Circular CAMCO 1-117: National Payments System - Electronic Compensation Instructions for Direct Debits and Checks. Modifications to Communication A 2559

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
COMUNICACIÓN "A" 2819 17/12/98
TO FINANCIAL ENTITIES
Ref.: Circular CAMCO 1 - 117. National Payments System. Instructions for the electronic compensation of Direct Debits and Checks. Modifications to Comm. "A" 2559.

We address you in order to accompany you, in attachment, the sheets that replace those previously provided via Communication "A" 2559, which contain modifications introduced in the operational instructions for the electronic compensation of direct debits and checks.

We salute you very attentively.

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
Héctor O. Biondo
General Manager of
Operations
Alejandro L. Saravia
General Manager of
Informatics and Organization

BCRA CHECKS. Section 3. Operational Instructions Therefore, it is necessary for Entities to strengthen electronic controls on the information received to ensure the proper conduct of operations.

3.2.7 Rejections
3.2.7.1 Rejections by the Depositary Entity
3.2.7.1.1 Definition
These are the rejections made by the Depositary Entity when it verifies, in the physical checks received, the existence of any of the defects foreseen in current legislation and regulations.

3.2.7.1.2 Operational Instructions
3.2.7.1.2.1 Transmission of rejected checks
The Depositary Entity will transmit to the Electronic Chamber, until the deadline hour of the rejection session, the file with the corresponding information for the checks it rejected, taking into account the grounds for rejection defined in current regulations.

3.2.7.1.2.2 Processing by the Electronic Chamber
The Chamber will receive and compensate the rejected checks, according to the defined schedules.

3.2.7.1.2.3 Receipt of rejections by the Drawee Entity
The Drawee Entity will receive from the Electronic Chamber the file with the rejection information observed by the Depositary Entity.
With this information, the Drawee Entity:

• Will reverse the debits duly made in its clients' accounts, informing them
• Will notify the BCRA, according to what is established in point 1.4.1 of Communication "A" 2514, and
• Will proceed, when applicable, to the collection of fines from its clients in accordance with current legislation
  Version: 2nd Communication "A" 2559 Page 12

BCRA CHECKS. Section 3. Operational Instructions
3.2.7.2 Rejections by the Drawee Entity
3.2.7.2.1 Definition
These are the rejections made by the Drawee Entity when it verifies, in the electronic check information received, the existence of any of the grounds for rejection or return of the document, or grounds for rejection of transactions, foreseen in current regulations.

3.2.7.2.2 Operational Instructions
3.2.7.2.2.1 Transmission of rejected checks
The Drawee Entity will transmit to the Electronic Chamber, until the deadline hour of the rejection session, the information corresponding to the checks/transactions it rejected.

3.2.7.2.2.2 Processing by the Electronic Chamber
The Chamber will receive and compensate the information corresponding to the rejected checks, according to the defined schedules.

3.2.7.2.2.3 Receipt of rejections by the Depositary Entity
The Depositary Entity will receive from the Electronic Chamber the file with the information corresponding to the rejected checks.

3.2.7.2.2.4 Transitional file until rejections from the Drawee Entity arrive
It is necessary for Depositary Entities to temporarily archive truncated checks not yet confirmed, in order to return them to the depositing client if they are rejected by the Drawee Entity.

3.2.7.2.2.5 Stamp and delivery to the depositing client
The Depositary Entity will stamp the rejected check, including in said stamp the information established by the BCRA, and will deliver the check to the client who made the deposit. Version: 2nd Communication "A" 2559 Page 13

BCRA CHECKS. Section 3. Operational Instructions
3.2.7.2.3 Treatment of rejections by order of non-payment
In the case of truncated checks that are rejected for "order of non-payment" by the Drawee Entity, the original documents must be sent physically by the depositary in the session of physical exchange of rejected checks the day following the rejection. The physical exchange of said checks will be operated through the same Exchange Center used to exchange non-truncated checks.

