CMN Resolution No. 4829 - Amends Rural Credit Manual Directing Resource Percentages for Pronaf and Pronamp

The Central Bank of Brazil, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the National Monetary Council, in an extraordinary session held on June 17, 2020, considering the provisions of Article 4, item VI, of the aforementioned Law, Articles 4, 14, and 21 of Law No. 4,829 of November 5, 1965, and Article 27, § 2, of Law No. 11,076 of December 30, 2004,

R E S O L V E S:

Art. 1 The Section 1 (General Provisions) of Chapter 2 (Basic Conditions) of the Rural Credit Manual (MCR) shall enter into force with the following alterations:

“2 - It is mandatory to present the geodetic coordinates (GC) for rural credit operations for working capital and investment that are linked to a delimited area of the rural property, which must:

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b) comprise the points necessary to identify the perimeter that defines the area or areas subject to the financing operation;

..........................................................” (NR)

“2-A - The borrower must communicate to the financial institution any alteration of the initially presented area, with the new GCs, and it is incumbent upon the financial institution to make the appropriate adjustments in Sicor, prohibited from altering the area in Sicor after thirty days from the date of the end of planting.” (NR)

Art. 2 Section 8 (Supervision by Remote Sensing) of Chapter 2 of the MCR shall enter into force with the following alteration:

“1 - The use of remote sensing techniques is admitted for compliance with the provisions of MCR 2-7 in the supervision of rural credit operations, observing the standards established in this Section.” (NR)

Art. 3 Section 2 (Working Capital Credits) of Chapter 3 (Operations) of the MCR shall enter into force with the following alteration:

“30 - ..........................................................

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b) upon each renewal, the financial institution is obliged to require from the borrower, at minimum, a simplified budget containing the location of the enterprise, observing the provisions of MCR 2-1-2, the activities for the new cycle, and the disbursement schedule, or authorization for the maintenance of the original location, activity, and budget, making, in all cases, the appropriate registration in the Rural Credit and Proagro Operations System (Sicor).” (NR)

Art. 4 Section 2 (Service to Members) of Chapter 5 (Credits to Agricultural Production Cooperatives) of the MCR shall enter into force with the following alterations:

“5 - ...........................................................

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b) make available, when requested by the financier, the titles originating from the sale of products on credit, for the purpose of supervising these operations.” (NR)

“6 - ...........................................................

a) only an advance on account of production received by the cooperative that meets all quality requirements and is free of any encumbrance or lien is admissible;

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d) the cooperative must deliver to the financier a list specifying, by name and registration number in the Individual Taxpayer Registry (CPF) or the National Registry of Legal Entities (CNPJ), the value of the advance to be allocated to each cooperative member, before the release of funds, observing that:

I - the value corresponding to the difference between the total financed value and the sum of advances to members reported in the list must be disqualified from the operation;

II - for the purpose of supervising these operations, any eventual divergence between the list registered in Sicor and that actually attended by the cooperative does not constitute an irregularity, provided that the documentation presented by the cooperative demonstrates that it was merely a substitution of producers or an adjustment in the volumes attended;

..........................................................” (NR)

“11 - ..........................................................

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b) present to the financier before the release of funds the list of beneficiaries by name and registration number in the Individual Taxpayer Registry (CPF) or the National Registry of Legal Entities (CNPJ), discriminating the value of the inputs to be provided to each beneficiary, observing that:

I - the value corresponding to any eventual difference between the total financed value and the sum of supplies to members reported in the list must be disqualified from the operation;

II - for the purpose of supervising these operations, any eventual divergence between the list registered in Sicor and that actually attended by the cooperative does not constitute an irregularity, provided that the documentation presented by the cooperative demonstrates that it was merely a substitution of producers or an adjustment in the volumes attended.” (NR)

“11-B - The value of the inputs provided to the cooperative member impacts the limit referred to in MCR 3-2-5.” (NR)

“13 - ..........................................................

