CMN Resolution No. 4687 — Establishes Rules for Interest Rate Equalization Operations under the Proex Export Financing Program

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 September 25, 2018, based on Article 4, items V, VI, XVII, and XXXI, of the aforementioned Law and considering the provisions of Article 3 of Law No. 10,184 of February 12, 2001, and Article 3 of Decree No. 7,710 of April 3, 2012,

R E S O L V E D:

Art. 1 In financing operations for the export of goods and services, the National Treasury may grant the lender or refinancer, as the case may be, sufficient equalization to make the financial charges compatible with those practiced in the international market.

§ 1 In financing for the export of civil aircraft, parts, pieces, and related services, the equalization of interest rates shall be established according to the characteristics of each operation, observing the terms, conditions, and procedures stipulated in the Sectoral Understanding on Export Credits for Civil Aircraft ("Sectoral Understanding on Aviation") of the Organization for Economic Cooperation and Development (OECD), when applicable.

§ 2 The equalization percentage, throughout the entire period, is fixed and will respect the limits and criteria established by the Ministry of Finance and Decree No. 7,710 of April 3, 2012, or any other that may replace it.

Art. 2 Equalization may be granted:

I - in financing to the importer, for cash payment to the exporter established in Brazil; and

II - in refinancing granted to the exporter established in Brazil.

§ 1 The following are eligible to operate:

I - multiple, commercial, investment, and development banks resident or domiciled in the country and the Special Agency for Industrial Financing (Finame);

II - credit or financial establishments located abroad, including agencies or subsidiaries of Brazilian banks; and

III - multilateral organizations with an export credit portfolio.

§ 2 By a credit or financial establishment abroad is understood an establishment regularly constituted under the laws of the country in which it is located, whose statutes provide for the possibility of granting credit in any form of loan and which is subject to supervision by a government body.

§ 3 The negotiation abroad of credit titles related to the export or, where applicable, the respective letter of credit, does not interrupt, exclude, or transfer the right to equalization.

Art. 3 The amounts due by way of equalization are calculated as follows:

I - period: semi-annual, except for the first, which begins:

a) when it concerns financing to the importer, for cash payment to the exporter, or refinancing to the latter, granted by an agent mentioned in item I of § 1 of Art. 2: from the date of credit in the exporter's current account or the date of shipment or delivery of goods, invoice, commercial contract, or financing contract, or the date of consolidation of shipments or invoicing of services, whichever occurs last; and

b) when it concerns financing to the importer, for cash payment to the exporter, or refinancing to the latter, granted by the agents mentioned in items II and III of § 1 of Art. 2: from the date of payment related to the total value of the export or the date of shipment or delivery of goods, invoice, commercial contract, or financing contract, or the date of consolidation of shipments or invoicing of services, whichever occurs last;

II - calculation base: the debtor balance of the financings in each period, recomposed based on the maximum equalizable term, where applicable, using the divisor 36,500 and considering a maximum grace period, for the principal, of six months; and

III - in the case of operations with a term of less than three hundred and sixty days, the equalization period is established:

a) in operations with a financing term of up to one hundred and eighty days: based on the maximum equalizable term, limited to the financing term, counted according to the provisions of item "a" or "b" of item I of the main text of this article, as the case may be; and

b) in operations with a financing term of more than one hundred and eighty days and less than three hundred and sixty days: recomposed in two periods, the first of one hundred and eighty days counted according to the provisions of item "a" or "b" of item I of the main text of this article, as the case may be, and the second for the remaining days, based on the maximum equalizable term, limited to the financing term.

§ 1 The maximum period for consolidation of shipments or invoicing of services is thirty days, with the date of consolidation being that of the last event that integrates it.

§ 2 Operations with a term of less than three hundred and sixty days are admitted, provided that amortization and payment of interest occur on a single date.

§ 3 The values due in financing operations carried out in a currency other than the United States dollar will be converted to that currency based on the parity in effect on the date of the start of the first equalization period, published by the Central Bank of Brazil.

Art. 4 The equalization values referred to in this Resolution are paid to the agents mentioned in § 1 of Art. 2 in National Treasury Notes of series I (NTN-I).

§ 1 The issuance of NTN-I is processed in book-entry form, through the registration of respective credit rights in the name of the agents mentioned in § 1 of Art. 2 in the Special Settlement and Custody System (Selic), through which redemptions are effected.

§ 2 Agents not participating in Selic must enter into a contract with a bank participating in this System, covering:

I - custody service aimed at receiving NTN-I;

II - use of the "Bank Reserves" account for carrying out financial movements resulting from equalizations, as well as negotiations of the titles;

III - authorization to carry out foreign exchange operations and respective transfers to or from abroad resulting from the redemption or negotiation of NTN-I, if the agent not participating in Selic is located abroad; and

IV - legal representation service for the purposes and effects of the provisions of Art. 5.

