CIEX No. 65/2019: Requirements for Participation in Open Market Operations and Fiscal Policy Securities Operations via Electronic Auction System

[Logo: Central Bank of Bolivia]

CENTRAL BANK OF BOLIVIA
PLURINATIONAL STATE OF BOLIVIA

EXTERNAL CIRCULAR

La Paz, October 29, 2019
CIEX No. 65/2019

FROM: GENERAL MANAGEMENT
MONETARY OPERATIONS MANAGEMENT

TO: MULTIPLE BANKS, SME BANKS, HOUSING FINANCIAL ENTITIES, SAVINGS AND CREDIT COOPERATIVES, DEVELOPMENT FINANCIAL INSTITUTIONS, STATE FINANCIAL ENTITIES OR WITH MAJORITY STATE PARTICIPATION, BROKERAGE AGENCIES, INVESTMENT FUND MANAGEMENT COMPANIES, INSURANCE AND REINSURANCE COMPANIES, PENSION FUND ADMINISTRATORS

SUBJECT: REQUIREMENTS TO PARTICIPATE IN OPEN MARKET OPERATIONS AND OPERATIONS WITH SECURITIES FOR FISCAL POLICY PURPOSES THROUGH THE ELECTRONIC AUCTION SYSTEM (EAS)

Ladies and Gentlemen:

The Central Bank of Bolivia (BCB) communicates to entities holding a license of operation granted by the Financial System Supervision Authority (ASFI) or the Pension and Insurance Supervision and Control Authority (APS) or another competent authority, the requirements to participate in operations with the BCB under auction and money desk mechanisms.

I. Direct Participants and Requirements

Direct participants are entities authorized by the BCB to carry out operations to purchase public securities in the primary market and repurchase agreements with public securities and securities from private issuers, under auction and money desk mechanisms. These may act as intermediaries for other participants.

Requirements for Direct Participants

• Signature of the Electronic Auction Contract for Securities and Repurchases, for which a written request must be sent to the Monetary Operations Management of the BCB attaching the following documents:

The BCB contributes to the economic and social development of the country Ayacucho Street corner Mercado - Telephone: (591-2) 2409090 - Fax: (591-2) 2661590 www.bcb.gob.bo - bancocentraldebolivia@bcb.gob.bo - La Paz - Bolivia

[Logo: Central Bank of Bolivia]

CENTRAL BANK OF BOLIVIA
PLURINATIONAL STATE OF BOLIVIA

• Simple copy of the Entity's Deed of Constitution and the Deed of the last Public Deed of Modification, if applicable.
• Legalized copy of the Power of Attorney Deed for Legal Representation of the person(s) who will sign the contract.
• Simple copy of the Identity Card of the person(s) who will sign the contract.
• Simple copy of the electronic certification of registration in the National Taxpayer Registry with its respective Tax Identification Number (NIT).
• Simple copy of the Commercial Registration Certificate or Update of Registration, as applicable, issued by the Commercial Registry granted to FUNDEMPRESA, in the case of commercial companies.
• Simple copy of the Administrative Resolution issued by ASFI or APS granting the License of Operation.

If direct participants have the signed Electronic Auction Contract for Securities and Repurchases, submission of the aforementioned documentation will not be necessary.

II. Operations with Public Securities

Direct Participants:

Multiple Banks, SME Banks, Housing Financial Entities, Savings and Credit Cooperatives, Development Financial Institutions, State Financial Entities or with Majority State Participation, Brokerage Agencies, Investment Fund Management Companies, Insurance and Reinsurance Companies, Pension Fund Administrators, and other entities authorized for operation by the competent authority, unless restrictions are imposed by the regulations issued by the corresponding regulatory entities.

Indirect Participants (Third Parties) and Requirements:

These consist of non-financial legal entities, investment funds, and natural persons.

