Central Bank of Bolivia

Board of Directors

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BOARD RESOLUTION NO. 131/2017

SUBJECT: FINANCIAL ENTITIES MANAGEMENT - THE REGULATION ON THE TRANSPORT OF MONETARY MATERIAL AND/OR VALUABLES

VIEWED:

• The Political Constitution of the State of February 7, 2009.
• Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia.
• Law No. 393 of August 21, 2013, on Financial Services.
• Law No. 734 of April 8, 1985, Organic Law of the National Police.
• The Statute of the Central Bank of Bolivia approved by Board Resolution No. 128/2005 of October 21, 2005, and its modifications.
• The Regulation on the Transport of Monetary Material and/or Valuables approved through Board Resolution No. 008/2011 of January 18, 2011, and modified by Board Resolutions No. 037/2011 and No. 147/2011 dated April 12 and November 15, 2011, respectively.
• The Report from the Financial Entities Management BCB-GEF-SSPSF-DVSP-INF-2017-36 of September 20, 2017.
• The Report from the Legal Affairs Management BCB-GAL-SANO-DLBCI-INF-2017-249 of September 22, 2017.

CONSIDERING:

• That, the Political Constitution of the State establishes in its article 328 that it is an attribute of the Central Bank of Bolivia, in coordination with the economic policy determined by the Executive Branch, in addition to those indicated by Law, to regulate the payment system.
• That, pursuant to article 331 of the Political Constitution of the State, financial intermediation activities, the provision of financial services, and any other activity related to the handling, use, and investment of savings are of public interest and can only be exercised with prior authorization from the State, in accordance with the Law.
• That, Law No. 1670 of the Central Bank of Bolivia, in its articles 1, 2, and 3, states that the object of the Issuer Entity is to ensure the stability of the internal purchasing power of the national currency and, within the framework of its administrative, technical, financial, and specialized regulatory competence, formulates policies of general application in monetary, exchange, and payment system matters.

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• That, articles 30 and 37 of the aforementioned Law stipulate that entities of the financial intermediation and services system, whose operation is authorized by the Superintendence of Banks and Financial Entities, currently the Financial System Supervision Authority, are subject to the regulatory competence of the Central Bank of Bolivia.
• That, its article 54 subsection b) provides that it is an attribute of the Board of Directors of the Central Bank of Bolivia to regulate the administration of payment systems between authorized financial entities.
• That, Law No. 393 on Financial Services establishes in paragraph III of article 8 that the Financial System Supervision Authority will issue specific regulation and supervise its compliance within the framework of the regulation issued by the Central Bank of Bolivia in the field of the payment system.
• That, article 123 of the aforementioned Law establishes as a complementary financial service the activity of transporting monetary material and valuables.
• That, article 314 establishes that companies transporting monetary material and valuables are complementary financial service companies.
• That, article 352 establishes the operations and services that monetary material and valuables transport companies may carry out and provide. Similarly, it states that the Financial System Supervision Authority, in coordination with the Central Bank of Bolivia, will authorize the carrying out and provision of operations and services not established in the aforementioned Law and related to the field of activity.
• That, by virtue of what is established in article 136 of the Organic Law of the National Police No. 734, private organizations destined for investigation and private security may only be constituted and function with prior authorization from the General Command of the National Police, ratified by resolution of the Ministry of the Interior, currently the Ministry of Government.
• That, the Board of Directors of the Central Bank of Bolivia, in its capacity as the highest authority of the Institution, is responsible for defining its policies, specialized regulations of general application, and internal norms, and is empowered to issue norms and adopt general decisions necessary for the fulfillment of functions, as well as to regulate the administration of payment systems between authorized financial entities, competencies and powers assigned by Law to the Issuer Entity, as established in articles 44 and 54 subsections b) and o) of Law No. 1670 and articles 9, 11, and 24 of the Statute of the Central Bank of Bolivia.

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• That, the Regulation on the Transport of Monetary Material and/or Valuables and its subsequent modifications aim to regulate the service of transporting Monetary Material and/or Valuables within the scope of the payment system and the national financial system.
• That, the Report from the Financial Entities Management BCB-GEF-SSPSF-DVSP-INF-2017-36 recommends modifying the Regulation on the Transport of Monetary Material and/or Valuables with the purpose of incorporating the definitions and references established in Law No. 393 on Financial Services.
• That, the Report from the Legal Affairs Management BCB-GAL-SANO-DLBCI-INF-2017-249 states that there is no legal impediment for the Board of Directors of the Central Bank of Bolivia to consider the modification of the Regulation on the Transport of Monetary Material and/or Valuables and recommends its approval.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Approve the Regulation on the Transport of Monetary Material and/or Valuables in its III Chapters and 13 Articles, which form part of this Resolution as an annex, with effect from its approval.

