Foreign currency system is a set of principles and relationships that are given in the form of regulations governing foreign relations and economic activities and other entities at home and abroad. It has an important role in the performance of the company, and thus a role in economic development. The legal basis of the foreign exchange system is the Croatian Foreign Exchange Act. Secondary legislation in this field determines the procedure for conducting foreign policy. The measures aim to determine the degree of restrictions on capital movements between residents and non-residents, as well as the conditions and manner of using foreign means of payment and kuna between residents and between residents and non-residents. Foreign Exchange System consists of all foreign exchange transactions carried out on the foreign exchange market, and the shares are traded in foreign currencies (foreign exchange). All transactions concluded between residents and nonresidents. Since the market implies the confrontation of supply and demand, foreign exchange market implies the confrontation of supply and demand of foreign currency, which is being held foreign exchange trading by certain regulations. On this basis, the exchange rate is formed which represents the price of one unit of foreign currency expressed in number of units of foreign currency. The foreign exchange market has no particular geographical location and business hours, and most of the world's trade is carried out in the United States, Japan and the UK. The most common currencies in trade are the US dollar, euro and yen. Croatia is a young and open country that since its independence turned model of market economy. In the early 90s, inflation was removed devaluation of 20%, and since then the Croatian kuna on foreign exchange markets considered overvalued.