it results in an increase in costs, the increase shall be deducted from the security and the said schedule value, and the balance shall be paid to the receiver. If this is insufficient to cover the entire increase, the recourse shall be limited to confiscating the security and the schedule value.
Principle of Execution before Payment
The contract value may not be paid until after the contract has been executed. However, the Minister of Finance may, at the request of the competent minister, grant contractors advances against bank guarantees. If obtaining such guarantees proves impossible, the advance shall be granted without a guarantee upon approval of the Council of Ministers. The advance may not exceed 25 per cent of the contract value and shall not exceed 30,000,000 L.L. However, in exceptional cases, the Council of Ministers may, by decision, derogate from the foregoing provisions.
Amended 1966Amended 1987Amended 1990Amended 1994
Ten Per Cent Withholdings
If the conditions document so provides, instalment payments for completed works shall not exceed nine-tenths of the amount due, with one-tenth being withheld in the Treasury until final acceptance has taken place. These withholdings shall be returned upon final acceptance where the conditions document specifies a guarantee period for supplies or works, after the contractor has paid any penalties that have accrued under the conditions document. The administration may stop deducting the ten per cent withholdings when it considers that they have reached the level required for the guarantee.
Acceptance Committee
Supplies, works and services shall be accepted in each ministry by a committee appointed by decision of the director general, comprising three technical staff members, one from the unit for whose benefit the contract was awarded and two from outside it.(1)
1. See Decree No. 3906 of 29 April 2010 granting each of the two members of the supplies, works and services acceptance committee in the General Directorate of Finance from outside the unit for whose benefit the contract was awarded a flat-rate transfer allowance.
Consequences of Breach of the Conditions Document
If the contractor fails to comply with the conditions document or any of its provisions during contract execution, the competent administration shall formally notify him of the obligation to comply fully with his obligations within a specified period that it assesses. If the specified period expires without the contractor having performed what was required of him, the administration shall have the right, subject to the provisions of the general conditions document, to consider him in default and apply against him the provisions of Article 135 of this Law. In the event of a retender, the defaulting contractor shall have the right to participate again. If the acceptance committee finds that the contract has generally been executed in accordance with the conditions document but with certain minor defects or flaws preventing acceptance, it may proceed with acceptance subject to conditions established by decree(2) adopted in the Council of Ministers.
2. The conditions for accepting contracts with minor defects or flaws were established by Decree No. 14601 of 30 May 1970.
Return of Security
The security shall be returned to the contractor on the basis of a memorandum from the competent administration within at most one month of the date of final acceptance. However, the administration may, before the expiry of the execution period, or after provisional acceptance if the state of the works permits, return to the contractor, at his request, all or part of the security.
Exclusion from Tenders
A contractor whose works are placed under direct administration or whose contract is re-awarded at his expense pursuant to this Law or the general conditions document shall be excluded from tenders: - For three months when these measures are applied against him for the first time. - For a full year when applied against him a second time within twelve months. - Permanently when applied against him a third time within five years. The aforementioned periods shall begin from the date of the first decision ordering the works to be placed under direct administration or the contract to be re-awarded at the contractor's expense.(1)
1. The exclusion from participation in public contract execution was organised by Decree No. 8117 of 29 August 1968.
Cases for Adopting Restricted Tender
The administration may, where the nature of the supplies, works or services allows competition to be opened to all, restrict the tender to a limited category of tenderers who possess the required financial, technical and professional qualifications. These qualifications shall be specified in detail in the general conditions document, as shall the basis for the guarantees required of tenderers and the specifications that the works or materials requested must meet.
Provisions of the Restricted Tender
All provisions applicable to public tenders shall apply to restricted tenders.
Cases for Adopting Invitation to Submit Proposals
Contracts may be awarded by invitation to submit proposals:
- 1)If their value does not exceed 100,000,000 L.L.
- 2)If their value exceeds 100,000,000 L.L. and they relate to:
- 3)Works carried out by the administration on an experimental or study basis, provided the competent minister so decides.
- 4)Equipment, materials and commodities that must be acquired at their place of production owing to their special nature.
- 5)Shipping, transport and insurance.
- 6)Supplies, works and services for which no price was submitted in the tender or for which the prices submitted were unacceptable.