The BCB contributes to the economic and social development of the country Ayacucho Street corner Mercado - Telephone: (591-2) 2409090 - Fax: (591-2) 2661590 www.bcb.gob.bo - bancocentraldebolivia@bcb.gob.bo - La Paz - Bolivia

[Logo: Central Bank of Bolivia]

CENTRAL BANK OF BOLIVIA
PLURINATIONAL STATE OF BOLIVIA

They operate with the BCB through direct participants, through whom they can carry out operations to purchase public securities in the primary market and repurchase agreements with public securities, under auction and money desk mechanisms. The direct participant must request in writing to the Monetary Operations Management of the BCB to include as their third party a specific non-financial legal entity, investment fund, or natural person, attaching the following documents:

a) Non-financial Legal Entities and Investment Funds

• Simple copy of the Entity's Deed of Constitution and the Deed of the last Public Deed of Modification, if applicable.
• Simple copy of the electronic certification of registration in the National Taxpayer Registry with its respective Tax Identification Number (NIT), if applicable.
• Simple copy of the Commercial Registration Certificate or Update of Registration, as applicable, issued by the Commercial Registry granted to FUNDEMPRESA, in the case of commercial companies, if applicable.

b) Natural Persons¹:

• Copy of Identity Card.

III. Repurchase Operations with Securities from Private Issuers

Direct Participants:

Brokerage Agencies with a license of operation granted by the Financial System Supervision Authority (ASFI).

These entities may carry out repurchase operations with the BCB, on their own account and/or on behalf of third parties, using securities expressly authorized by the BCB Board of Directors and registered in the Securities Market Registry.

¹ Upon expiration, the holder must present the Certificate of Registration from the National Tax Service with security code, valid for 5 calendar days from the date of certification, and the main or secondary activity that expressly states "capital placement". Otherwise, the BCB will act as a withholding agent.

The BCB contributes to the economic and social development of the country Ayacucho Street corner Mercado - Telephone: (591-2) 2409090 - Fax: (591-2) 2661590 www.bcb.gob.bo - bancocentraldebolivia@bcb.gob.bo - La Paz - Bolivia

[Logo: Central Bank of Bolivia]

CENTRAL BANK OF BOLIVIA
PLURINATIONAL STATE OF BOLIVIA

Indirect Participants and Requirements:

Multiple Banks, SME Banks, Housing Financial Entities, Savings and Credit Cooperatives, Development Financial Institutions, State Financial Entities or with Majority State Participation, Investment Fund Management Companies, Investment Funds, Insurance and Reinsurance Companies, Pension Fund Administrators, and other entities authorized for operation by the competent authority, unless restrictions are imposed by the regulations issued by the corresponding regulatory entities.

The direct participant must request in writing to the Monetary Operations Management of the BCB to include as their third party a specific entity, sending a note requesting its registration, attaching a letter from the clearing entity authorizing the BCB to perform debits and credits for repurchase operations carried out by the Brokerage Agency on behalf of the third party.

Additionally, the following documents must be attached:

a) Entities with a license of operation granted by ASFI, APS, or another competent authority.

• Simple copy of the Entity's Deed of Constitution and the Deed of the last Public Deed of Modification, if applicable.
• Simple copy of the electronic certification of registration in the National Taxpayer Registry with its respective Tax Identification Number (NIT).
• Simple copy of the Commercial Registration Certificate or Update of Registration, as applicable, issued by the Commercial Registry granted to FUNDEMPRESA, in the case of commercial companies.
• Simple copy of the Administrative Resolution issued by ASFI or APS granting the License of Operation.

b) Investment Funds

• Simple copy of the Entity's Deed of Constitution and the Deed of the last Public Deed of Modification, if applicable.

The BCB contributes to the economic and social development of the country Ayacucho Street corner Mercado - Telephone: (591-2) 2409090 - Fax: (591-2) 2661590 www.bcb.gob.bo - bancocentraldebolivia@bcb.gob.bo - La Paz - Bolivia

[Logo: Central Bank of Bolivia]

CENTRAL BANK OF BOLIVIA
PLURINATIONAL STATE OF BOLIVIA

If indirect participants have the Electronic Auction Contract for Securities and Repurchases or are already registered as third parties with the BCB, submission of the documentation indicated in items a) and b) above will not be necessary.

External Circular SGDB No. 038/2018 dated October 26, 2018, is hereby repealed.

Sincerely,

[Signature]
ABEL SANJINES ALVAREZ
MONETARY OPERATIONS MANAGER
CENTRAL BANK OF BOLIVIA

[Signature]
CARLOS A. COLODRO LÓPEZ
GENERAL MANAGER a.i.
CENTRAL BANK OF BOLIVIA

[Signature]
CACL/AFSA/ltgm/taab/nlsc
C.c. Archive

The BCB contributes to the economic and social development of the country Ayacucho Street corner Mercado - Telephone: (591-2) 2409090 - Fax: (591-2) 2661590 www.bcb.gob.bo - bancocentraldebolivia@bcb.gob.bo - La Paz - Bolivia