CMN Resolution No. 4427 — Authorizes the use of remote sensing for rural credit operations inspection and requires registration of geodetic coordinates in Sicor

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The Central Bank of Brazil, pursuant to Article 9 of Law No. 4,595 of December 31, 1964, makes public that the National Monetary Council, in a session held on June 25, 2015, considering the provisions of Article 4, item VI, of Law No. 4,595 of 1964, and Articles 4, 10, and 14 of Law No. 4,829 of November 5, 1965,

R E S O L V E D:

Article 1. Items 2, 3, and 4 of Section 1 (General Provisions) of Chapter 2 (Basic Conditions) of the Rural Credit Manual (MCR) shall enter into force with the following wording:

“2 - The geodetic coordinates (GC) of the enterprise financed by agricultural operating credit operations and by investment credit operations referred to in items “d”, “e”, and “f” of MCR 3-3-2 must:

a) be provided in the budget, plan, or project related to the enterprise:

I - from January 1, 2016, in operations above R$300,000.00 (three hundred thousand reais);

II - from July 1, 2016, in operations above R$40,000.00 (forty thousand reais);

b) comprise the points necessary to identify the perimeter that defines the plot to be cultivated or, if applicable, two or more plots subject to the same financing operation;

c) be registered in the Rural Credit and Proagro Operations System (Sicor) by the financial agent, in accordance with MCR 3-5-A norms, after verification of data consistency regarding:

I - location of the plot in the municipality or municipalities where the respective property is situated;

II - compatibility between the area calculated using the GC and the financed area provided in the credit contract.” (NR)

“3 - The financial institution must use the standard customer registration for the granting of rural credit.” (NR)

“4 - The registration form must remain at the operating branch of the financial institution granting the credit to the final beneficiary, available for inspection by the Central Bank of Brazil.” (NR)

Article 2. Section 8 (Inspection by Remote Sensing) of Chapter 2 (Basic Conditions) of the MCR is hereby established, as per the annex.

Article 3. This Resolution enters into force on the date of its publication.

Article 4. The following are repealed:

I - Article 3 of Resolution No. 4,174 of December 27, 2012; and

II - Items 4-A, 5-A, and item “c” of Item 5 of Section 7 (Inspection) of Chapter 2 (Basic Conditions) of the MCR.

Alexandre Antonio Tombini
President of the Central Bank of Brazil

----------------------------------------------------------------------------- TITLE: RURAL CREDIT
CHAPTER : Basic Conditions - 2
SECTION: Inspection by Remote Sensing - 8 (*)

----------------------------------------------------------------------------- 1 - The use of remote sensing techniques is permitted for compliance with the provisions of MCR 2-7, regarding the inspection of agricultural operating credit operations and investment credit operations referred to in items “d”, “e”, and “f” of MCR 3-3-2, observing the standards established in this Section.

2 - Remote sensing is considered to be the set of activities related to the acquisition and analysis of data from photographic, opto-electronic, or radar systems, capable of detecting and registering, in the form of images, the flow of electromagnetic radiation reflected or emitted by distant objects.

3 - The enterprise subject to inspection by remote sensing must have its location identified through geodetic coordinates, observing MCR 2-1-2, in order to delimit the perimeter of the planted area subject to credit.

4 - Inspection by remote sensing must include a sequence of images of the enterprise, observing the following conditions:

a) spatial resolution lower than 30 meters and minimum radiometric resolution of 10 bits;

b) quality sufficient, according to the enterprise, to quantify the planted area with a maximum error of 10%, identify the crop, and evaluate vegetative development in each phase of cultivation;

c) obtaining at least three images, recording the following phases of cultivation:

I - initial vegetative development or, for permanent crops, obtaining an image on an appropriate date for preliminary inspection purposes;

II - full vegetative development; and

III - final maturation stage.

5 - For each phase mentioned in item “c” of Item 4, the images used may present, at most, 10% (ten percent) of the enterprise area covered by clouds, shadows, or other factors that compromise the extraction of information, allowing for the overlap of images taken at different times of the same phase.

6 - The result of inspection by remote sensing must be recorded in a specific report, observing the applicable provisions of MCR 2-7 and containing, at minimum, the following information:

a) name and CPF/CNPJ of the producer, Refbacen of the credit operation, and State/Municipality of the enterprise;

b) financed crop, total financed area, and expected production in the case of operating credit;

c) geodetic coordinates of the financed area, registered in the Rural Credit and Proagro Operations System (Sicor);

d) imaging satellite and sensor used, date of images, spatial resolution, radiometric resolution, and bands used;

e) methodology used to perform pre-processing and processing of the image;

f) confirmation of the location of the enterprise and the actually planted area;

g) confirmation of the planted crop;

h) achieved vegetative development, vegetation index used for biomass evaluation, and estimated productivity;

i) analysis of deviations verified and their relevance in relation to the parameters contained in the budget and financing contract; and

j) conclusions of the analysis regarding the regularity of the enterprise, concerning the items related to the location and extent of the planted area, the crop, and vegetative development.

7 - The report must be signed:

a) by the professionals responsible for the analysis and preparation of remote sensing images, interpretation, and preparation of conclusions; and

b) by a representative of the financial institution granting the credit, allowing, in place of this signature, the reference to the contract signed between the financial institution and the entity providing remote sensing services for it to act on its behalf.

8 - Local inspection by inspectors not related to the work or to the entities contracted for remote sensing services is mandatory for 10% of the enterprises inspected by remote sensing, selected randomly by the financial institution, observing Items 6 to 13 of MCR 2-7 - Inspection.

9 - The financial institution must adopt measures to adjust the technical procedures for obtaining and analyzing images, with the entities contracted for remote sensing services, when inconsistencies are found between the results of local inspection reports and the specific reports of the remote sensing inspection results.

10 - Financial institutions must keep the documentation generated in the remote sensing inspection process available to the Central Bank of Brazil, together with the documentation related to the credit contract and its execution, observing the legal and regulatory norms regarding the retention and conservation of documents related to rural credit operations.

11 - The provisions of Item 10 apply to the report of the local inspection, if any, to the original and processed images of the enterprise, the calculation memories of pre-processing and processing of the images and their metadata, the analyses, the issued report, and the other files and documents generated in the process.