Circular Foreign Exchange Operations and Movement of Funds and Securities with the Abroad - CAMEX 1 - 10

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
COMUNICACIÓN "A" 61 24/09/81
TO FINANCIAL ENTITIES AUTHORIZED TO OPERATE IN FOREIGN EXCHANGE AND FOREIGN EXCHANGE BROKERS:
Ref.: Circular FOREIGN EXCHANGE OPERATIONS AND MOVEMENT OF FUNDS AND SECURITIES WITH THE ABROAD - CAMEX - 1 - 10

We address you and, through you, to interested parties, to bring to your knowledge that this Bank has decided to establish a foreign exchange insurance regime - in US dollars - consisting of their advance negotiation for the coverage of debts from financial loans in foreign currency, from the private sector, whose maturities operate until 31.12.83.

1. Scope
   The regime is applicable to the following operations:

1.1. Financial loans in force as of 30.6.81 entered into and negotiated in the foreign exchange market until 19.6.81 inclusive, whose maturities operate until 31.12.83 and that upon occurrence are extended for a minimum term of 540 days and a maximum of 3 years.

1.2. Foreign exchange insurance may only be negotiated on 50% (fifty percent) of the total amount of the debt from financial loans of each company, in force as of 30.6.81 and registered in this Bank according to the permanent survey regime of obligations with the abroad. In such manner, in those cases where by application of the provisions of Communications "A" 31 and 54 within the amount in force as of 30.6.81 there are operations already covered by foreign exchange insurance, these provisions will only apply to the remaining operations until covering 50% of the total debt. Insurance operations negotiated prior to the date of this circular may be complemented in terms of term to reach the maximum referred to in point 1.1.

1.3. In addition to the principal, the foreign exchange insurance may cover the interest accrued until the maturity that originates said contract, provided that the payment of said interest is extended to coincide with the repayment of the principal, that is, at the end of the foreign exchange insurance. Under equal conditions, foreign exchange insurance may be negotiated for future interest, to the extent that they are extended in payment until the repayment of the principal when liquidating the foreign exchange insurance. In this case, for the interest, a foreign exchange contract will be formalized on each occasion for the corresponding amount and with adjustment to the provisions of point 3, in force at that time, without requiring prior authorization. The interest to be insured will be for the net amount to be paid to the lender, that is, excluding any local charge (income tax payable by the lender, etc.) and its semi-annual calculation, to coincide with periods of application of foreign exchange insurance rates.

1.4. Not applicable to:

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1.4.1. Personal debts, except if they are sole proprietorships that carry out economic activity.

1.4.2. Debts from pre-financing or financing of exports originated in loans applied directly abroad to the financing of imports.

2. Term
   The foreign exchange insurance will cover the period from the date of its negotiation until the result of the extension referred to in point 1.1.

3. Foreign Exchange Insurance Rate
   On the selling exchange rate for this effect communicated daily by this Bank at the opening of the market, a fixed rate will be applied for the first 180 days, which is also communicated daily, and for the remaining period borrowers may decide on that occasion, between the rate resulting from the variation of wholesale prices, general level, deducting international inflation (Communication "A" 36 of 17.6.81) and the rate that will arise from the difference by quotient between the variation rates registered by the financial adjustment index (Circular R.F. 1050) and the index of the LIBOR rate on the days (Communication "A" 44 of 3.7.81). The amount of the foreign exchange insurance rate must be paid to this Bank semi-annually due.

4. Procedure
   When representing the requests in form 4008 A, interested parties must comply with the following requirements:

4.1. Extend the terms of the loans referred to in these provisions for a period not less than 540 days from the date of each of the maturities to which the foreign exchange insurance will apply. When it is foreseen, to concretize the extensions for the terms referred to in point 1, the use of several lenders, in the survey form of obligations with the abroad, the circumstance will be noted but also stated that it will not alter the total term of the foreign exchange insurance with the Central Bank.

4.2. Supply in the respective request all data referring to the loan operations in question, attaching copies of forms 3189 or 3191 - as the case may be - corresponding to the report in the permanent survey of * 1136 * obligations with the abroad and ratify, under sworn declaration, that the debts have not been cancelled by any procedure.

4.3. Detail the amount of the debt from financial loans, in force as of 30.6. indicating date of negotiation or last renewal - as the case may be - of an operation, maturity (with indication of extension and new maturity for those that operated between 1.7.81 and the date of the request) and indicate for each of them if the franchises referred to Communications "A" 31, 33 and 54 have been applied.

5. The operations will be negotiated with this Bank, directly by the Financial Entities authorized to operate in foreign exchange, through the foreign exchange switch.

6. Information and Survey Regime
   The foreign exchange transactions with clients must be reported in Form 4002 A (sale to third-

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  B.C.R.A COMMUNICATION "A" 61 24/09/81 term) and 4004 B (settlement) and stating in all cases in the space reserved for the concept the legend "COMMUNICATION "A" 61.
  In form 4002 A, the number of form 3191 presented in compliance with the norms on survey of obligations with the abroad, modifying the previous one, must be indicated indefectibly, proceeding to its return, attached to 4004 B, at the time of settlement of the operations. When it concerns renewals, they must comply with the information regime provided for financial loans and stating in the report forms the number assigned to the new form 3191 modifying the previous one, which will be added to form 4004 B at the time of settlement. The counterparties with the Central Bank will be reported in form 116, in duplicate, separately from the other transactions between entities or with this institution.

7. Expiration of Contracts
   Foreign exchange insurance contracts negotiated under these provisions and those established by Communications "A" Nos. 31, 36, 44 and 54 will cease to have effect and will be automatically cancelled, when there is lack of payment of the insurance rate by their holders, at the sole semi-annual expiration of the fixed term and without the need for any request.

8. Authorized Intervening Entities
   The operations referred to in these provisions can only be processed through financial entities authorized to operate in foreign exchange, in Categories B and C.

We salute you very attentively.
BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
Antonio E. Conde Evaristo H. Evangelista
Manager of
Foreign and Exchange
Deputy General Manager