- 7)Supplies, works and services for which certain urgent situations arising from emergency circumstances do not allow public tendering, provided the competent minister so decides.
- 8)Technical supplies, works and services whose nature does not allow public tendering, provided the competent minister so decides.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions for Invitation to Submit Proposals
The provisions applicable to public tenders shall apply to the invitation to submit proposals subject to the following:
- 1)The announcement may be replaced by communicating the necessary information confidentially and by registered letter to traders in the relevant line or professionals considered by the administration as capable of executing the contract.
- 2)Invitation to submit proposals for a contract whose value exceeds 100,000,000 L.L. shall be conducted before a special committee established in each public administration by decision of the minister; other contracts shall be handled by the tender committee.
Amended 1978Amended 1987Amended 1990Amended 1994
Cases for Adopting Mutual Agreement
Agreements may be concluded by mutual agreement regardless of the contract value, where they relate to:
- 1)Supplies, works and services that may be placed in a tender, either because secrecy is necessary, or because public safety requirements preclude it, provided the competent minister so decides.
- 2)Additional supplies, works and services that must be entrusted to the original contractor lest their execution be delayed, and where bringing in a new contractor during contract execution would not be appropriate; this is permissible:
- 3)- If the supplies, works and services were not anticipated when the original contract was awarded, are related consequences thereof and form an integral part of it.
- 4)- If the supplies, works and services must be executed using the equipment and installations specifically used by the contractor at the work site, provided they were not anticipated when the contract was awarded and do not form an integral part of it.
- 5)Equipment whose manufacture is exclusively held by the holder of its patent.
- 6)Equipment held by a single entity.
- 7)Technical supplies, works and services that may be entrusted to experienced Lebanese specialists, craftsmen or artisans whose capabilities have been demonstrated.
- 8)Supplies and works manufactured by persons with disabilities who require social welfare assistance from the Ministry of Labour and Social Affairs, provided their prices do not exceed market prices.
- 9)Hospitality and protocol expenditure and similar representation expenditure.
- 10)Supplies, works and services for which the following have been conducted:
- 11)- Two consecutive public tenders.
- 12)- Or two consecutive invitations to submit proposals.
- 13)- Or a tender followed by an invitation to submit proposals.
- 14)Without any of these processes yielding a positive result.
- 15)In such cases, the mutual agreement must result in a price not exceeding the ratio of prices submitted during the award process, except in exceptional circumstances justified by the administration in a reasoned report.
- 16)Supplies, works and services that may be entrusted to public institutions or municipalities.
- 17)Supplies and services provided by the administration through international organisations.
- 18)Supplies, works and services that the Council of Ministers approves entrusting, upon the proposal of the competent minister, to foreign governments or institutions affiliated to them. In such cases, the Government may exempt the counterpart from conditions relating to place of residence, security, penalties and the obligation of delivery before receipt.
- 19)Supplies, works and services whose procurement by mutual agreement is decided by the Council of Ministers on the proposal of the competent minister.
Authority Competent to Conclude Mutual Agreements
Mutual agreements shall be concluded by: - The director, or the head of the service in the absence of a director, if the contract value does not exceed 10,000,000 L.L. - The director general, if the value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister in other cases. The transaction shall be conducted by one of the following methods:
- 1)A contract between the competent authority and the party concerned.
- 2)An undertaking signed by the party concerned on the general conditions document.
- 3)A proposal from the party concerned approved by the competent authority.
- 4)An exchange of correspondence between the party concerned and the competent authority, in accordance with commercial custom.
Amended 1978Amended 1987Amended 1990Amended 1994
Provisions of Mutual Agreements
Mutual agreements shall be governed by the provisions of the general conditions document and a special conditions document shall be prepared for them where appropriate. In addition to the provisions of the two preceding articles, the provisions of Articles 137 to 141 of this Law shall apply to mutual agreements.
Technical Services Contracts
Mutual agreement may be used for technical services contracts (studies, preparation of conditions documents, supervision of works execution, projects, etc.) regardless of their value where they exceed the administration's own capacity. The following provisions shall apply to these contracts:
- 1)Contracting may only be done with those who possess the required technical qualifications, which must be described in detail in a study prepared by the administration before the contract is concluded.
- 2)An agreement may be concluded where appropriate after a consultation process among those who possess the said qualifications.
