Central Bank of Bolivia

Board of Directors

BOARD RESOLUTION NO. 012/2015

SUBJECT: MONETARY OPERATIONS MANAGEMENT – APPROVES MODIFICATIONS TO THE NEW REGULATIONS ON SECURITIES IN CUSTODY.

VISTOS:

• Law No. 1670 of the Central Bank of Bolivia of October 31, 1995.
• The Statute of the Central Bank of Bolivia approved by Board Resolution No. 128/2005 of October 21, 2005, and its modifications.
• The Regulations on Securities in Custody, approved by Board Resolution No. 045/2009.
• Report BCB-GOM-STES-INF-2015-3 of January 9, 2015, from the Monetary Operations Management.
• Report BCB-GAL-SANO-INF-2015-21 of January 9, 2015, from the Legal Affairs Management.
• Report BCB-GOM-STES-INF-2015-9 of January 15, 2015, from the Monetary Operations Management.
• Report BCB-GAL-SANO-INF-2015-30 of January 15, 2015, from the Legal Affairs Management.

CONSIDERING:

• That Article 29, subsection c) of Law No. 1670, empowers the CBB to receive securities in custody from the State, as well as to delegate their custody to other financial intermediation entities.
• That the Regulations on Securities in Custody aim to establish the rules applicable to the receipt and return of securities deposited with the CBB.
• That within the framework of the aforementioned, the Board of Directors of the CBB, pursuant to Law No. 1670 in its Article 54, subsections a) and o); and as provided by the Statute in its Article 11, items 2) and 29), is empowered to issue norms and adopt general decisions that are necessary for it to fulfill the functions, competencies, and powers assigned by the Law.
• That the Monetary Operations Management, in its Report BCB-GOM-STES-INF-2015-3 of January 9, 2015, recommends the modification of the Regulations on Securities in Custody.
• That the Legal Affairs Management, in its Report BCB-GAL-SANO-INF-2015-21 of January 9, 2015, recommends submitting to the Board the proposal for the Regulations on Securities in Custody according to the technical criterion expressed in Report BCB-GOM-STES-INF-2015-3.
• That the Monetary Operations Management, in its Report BCB-GOM-STES-INF-2015-9 of January 15, 2015, presents the new proposal for the modification of the Regulations on Securities in Custody and recommends its consideration by the Board, prior to the corresponding legal analysis.
• That the Legal Affairs Management, in its Report BCB-GAL-SANO-INF-2015-30 of January 15, 2015, recommends submitting to the Board the complements to the Regulations on Securities in Custody proposed according to the technical criterion expressed in Report BCB-GOM-STES-INF-2015-9, recommending that they be sent to the Board for approval.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Approve the modification of Article 1 of the Regulations on Securities in Custody in the following terms:

SAYS:

Article 1. (Object of the Regulations). These Regulations aim to establish rules for:

1. The receipt and return of securities in custody of authorized entities of the Public Sector, within the framework established in Title II of Chapter V of Law No. 1670.
2. The receipt and return of securities in custody of banks and financial intermediation entities within the framework established in Title II of Chapter VI of Law No. 1670.
3. The receipt and return of securities in custody of the different areas of the CBB.

MUST SAY:

“Article 1. (Object of the Regulations). These Regulations aim to establish rules for:

1. The receipt, custody, and return of securities of authorized entities of the Public Sector, within the framework established in Title II of Chapter V of Law No. 1670.
2. The receipt and return of securities in custody of banks and financial intermediation entities within the framework established in Title II of Chapter VI of Law No. 1670.
3. The receipt and return of securities in custody of the different areas of the CBB.
4. The receipt, custody, and return of machinery or equipment.”

