Circular on Foreign Exchange Operations and Transfers of Funds with Abroad - CAMEX 1 - 193. Information Regime for Foreign Exchange Operations and Obligations with Abroad - REFEX 1 - 43

CENTRAL BANK OF THE ARGENTINE REPUBLIC

COMMUNICATION "A" 1396
13/04/89

TO FINANCIAL INSTITUTIONS AUTHORIZED TO OPERATE IN FOREIGN EXCHANGE, EXCHANGE HOUSES, AGEN- CIES, OFFICES AND EXCHANGE BROKERS:

Ref.: Circular Foreign Exchange Operations and Transfers of Funds with Abroad - CAMEX - 1 - 193.
Information Regime for Foreign Exchange Operations and Obligations with Abroad - REFEX 1 - 43

We address you and through you all interested parties, to bring to your knowledge that as from the beginning of the activities corresponding to 17.4.89, all foreign exchange transactions shall be conducted through the Free Exchange Market.

The aforementioned provision, which was adopted by this Institution in accordance with the guidelines established by the economic authorities, renders ineffective the operation of the Official Exchange Market at the close of operations corresponding to 13.4.89.

Consequently, the Free Exchange Market is established in accordance with the following provisions:

1. FREE FOREIGN CURRENCIES

1.1. The exchange rate shall be the result of the free interplay of supply and demand.

1.2. Authorized financial institutions, exchange houses, agencies and offices may carry out spot operations of purchase, sale, arbitrage and exchange, with foreign currencies, banknotes and minted gold and bars of "good delivery", among themselves and with clients, within the regulations in force regarding permitted operations for each class and category of operator.

1.3. Forward purchase-sale and swap operations must comply with the rules set forth by Communication "A" 1257 of 08.09.88.

1.4. Financial institutions authorized to operate in foreign exchange must maintain daily the Foreign Exchange Technical Ratios established by point 3. of Communication "A" 1257 of 08.09.88.

1.5. The supply and demand originating from the Public Sector for individual operations exceeding US$ 10,000 shall be channeled by the institutions through the Central Bank at the buyer or seller exchange rate, as applicable, of the Banco de la Nación Argentina at the close of operations of the previous business day. For this purpose, the institutions shall carry out operations with normal value with the Central Bank and transfer them under equal conditions to their clients.

2. COLLECTION AND PAYMENT OPERATIONS CONDUCTED THROUGH RECIPROCAL CREDIT AGREEMENTS

2.1. The exchange rates of the Banco de la Nación Argentina shall apply for the purchase and sale of foreign currencies at the close of operations of the previous business day in the Free Exchange Market.

Consequently, operations carried out by the institutions with their clients must be channeled to the Central Bank at the close of the Market, at the buyer and seller exchange rates, as applicable, indicated above.

2.2. For the cancellation of loans in foreign currency received to finance exports (point 1.5. of Circular COPEX - 1 and complementary), the Central Bank shall proceed with the delivery of free foreign currencies through arbitrage to be carried out in the Free Exchange Market.

3. INFORMATION REGIME

3.1. Operations with clients

3.1.1. Private sector and mixed economy companies.

Collections for exports, advances and loans to pre-finance exports, financing of exports and loans from International Organizations, as well as payments for imports, whatever their amount, must be recorded in individual sworn declarations 4001 A or B and 4002 A or B as applicable. Operations for the remaining concepts shall be declared in summary forms 4031 A or B and 4032 A or B, depending on whether they are purchases or sales.

When dealing with operations with state guarantee, their declaration shall be required in all cases.

3.1.2. Public sector (State departments, companies and agencies and financial institutions for their own operations).

Transactions, whatever their amount, shall be reported by individual sworn declaration in form 4001 A or B and 4002 A or B, depending on whether they are purchases or sales.

3.2. Operations between institutions, exchange houses, agencies and offices

Transactions between the aforementioned operators must be reported in form 116 A or 112 depending on whether they are purchases-sales or arbitrages. In the latter case, when dealing with gold operations, the class and quantity must be detailed in each case.

B.C.R.A. COMMUNICATION "A" 1396 13.4.89

In order to comply with current customs requirements, for shipments abroad of foreign banknotes and gold, a form 112 must be submitted in original and two copies, which shall be destined for the National Customs Administration and the intervening institution.

3.3. Operations with the Central Bank as counterpart of operations with the Public Sector.

Purchases and sales of foreign exchange shall be reported in forms 116 A or B, applying the quotation reported by the Banco de la Nación Argentina for the close of operations of the previous business day.

3.4. Summary of Operations and Exchange Position

3.4.1. Financial Institutions Authorized to Operate in Foreign Exchange.

3.4.1.1. Spot operations

The summary of daily movement shall be reported in form 4009 and the exchange position in form 111.

3.4.1.2. Forward operations

The daily movement shall be reported in accordance with the provisions of Communication "A" 1239 of 3.8.88 and complementary.

3.4.2. Exchange Houses, Agencies and Offices.

The summary of daily movement and the exchange position shall be reported in form 4033.

