Circular SINAP 1 - 7: National Payments System - Operational Instructions - Checks. Incorporation of rejection reasons.

“2005 - Year of Tribute to Antonio Berni”
BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
COMMUNICATION “A” 4410 22/08/2005
TO FINANCIAL ENTITIES:
Ref.: Circular
SINAP 1 - 7
National Payments System - Operational Instructions - Checks. Incorporation of rejection reasons.

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We address you to inform you that this Institution has adopted the following resolution:
Replace point 3.1.4.2. item ii)a) of Section 3 of the regulations on “National Payments System - Operational Instructions - Checks” with the following:
“ii) Operational Instructions. a) Scheduled local holidays:
Upon receiving the holiday notice, the CECs will identify movements with the banking postal code/s with a settlement date of the holiday, reject them in the rejection session of that same day, for which they will use code R09 “local holiday”, and in the next immediate presentation session, they will resubmit them with the date of the next business day, distributing to the entities the information of the transactions corresponding to the exchange point with local holiday.” Likewise, the following rejection reasons are incorporated into points 3.2.7.1. and 3.2.7.2. of Section 3 and in 7.4 of Section 7:
R29: “Reversal already made”
R46: “Non-compensable design”
R47: “Second presentation not applicable”
We send you the sheets that replace those previously provided, which should be incorporated into the ordered text of the regulations on “National Payments System - Operational Instructions - Checks”. We remain, Very attentively, BANCO CENTRAL DE LA REPUBLICA ARGENTINA Julio César Pando José A. Barone Systems Manager of Payment Systems / on behalf of the General Submanager of Payment Means

ANNEX

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 3 - Operational Instructions
Version: 2 COMMUNICATION “A” 4410
Validity:
22/08/2005
3.1.4. Other operational aspects.
3.1.4.1. Business days for settlement.
All days defined by the BCRA as such shall be considered business days for settlement.
3.1.4.2. Local holidays.
i) Definition.
A scheduled local holiday is considered any declared by the competent authority (national, provincial, municipal, or Autonomous City of Buenos Aires), which can be included in advance in a schedule of local holidays. This schedule will be administered by the CECs, and will include the dates of scheduled holidays for the different exchange points. It will be duly disseminated through the publication of a CIMPRA bulletin and will be prepared with the information that entities must provide to the CECs. An unscheduled local holiday is considered any declared by the competent authority (national, provincial, municipal, or Autonomous City of Buenos Aires), which cannot be included in advance in the schedule administered by the CECs, but which is known to them through information formally provided by the bank/s present in the location, at the latest on the business day immediately preceding the date the holiday occurs. ii) Operational Instructions. a) Scheduled local holidays:
Upon receiving the holiday notice, the CECs will identify movements with the banking postal code/s with a settlement date of the holiday, reject them in the rejection session of that same day, for which they will use code R09 “local holiday”, and in the next immediate presentation session, they will resubmit them with the date of the next business day, distributing to the entities the information of the transactions corresponding to the exchange point with local holiday. Below are described the tasks and their sequence, which must be performed by the different intervening actors:
Day D

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 3 - Operational Instructions
Version: 2 COMMUNICATION “A” 4410
Validity:
22/08/2005

• R33 “Check forgery”.
• R36 “Check tampering”.
• R37 “Legal validity period expired”.
• R38 “Drawer’s signature does not match the signature of the person endorsing on the back”.
• R46 “Non-compensable design”
• R47 “Second presentation not applicable”
• R83 “Irregularity in the endorsement chain”.
• R96 “Depositary entity errors” .
• R97 “Early presentation” (cpd).
  b) Electronic Chamber processing.
  The CEC will receive and settle the rejected checks, according to the defined schedules. c) Receipt of rejections by the drawee entity. The drawee entity will receive from the CEC the file with the information of rejections observed by the depositary entity. With this information, the drawee entity:
• Will reverse the debits duly made in its clients' accounts, informing them.
• Will inform the BCRA of the check rejections, according to what is established in point 1.5.2.11 of the regulations on “Regulation of the bank current account”.
  3.2.7.2. Rejections by the drawee entity.
  i) Definition.
  These are the rejections made by the drawee entity when it verifies, in the electronically received check information, the existence of any of the grounds for rejection or return of the document, or grounds for rejection of transactions, provided for in the current regulations. ii) Operational Instructions. a) Transmission of rejected checks and transactions. The drawee entity will transmit to the CEC, until the deadline of the rejection session, the information corresponding to the checks/transactions it rejected. In case of truncation, according to current regulations, it will transmit for the following check and/or transaction rejection reasons:
• R01 “Account under attachment”,