Article 2.- Approve the modification of Article 3 of the Regulations on Securities in Custody in the following terms:

SAYS:

Article 3. (Terms and Definitions). The terms and definitions applicable to these Regulations are the following:

1. Deposit or Withdrawal Act, document signed by the applicants as proof of the receipt or return of securities in custody.
2. CBB, Central Bank of Bolivia.
3. Applicant, entity of the public sector, the financial system, or area of the CBB that requests the deposit or withdrawal of securities in custody.
4. Authorized Signatories, persons designated by the Applicants to participate in the procedures for receipt and return of securities in custody and to sign the respective documents.
5. GOM, Monetary Operations Management.
6. STES, Treasury Sub-Management.
7. Securities in Custody, securities subject to deposit in custody at the CBB that correspond to Seizures, Documents and Historical Objects, Financial Securities, and Numismatic Securities.
   • a) Seizures. Drug samples not exceeding ten grams, money, jewelry, and securities seized, as determined in Law No. 1008.
   • b) Documents and Historical Objects. Manuscripts, acts, publications, and other printed materials with historical value. The Presidential Medal, the Vice-Presidential Medal, the Medal of the President of the Senate, and other jewelry with historical value.
   • c) Financial Securities. Promissory notes, bonds, shares, bills, guarantee certificates, and any other value regulated by the national legal framework, valid, issued, or endorsed in favor of an entity of the public sector or the financial system.
   • d) Numismatic Securities. Specimens and collections of banknotes and coins, Bolivian and foreign medals with numismatic value, matrices, plates, dies, or other objects used in the manufacture of monetary material.

MUST SAY:

“Article 3. (Terms and Definitions). The terms and definitions applicable to these Regulations are the following:

1. Deposit or Withdrawal Act, document signed by the applicants as proof of the receipt or return of securities in custody.
2. CBB, Central Bank of Bolivia.
3. Applicant, entity of the public sector, the financial system, or area of the CBB that requests the deposit or withdrawal of securities in custody.
4. Authorized Signatories, persons designated by the Applicants to participate in the procedures for receipt and return of securities in custody and to sign the respective documents.
5. GOM, Monetary Operations Management.
6. STES, Treasury Sub-Management.
7. Assets and Securities in Custody, securities subject to deposit in custody at the CBB that correspond to: Seizures, Documents and Historical Objects, Financial Securities, Numismatic Securities, and Machinery or Equipment.

• a) Seizures. Drug samples not exceeding ten grams, money, jewelry, and securities seized, as determined in Law No. 1008.
• b) Documents and Historical Objects. Manuscripts, acts, publications, and other printed materials with historical value. The Presidential Medal, the Vice-Presidential Medal, the Medal of the President of the Senate, and other jewelry with historical value.
• c) Financial Securities. Promissory notes, bonds, shares, bills, guarantee certificates, and any other value regulated by the national legal framework, valid, issued, or endorsed in favor of an entity of the public sector or the financial system.
• d) Numismatic Securities. Specimens and collections of banknotes and coins, Bolivian and foreign medals with numismatic value, matrices, plates, dies, or other objects used in the manufacture of monetary material.
• e) Machinery or Equipment. Computer equipment, servers, and others.

8. Force Majeure: External, unforeseen, or inevitable obstacle that originates a force foreign to man that prevents the fulfillment of the obligation (fires, floods, and other natural disasters).
9. Fortuitous Event: Internal obstacle attributable to man, unforeseen or inevitable, relating to the conditions themselves in which the obligation had to be fulfilled (civil commotions, strikes, blockades, revolutions, etc.).
10. Vault Environment: The closed and protected space of the CBB that has security measures for the safeguarding of assets or securities.”

Article 3.- Approve the incorporation of a new Chapter to the Regulations on Securities in Custody in the following terms:

“CHAPTER IV
PROCEDURE FOR THE RECEIPT, CUSTODY, AND RETURN OF MACHINERY OR EQUIPMENT

Article 21. (Deposits in Custody of Machinery or Equipment). The CBB may receive machinery or equipment in custody only from Public Sector Entities.

Article 22. (Request). The Public Entity that requires making a deposit or withdrawal of machinery or equipment at the CBB must send to the President of the CBB a request note signed by its highest authority or legal representative authorized for this purpose and containing the following information:
a) Description of the machinery or equipment to be custodied or withdrawn.
b) Specification of dimensions.
c) Duration of the deposit.
d) Name, position, and identity card number of each of the persons designated as authorized signatories of the Applicant, to make the deposit or withdrawal and sign the corresponding Deposit or Withdrawal Act.
e) In case of requiring the participation of a Notary Public, the name and identity card number of the same must be presented. It is the responsibility of the requesting entity to specify its need to have a notarized act for the deposit or withdrawal of machinery or equipment.
f) The value of the machinery or equipment.
g) Insurance Policy.
h) In case of withdrawal, a copy of the Deposit Act or the deposit code must be attached.

