CMN Resolution No. 5042 — Establishes Guidelines for Foreign Exchange Market Operations

CMN RESOLUTION NO. 5,042, OF NOVEMBER 25, 2022

Establishes the guidelines that must be observed for the conduct of operations in the foreign exchange market.

The Central Bank of Brazil, in accordance with Article 9 of Law No. 4,595, of December 31, 1964, makes public that the National Monetary Council, in a session held on November 24, 2022, based on Articles 3, item IV, and 4, items V and VIII, of Law No. 4,595, of December 31, 1964, and considering Articles 2, 14, § 2, and 15 of Law No. 14,286, of December 29, 2021, which will enter into force on December 31, 2022,

RESOLVED:

Art. 1 This Resolution establishes the guidelines that must be observed for the conduct of operations in the foreign exchange market.

Sole Paragraph. The provisions of this Resolution also include guidelines regarding the entry into or exit from the country of Brazilian reais or foreign currency through an institution authorized to operate in the foreign exchange market.

Art. 2 To conduct operations in the foreign exchange market, financial institutions and other institutions authorized to operate by the Central Bank of Brazil must obtain prior authorization from the Central Bank of Brazil.

Art. 3 The principles that guide the regular functioning of the foreign exchange market are:

I - competition for the provision of services to the public related to foreign exchange market operations;

II - meeting the needs of the public, especially freedom of choice, privacy, transparency, and access to clear and complete information about the conditions of foreign exchange market operations;

III - efficiency of operations conducted in the foreign exchange market;

IV - encouragement of innovation, considering the legality of operations, and diversity of business models;

V - reduction of transaction costs in the foreign exchange market;

VI - financial inclusion;

VII - reliability and quality of products and services offered in the foreign exchange market; and

VIII - integrity, compliance, security, and confidentiality of foreign exchange operations or value movements.

Art. 4 The conduct of operations in the foreign exchange market and the entry into or exit from the country of Brazilian reais or foreign currency through an institution authorized to operate in the foreign exchange market must observe the following general guidelines:

I - free agreement on the exchange rate;

II - free conduct of operations in the foreign exchange market, without value limitation, observing legislation, the guidelines of this article, and the regulation of the Central Bank of Brazil;

III - adequacy of products and services offered or recommended to the needs, interests, and objectives of clients;

IV - provision, in a clear and precise manner, of the information necessary for free choice and decision-making by clients, explicitly stating, among other things, rights and duties, responsibilities, costs or burdens, penalties, and any existing risks in the conduct of foreign exchange operations or value movements;

V - use, in offers, contracts, and receipts, of clear, objective, and appropriate wording relative to the nature and complexity of the services to be provided regarding foreign exchange operations or value movements;

VI - compliance with legislation and the regulation of the Central Bank of Brazil, including regarding:

a) procedures and policy for client identification and qualification, including those aimed at preventing illicit activities;

b) the functioning and supervision of institutions authorized to operate in the foreign exchange market;

c) the types and characteristics of foreign exchange operations, including forms, limits, rates, deadlines, and other conditions; and

d) requirements and procedures for opening and managing accounts in Brazilian reais owned by non-residents and accounts in foreign currency in the country;

VII - provision of the minimum characteristics that operations conducted in the foreign exchange market must have to ensure proof of business consensus between the parties regarding agreed conditions; and

VIII - treatment of gold as a foreign exchange instrument and the subjection of gold operations to the rules applicable to foreign currency purchase and sale operations.

Art. 5 The financial relationship between institutions authorized to operate in the foreign exchange market and institutions domiciled or headquartered abroad must be maintained with those subject to financial regulation and supervision in their respective country of origin.

Art. 6 Financial institutions and other institutions authorized to operate by the Central Bank of Brazil, observing the activities permitted to them by legislation, may allocate, invest, and direct for credit and financing operations, in the country and abroad, resources raised in the country and abroad, observing the regulatory and prudential requirements established by the National Monetary Council and the Central Bank of Brazil.

Art. 7 The types and characteristics of foreign exchange operations, including forms, limits, rates, deadlines, and other conditions, may be defined based on a proportionality criterion, considering complexity and associated risks.

Art. 8 The following are revoked:

I - Circular No. 24, of February 25, 1966;

II - Resolution No. 4,033, of November 30, 2011; and

III - Article 3 of CMN Resolution No. 4,948, of September 30, 2021.

Art. 9 This Resolution enters into force on December 31, 2022.

Roberto de Oliveira Campos Neto
President of the Central Bank of Brazil