Circular 5/2004 of the Bank of Spain, of December 22, to Credit Institutions, on the Repeal of Circulars 22/1992, 1/1993, 2/1997 and 12/1998

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Circular 5/2004, of December 22, of the Bank of Spain, to credit institutions, on the repeal of Bank of Spain Circulars 22/1992, 1/1993, 2/1997 and 12/1998. (BOE of 30)

"Bank of Spain Circular 22/1992, of December 18, to registered entities, on the foreign exchange market," regulates the operation of said market, incorporating the principle of freedom of exchange rates and establishing the conditions under which foreign currency purchase and sale operations (both against pesetas and against other currencies) must be carried out, as well as the days that are to be considered business days for such purposes. Likewise, in the aforementioned Circular, the currencies subject to quotation by the Bank of Spain are determined and the obligation of said entity to publish daily the purchase and sale exchange rates of foreign currencies that it applied to the ordinary operations it carried out on its own account, which had the status of "official quotations" for the purposes of the current regulations referring to them. Finally, the fifth provision of this Circular adds a first bis provision to "Circular 8/1990, of September 7, to credit institutions, on transparency of operations and protection of the client" and modifies letters g) and h) of its fifth provision.

Consequently, said Circular 22/1992, of December 18, refers to foreign currency purchase and sale operations, both against pesetas and against other currencies. However, on January 1, 1999, the birth of the euro occurred and the disappearance of the peseta as the monetary and accounting unit of the national monetary system, as well as the attribution of exchange rate policy to the Council of the European Union, all of which has represented a radical change in the foreign exchange market, which has ceased to have a local character to pass to having a European scope. Thus, from the aforementioned January 1, 1999, the aforementioned Council of the European Union, in collaboration with the European Central Bank, the European Commission and the European Parliament, is the highest authority responsible for the exchange rate policy of the European Union. Furthermore, since the approval of this Circular 22/1992, of December 18, the operations carried out in the aforementioned foreign exchange market have evolved significantly, with a liberalization of the conditions (spot or forward, dates on which operations are carried out, etc.) under which they are executed.

On the other hand, Article 36 of "Law 46/1998, of December 17, on the introduction of the euro" regulates the publication of the official exchange rate of the euro against other currencies by the European Central Bank (by itself or through the Bank of Spain) and the publication by the latter of other quotations of the euro with respect to currencies other than those considered by the European Central Bank, for the purposes of the provisions of current legislation.

Finally, it should be noted that the first provision of "Circular 3/1999, of March 24, to credit institutions, modifying Circulars 8/1990, of September 7, on transparency of operations and protection of the client; and 1/1997, of January 31, on information on the account balances that make up the base for calculating contributions to the Deposit Guarantee Funds," has given a new wording to the first bis provision and to letters g) and h) of the fifth provision of Circular 8/1990, of September 7, 2004, cited above, which had been modified, as indicated, by the aforementioned Circular 22/1992, of December 18.

Therefore, based on all the above, it is necessary to proceed to repeal this Circular 22/1992, of December 18.

Likewise, this Circular takes the opportunity to expressly repeal "Circular 2/1997, of March 25, to registered entities, regulating information on daily foreign currency position," whose content is merely modifying (it was limited to repealing the fourth provision) of the aforementioned Circular 22/1992, of December 18, which, in turn, as indicated, is also repealed now.

Likewise, "Circular 1/1993, of January 26, on the payment regime with Colombia," is repealed, since, having ended in that year the Reciprocal Credit Agreement between the Bank of the Republic of Colombia and the Bank of Spain and having proceeded, in the meantime, to the liquidation of all pending operations, it is unnecessary to keep it in force.

Finally, the repeal of "Circular 12/1998, of December 23, on the redenomination of Bank of Spain certificates" is also established. And this is because all deposit certificates issued by the Bank of Spain have already been amortized.

Sole Provision.

Repeal of various Circulars.

From the date of entry into force of this Circular, the following Circulars are repealed:

Circular 22/1992, of December 18, to registered entities, on the foreign exchange market.

Circular 1/1993, of January 26, on the payment regime with Colombia.

Circular 2/1997, of March 25, to registered entities, regulating information on daily foreign currency position.

Circular 12/1998, of December 23, on the redenomination of Bank of Spain certificates.

Final Provision.

Entry into force.

This Circular shall enter into force on the day of its publication in the BOE.

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