Regulatory Alerts2024-09-01
Regulation No. 002/2023 on the Interbank Foreign Exchange Market (MID)
The Bank of the Republic of Burundi issued Regulation No. 002/2023 to establish and govern the Interbank Foreign Exchange Market (MID), where commercial banks conduct all foreign currency exchanges against the Burundi Franc under central bank supervision. The regulation mandates that MID operations utilize a secure, circular-defined electronic channel for submitting buy/sell offers and requires participants to report all transactions through this designated system. It further outlines the market's operating hours, settlement procedures, and the central bank's authority to publish closing rates or intervene directly in currency trading.
BANK OF THE REPUBLIC OF BURUNDI
THE DIRECTION
REGULATION NO. 002/2023 ON THE INTERBANK FOREIGN EXCHANGE MARKET, "MID" ACRONYM
The Bank of the Republic of Burundi;
Having regard to Law No. 1/34 of December 2, 2008 establishing the Statutes of the Bank of the Republic of Burundi;
Having regard to Law No. 1/17 of August 22, 2017 governing banking activities;
Having regard to Law No. 1/07 of May 11, 2018 establishing the National Payment System;
Having regard to the Foreign Exchange Regulations of September 17, 2019;
Having reviewed the Regulation of April 12, 2013 on the Interbank Foreign Exchange Market;
Enacts:
Article 1: Definition
Within the framework of this regulation, the Interbank Foreign Exchange Market (MID) is a market where participants buy and sell foreign currencies against the Burundi Franc (BIF), under the supervision of the Bank of the Republic of Burundi.
Article 2: Purpose
This regulation defines the operating conditions of the MID.
Article 3: Transactions on the MID
All foreign exchange operations between commercial banks take place on the MID.
Article 4: Market Location
The MID is a market where operations are processed via a secure information exchange channel for foreign currency buy/sell offers, as defined in an implementing circular of this regulation.
Article 5: Market Participants
Direct participants in the MID are commercial banks. Non-bank operators may request, through their banks, quotations for amounts exceeding a limit set in an implementing circular of this regulation.
The Bank of the Republic of Burundi may intervene on the MID by buying or selling foreign currencies, according to the procedures defined in an implementing circular of this regulation.
Article 6: Transaction Currency
Any currency quoted by the BRB is admitted to the MID.
Article 7: Settlement of Transactions
The settlement of transactions on the MID is carried out according to the conditions and timeframes agreed upon by the parties.
Article 8: Market Frequency
The MID operates on days and hours fixed in an implementing circular of this regulation.
Article 9: Market Operation
Transactions on the MID are processed at freely negotiated rates between participants via the channel specified in Article 4 of this regulation.
The BRB publishes the MID closing rate and may also communicate informative transaction rates during the day.
Article 10: Information Transmission
MID participants are required to transmit information on all transactions conducted on the MID via the channel specified in Article 4 of this regulation.
However, in case of unavailability of said channel, MID participants are required to transmit this information according to the procedures defined by the BRB.
Article 11: Repeal Provision
All prior provisions contrary to this regulation are repealed.
Article 11: Entry into Force
This regulation enters into force on the day of its publication in the Official Bulletin of Burundi and on the BRB website.
Done at Bujumbura, April 28, 2023
Dieudonné MURENGERANTWARI
Governor. - [Signature]
[Seal: BANK OF THE REPUBLIC OF BURUNDI, BRB, Governor]