3.2.7.2.4 Management of Rejections by the Electronic Chamber
The Electronic Chamber must manage the validity of the rejections by Entities regarding time limits. The normal rejection period for a check will be 1 business day. In case the Depositary Entity transmits to the Electronic Chamber the rejection of a check for any of the grounds provided, and said check is also rejected by the Drawee Entity for any of the grounds provided, a duplication of rejections on the same document in the same compensation cycle (Collision of Rejections) would occur. The Clearing Chamber processes the information received from both Entities in the rejection session, and in case it detects records corresponding to the same document, it must administer the collision as follows:

• The Chamber will send to each Entity the rejection reasons reported by the other Entity.
• The Chamber will make the monetary charge based on one of the received records, considering the other as informational.

3.2.7.2.5 Identification of the signatory in the Drawee Entity upon request of the holder of the rejected check
Proceedings will be according to regulations issued by the BCRA for this purpose.
Version: 2nd Communication "A" 2559 Page 14

BCRA CHECKS. Section 3. Operational Instructions
3.2.8 Claims
3.2.8.1 Definition
When the Drawee Entity, after the settlement of the check, needs to resort to the observation of the same to resolve an incident, it may request the depositary for the original document or a reproduction of the same.

3.2.8.2 Time Limits
The time limits for the delivery of claims made are exposed in the following table, expressed in business banking days:
Type of Claim Less than 1 year More than 1 year Original or Copy 7 20

3.2.8.3 Operational Instructions
3.2.8.3.1 Sending the claim to the Chamber
This request is made through a specific file, whose structure, content, and format are specified in the Messages and Record Design chapters, which will be sent in the rejection session to the Chamber. The Drawee Entity must indicate the reason for its request, due to:

• Apparent theft/loss
• Apparent irregular document
• Possible capture error
• Judicial order
• Other reasons.
  Version: 2nd Communication "A" 2559 Page 15

BCRA CHECKS. Section 3. Operational Instructions The Drawee Entity must clarify whether it requests the original document or a reproduction of the same.

3.2.8.3.2 Receipt of the claim by the depositary
The Depositary Entity will receive the claim message through the Electronic Chamber and must obtain the physical document or its reproduction to then send it to the Drawee Entity. The time limit for the delivery of the check or its reproduction will be variable, as the effort differs depending on the age of the claimed check. When the Depositary Entity receives a claim and verifies that the check does not belong to it or does not possess it because it was rejected, it will inform the Drawee Entity of the improper claim.

3.2.8.3.3 Delivery of the original check or copy
The Depositary Entity will send the check or its reproduction, in the session of physical exchange of rejected checks, to the Exchange Point where the Drawee Entity attends. The Drawee Entity will sign an acknowledgment of receipt where it will be clarified whether it is the original or a copy of the check, which will serve as proof that the document has come under its responsibility.

3.2.8.3.4 Confirmation by the drawee
The Drawee Entity, once the pertinent verifications have been made on the received document (reproduction or original), will inform the depositary of the result, but bilaterally, outside the electronic compensation system. The time limit to confirm the result will be 5 business days from the date established for the delivery of the check. After said period, a claim cannot be regularized. This confirmation can be adjusted to the following cases:

• Irregularity confirmed = Forged document
• Failure confirmed = Capture error
  Version: 2nd Communication "A" 2559 Page 16

BCRA CHECKS. Section 3. Operational Instructions
3.2.8.3.5 Adjustment for failure to comply with the claim
If the Depositary Entity does not deliver the original document or reproduction within the time limit established, counting from the date of the claim, the claiming Drawee Entity will send a debit, for the amount of the claimed check, through a monetary transaction of Adjustment citing the non-compliance of the claim by the Depositary Entity.

3.2.8.3.6 Rejection of adjustment for non-compliance with claims
The Depositary Entity may reject the operations corresponding to the rejections that the Drawee Entities make citing the non-compliance, by the depositary, of the claim for delivery of the original check or its reproduction. This rejection of the rejection may be due, for example, to:

• The requested check was rejected in its original presentation, and returned to the depositing client,
• The check was delivered to the drawee within the established time limits.
  The controversies that arise between the Entities affected by such rejection will be resolved bilaterally between them, outside the compensation system.

3.2.8.3.7 Resolution
In case the resolution of the claim confirms any irregularity, the regularization of this will be carried out outside the electronic compensation system, by bilateral agreement between the Entities.

