CMN Resolution No. 2433 — Conditions and Procedures for Extending Rural Credit Debt

RESOLUTION NO. 2433

Sets forth the conditions and procedures to be observed regarding the process of extending debts originating from rural credit, as governed by Law No. 9,138 of November 29, 1995, and complementary regulations.

The CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes it public that the MONETARY NATIONAL COUNCIL, in a session held on October 15, 1997, in view of the provisions of Article 4, item VI, of the aforementioned Law, Articles 4 and 14 of Law No. 4,829 of November 5, 1965, the sole paragraph of Article 8, and Article 10 of Law No. 9,138 of November 29, 1995,

RESOLVES:

Article 1. With regard to extended operations under the terms of Law No. 9,138 of November 29, 1995, the financial institution must provide 1 (one) statement of each graphical account of the original operations and 1 (one) statement of the consolidated balance as of November 30, 1995, to the borrower who requests them, observing:

I - statement relating to the graphical account of the original operation containing all entries with their respective values, dates, and identifications, where it is clearly demonstrated:

a) the charges due for the normal status of the operation, until the due date;

b) default charges and dates of their respective applications, including late interest, fines, and service fees;

c) legal fees due to the professional hired by the financial institution;

d) the additional amount of the Agricultural Activity Guarantee Program (PROAGRO), discriminating the respective calculation bases, values, and dates of collection;

e) that the application of the 1% (one percent) rebate referred to in item II of Article 5 of Resolution No. 2,164 of June 19, 1995, was observed, provided that the operation was renegotiated based on this regulation;

II - statement relating to the debtor balance calculated on November 30, 1995, where it is clearly demonstrated:

a) that the provisions of items V, VI, and VII of Article 1 of Resolution No. 2,238/96 were observed;

b) that the effects of the application of the criterion for updating interest rates different from that established in the original contract were eliminated, where applicable.

Article 2. The following procedures must be observed when the borrower disagrees with the values presented to them by the financial institution, which must provide the necessary clarifications regarding the extension process:

I - the borrower will have 60 (sixty) days, counted from the receipt of the statements, to attempt to resolve their discrepancies with the respective branch;

II - if no agreement is reached within this period, the borrower will have 30 (thirty) days to request the mediation of the National Confederation of Agriculture (CNA), through its State Federations;

III - the CNA will have 60 (sixty) days to seek to resolve the pending issue between the parties;

IV - if the impasse persists, the borrower will have 60 (sixty) days to appeal to the Central Bank of Brazil, via Regional Delegations.

Sole Paragraph. The observance of the procedures and deadlines indicated in this article does not dispense with the obligation of the borrower to pay their commitments on the agreed due dates, with the borrower being assured the reversal or return of values debited or charged improperly.

Article 3. The financial institution must adopt the necessary measures for the continuity of credit assistance to borrowers covered by the extension, when indispensable for the development of their operations, including regarding the possibility of extinguishing judicial processes.

Article 4. Provided that the justified inability to pay by the borrower is proven, in accordance with MCR 2-6-9, the partial or full extension of the portion of the rural credit debt extended under the terms of Law No. 9,138/95 and complementary regulations issued by the Central Bank of Brazil, due on October 31, 1997, is due, regardless of the original source of the resources, subject to case-by-case examination, observing the following conditions:

I - the inability to pay will be considered justified and duly proven when resulting from one of the following reasons:

a) difficulty in marketing products, crop failure due to adverse factors or eventual occurrences detrimental to the development of operations, considered for the purpose of paying the installment subject to extension; or

b) non-receipt of financing for the 96/97 crop cycle operating costs;

II - respecting the maximum period of 10 (ten) years, the installment subject to extension must be repactored for payment in the year following the end of the originally established repayment schedule;

III - the installment subject to extension, expressed in quantity of units equivalent in product, must be increased by an effective interest rate of 3% p.a. (three percent per annum), compounded annually.

Sole Paragraph. In the case of denial of the extension, the financial institution must present a formal and technical justification to the applicant.

Article 5. The financial institution must release the guarantees, linked to the debt extension operation, that exceed the parameters normally used in rural credit.

Article 6. Amend, to March 31, 1999, the deadline established in Article 4, item I, of Resolution No. 2,080 of June 22, 1994.

Article 7. The Secretariats of Economic Monitoring and of the National Treasury, of the Ministry of Finance, and of Agricultural Policy, of the Ministry of Agriculture and Supply, are authorized to jointly define the complementary measures necessary for the implementation of the provisions of this Resolution, with the relevant instructions to be disseminated to financial institutions by the Central Bank of Brazil.

Article 8. This Resolution enters into force on the date of its publication.

Article 9. In view of the provisions of Article 2 of this Resolution, the Commission referred to in item VIII of Article 1 of Resolution No. 2,238/96 is hereby extinguished.

Brasília, October 16, 1997

Gustavo H. B. Franco
President