Article 2.- Repeal, from the entry into force of this Resolution, Board Resolutions No. 008/2011 of January 18, 2011, No. 037/2011 of April 12, 2011, and No. 147/2011 of November 15, 2011.

Article 3.- The Presidency and General Management are charged with the execution and compliance of this Resolution.

La Paz, September 26, 2017

Pablo Ramos Sánchez

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Luis Baudoin Olea
Ronald Polo Rivero
Abraham Pérez Alandia
Sergio Velarde Vera

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ANNEX

REGULATION ON THE TRANSPORT OF MONETARY MATERIAL AND/OR VALUABLES

CHAPTER I

GENERAL PROVISIONS

Article 1 (Object). This Regulation aims to regulate the service of transporting Monetary Material and/or Valuables within the scope of the payment system and the national financial system.

Article 2 (Scope of Application). The norms contained in this Regulation shall apply to:

a) Financial entities that hold an operating license granted by the Financial System Supervision Authority-ASFI or are in the process of adaptation.

b) Operations of the Central Bank of Bolivia-BCB with Financial Intermediation Entities-EIF holding an operating license granted by the Financial System Supervision Authority-ASFI or vice versa.

c) Public or private companies that hold an operating license granted by the Financial System Supervision Authority-ASFI to provide the service of transporting Monetary Material and/or Valuables within the national territory.

d) Own transport services of Monetary Material and/or Valuables organized by Financial Intermediation Entities-EIF with prior authorization granted by the Financial System Supervision Authority-ASFI.

Article 3 (Mandatory Contracting). I. Financial entities subject to the scope of application of this Regulation must contract the services of transporting Monetary Material and/or Valuables from Monetary Material and Valuables Transport Companies that hold an operating license granted by the Financial System Supervision Authority-ASFI.

II. Financial Intermediation Entities-EIF may also organize their own service for transporting Monetary Material and/or Valuables with prior authorization from the Financial System Supervision Authority-ASFI.

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Article 4 (Definitions). For the purposes of this Regulation, the following definitions are established:

a) Contractor: The financial entity and/or general public that contracts the services of transporting Monetary Material and/or Valuables.

b) Vault Custody of Monetary Material and/or Valuables: Protection, safeguarding, and conservation of Monetary Material and/or Valuables.

c) Financial Entity: Financial Intermediation Entity-EIF or complementary financial services company authorized by the Financial System Supervision Authority-ASFI to carry out financial intermediation activities and/or provide complementary financial services.

d) Financial Intermediation Entity-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT: Financial Intermediation Entity-EIF holding an operating license granted by the Financial System Supervision Authority-ASFI, which organizes its own transport and custody service for Monetary Material and/or Valuables to exclusively cover its own needs.

e) Monetary Material and Valuables Transport Company-ETM: A public or private legal entity constituted as a complementary financial services company, with an operating license to routinely carry out operations for transporting Monetary Material and Valuables destined for financial entities and the general public.

f) Monetary Material: Banknotes and coins that the Central Bank of Bolivia-BCB put into circulation and those issued by other central banks of countries or economic zones that circulate within the national territory.

g) Complementary Financial Services: Financial leasing, factoring, warehousing, temporary safekeeping of goods or merchandise belonging to others, clearing and settlement, administration and supply of credit and operational risk information, transport of money and valuables, administration of electronic cards, currency exchange, transfers and remittances, and financial services through mobile devices, and others that the Financial System Supervision Authority-ASFI may identify and incorporate into the scope of regulation and supervision.

h) Transport of Monetary Material and/or Valuables: The activity of physical transfer of Monetary Material and/or Valuables from one geographic point to another within the local and national scope.

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i) Valuables: Securities, assets subject to physical transport, and other objects or documents that represent value for the service user, which includes in an illustrative and non-limiting manner works of art, jewelry, precious metals, property titles, books, printed and/or digital manuscripts with historical value, and other documents or objects to which the contractor of the transport service assigns a specific value.

Article 5 (Importation of New Monetary Material). The transport for the purpose of importing new monetary material is excluded from the application of this Regulation, which shall be governed by what is stipulated in the acquisition contracts for monetary material signed by the Central Bank of Bolivia-BCB and monetary material supplier companies.

Article 6 (Transport of Foreign Currency and Gold from and to the Abroad by the Central Bank of Bolivia-BCB). The transport of foreign currency and gold by the Central Bank of Bolivia-BCB from and to the abroad is excluded from the application of this Regulation, which shall be governed by what is stipulated by specific regulation.