Article 23. (Analysis and Acceptance of the Deposit Request). The request for deposit of machinery or equipment will be referred to the GOM and the Legal Affairs Management (GAL) to issue the corresponding technical and legal reports, which will establish both the technical and legal feasibility to accept the request, which will be formalized through the signing of an Inter-institutional Agreement.

The GAL will draft the Inter-institutional Agreement, which, together with the Technical and Legal Reports, will be submitted to the Board for consideration so that this instance, by majority vote of the members present, can authorize the President of the CBB to sign said Agreement.

The procedure for the withdrawal of the machinery or equipment will be governed by the terms of the Inter-institutional Agreement signed.”

# Central Bank of Bolivia
## Board of Directors

//6. B.D. No. 012/2015

**Article 24. (Programming of the Operation).** After signing the Inter-institutional Agreement, the Manager of the GOM will agree in writing with the Applicant the time and date for the receipt of the machinery or equipment in Custody or, if applicable, its withdrawal, and will designate the STES personnel who will participate in the operation, among which must necessarily include the Treasury Sub-Manager or the Head of the Treasury Department.

**Article 25. (Operation).** On the agreed date and time for receipt or withdrawal, the STES will verify the following requirements:

a) The correspondence of the machinery or equipment with the declaration made by the Applicant. In case of withdrawal, correspondence with the data recorded in the Deposit Act must also be verified additionally.

b) The condition of the machinery or equipment so that its custody does not represent a risk to the environments or personnel of the CBB.

c) The correct identification of the Applicant's representatives, including, when applicable, the Notary Public mentioned in Article 2 of this Chapter.

If any of the requirements are not met, the STES personnel will suspend the process of receipt or withdrawal of the machinery or equipment in custody.

**Article 26. (Entry of Personnel).** The entry of authorized personnel from the requesting Public Entity into the vault environment, to make a deposit in custody or withdrawal of machinery or equipment, must be framed within the CBB's security protocols.

**Article 27. (Environments).** The CBB must provide specific places in the vault environment (security areas) for the custody of the machinery or equipment.

**Article 28. (Deposit or Withdrawal Act).** Once the requirements are met, the attendees will sign a Deposit or Withdrawal Act, as appropriate, prepared by the STES, which includes at least the following information:

a) Date and time of receipt or return.

b) Description of the machinery or equipment in Custody.

c) Identification of the participants.

The GOM, through the STES, will deliver a copy of the Deposit or Withdrawal Act to the persons authorized by the Applicant.

**Article 29. (Notarized Acts).** The Applicant may raise, under its responsibility and cost, Notarized Acts of the deposit and/or withdrawal of the machinery or equipment in Custody, prior communication of this determination to the GOM, as provided in Article 2 of this chapter.

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//7. B.D. No. 012/2015

**Article 30. (Registration).** The GOM, through the STES, will register the deposit or withdrawal of the machinery or equipment in custody at the CBB.

**Article 31. (Force Majeure and Fortuitous Event).** The CBB will not have the obligation to return or compensate the value received in custody in cases of force majeure or fortuitous event, when there is loss, destruction, obsolescence, deterioration, or other damage to it.

**Article 32. (Insurance).** The Public Entity requesting the deposit of machinery or equipment in the CBB's vault environments must attach to the request an all-risk insurance policy, in which it is specified that it has coverage for "Equipment out of the Insured's control" and whose Annex specifically includes the machinery or equipment that is deposited in custody. Said insurance must remain valid during the time the machinery or equipment is in the CBB's facilities, and the Public Entity must send a copy of the policy in each renewal it makes.”

**Article 4.-** These Regulations will enter into force from the date of approval of this Board Resolution.

**Article 5.-** The Presidency and the General Management are charged with the execution and compliance of this Resolution.

La Paz, January 15, 2015

Marcelo Zabala Estrada

Abraham Pérez Alandia

Reynaldo Yujra Segales

Ronald Polo Rivero

Sergio Velarde Vera