- 3)These contracts shall be governed by the other provisions applicable to mutual agreements.
Cases for Using Statements and Invoices
Contracts may be concluded by means of a statement or invoice:
- 1)If their value does not exceed three million pounds. This procedure shall apply to the implementation of the Lebanese University's budget without the need to issue any additional text.
- 2)If the prices of the materials to be purchased are fixed in a tariff issued by the administration or by a recognised international body and it is not possible to obtain a lower price.
- 3)If the contract relates to the hire of public works in accordance with a general tariff established by decision of the competent minister.
- 4)The contract shall be concluded by the head of the competent unit and acceptance shall be ensured by the committee provided for in Article 139.
- 5)The heads of competent units authorised to conclude contracts shall be designated by decision of the competent minister in public administrations, and by decision of the head of the executive authority in public institutions and municipalities subject to the Public Accounting Law.(1)
1. The Director General of the Central Statistics Administration was authorised to commit expenditure by means of a statement or invoice as provided in this article, by Article 1 of Decision No. 134/2009 of 24 December 2009.
Amended 1978Amended 1984Amended 1987Amended 1990Amended 1993
Definition of Works by Direct Administration
Works by direct administration are works that the administration itself undertakes to execute.
Authority Competent to Authorise Works by Direct Administration
Works by direct administration shall be authorised by: - The head of the competent unit, if their value does not exceed 3,000,000 L.L. - The director, or the head of the service in the absence of a director, if their value exceeds 3,000,000 L.L. but does not exceed 10,000,000 L.L. - The director general, if their value exceeds 10,000,000 L.L. but does not exceed 35,000,000 L.L. - The minister, if their value exceeds 35,000,000 L.L. but does not exceed 150,000,000 L.L. - The Council of Ministers in other cases. The normal procedures for procuring the materials required for executing these works shall apply.
Amended 1978Amended 1987Amended 1990Amended 1994
Monitoring Unit for Works by Direct Administration
A special unit must be established in every administration undertaking works by direct administration, whose task is to monitor the execution of such works. This unit shall be attached directly to the head of the administration and shall not carry out any execution activities.
Detailed Statement of the Results of Direct Administration Execution
The head of the unit that undertook the execution of works by direct administration must submit to its administration, upon completion of the works, a detailed statement of the quantities executed and the costs incurred of all kinds. The monitoring unit shall review this statement and forward it, together with its comments, to the Central Inspectorate.
Powers of the District Commissioner and Governor
The district commissioner shall exercise within his district the powers conferred by this chapter's provisions on the director. The governor shall exercise within his governorate the powers conferred by this chapter's provisions on the director general, with respect to supplies, works and services contracts concluded in the district or governorate.
Detailed Rules for Applying Contract Provisions
Detailed rules for applying the provisions of this Law relating to supplies, works and services contracts, in particular the conditions for classifying and admitting contractors to participate in tenders, shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.(1)
1. See Decree No. 2866 of 16 December 1959 on the tender system and Decree No. 3688 of 25 January 1966 defining the conditions for participation in public contract execution.
Definition of Materials Accounting
Materials accounting covers all the entries and documents necessary for establishing the inventory of materials owned by public administrations and for recording their movements.
Application of Materials Accounting to All Public Administrations
All public administrations must maintain materials accounts. All institutions subject to State supervision must also maintain materials accounts that enable this supervision to be exercised.
Liability of the Materials Custodian or User
Any person tasked with the safekeeping or use of the materials referred to in Article 214 of this Law shall be financially liable for them. The same liability may also be imposed on officials tasked with maintaining and supervising materials accounts.
Territorial Scope of Materials Accounting
The application of the provisions of this chapter shall be limited to materials located within Lebanese territory or in Lebanese missions abroad. It shall not apply to equipment of active service units or to equipment used on naval or air vessels.
Materials Accounting Decree
Detailed rules for applying the provisions of this chapter shall be established by decree adopted in the Council of Ministers on the proposal of the Minister of Finance.
1. Detailed rules for applying this chapter were established by Decree No. 8620 of 12 June 1996.
Municipal Provisions
The conditions for applying this Law to municipalities shall be established by decrees issued on the proposal of the Ministers of Interior and Finance.
