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2019-07-04

Directive No. 06-DCC-DMA-2019, of July 5

The Bank of Angola issues this directive to establish criteria and conditions for allocating limits on Documentary Credits for Imports through monthly quantity auctions. Commercial banks must participate by demonstrating prior issuance exceeding 50% of their previous limit, prioritizing equipment and raw materials, and adhering to a minimum 60-day settlement period from the Bill of Lading date. The regulation prohibits offshore trading company beneficiaries, commits the central bank to selling foreign currency at spot rates for advances and remaining balances, and takes effect on August 1, 2019.

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Banco Nacional de Angola

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GOVERNOR

Whereas it is necessary to define the criteria for allocating limits for the issuance of Documentary Credits for Imports (DCIs) under quantity auctions conducted in accordance with Instruction No. 19/2018 of December 3, as well as certain terms and conditions applicable to DCIs;

This directive serves to establish the following:

  1. The Bank of Angola (BoA) announces monthly the amount to be allocated to quantity auctions for the issuance of DCIs.

  2. Commercial banks with requests from their clients to issue DCIs must participate in the quantity auctions, indicating to the BoA their desired amount, provided that, as stipulated in numbers 3 and 4.2.6 of Instruction 19/2018:

a) They meet the access conditions for foreign currency sales sessions; b) They have previously issued DCIs in an amount exceeding 50% of the limit allocated in the preceding quantity auction.

DIRECTIVE NO. 06/DCC/DMA/2019 ORIGIN: Foreign Exchange Control Department (DCC) Asset Markets Department DATE 05/07/2019 SUBJECT: FOREIGN EXCHANGE POLICY

  • Documentary Credits for Imports
  • Allocation of limits by the Bank of Angola
  • Applicable Terms and Conditions

DIRECTIVE NO. 06/DCC/DMA/2019 Page 2 of 3

  1. The total amount to be allocated shall be assigned to each Commercial Bank:

a) Based on its market share in corporate sector deposits, and limited to the needs reported by each for the issuance of DCIs; b) Considering the execution rate of the previously allocated limit.

  1. The issuance of letters of credit whose beneficiaries are trading companies in offshore jurisdictions is prohibited.

  2. The payment terms of DCIs must establish a minimum settlement period of 60 (sixty) days from the date of the Bill of Lading.

  3. Commercial banks must prioritize operations involving equipment and raw materials within economic development programs.

  4. The BoA commits to selling foreign currency for the settlement of letters of credit issued under quantity auctions in accordance with No. 4.2.1 of Instruction 19/2018, namely:

a) On the auction date, an amount to be determined at the spot exchange rate, which may be used for settling advances or establishing collateral; b) Up to 5 (five) days before the payment date of each shipment, the remaining amount upon submission of proof of document negotiation, at the spot exchange rate.

  1. Commercial banks must follow the procedures established in Directive No. 03/FCCD/2018 of October 26 for inserting DCIs into the Needs Maps for the purpose of purchasing foreign exchange from the BoA for their settlement.

DIRECTIVE NO. 06/DCC/DMA/2019 Page 3 of 3

  1. Doubts and omissions arising from the interpretation and application of this Directive shall be clarified by the Bank of Angola.

  2. This Directive enters into force on August 1, 2019.

Luanda, July 5, 2019. Foreign Exchange Control Department

Veloso Ndunguini Filipe Pedro -Director- Asset Markets Department

Tânia Patrícia de Oliveira Mendes Lopes -Director-

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