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 3 - Operational Instructions
Version: 2 COMMUNICATION “A” 4410
Validity:
22/08/2005

• R02 “Account closed by judicial order”,
• R03 “Non-existent account”,
• R04 “Invalid account number”,
• R08 “Report of loss, theft, or tampering of check” (order not to pay),
• R10 “Insufficient available funds”,
• R13 “Non-existent branch / destination entity”,
• R19 “Incorrect amount”,
• R21 “Preventive bankruptcy of the drawer, declared judicially”,
• R24 “Duplicate transaction”,
• R34 “Emergency situations”,
• R35 “Lack of conformity in the receipt of check books”,
• R39 “Amount does not match the amount recorded by the drawee bank”,
• R44 “Values stolen or missing from checkbooks not delivered to clients”
• R46 “Non-compensable design”
• R47 “Second presentation not applicable”
• R79 “Error in field 7 individual record”,
• R81 “Force majeure”,
• R82 “Missing check”,
• R93 “Non-working day”,
• R94 “Incorrect postal code”,
• R96 “Depositary entity errors”
• R97 “Early presentation (cpd)”.
  b) Chamber processing.
  The chamber will receive and settle the information corresponding to the rejected checks, according to the defined schedules. c) Receipt of rejections by the depositary entity. The depositary entity will receive from the CEC the file with the information corresponding to the rejected checks.

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 7 - Record Design
Version: 2 COMMUNICATION “A” 4410
Validity:
22/08/2005
R44 Stolen documents
This code will be used for values stolen or missing from checkbooks not delivered to clients.
R46 Non-compensable design
This code will be used for checks presented in CEC with designs according to Com. “A” 2902 or prior.
R81 Force Majeure
This code will be used by banks when there are causes of force majeure at the time of presentation of the check that prevent its payment. For the case of truncation, this code will be used for the rejection of the corresponding transaction. R83 Irregularity in the endorsement chain This code will be used when an irregularity in the endorsement chain of the check is verified due to: no successive endorsements, missing first endorsement, missing receipt signature for deposit, check not to order with more than one endorsement. R97 Early presentation date (CPD) This code will be used in the case where the depositary bank presents for payment a CPD with a maturity date later than the presentation. The following table contains the rejection reasons for transactions presented for their settlement:
Code Description Explanation
R03 Non-existent account
This code will be used by the drawee entity in case the account on which the transaction falls cannot be identified. R04 Invalid account number This code will be used by the drawee entity in case the account on which the transaction falls has a format error. R09 Local Holiday This code will be used by the chambers to reject movements presented from locations with a local holiday. R11 Non-compliance with claim for truncated check This code will be used by the drawee entity when the depositary entity did not comply in time with the claim for the delivery of truncated checks from the drawee. R12 Rejection of claim for check already delivered This code will be used by the depositary banks to reject a claim for a truncated check that has already been delivered to the drawee bank. R13 Non-existent branch/destination entity This code will be used by the drawee entity when it is impossible to identify the entities to which transactions are sent or from which transactions are received. R17 Format error This code will be used by the chambers to reflect format errors. It applies to errors in mandatory, fixed, or specific type fields (numeric or alphanumeric). R18 Incorrect settlement date This code will be used by the chambers when the settlement date does not match the periods defined for each product. R19 Incorrect amount This code will be used by the drawee entity when the amount of a rejection does not match the amount of the original transaction. R24 Duplicate transaction This code will be used by the drawee entity when it receives duplicate transactions. R25 Error in additional record This code will be used by the chambers when there is a problem with the 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.