1. Funds belonging to municipalities under the Law of 4 August 1954 were made subject to the provisions of the Public Accounting Law by Article 1 of Decree No. 12915 of 3 June 1963, which reads: 'Funds belonging to municipalities under the Law of 4 August 1954 shall be subject to the provisions of the Public Accounting Law with regard to the stages of committing, liquidating, issuing payment orders for and paying expenditure, and shall be exempt from the annual budget rule.'
Subsection 6Public Institutions
Public Institutions
Provisions for Public Institutions
The conditions for applying this Law to independent services and other public institutions shall be established by decrees issued on the proposal of the Minister of Finance and the supervisory minister.
2. Decree No. 15934 of 31 March 1964 (application of the Public Accounting Law to the Council for Development and Reconstruction projects): Article 1 - The Council for Development and Reconstruction shall be subject to the provisions of the draft law enacted by Decree No. 14969 of 31 December 1963, in all matters not inconsistent with the provisions of the draft law enacted by Decree No. 6839 of 15 June 1961.
Section 6Miscellaneous Provisions
Miscellaneous Provisions
Deposit of Funds with Banque du Liban
All public funds defined in Article 2 of this Law must be deposited in the account opened with Banque du Liban in the name of the general Treasury. The date of application of this article with respect to municipalities and their affiliated public institutions shall be established by decree on the proposal of the Ministers of Interior and Finance.
Amended 1966
Special Accounts for Certain Public Law Persons
Public administrations, municipalities, public institutions and legal persons referred to in Article 2 of this Law are prohibited from opening accounts in private banks or opening a special account in Banque du Liban.(1)
1. Notwithstanding any other provision and in particular the provisions of the Public Accounting Law and its amendments and the provisions of the Money and Credit Law and its amendments, public administrations with annexed budgets, public institutions, municipalities and other public law persons were authorised to open independent current accounts in Banque du Liban pursuant to Article 3 of Law No. 87/49 of 21 November 1987 on the amendment of certain provisions of the Public Accounting Law.
Amended 1966
Special Accounts in the Treasury Service Records
A special account in the name of each of the entities referred to in the preceding article shall be opened in the records of the Treasury Service of the Ministry of Finance.
2. See Decree No. 13684 of 23 August 1963 and Decree No. 16573 of 5 June 1964 on directing the accounts of administrations and public institutions to the Treasury cashbox.
Amended 1966
Maximum Amounts that May Be Retained in Special Cashboxes
The provisions relating to the maximum amounts that each of them may retain in its own cashboxes, and the procedures for activating the accounts referred to in Article 244 above, shall be established by decision of the Minister of Finance, or by joint decision of the Ministers of Finance and Interior for municipalities and municipal public institutions: - Public administrations, municipalities and public institutions referred to in this Part shall receive revenue accruing to them. Payment operations shall be effected through their own cashboxes if their value does not exceed a maximum established by decision of the Minister of Finance, or by joint decision of the Ministers of Finance and Interior for municipalities and municipal public institutions, and shall be paid through the Treasury cashbox if they exceed this limit. - Administrations and public institutions that do not have their own cashboxes shall carry out all receipt and payment operations through the Treasury cashbox.
Amended 1966
Prohibition on Suspending any Payment Operation from a Special Cashbox
The Treasury Service may not suspend any payment operation initiated by one of the entities holding a special account in its records, as long as that entity has a sufficient balance in that account.
Amended 1966
Maintenance of Accounts and Entries in Special Cashboxes
Detailed rules for applying Articles 242 and 246 of this Law, in particular those relating to the maintenance of accounts, organisation of entries, form of registers and printed materials, the method of the Treasury's payment of expenditure for administrations and institutions holding accounts in its records, and the time limits within which financial transactions must be completed, shall be established by decision of the Minister of Finance or by joint decision of the Ministers of Finance and Interior for municipalities and municipal public institutions.
Amended 1966
Repeal of Conflicting Provisions
Legislative Decree No. 117 of 12 June 1959 and its amendments, Decrees No. 13665 and 13684 of 23 August 1963, and the Law of 4 January 1945 are hereby repealed, as is every other provision conflicting with the provisions of this Law or inconsistent with its content.
Amended 1966
Publication and Entry into Force
This Law shall be published in the Official Gazette and shall enter into force as of 31 December 1963.