CHAPTER II

ON MONETARY MATERIAL AND VALUABLES TRANSPORT COMPANIES-ETM AND FINANCIAL INTERMEDIATION ENTITIES-EIF WITH OWN TRANSPORT SERVICE OF MONETARY MATERIAL AND/OR VALUABLES-ESPT

Article 7 (Operating License for Monetary Material and Valuables Transport Companies-ETM). To provide services for transporting Monetary Material and/or Valuables as a Monetary Material and Valuables Transport Company-ETM, companies must hold an operating license issued by the Financial System Supervision Authority-ASFI.

Article 8 (Authorization to Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT). The Financial Intermediation Entity-EIF, to organize its Own Transport Service of Monetary Material and/or Valuables-ESPT, must hold authorization from the Financial System Supervision Authority-ASFI.

Article 9 (Minimum Requirements for Constitution and Obtaining License or Authorization). The Financial System Supervision Authority-ASFI will determine the requirements for the constitution and obtaining of an operating license or authorization under specific regulation, considering at least the following aspects:

a) Minimum capital amount for Monetary Material and/or Valuables Transport Companies-ETM.

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b) Operational requirements:

i. Operating authorization for the transport of Monetary Material and/or Valuables granted by the General Command of the Bolivian Police according to specific regulation, homologated by the Ministry of Government.

ii. Insurance against business risks contracted with an insurance entity authorized to operate in the Plurinational State of Bolivia, whose risk rating is at least double A or its equivalent, and which has reinsurance as required in the regulation of the Authority for Pension and Insurance Supervision and Control-APS.

iii. Contingency plans and procedures to guarantee service continuity.

c) Administrative requirements:

i. Have an Internal Operations Regulation-IOB that includes the description of the process of transporting Monetary Material and/or Valuables in all its stages, indicating the precise moment when contingency procedures begin and end, rights, obligations, and responsibilities of service users, and the procedure for determining, modifying, and disseminating tariffs for Monetary Material and Valuables Transport Companies-ETM.

Article 10 (Services).

I. Monetary Material and Valuables Transport Companies-ETM may provide the following services:

a) Transport of Monetary Material and/or Valuables within the local and national scope.

b) Vault Custody of Monetary Material and/or Valuables that, due to schedule reasons, distances, fortuitous cases, or force majeure, could not be delivered by:

i. 24 hours when the transport originates and is destined within the same city.

ii. Up to 72 hours when the transport is destined to other cities, intermediate cities, provinces, and the Monetary Material and Valuables Transport Company-ETM has appropriate environments to perform vault custody.

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iii. Custody activities carried out for a period longer than indicated must be instrumented according to what is defined by the Financial System Supervision Authority-ASFI in specific regulation.

c) Cash processing, including the selection, classification, cleaning, and counting of banknotes and coins.

d) Supplying and reloading banknotes and coins in automated teller machines.

e) Others related to the field of activity, with authorization from the Financial System Supervision Authority-ASFI in coordination with the Central Bank of Bolivia-BCB.

II. Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT may only provide the service of transporting Monetary Material and/or Valuables to exclusively cover their own needs in accordance with the regulation issued by the Financial System Supervision Authority-ASFI.

Article 11 (Obligations and Rights). The Financial System Supervision Authority-ASFI will determine the obligations and rights of Monetary Material and Valuables Transport Companies-ETM and Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT in its specific regulation.

CHAPTER III

ON SURVEILLANCE AND SUPERVISION WORKS

Article 12 (Surveillance).

I. In order to promote a safe and efficient functioning of the service of transporting Monetary Material and/or Valuables and to safeguard the efficiency of the national payment system, the Central Bank of Bolivia-BCB, in its capacity as the governing body of the payment system, through the Financial Entities Management as the operational area responsible for surveillance works, will carry out the following functions:

a) Request statistical information from Monetary Material and Valuables Transport Companies-ETM and Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT relative to their operations.

b) Others necessary for the safe and efficient functioning of the service provided by Monetary Material and Valuables Transport Companies-ETM and Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT.

II. If, in the exercise of its surveillance works, the Central Bank of Bolivia-BCB identifies indications of regulatory or operational non-compliance, it will communicate the fact to the Financial System Supervision Authority-ASFI for the corresponding process.

Article 13 (Supervision). Within the framework of Law No. 393 on Financial Services and based on this Regulation, the Financial System Supervision Authority-ASFI:

a) Will issue specific regulation for the adaptation, obtaining of operating license and/or liquidation of Monetary Material and Valuables Transport Companies-ETM, as well as for the authorization of Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT.

b) Will grant operating licenses and authorize Monetary Material and Valuables Transport Companies-ETM to carry out activities and provide services related to the field of activity, in coordination with the Central Bank of Bolivia-BCB.

c) Will carry out supervision and control, as well as periodic reviews of the contingency systems of Monetary Material and Valuables Transport Companies-ETM and Financial Intermediation Entities-EIF with Own Transport Service of Monetary Material and/or Valuables-ESPT, applying sanctions when appropriate.