Instruction (Historical) No. 4/2023

Instruction No. 4/2023
BO No. 2/2023 Supplement • 2023/02/24
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Topics
Banking Operations :: Deposits and Withdrawals of Banknotes Mod. 99999911/T – 01/14 Index Text of the Instruction
Annex I to the Instruction - Hours and locations for deposit and withdrawal of banknotes and metallic coins
Annex II to the Instruction - Compliance with the duty of information towards the data subject

Text of the Instruction
Subject: Deposit and withdrawal operations of euro banknotes and metallic coins at the Bank of Portugal

Article 6(1) of the Organic Law of the Bank of Portugal states that, "in accordance with Article 106 of the Treaty establishing the European Community, the Bank issues banknotes with legal tender and discharge power".

A combined reading of this article with Article 128(1) of the Treaty on the Functioning of the European Union (TFEU) and Article 16 of Protocol No. 4 annexed to the TFEU, which establishes the Statute of the European System of Central Banks (ESCB), which provides that the European Central Bank (ECB) has the exclusive right to authorize the issue of euro banknotes in the Union, results in the conclusion that this right includes the competence to adopt measures to protect the integrity of euro banknotes.

In addition to the legal basis referred to, the recitals of the ECB Decision of 16 September 2010 on the verification of authenticity and quality and the recirculation of euro banknotes (ECB/2010/14) reinforce the need for each National Central Bank to ensure that euro banknotes in circulation are genuine and in good condition of preservation.

To guarantee the genuineness of euro banknotes in circulation, they must also be kept in good condition of preservation, so that the quality control of euro banknotes is essential for the general public to easily verify the integrity of the banknotes made available to them. In this sense, national law also establishes, in Article 10 of Decree-Law No. 195/2007 of 15 May, which regulates the activity of recirculation of euro banknotes carried out by all entities that operate professionally with cash, the duty to return to the Bank of Portugal euro banknotes that do not meet the minimum quality requirements to remain in circulation or that have not been submitted to any of the verification processes provided for.

Regarding the issuance of metallic coins, Regulation (EU) No. 651/2012 of the European Parliament and of the Council of 4 July 2012 on the issuance of euro coins determines that Member States may issue current or commemorative euro coins.

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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In this context, the Bank of Portugal has been assigned, as determined by Article 6(2) and (3) of its Organic Law, the competence to put "into circulation metallic coins, including commemorative ones (...) through and upon requisition of the Bank".

Regulation (EU) No. 1210/2010 of the European Parliament and of the Council of 15 December 2010 on the authentication of euro coins and the handling of euro coins unfit for circulation determines, in Article 3(2), that, "following authentication, all euro coins suspected to be counterfeit and euro coins unfit for circulation are presented to the designated national authority". Such coins, in accordance with Article 9 of Decree-Law No. 184/2007 of 10 May, a document that regulates the activity of recirculation of euro coins carried out by all entities that operate professionally with cash, "must be deposited with the Bank of Portugal, in accordance with the rules relating to quantities and packaging to be defined by instruction of the Bank of Portugal".

Considering the foregoing, this instruction aims to regulate the operationalization of the functions of the Bank of Portugal, both as an issuer of euro banknotes, within the framework of the Eurosystem, and in the context of the placement into circulation of metallic coins, in accordance with the responsibilities assigned and internally defined by the Portuguese State, as well as as an entity with responsibilities in preserving the integrity of euro banknotes and metallic coins.

Given the scale of the changes to be introduced, the Bank of Portugal proceeds to revoke Instruction No. 18/2021 of 15 December, which will be replaced by this new Instruction.

Thus, given the provisions of Articles 6(1) to (3) of the Organic Law of the Bank of Portugal, Article 128(1) of the Treaty on the Functioning of the European Union and Article 16 of Protocol No. 4 annexed thereto, Article 2(1) of Regulation (EU) No. 651/2012 of the European Parliament and of the Council of 4 July on the issuance of euro coins and Article 3(2) of Regulation (EU) No. 1210/2010 of the European Parliament and of the Council of 15 December 2010 on the authentication of euro coins and the handling of euro coins unfit for circulation, and also in accordance with Article 10 of Decree-Law No. 195/2007 of 15 May and Article 9 of Decree-Law No. 184/2007 of 10 May, the Bank of Portugal determines:

CHAPTER I
General Provisions

Article 1.
Object
1 - This instruction defines the locations, hours, rules, conditions and the application support through which deposits and withdrawals of euro banknotes and metallic coins can be carried out at the Bank of Portugal. 2 - This instruction does not apply to the delivery of banknotes and euro coins suspected of counterfeiting and damaged by intelligent banknote neutralization systems (IBNS).