3.2.8.3.8 Cost of claims
The price for the claim service will vary depending on whether the Drawee Entity requests the original document or a reproduction of the same.
The Chamber will settle the costs incurred by the claims, unless there is a rejection for non-compliance, at the end of the stipulated period for delivery, or at the moment a rejection occurs for an improper claim (point 3.2.8.3.2). Version: 2nd Communication "A" 2559 Page 17

BCRA CHECKS. Section 3. Operational Instructions
3.3.7.3 Operational Instructions
The physical exchange of rejected documents will be carried out at the same exchange points where the original checks had been previously presented. The electronic compensation of rejections will be carried out according to the previously described operation in the electronic compensation of checks in general. The Drawee Entity, in the same way as it does with truncated checks, must:

• Reverse the debits duly made in its clients' accounts, informing them
• Notify the BCRA, according to what is established in point 1.4.1 of Communication "A" 2514, and
• Proceed, when applicable, to the collection of fines from its clients in accordance with current legislation

3.3.8 Deferral Orders
3.3.8.1 Definition
These are messages that the Drawee Entity sends to the Electronic Chamber when it does not receive, on the business day prior to the agreed settlement date, the non-truncated check.

3.3.8.2 Operational Instructions
3.3.8.2.1 Transmission of the file by the drawee
The Drawee Entity will transmit the deferral order to the Electronic Chamber, including it in the files, in separate batches, with the information corresponding to the checks it rejects.

3.3.8.2.2 Time limits and schedules
The file that includes the deferral orders must be transmitted in the rejection session until the defined deadline hour.

3.3.8.2.3 Compensation of the check with deferral order

• The Chamber, upon receiving these orders, will defer the Compensation of the check for one business day. This deferral will consist of two movements:
• Debit in the rejection session the check previously compensated in favor of the Depositary Entity
  Version: 2nd Communication "A" 2559 Page 22

BCRA CHECKS. Section 7 Record Design
Additional Rejection Record
Field 1 2 3 4 5 6 7 8
Name Record Identifier
Additional Record Type Code
First Rejection Reason
Original Transaction Record Counter
Communication Number
Original Transaction Entity
Other Rejection Reasons
Record Counter
Field Requirement
M O M O M
Type 7 99 Alphanumeric Numeric Alphanumeric Numeric Alphanumeric Numeric Length 1 2 3 15 6 8 44 15 Position 01-01 02-03 04-06 07-21 22-27 28-35 36-79 80-94 Field Descriptions:

1. Record Identifier
   7 Additional Record
2. Additional Record Type Code
   This code indicates the type of additional record. In this case, the code '99' is used.
   Version 3rd Communication “A” 2559 Page: 10