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 7 - Record Design
Version: 2 COMMUNICATION “A” 4410
Validity:
22/08/2005
R26 Error in mandatory field
This code will be used by the chambers when a mandatory field is blank or contains invalid characters.
R27 Error in record counter
This error will be used by the chambers when there is a problem in the sequence of the record counter.
R29 Reversal already made
This code will be used by the chambers when they must proceed to reject again movements corresponding to transactions deferred by R09 by the CEC and also by R93 by the entities. R31 Chamber unwind (Unwinding) This code will be used by the chambers when documents must be rejected due to the need to reprocess the chamber, given that a bank did not cover the debtor position. For the case of truncation, this code will be used for the rejection of the corresponding transaction. R34 Emergency situations This code will be used by the drawee entity when rejecting documents due to the occurrence of all those situations of external origin to the financial entities and of serious effects such as. Flood, tornado, road cuts, etc. R35 Lack of conformity This code will be used by the drawee entity when there is a lack of conformity in the receipt of check books. R39 Amount does not match the amount recorded by the drawee bank This code will be used by the drawee entity in the case of truncated CPDs registered. R47 Second presentation not applicable This code will be used by the drawee entity in the case of a rejected check that does not correspond to a second presentation. R75 Date error This code will be used by the chambers when there are format errors in the date. R76 Error in field 11 Batch Header This code will be used by the chambers when there is an error in the origin code. R77 Error in field 4 Individual Record This code will be used by the chambers when in 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 the 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 drawee entity and by the chambers when this field contains a format error or by the Banks when the reported check number is incorrect. R80 Error field 3 Additional Record This code will be used by the chambers when the information included in this field has been standardized and does not match the necessary data or by the chambers when no information is included in this field. R82 Missing Check This code will be used by the drawee entity when the physical document is missing. R87 Invalid currency This code will be used by the chambers when in field 10 1st byte it reports a data different from “0” or “1”. R88 Error field 2 Individual Record This code will be used by the chambers when it reports an incorrect transaction code. R90 Transaction does not correspond due to non-existence of original transaction This code will be used by the chambers when it receives claims on non-existent checks or by the chambers when it receives rejections on non-existent transactions.

NATIONAL PAYMENTS SYSTEM - CHECKS B.C.R.A.
Section 7 - Record Design
Version: 2 COMMUNICATION “A” 4410
Validity: 22/08/2005
R91 Bank code incompatible with transaction currency This code will be used by the 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 the 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 drawee banks that cannot process the documents received for any 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 by the drawee entity when the postal code (field 8 of the individual record) is incorrect. R96 Depositary entity errors This code will be used by the entities in case the bank seal and/or the signature of banking responsibility are missing and, additionally, when the depositary entity detects errors in the electronic data transmission transmitted to the drawee entity. New rejection reasons for transactions will be added to this list.
1. Original transaction record counter.
This field carries the record counter of the transaction being rejected.
2. Communication number.
This field will include the communication number of the entity's rejection to the BCRA in its 6 positions.
5. Communication Number
This field will include the Communication number of the Entity's rejection to the BCRA in its 6 positions.
6. Entity of the original transaction.
It is completed with the entity and branch code in four positions of who generates the rejection.
7. Other rejection reasons.
Other rejection reasons may be indicated, which must be left-aligned respecting the following rule:

• R followed by rejection in two positions.
• No separators of any kind shall be used.
• The remaining positions will be completed with blank spaces.
  8. Record counter.
  It is completed with the same counter of the corresponding individual record (field 12).

B.C.R.A.
ORIGIN OF THE PROVISIONS INCLUDED IN THE ORDERED TEXT OF THE REGULATIONS ON OPERATIONAL INSTRUCTIONS OF THE NATIONAL PAYMENTS SYSTEM - CHECKS -1- ORDERED TEXT SOURCE OF THE PROVISIONS Observations Point Paragraph Com.
Annex or
Chapter
Point
Paragraph
1.1 “A” 2559 Checks
2.1. “A” 2559 “
2.2. “A” 2559 “
2.3 “A” 2559 “ 2.3.1. S/Com. “A” 4281.
2.4 “A” 2559 “
3.1 “A” 2559 “ 3.1.3 S/Com. “A” 2795
“A” 2559 “ 3.1.4 S/Com. “A” 2795, 4281 and
4410
3.2. “A” 2559 “ 3.2.7 S/Com. “A” 4281 and 4410
“A” 2559 “ 3.2.8. S/Com. “A” 4281
3.3. “A” 2559 “ 3.3.7 S/Com “A” 4281
4.1 “A” 2559 “ S/Com. “A” 4281
4.2. “A” 2559 “
4.3. “A” 2559 “ S/Com. “A” 4281
5.1. “A” 2559 “
5.2. “A” 2559 “
6.1. A” 2559 “
6.2. A” 2559 “
7.1. “A” 2559 “
7.2. “A” 2559 “ S/Com. “A” 2723
7.3. “A” 2559 “ S/Com. ”A” 2795 and 2857
7.4. “A” 2559 “ S/Com. “A” 2819, 4281 and
4410
7.5 “A” 2559 “ S/Com. “A” 4281
7.6. “A” 2559 “ S/Com. “A” 4281
7.7. “A” 2559 “
7.8. “A” 2559 “
7.9. “A” 2559 “
7.10. “A” 2559 “