Instruction No. 15/2018 of November 19 on Foreign Currency Policy – Sale of Foreign Currency to Exchange Offices and Payment Service Companies

INSTRUCTION NO. 15/2018 of November 19

SUBJECT: FOREIGN CURRENCY POLICY – Sale of Foreign Currency to Exchange Offices and Payment Service Companies

Whereas it is necessary to amend the procedures for the sale of foreign currency to Non-Bank Financial Institutions, namely Exchange Offices and Payment Service Companies that carry out value transfer activities (Value Transfer Companies); Pursuant to the combined provisions of Articles 64 and 94 of Law No. 12/15, of June 17 – the Framework Law for Financial Institutions, paragraph q) of Article 2 of Law No. 5/05, of July 29 – the Payment Systems Act, and Articles 3 and 51 of Law No. 16/10, of July 15 – the Bank of Angola Act;

I HEREBY DETERMINE:

1. Access to Foreign Currency Purchases by Exchange Offices and Value Transfer Companies 1.1. Access to foreign currency purchases by Exchange Offices and Value Transfer Companies is subject to the full and permanent compliance with applicable legislation and regulations governing their activities.

CONTINUATION OF INSTRUCTION NO. 15/2018 Page 2 of 4 1.2. Whenever compliance with the preceding point is at stake, the Bank of Angola shall instruct commercial banks to suspend the sale of foreign currency to the entities covered by this Instruction, until the reason for such decision is remedied.

2. Request for Foreign Currency Purchases by Exchange Offices and Value Transfer Companies from Commercial Banks 2.1. Exchange Offices and Value Transfer Companies must, whenever they wish to purchase foreign currency, submit requests to the Commercial Banks with which they regularly maintain commercial relations, specifying the currency and amount sought. 2.2. The total weekly amount requested by each Exchange Office or Value Transfer Company from Commercial Banks must not exceed their own funds.

3. Sales Procedures by the Bank of Angola to Commercial Banks 3.1. Commercial banks must insert the amount requested by Exchange Offices and Value Transfer Companies into their weekly needs statement upon receiving the request. 3.2. The Bank of Angola sells foreign exchange to Commercial Banks in accordance with the provisions governing auction procedures, and Commercial banks must allocate the foreign currency to their clients, Exchange Offices and Value Transfer Companies, under the same terms as for other clients reflected in the needs statements, subject to the conditions set out in paragraph 4 of this Instruction. 3.3. For reasoned market balance considerations, the Bank of Angola may accommodate specific demand from Non-Bank Financial Institutions that have been included in the needs statements.

CONTINUATION OF INSTRUCTION NO. 15/2018 Page 3 of 4 4. Sales Conditions by Commercial Banks to Exchange Offices and Value Transfer Companies 4.1. Commercial banks may only provide foreign currency in physical banknotes to Exchange Offices, and must debit the national currency account of these institutions upon delivery of the physical banknotes. 4.2. Commercial banks may only provide foreign exchange to Value Transfer Companies, which must be used exclusively for transfers to overseas Remittance Service Providers with whom they work, to cover remittances executed on behalf of their clients. 4.3. In the sale of foreign currency to Exchange Offices and Value Transfer Companies, Commercial banks may charge a spread of up to 2% on the reference exchange rate published on the official portal of the Bank of Angola. 4.4. The amounts for exchange rates and commissions must be charged and paid in Kwanzas. 4.5. Commercial banks may provide banknotes to Exchange Offices and foreign exchange to Value Transfer Companies in a currency different from the one purchased from the Bank of Angola, when requested by them.

5. Conflict of Interest Commercial banks must implement processes to identify, monitor, and mitigate conflicts of interest in their relations with Exchange Offices and Value Transfer Companies, as provided in Notice No. 01/2013 of April 19.

CONTINUATION OF INSTRUCTION NO. 15/2018 Page 4 of 4 6. Sanctions Violation of the provisions established in this Instruction constitutes an offense provided for and punishable under Law No. 5/97 of June 27 – the Foreign Exchange Act, and Law No. 12/2015 of June 17 – the Framework Law for Financial Institutions, including temporary market exclusion by infringers.

7. Doubts and Omissions Doubts and omissions regarding the interpretation and application of this Instruction are resolved by the Bank of Angola.

8. Repeal Instruction No. 17/2015 of August 20 and Directive No. 2/2011 of March 31 are hereby repealed.

9. Entry into Force This Instruction enters into force on the date of its publication.

PUBLISHED. Luanda, November 20, 2018. THE GOVERNOR JOSÉ DE LIMA MASSANO