BCRA CHECKS. Section 7. Record Design
The following table contains the grounds for rejection of transactions presented for compensation:
Code Description Explanation
R03 Account does not exist This code will be used in case the account on which the transaction falls cannot be identified R04 Invalid account number This code will be used in case the account on which the transaction falls has a format error R11 Non-compliance with truncated check claim This code will be used by the Drawee Entity when the depositary had not complied in time with the claim for delivery of truncated checks by the drawee R12 Rejection of claim for already delivered check This code will be used by banks to reject a claim for a truncated check that has already been delivered to the drawee bank R13 Branch/ Destination Entity does not exist This code will be used by banks and chambers when it is impossible to identify the Entities to which transactions are sent or from which they are received R17 Format error This code will be used by banks or chambers to reflect format errors. It applies to errors in mandatory, fixed, or specific type fields (Numeric or Alphanumeric) R18 Incorrect compensation date This code will be used by banks or by chambers when the compensation date does not coincide with the deadlines defined for each product R19 Incorrect amount This code will be used by chambers when the amount of a rejection does not coincide with the amount of the original transaction R24 Duplicate transaction This code will be used when receiving duplicate transactions R25 Error in additional record This code will be used by banks and chambers when there is a problem with additional records, for example when an additional record is missing when it is mandatory, when the presence of the additional record is indicated and it does not exist, etc. R26 Error in mandatory field This code will be used when a mandatory field is blank or with invalid characters. R27 Error in record counter This error will be used by the chamber when there is a problem in the record counter sequence R31 Chamber unwind (Unwinding) This code will be used by Banks and by chambers when documents must be rejected due to the need to reprocess the chamber, given that a Bank did not cover the debit position. For the case of truncation, this code will be used for the rejection of the corresponding transaction. R75 Date error This code will be used by chambers when there are format errors in the date R76 Error in field 11 Batch Header This code will be used by banks or Chambers when there is an error in the origin code R77 Error in field 4 individual record This code will be used by chambers when field 4 (Reserved) of the individual record contains a value different from "0" (zero) R78 Error field 5 Individual Record This code will be used by chambers when there is a format error in the account number R79 Error in field 7 Individual Record This code will be used by the chamber when this field contains a format error or by Banks when the reported check number is incorrect R80 Error field 3 Additional Record This code will be used by the Bank when the information included in
this field has been standardized and does not match the necessary data or by chambers when no information is included in this field R82 Missing check This code will be used when the physical document is missing. R87 Invalid currency This code will be used by chambers when field 10 1st byte reports data different from "0" or "1" R88 Error field 2 Individual Record This code will be used by chambers when an incorrect transaction code is reported R90 Trx does not correspond because no original trx exists This code will be used when receiving claims on non-existent checks or by chambers when receiving rejections on non-existent transactions R91 Bank Code incompatible with trx currency This code will be used by banks or chambers when Entity numbers are not expressed in all cases in the same currency. Example:
Originator Entity No. + 500 and Entity to Debit credit Entity No. without adding 500 R92 Maximum number of deferral orders exceeded This code will be used by banks or Chambers when a Drawee Entity exceeds the maximum number of deferral orders for checks R93 Non-working day This code will be used by those Banks that cannot process the documents received for some branch, in whose location there is a local holiday. For the case of truncation, this code will be used for the rejection of the corresponding transaction. R94 Incorrect postal code This code will be used when the postal code (field 8 of the individual record) is incorrect R96 Depositary Entity Errors This code will be used in case the Depositary Bank presents for payment CPD with a maturity date later than the presentation, when documents are presented on dates later than current legal deadlines, when the Bank stamp is missing, lack of bank responsibility signature, and when second presentation does not correspond New transaction rejection grounds will be added to this list
4. Original Transaction Record Counter
This field carries the record counter of the transaction being rejected
5. Communication Number
This field will include the Communication number of the Entity's rejection to the BCRA in its 6 positions Version 3rd Communication “A” 2559 Page: 12

BCRA CHECKS. Section 7 Record Design
Individual Record of Records
Field 1 2 3 4 5 6 7 8 9 10 11 12
Name
Record Identifier
Transaction Code
Destination Entity
Reserved
Affected Account
Amount
Check Number/
Date of presentation of original transaction
Postal Code/Claim Data
Exchange Point/
Depositary rejection
Additional Transaction Information
Additional Records
Record Counter
Field Requirement
M
Type 6 Numeric Numeric 0 Numeric $$$$$$$$cc Numeric Alphanumeric Alphanumeric Alphanumeric Numeric Numeric Length 1 2 8 1 17 10 15 6 16 2 1 15 Position 01-01 02-03 04-11 12-12 13-29 30-39 40-54 55-60 61-76 77-78 79-79 80-94 Field Descriptions

1. Record Identifier
   6 Individual Record
2. Transaction Code
   This code indicates the type of transaction
   Claim 28
   Rejection 26
3. Destination Entity
   This field contains the identification number of the receiving Entity of the record.
4. Reserved
   This field is reserved for future uses. This field is completed with zeros ("0").
5. Affected Account
   This field indicates the affected account and must contain the exact data of the same. Numbers from 0 to 9 are included, aligned to the right.
   Version 2nd Communication “A” 2559 Page: 13