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Mod. 99999911/T – 01/14

Article 2.
Scope of Application
The recipients of this Instruction are:
a) Credit institutions (CI); b) Value-in-transit companies (VTC) that ensure, on behalf and on the order of CIs, the carrying out, at the Bank of Portugal, of the operations provided for in this regulation.

Article 3.
Value-in-Transit Companies
1 - In the situations provided for in point (b) of the previous article, CIs must, whenever the Bank of Portugal requests, provide proof, within ten business days, that they have contracted the respective cash transport and treatment services with the mandated VTC, namely by presenting an extract of the contract that provides for said services. 2 - Failure to comply with the preceding point prevents the VTC from carrying out operations at the Bank of Portugal, with respect to the CI concerned.

Article 4.
Business Continuity
The Bank of Portugal adopts the necessary procedures to, in the face of crisis scenarios, ensure the following:
a) A maximum period of unavailability of up to the next business day after the day a crisis scenario occurs; b) At least one debit operation per day, per CI, at one of the Bank of Portugal's treasuries.

Article 5.
Hours and Locations
CIs and VTCs may only proceed to the deposit and withdrawal of banknotes and metallic coins at the hours and locations listed in Annex I to this Instruction.

Article 6.
Conditions for Carrying Out Operations at the Bank of Portugal 1 - If the Bank of Portugal considers that, at a certain cash processing center (CPC), a VTC repeatedly fails to comply with the duty to promote efficient cash recirculation, following two formal warnings, the Bank of Portugal may inhibit operations related to that CPC for up to 10 business days. 2 - The circumstances referred to in the previous point may also constitute grounds for re-evaluation of the conditions for carrying out cash recirculation.

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Mod. 99999911/T – 01/14
3 - Practices that fail to comply with the duty to promote efficient cash recirculation are considered, namely:
a) Deposit of fit banknotes, previously processed or not, followed by withdrawal, on the same day or within the next 2 business days, of banknotes of the same denomination; b) Incorrect segregation of counterfeits in deliveries; c) Non-compliance with packaging standards defined by the Bank of Portugal, namely by the use of consumables, or their residues, that damage cash processing equipment; d) Return of banknotes in the packaging standard of withdrawals at the Bank of Portugal.

Article 7.
Contacts of CIs and VTCs
CIs and VTCs are obliged to make available, up to twice a year, or to communicate whenever they change, the contacts of the persons in charge of the business area at national level, as well as the operational managers in each of the treasuries at which they operate, relevant for the operations carried out under this Instruction.

Article 8.
Personal Data
The personal data processed by the Bank of Portugal by virtue of the application of this Instruction are processed as described in Annex II.

CHAPTER II
Integrated management of cash withdrawal and deposit operations

Article 9.
GOLD Application
1 - CIs and VTCs use the GOLD application, available on the BPnet channel, to communicate deposit orders (DO) and withdrawal orders (WO) of euro banknotes and metallic coins at the Bank of Portugal, as well as to manage said operations. 2 - The Bank of Portugal publishes on the BPnet channel, in the documentation area associated with the GOLD application:
a) The Procedures Manual for Cash Deposit and Withdrawal Operations at the Bank of Portugal, to facilitate understanding of the rules and operational procedures related to this Instruction, as well as to define operational aspects related to the use of the GOLD application. b) Any changes to the Procedures Manual for Cash Deposit and Withdrawal Operations at the Bank of Portugal.

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Mod. 99999911/T – 01/14

Article 10.
Reference Units for Euro Banknotes
1 - The reference units for the constitution of DOs and WOs of euro banknotes are the thousand (1,000 notes), the half-thousand (500 notes) and the hundred (100 notes), in compliance with the rules defined in the following numbers. 2 - DOs and WOs observe, in addition to discrimination by denomination, according to the request presented by the CI, the reference units as represented in the following table:

Denomination	Thousand	Half-Thousand	Hundred
EUR 500	DO
EUR 200	DO/WO
EUR 100	DO/WO
EUR 50	DO/WO	DO/WO	n/a
EUR 20	DO/WO	DO/WO	n/a
EUR 10	DO/WO	DO/WO	n/a
EUR 5	DO/WO	DO/WO	n/a

3 - Deposits of hundreds are only accepted in quantities that do not make up the immediately superior reference units and are limited to one delivery per day per CI or VTC and per Bank of Portugal Treasury. 4 - Exceptionally, deposit and withdrawal requests, in quantities lower than indicated, may be accepted at the Faro Branch, at the Regional Delegations of the Azores and Madeira, provided that this is previously requested and coordinated with the respective Bank of Portugal Treasury. 5 - The exception referred to in the previous number is limited to one delivery per day per CI or VTC and per Treasury.

