Circular to Approved Intermediaries No. 2020-13 of June 2, 2020

CIRCULAR TO APPROVED INTERMEDIARIES
No. 2020-13 of June 2, 2020
Subject: External Loans.
The Governor of the Central Bank of Tunisia,
Having regard to the Exchange and Foreign Trade Code promulgated by Law No. 76-18 of January 21, 1976, consolidating and codifying the exchange legislation governing relations between Tunisia and foreign countries, as amended by subsequent texts, notably Decree-Law No. 2011-98 of October 24, 2011; Having regard to Law No. 2016-35 of April 25, 2016 establishing the status of the Central Bank of Tunisia; Having regard to Law No. 2016-48 of July 11, 2016 on banks and financial institutions; Having regard to Decree-Law No. 2011-117 of November 5, 2011 on the organization of microfinance institutions' activities, as amended by Law No. 2014-46 of July 24, 2014; Having regard to Decree No. 77-608 of July 27, 1977 setting the application conditions for the aforementioned Exchange and Foreign Trade Code, as amended and supplemented by subsequent texts, notably Government Decree No. 2019-1115 of December 3, 2019; Having regard to Circular to Approved Intermediaries No. 93-05 of April 5, 1993 on foreign currency investment forms, as amended by Circular to Approved Intermediaries No. 2018-14 of December 26, 2018 on foreign currency investments by non-residents in Tunisia; Having regard to Circular to Approved Intermediaries No. 93-16 of October 7, 1993 on external loans, as amended by subsequent texts, notably Circular No. 2007-01 of January 9, 2007; Having regard to Circular to Approved Intermediaries No. 97-02 of January 24, 1997 on information forms; Having regard to Opinion No. 2020-13 of the Compliance Control Committee dated June 2, 2020, Decides:
Article 1 - This circular sets the conditions for resident companies to access external foreign currency loans from non-residents, as well as their repayment procedures.
Section 1: Conditions for accessing external loans
Article 2 - Resident companies may, for the needs of their activities, contract external foreign currency loans from non-residents in forms including buyer's credits, supplier's credits, financial credits, leasing credits, and advances on current accounts with associated parties, in accordance with this circular.
External foreign currency loans contracted with State guarantee are not subject to the conditions set forth in Articles 3, 4, and 5 of this circular.
Article 3 - External foreign currency loans with a repayment period not exceeding twelve months are contracted freely within the following amounts:

• twenty-five million dinars (25,000,000 TND) per calendar year for banks and approved financial institutions under Law No. 2016-48;
• ten million dinars (10,000,000 TND) per calendar year for other companies, including microfinance institutions approved under Decree-Law No. 2011-117.
  Article 4 - External foreign currency loans with a repayment period exceeding twelve months are contracted freely under the following conditions:
• without amount limit for banks and financial institutions referred to in Article 3 above, listed on a stock exchange or having obtained a rating from one of the rating agencies listed in the annex to this circular;
• up to fifty million dinars (50,000,000 TND) per calendar year for other companies, including microfinance institutions referred to in Article 3 above, provided these companies are listed on a stock exchange or have obtained a rating from one of the rating agencies listed in the annex to this circular;
• up to thirty million dinars (30,000,000 TND) per calendar year for companies not meeting the conditions of the two preceding paragraphs;
  Article 5 - Resident companies must contract external loans:
• under the best market conditions prevailing at the time of loan conclusion;
• from, as applicable, financial institutions with a physical presence and/or affiliated to a regulated financial group, their suppliers for the financing of their purchases, or their associates for advances on current accounts with associated parties.
  Article 6 - The issuance and provision of guarantees in the context of loans contracted in compliance with this circular are free.
  Section 2: Domiciliation of loan files and conditions for executing transfers
  Article 7 - The company that has contracted an external loan must domiciliate the related file with a single approved intermediary. This file must include copies of the following documents, accompanied by originals:
• the loan contract duly signed by the contracting parties or, alternatively, any other document evidencing their contractual commitments and the guarantee agreement if it is a loan contracted with State guarantee;
• the amortization schedule indicating repayment deadlines for principal, interest, and potentially all other charges stipulated in the loan contract, or, in the case of a leasing credit, the payment schedule for rents and the residual acquisition amount;
• the Central Bank of Tunisia's approval authorizing the conclusion of the loan, for loans not meeting the conditions set forth in this circular.
  The approved intermediary returns to the borrower the originals of the documents submitted after having them countersigned.
  Article 8 - In the case of variable rate credits, the approved intermediary must obtain from the lender, upon each renewal of the interest period, a confirmation specifying the duration of the new period and the related interest rate, which it verifies for accuracy.
  Article 9 - The approved intermediary executes, upon the borrower's order, transfers at their due dates based on:
• supporting documents referred to in Articles 7 and 8 of this circular;
• investment forms, prepared in accordance with current regulations, concerning external loans resulting in foreign currency importation or any document justifying the effective use of the loan for other loans (import documents charged by customs, statements, provisional reception reports, invoices...).
  It must also ensure beforehand that the deadlines comply with the amortization schedule and that this schedule corresponds to the loan contract.
  For the payment of late interest, the approved intermediary verifies the actual duration of the delay and the applied interest rate according to contractual provisions.
  Article 10 - If the guarantees referred to in Article 6 above are called, the approved intermediary executes the transfer of the resulting sums based on appropriate supporting documents and in compliance with the terms of said guarantees.
  Section 3: Repayment of bond loans subscribed by non-residents
  Article 11 - The approved intermediary executes transfers of due principal and interest amounts for foreign currency bond loans issued abroad and subscribed by non-residents with resident companies, based on:
• any document justifying the due amount;
• the investment form, prepared in accordance with current regulations;
  Section 4: Communication to the Central Bank of Tunisia
  Article 12 - Approved intermediaries must retain all documents required by this circular in accessible files for control purposes.
  Article 13 - For each transfer falling under this circular, the domiciling approved intermediary prepares and communicates to the Central Bank of Tunisia an information form prepared in accordance with current regulations.
  The domiciling approved intermediary must additionally submit to the Central Bank of Tunisia via the Data Exchange System (SED) no later than 20 days after the end of each quarter, a statement of domiciled loans and related transfers executed during said quarter, in accordance with the technical guide available to approved intermediaries, downloadable via (SED).
  Article 14 - Circular to Approved Intermediaries No. 93-16 of October 7, 1993 on external loans is hereby repealed.
  Article 15 - This circular enters into force from the date of its publication.
  The Governor
  Marouane EL ABASSI
  Annex to Circular to Approved Intermediaries No. 2020-13 of June 2, 2020 on external loans
  List of rating agencies:

1. For microfinance companies:

• MicroRate;
• Micro-Credit Ratings International Limited (M-CRIL);
• Micro Finanza Rating (MFR)

2. For other companies, including banks and approved financial institutions under Law No. 2016-48:

• Fitch Ratings;
• Standard & Poor's;
• Moody's;