BCRA CHECKS. Section 7 Record Design
6. Amount
This field indicates the amount of the check being claimed
7. Check Number/Date of presentation of original transaction
This field identifies the number of the check to which the transaction refers (first 8 positions).
This field indicates the date of presentation of the document being claimed (YYMMDD, positions 9 to 14) completed with blanks.
8. Postal Code/Claim Data
This field will be completed with claim data and the Postal Code according to the following description:
The reason generating the claim (1st position) 0 Apparent theft/loss 1 Apparent irregular document 2 Judicial order 3 Possible capture error 4 Other reasons The type of claim (2nd position) 0 Original 1 Copy In the last 4 (four) positions, the postal code of the Destination Entity is indicated, by which the destination location is identified.
9. Exchange Point/Depositary Rejection
This field contains the identification of the exchange point where the physical document is presented, and will be completed as follows: the first 4 positions will be completed with the identification code of the exchange point (case 1: with two zeros and the Chamber code - two positions-, case 2: with the postal code of the exchange point - four positions-). In case of a Depositary Entity rejection, the next 4 (four) positions will be completed with the rejection reasons - two positions for each without the "R"-, the remaining 8 positions from the right will be completed with blanks.
10. Additional Transaction Information
This field allows identifying the currency of the affected account and the type of transaction being reported.
The first position of this field will contain the currency type of the affected account:
0 Pesos
1 Dollars
Version 2nd Communication “A” 2559 Page: 14

BCRA CHECKS. Section 7 Record Design

Individual Record of Adhesions, Disconnections, Change Notifications, and Rejections of Adhesions, Disconnections, and Change Notifications

Field	1	2	3	4	5	6	7	8	9	10	11
Name	Name	Record Identifier	Transaction Code	Destination Entity	Check Digit	Account to Debit	Identification of Entity to be Modified	Reserved	Payer Client Identification	Additional Transaction Information	Additional Records	Record Counter
Requirement	M	O	M	M	M	M	M	M	M	M	M
Type	6	Numeric	Numeric	0	Numeric	Numeric	Alphanumeric	Alphanumeric	Numeric
Length	1	2	8	1	17	10	15	22	2	1	1
Position	01-01	02-03	04-11	12-12	13-29	30-39	40-54	55-76	77-78	79-79	80-94

Field Descriptions:

1. Record Identifier
   This code is assigned to identify the type of record.
   6 Individual record

2. Transaction Code
   This code indicates the type of transactions reported.
   Adhesion / Disconnection / Change Notification: 38 Rejections: 36

3. Destination Entity
   When Adhesions or Change Notifications are initiated by the Originating Entity, this field contains the identifying number of the Receiving Entity of the reported transaction, informing the Entity in 4 positions and its branch in 4 positions. In the case of Adhesions, Disconnections, or Change Notifications initiated at the Receiving Entity, this field must be completed with nines ("9"), with the clearing house routing the transaction to the corresponding Originating Entity.

4. Reserved
   This field must be completed with a "0".

5. Account to Debit
   This field indicates the account to be debited and must contain the data reported in block 2 of the CBU, including its check digit.

   Version 4a Communication “A” 2559 Page: 14

6. Identification of Entity to be Modified
   In the case of a Change Notification sent by the entity that will now act as the receiver of Direct Debits, it will be completed as follows:

   • In the first 8 (eight) positions aligned to the right, block 1 of the CBU of the previous Entity
   • In the remaining two positions to the left with zeros "0"
     In the case of a Change Notification sent by the Entity that previously acted as the receiver of Direct Debits, it will be completed with zeros "0000000000".

7. Reserved
   This field is reserved for future uses; currently, it will be completed with spaces in its 15 (fifteen) positions.

8. Payer Client Identification
   This field uniquely identifies the client to be debited. E.g., client number, telephone number, etc.

9. Additional Transaction Information
   The first position of this field will contain the number 0. The second position will indicate the type of transaction being reported or rejected:
   2 Adhesion in Originating Company
   3 Adhesion in Receiving Entity
   4 Disconnection carried out in the Receiving Entity 5 Change Notification carried out by the Originating Company 6 Change Notification carried out by the Receiving Entity

10. Additional Records
    This field indicates whether there are additional records ('1' or '0' respectively).

11. Record Counter (Trace number)
    This field includes the identifying number of the Originating Entity in 8 positions (4 for the Entity and 4 for the branch) and then in positions 9 to 15 a unique ascending sequential number for each record sent in a file. This implies that the record counter number can be repeated in different files. These 15 positions must be ordered sequentially within each batch.

Additional Comments:

When a field has more characters than required to complete the information, they must be filled with zeros starting from the left margin in the case of numeric fields and with spaces to the right in the case of alphanumeric fields. The alphabetic characters of alphanumeric fields must always be reported in uppercase.

Version 4a Communication “A” 2559 Page: 15