CHAPTER III
Credentials, Mandates and Sub-delegation

Article 11.
Credentials
1 - The withdrawal of cash presupposes the intervention of two distinct BPnet users, previously credentialed by each CI, as follows:
a) A user responsible for entering the WO in the GOLD application; b) A user responsible for confirming the WO in the GOLD application.
2 - For the credential to be considered valid:

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Mod. 99999911/T – 01/14 a) It must be carried out using the "Credentiation" letter model; b) It must be accompanied by a document of recognition, by an authorized entity, of the signatures of the credentialed users.

Article 12.
Mandates
1 - CIs may mandate a VTC for the execution of deposit and withdrawal operations of euro banknotes and metallic coins, with the mandate being valid for all treasuries of the Bank of Portugal. 2 - Only VTCs authorized to carry out the activity of metallic coin recirculation may be mandated, under the previous number. 3 - For the mandate to be valid, it must be carried out using the "Mandates" letter model.

Article 13.
Sub-delegation
1 - A VTC may sub-delegate to another VTC the execution of deposit and withdrawal operations of euro banknotes and metallic coins, provided that it is previously and formally authorized by the CI that mandated it. 2 - The sub-delegation under the previous number does not suspend the mandate and is only valid for the Bank of Portugal treasury specified therein. 3 - The sub-delegation is carried out using the "Sub-delegation" letter model.

Article 14.
Communication and Formalization
1 - The CI is responsible for communicating to the Bank of Portugal the assignment or revocation of credentials, mandates and sub-delegations.
2 - The communications referred to in the previous number are made in writing and addressed to the mailing address referred to in this Instruction. 3 - Credentials, mandates and sub-delegations are signed by whoever has the power to bind the entity, and signatures must be recognized in person in accordance with legally provided terms. 4 - The letter models referred to in the previous articles are available on BPnet, in the area reserved for Issuance and Treasury, in the section related to documentation.

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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CHAPTER IV
Identification of Volumes and Packaging

Article 15.
Sealing and Identification of Volumes
1 - All volumes delivered to the Bank of Portugal by depositors must be sealed and identified with a unique barcode.
2 - The coding of the barcodes referred to in the previous number must comply with one of the following systems:
a) GS1 (SSCC - Serial Shipping Container Code); b) Code 128 with a maximum limit of 17 positions.

Article 16.
Packaging Material
The packaging material used in the delivery of euro banknotes and metallic coins to the Bank of Portugal is obligatorily recyclable and, preferably, reusable.

Article 17.
Packaging Structure for Current Euro Metallic Coins Fit for Circulation 1 - The packaging structure of current euro metallic coins consists of the following groupings of the same denomination:
a) Bags or rolls; b) Sleeves or combs, consisting of bags or rolls, respectively; c) Boxes, consisting of sleeves or combs.
2 - Sleeves must contain the following indications:
a) Quantity of coins; b) Denomination; c) Value; d) Weight; e) Date of their constitution; f) Financial agent code, assigned by the Bank of Portugal, of the entity responsible for their treatment. 3 - Sleeves or combs are packaged by the same denomination in boxes that, in turn, must contain the following indications:
a) Quantity of coins; b) Denomination;

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Mod. 99999911/T – 01/14 c) Value; d) Weight; e) Date of their constitution; f) Financial agent code, assigned by the Bank of Portugal, of the entity responsible for their treatment. 4 - The packaging referred to in the previous numbers must respect, for each denomination, the following quantities:

Denomination	Coins per Bag/Roll	Sleeves	Rolls	Coins	Sleeves	Combs	Coins	Boxes	Coins
EUR 0.01	50	30	1,500	10	500	190	570	285,000
EUR 0.02	50	30	1,500	10	500	145	435	217,500
EUR 0.05	50	20	1,000	10	500	170	340	170,000
EUR 0.10	40	20	800	10	400	190	380	152,000
EUR 0.20	40	20	800	10	400	145	290	116,000
EUR 0.50	40	15	600	5	200	145	435	87,000
EUR 1.00	25	15	375	10	250	220	330	82,500
EUR 2.00	25	15	375	10	250	220	330	82,500

Article 18.
Packaging of Non-Circulating Current Euro Metallic Coins Non-circulating euro metallic coins are packaged in rolls consisting of coins of the same denomination.