3.5. Documentation that institutions, exchange houses, agencies and offices must keep

For sales operations to clients in the Free Market declared in form 4032 A or B, operators must keep available to the Central Bank the supporting documentation, which shall contain the corporate name or the surname and name, address and identity document of the holder.

3.6. General provisions

3.6.1. Delivery of forms

3.6.1.1. Entities located in the Federal Capital and Greater Buenos Aires districts

The presentation of forms shall be made on the day the transactions are carried out, at the Department of General Secretariat - Sarmiento 476 -, until 19.00 hours.

3.6.1.2. Entities located outside the Federal Capital and the Greater Buenos Aires districts

Category "A" and "B" banks, exchange houses, agencies and offices shall present the corresponding forms monthly, and must summarize in a single presentation, as applicable - forms 111, 112, 116, 4009, 4031, 4032 and 4033 -, the transactions carried out in said period. The entities shall take the necessary precautions so that the aforementioned summaries and the individual forms 4001 A and B and 4002 A and B are in the possession of the Central Bank within five business days following the close of the month being reported.

3.6.2. Table of concepts

The conceptual coding shall be carried out in accordance with the detail set forth in the annex, whose codes shall be applied to report both purchases and sales of foreign exchange.

3.7. The provisions of the Exchange Reporting Regime not modified by this Communication remain in force.

4. TRANSITIONAL PROVISIONS

4.1. For the settlement of exports included in section II, point 2., first paragraph of Communication "A" 1397, the exchange rate that this Central Bank shall daily report for such purpose shall apply.

4.1.1. Non-prefinanced exports

In the case of transactions in free foreign currency or processed through reciprocal agreements, the purchases of foreign exchange made by the entities must be transferred to the Central Bank at the same exchange rate.

4.1.2. Prefinanced exports

When the transactions have a prefinanced amount, their re-settlement shall correspond through the purchase of the agreement credit or of free foreign currency, as applicable, at the Communication "A" 1397 exchange rate and the sale of free foreign currency at the seller's exchange rate of the Banco de la Nación Argentina at the close of operations of the last business day prior in the Free Exchange Market.

B.C.R.A.	COMMUNICATION "A" 1396	13.4.89

In the case of prefinancings entered through the former Official Exchange Market in accordance with the provisions of section II, point 2., second paragraph of Communication "A" 1397, the sale of free foreign currency shall be made at the same exchange rate applied for the purchase.

We greet you very attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Raúl O. Planes
Exchange Manager
Julio A. Piekarz
Deputy General Manager

B.C.R.A.
TABLE OF CONCEPTS
PUBLIC AND PRIVATE SECTORS
FREE AND OFFICIAL MARKETS
PURCHASES AND SALES
Annex to
Com. "A" 1396

Code	Concept
001	Passages
002	Tourism and travel
003	Retirements and pensions
004	Commercial commissions
005	Bank expenses and commissions
006	Royalties
007	Profits and dividends
008	Technical services
010	Export, import and interport freight
011	Insurance on merchandise
012	Consular expenses
013	Ship or aircraft expenses
014	Lease of ships or aircraft
015	Other unspecified concepts
021	Capital movements
031	Other interest
078	Collection of exports through transformation of advance payments
079	Advance collection of exports
081	Collection of exports against shipping documents
082	Collection of financed exports (COPEX 1 - Ch. I, point 1.5.)
083	Collection of financed exports (OPRAC 1 - Ch. I, Points 1.2. and 2.3.)
122	Financing of exports with letters rediscounted by the Central Bank
123	External loans to finance promoted exports (OPRAC - 1, Ch. I, Pt. 2.3.)
125	Short-term loans to the Public Sector (up to 1 year)
126	Long-term loans to the Public Sector (more than 1 year)
128	Other loans to prefinance exports
130	Loans to finance imports from countries with reciprocal credit agreements
132	Prefinancing of exports granted with local deposits in foreign currency
135	External loans to prefinance promoted exports (OPRAC - 1, Ch. I, Pt. 2.1.)
137	Repayment of advances and financing of unfulfilled exports (Com. “A” 932)
138	Repayment of advances and financing of unapplied exports, not exceeding 10% of the loan amount (Com. “A” 932)
139	Loans from International Organizations
154	Collection of interest from the Public Sector
553	Official missions abroad
581	Advance payments for imports
582	Payments for imports against shipping documentation
583	Deferred payments for imports
584	Payment of commercial interest
589	Lease contracts with option to purchase “Leasing”
672	Payment of interest on export financing
721	Remittances from embassies and members of the diplomatic corps
722	Consular collections
737	Payments and amortization for global contracts for works and services
746	Information services
749	Membership fees to International Organizations
751	Medical treatment expenses abroad

B.C.R.A.	TABLE OF CONCEPTS PUBLIC AND PRIVATE SECTORS FREE AND OFFICIAL MARKETS PURCHASES AND SALES	Annex to Com. "A" 1396

753	Salaries and expenses of Argentine official officials assigned abroad
754	Registration fees for international congresses and meetings
755	Expenses for attending international fairs and exhibitions
759	Expenses for commercial representations abroad
760	Scholarships and study expenses
761	Payment of interest on the financial debt of the Public Sector
762	Payment of default and compensatory interest of the Public Sector