Art. 5 The issuance of NTN-I is carried out after the credit or financial establishment, among those mentioned in § 1 of Art. 2 or the agent appointed as its legal representative, declares to the Financial Agent of the National Treasury for the Export Financing Program (Proex) that it is in possession of the documents proving compliance with the requirements described below:

I - when it concerns financing to the importer, for cash payment to the exporter, or refinancing to the latter, granted by an agent mentioned in item I of § 1 of Art. 2:

a) shipment of goods or invoicing of services;

b) credit in the exporter's current account of the value in reais corresponding to the financed value;

c) payment of the non-financed portion, if any; and

d) copy of the financing contract signed or of the credit titles related to the export, duly accepted and endorsed, or of the respective letter of credit, in refinancing granted to the exporter; and

II - when it concerns financing to the importer, for cash payment to the exporter, or refinancing to the latter, granted by agents mentioned in items II and III of § 1 of Art. 2:

a) shipment of goods and, where applicable, invoicing of services;

b) payment related to the total value of the export; and

c) copy of the financing contract signed or of the credit titles related to the export, duly accepted and endorsed or, where applicable, of the respective letter of credit.

§ 1 A declaration of possession of other documents related to the credit, granted in Brazil and abroad, framed under the terms of this Resolution, may be required.

§ 2 The deadline for requesting NTN-I from the Proex Financial Agent is six months, counted from the date of credit in the exporter's current account or the date of shipment or delivery of goods, invoice, commercial contract, or financing contract, or the date of consolidation of shipments or invoicing of services, whichever occurs last.

§ 3 Upon request by the National Treasury Secretariat, the Committee for Export Financing and Guarantees (Cofig), or internal and external control bodies, the Proex Financial Agent will demand from the credit or financial establishment the documents referred to in the main text and § 1 of this article.

Art. 6 In operations for the early settlement of financings supported by the Proex interest rate equalization, the following procedures must be observed:

I - for NTN-I not yet redeemed related to the future interest installments of the operation, proportionally to the settled value:

a) the cancellation of NTN-I held by the lender or refinancer, linked to the operation settled early;

b) the restitution, in cash, of the face value of NTN-I linked to the operation settled early; or

c) the delivery of any other public debt titles issued in book-entry form, registered in a centralized settlement and custody system authorized by the Central Bank of Brazil, at the discretion of the Ministry of Finance, which will determine the economic value of the said titles;

II - in the event of eventual redemption of NTN-I related to the future interest installments of the operation after the early settlement of the respective financing, the credit or financial establishment established in § 1 of Art. 2 or the agent appointed as its legal representative must return the overpaid values, plus charges calculated based on the accumulated Selic rate between the date of redemption of NTN-I and the business day preceding the effective return; and

III - in cases where early settlement occurs on a date different from the redemption date of NTN-I related to the interest received from the operation, the equalization due for the last period must be proportional to the term between the maturity of the last redeemed NTN-I and the date of early settlement, and in this case, the cancellation of the portion of NTN-I subsequent to the date of early settlement must occur proportionally.

§ 1 The proportional cancellation of the portion of NTN-I subsequent to the date of early settlement referred to in item III of the main text of this article may be replaced by the alternatives set out in items "b" or "c" of item I of the main text of this article.

§ 2 The equalization values received up to the date of early settlement, related to the interest received from the operation, are preserved.

Art. 7 In the event of default of financings supported by the Proex interest rate equalization, the following procedures must be observed:

I - in the case of early maturity of the debt or honor of guarantee, with cash payment of the amounts due, the right to future equalization installments ceases, with the corresponding cancellation of NTN-I, preserving the equalization values received up to the date of said payment; and

II - in other cases, the flow of NTN-I will be maintained as long as there is an obligation to pay interest related to the financing, preserving the equalization values related to the interest received from the operation.

§ 1 In the event of eventual redemption of NTN-I after the settlement of the financing contract referred to in the main text of this article, the lender or refinancer must return the overpaid values.

§ 2 The restitution of values referred to in § 1 will be proportional to the elapsed time, plus charges calculated based on the accumulated Selic rate between the date of redemption of NTN-I and the business day preceding the effective return.

Art. 8 The goods and services eligible for operations under the protection of this Resolution, as well as the term of the respective interest rate equalization, will obey the determinations defined by the Ministers' Council of the Foreign Trade Chamber (Camex) for the commercialization of operations under the protection of Proex.

Sole Paragraph. In any case, the term of equalization may not exceed the financing term agreed upon by the exporter or importer with the financial institution, limited to the provisions of Decree No. 7,710 of 2012, or any other that may replace it.

Art. 9 Beneficiaries of operations framed, up to the date of entry into force of this Resolution, for which the issuance of NTN-I has not been requested, will have, from that date, the period provided for in § 2 of Art. 5 to request it from the Proex Financial Agent.

Art. 10 Resolution No. 4,063 of April 12, 2012, is revoked.

Art. 11 This Resolution enters into force on the date of its publication.

Ilan Goldfajn
President of the Central Bank of Brazil