Regulatory Alerts2009-12-31
Regulation (NAP) - Limits on Fees and Commissions Charged by Financial Institutions
The Central Bank of São Tomé and Príncipe (BCSTP) mandates maximum commissions and uniform exchange rates for foreign currency operations performed by authorized financial institutions. Financial entities must cap sales commissions at 2% for euros and 4% for other currencies, while internal euro purchases utilize a single published rate with no additional fees. Furthermore, authorized institutions are required to fully fulfill foreign exchange hedging requests and submit their exchange positions to maintain effective market control.
ENTRY INTO FORCE / DATE OF ISSUE (5) 01/01/2010 | 31/12/2009 Revocation Data: Central Bank of S. T. P. PROPOSER P.P.M.C. NAP PERMANENT APPLICABILITY STANDARD CODE EA 04 DOC NO. 016/2009 PAGE 1/1 .1.01111.
Subject: Limits on Fees and Commissions Charged by Financial Institutions
In accordance with NAP No. 011/2009 on the Change to the Exchange Rate Regime, and under the provisions of Articles 6 and 10 of the Exchange Law – Decree-Law No. 32/99, which grants the BCSTP authority in this matter; Thus, the BCSTP has decided to fix the aforementioned fees and commissions as indicated below:
- For the BCSTP, in its euro purchase and sale operations conducted with authorized financial institutions, the applied exchange rate is uniform, and a maximum commission of up to 1.5% is fixed for all foreign currency operations.
- For financial institutions, the maximum sales commission limit is 2% for the euro and 4% for other currencies. Entities authorized to conduct foreign exchange trading are required to publish, in a visible location, the rates to be applied in foreign currency purchase and sale operations.
- All internal euro purchase operations must, from this date, use the same rate published by the BCSTP within the framework of the Economic Cooperation Agreement and are considered a Single Rate. No commissions may be charged.
- Henceforth, all foreign exchange hedging requests from authorized financial institutions will be fully satisfied. However, for better control of the foreign exchange market, these same institutions are required to submit their exchange position, as stipulated in No. 4 of Article 2 of NAP No. 14/2009 on Marking, Exchange.