Article 19.
Packaging of Circulating Current Euro Metallic Coins Circulating euro metallic coins are packaged in bags consisting of coins of the same denomination.

CHAPTER V
Deposit Operations
Section I
Deposit Operations of Euro Banknotes and Current Metallic Coins

Article 20.
Deposit Operations of Euro Banknotes
1 - When carrying out deposit operations, CIs and VTCs deliver to the Bank of Portugal the banknotes packaged and segregated by denomination, in accordance with Article 6 of this Instruction. 2 - Banknotes are delivered in sealed volumes, duly identified in accordance with Article 14, observing the following:
a) Each volume may only contain one denomination; b) Banknotes from different CIs are permitted in the same volume; c) They must be grouped by reference units, preferably with only one band. 3 - At Bank of Portugal treasuries where operational conditions allow, the delivery of banknotes must be carried out in reusable containers provided by the Bank of Portugal. 4 - At treasuries that do not operate with reusable containers, the use of sealed volumes has the following limits per volume:

Denomination	EUR 5	EUR 10	EUR 20	EUR 50	EUR 100	EUR 200	EUR 500
Quantity of notes per volume	10,000	8,000

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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5 - Exceptionally and whenever a volume with quantities lower than those defined in No. 4 is delivered, it is accepted that the total quantity of banknotes, of the same denomination, may be distributed equitably among all volumes, provided that this does not imply a change in the number of volumes to be delivered. 6 - The Bank of Portugal accepts deposits on the condition that the declared value corresponds to the amounts delivered and that the banknotes have legal tender. 7 - Without prejudice to the exception stipulated in No. 5, at each treasury, the Bank of Portugal only accepts one sealed volume with quantities lower than those defined in No. 4 per depositor, per day and per denomination.

Article 21.
Deposit Operations of Current Euro Metallic Coins Fit for Circulation 1 - The deposit of euro metallic coins at the Bank of Portugal depends on the authorization of this Bank, which is granted if the following requirements are met:
a) Prior registration in the Coin Surplus Module, available in the GOLD application; b) Verification, by an entity authorized to carry out metallic coin recirculation, of their authenticity and fitness, with a view to guaranteeing that they are genuine and meet sufficient conditions to remain in circulation. 2 - The recipients of this Instruction deliver euro metallic coins in boxes, in accordance with the provisions of Article 16, and may, whenever operational conditions justify it, request authorization from the Bank of Portugal to carry out the delivery in differentiated units.

Article 22.
Special Deposits
1 - Without prejudice to the provisions in the previous articles, the Bank of Portugal may select and determine the delivery of samples of euro banknotes or metallic coins, within a period of 5 business days, to comply with information reporting obligations within the framework of cash recirculation control. 2 - The provisions of the previous number are also applicable to euro banknotes or metallic coins collected during the carrying out of an inspection. 3 - The euro banknotes and metallic coins referred to in the previous numbers must be segregated by state and denomination, and placed in sealed volumes, complying with the identification requirements provided for in Article 14.

Article 23.
Verification of Deposit Regularity
1 - The acceptance of deposit volumes depends on the verification of their integrity, inviolability and validation of the information registered in GOLD. 2 - In case of irregularities detected at the time of receipt of the volumes, the Bank of Portugal may, if those are not remedied in due time, return part or all of the volumes.

Article 24.
Settlement of Deposits
The Bank of Portugal settles the values received through a specific document for this purpose.

Instruction No. 4/2023 BO No. 2/2023 Supplement • 2023/02/24 Topics Banking Operations :: Deposits and Withdrawals of Banknotes
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Article 25.
Posting of Deposit Values to Account
The Bank of Portugal posts the value of deposit operations to the account of the ordering CI on the date of their carrying out.

Section II
Discrepancies

Article 26.
Responsibility for Discrepancies
The entity that creates the DOs in GOLD assumes responsibility for discrepancies verified in the deposits.

Article 27.
Verification and Assessment by the Bank of Portugal 1 - The Bank of Portugal verifies the integrity of banknote deposits and assesses their authenticity within 15 days after the date of their receipt. 2 - The Bank of Portugal may, for operational reasons...