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c) the stock of inputs and goods acquired by the cooperative with the credit resources must correspond to the balance of the debt capital, reflecting the cost of supplies to be paid and the cost of cash supplies pending amortization.” (NR)

“17 - Credit for supply to members is subject to the deadlines indicated in this manual for working capital or investment.” (NR)

“23 - The value of the credit destined for the purpose referred to in item II of letter “c” of item 1 must observe, per agricultural year, the lowest of the following limits:

..........................................................” (NR)

Art. 5 Section 2 (Mandatory) of Chapter 6 (Resources) of the MCR shall enter into force with the following alterations:

“3 - Exigibility of Mandatory Resource Allocation is the duty of the financial institution to maintain applied in rural credit operations the value corresponding to 27.5% (twenty-seven and five-tenths percent) of the value calculated in accordance with item 2, considering, for compliance with this requirement:

..........................................................” (NR)

“3-A - The exigibility referred to in item 3 shall be 25% (twenty-five percent) starting from the compliance period beginning on July 1, 2021. (NR)”

“9 - As part of Pronamp Sub-exigibility, at least 28% (twenty-eight percent) of the total resources of the exigibility must be maintained applied in working capital operations:

a) supported by the National Program for Support to the Medium Rural Producer (Pronamp), as provided for in MCR 8;

b) contracted with small and medium rural producers, classified in accordance with MCR 1-4-4-A-“a” and “b”, respectively, respecting the maximum limit of 10% (ten percent) of the percentage referred to in the main text.” (NR)

“10 - As part of Pronaf Sub-exigibility, at least 22% (twenty-two percent) of the total resources of the exigibility must be maintained applied in working capital operations supported by the National Program for Strengthening Family Agriculture (Pronaf), as provided for in MCR 10.” (NR)

Art. 6 Section 3 (Free) of Chapter 6 of the MCR shall enter into force with the following alterations:

“3 - Credits granted with free resources may involve working capital, investment, commercialization, or industrialization operations, involving any products of vegetable or animal origin, including those obtained in extractive activities.” (NR)

“4 - ...........................................................

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b) diverse productive activities on the rural property, classified as working capital, investment, industrialization, or commercialization according to the predominance of their destination.” (NR)

Art. 7 Section 4 (Rural Savings) of Chapter 6 of the MCR shall enter into force with the following alteration:

“2 - Allocation of rural savings resources is the obligation of the financial institution to maintain applied in rural credit operations a value corresponding to 59% (fifty-nine percent) of the arithmetic mean of the Value Subject to Collection (VSR) relative to rural savings deposits, calculated in the calculation period, considering for compliance with this requirement:

..........................................................” (NR)

Art. 8 Section 7 (Agribusiness Credit Note - LCA) of Chapter 6 of the MCR shall enter into force with the following alterations:

“5 - ...........................................................

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b) .............................................................

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III - acquisition of Agribusiness Credit Rights Certificates (CDCA) and Agribusiness Receivables Certificates (CRA), provided that the credit rights linked are entirely originated from transactions in which the rural producer is a direct party;

IV - acquisition of Rural Product Note (CPR) issued by a rural producer and acquired from third parties;

V - acquisition of Agricultural Deposit Certificate (CDA) and Agricultural Warrant (WA), provided they were issued in favor of a rural producer; and

VI - quotas of guarantee funds for credit operations with rural producers, at the value of the subscription, provided that the guaranteed credit operations are rural credit.” (NR)

“5-A - The titles mentioned in items 5-“b”-I, 5-“b”-III, 5-“b”-IV, and 5-“b”-V must, additionally, comply with the following requirements:

...........................................................”(NR)

Art. 9 Section 1 (Pronamp) of Chapter 8 (National Program for Support to the Medium Rural Producer – Pronamp) of the MCR shall enter into force with the following alterations:

“5 - The contracting of working capital financing with provision for simplified renewal is admitted, observing the provisions of MCR 3-2-30.” (NR)

“6 - ......................................................

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f) in case of operation renewal, the financial institution must observe the procedures described in MCR 3-2-30-“b”;

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Art. 10 Section 4 (Working Capital Credits) of Chapter 10 (National Program for Strengthening Family Agriculture – Pronaf) of the MCR shall enter into force with the following alteration:

“10 - ..........................................................

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e) in case of operation renewal, the financial institution must observe the procedures described in MCR 3-2-30-“b”;

..........................................................” (NR)

Art. 11 The following are revoked:

I - items I and II of letter “b” of item 2 of Section 1 of Chapter 2 of the MCR;

II - item 18 of Section 4 (Expenses) of Chapter 2 of the MCR;

III - the following provisions of Section 2 of Chapter 5 of the MCR:

a) letter “c” of item 11;

b) item 12;

c) items 14 and 15; and

d) item 17-A; and

IV - letters “a” and “b” of item 5 of Section 1 of Chapter 8 of the MCR.

Art. 12 This Resolution enters into force on July 1, 2020.

Roberto de Oliveira Campos Neto President of the Central Bank of Brazil