Instruction No. 25 on Bilateral Foreign Exchange Auctions by the Central Bank of Congo

BANQUE CENTRALE DU CONGO - 1 VICE-GOVERNOR INSTRUCTION NO. 25 TO BANKS Concerning: Bilateral foreign exchange auctions by the Central Bank of Congo

The Central Bank of Congo, Having regard to Law No. 005/2002 of May 7, 2002, relating to the constitution, organization, and functioning of the Central Bank of Congo, particularly Article 6; Having regard to Ordinance-Law No. 67/272 of June 23, 1967, relating to the regulatory powers of the Central Bank of Congo in matters of exchange regulation, as amended to date; Considering the objectives of de-dollarizing the national economy, ensuring transparency in its foreign exchange purchase and sale operations, and improving the functioning of the foreign exchange market; Decrees the following provisions:

Article 1: Purpose This Instruction aims to organize bilateral auctions for the purchase and sale of foreign currency against the national currency by the Central Bank of Congo.

Article 2: Participants in bilateral foreign exchange auctions Only the Central Bank of Congo and approved commercial banks may participate in the bilateral auction operations covered by this Instruction.

Article 3: Frequency of auctions Bilateral foreign exchange auctions are organized on Mondays and Thursdays, or on working days of the Central Bank of Congo following if those are holidays, according to the following schedule (Kinshasa time): • Publication of the call for tenders • Submission of bids • Tallying of bids • Publication of results Day J-1 at the latest by 16h00; Day J at the latest by 10h00; Day J from 10h00 onwards; Day J at the latest by 11h00.

563, Colonel Tshatshi Boulevard - Kinshasa - Gombe Email: sgouvemeur@bcc.cd / svicegouve@bcc.cd / cabgouv@bcc.cd - Website: http://www.bcc.cd

BANQUE CENTRALE DU CONGO CONTINUED, PAGE 2 Exceptionally, based on imperatives related to monetary policy, the Central Bank of Congo may organize ad hoc bilateral auctions on other working days of the week.

Article 4: Publication of calls for tenders (Annex I) On the working day preceding the day of the intended operation, the Central Bank of Congo communicates to all eligible participants in bilateral foreign exchange auction sessions, via its Internet site, its information system, or any other means (duly signed letter, e-mail, fax, Swift), the characteristics of the operation. This announcement message specifies in particular: the number of the auction; the deadline date and time for submitting offers; the type of call for tenders: bilateral with variable rates; the competitive multi-rate auction method; the value date of the operation: Day J+2; the maximum number of offers per participant for purchase and sale; the minimum amount per offer and multiples of this amount (the increment); the format of the exchange rate; and

Article 5: Transmission of offers (Annex II) Purchase and/or sale offers of foreign currency are submitted to the Central Bank of Congo/Direction having foreign exchange operations within its purview, via its information system, respecting what is indicated in the call for tender. In case of unavailability of the Central Bank of Congo's information system, banks are authorized to use the equipment of the Central Bank of Congo or other backup procedures approved by the latter to submit bids. No offer may be withdrawn or modified after the deadline for receipt of submissions. Each participant:

• indicates the amount it wishes to buy and/or sell as well as the proposed exchange rate for each offer; submits a maximum of four offers for purchase and four offers for sale, different at different exchange rates. For each offer, the exchange rate (CDF per concerned currency) is expressed to one decimal place.

563, Colonel Tshatshi Boulevard - Kinshasa - Gombe Email: sgouvemeur@bcc.cd / svicegouve@bcc.cd / cabgouv@bcc.cd - Website: http://www.bcc.cd

BANQUE CENTRALE DU CONGO CONTINUED, PAGE -3-

Article 6: Tallying of bids The "Committee for Bilateral Foreign Exchange Auction", acronym "CABD", established for this purpose, is responsible for tallying offers, ensuring compliance of submissions with the call for tenders and this Instruction. To this end, this Committee proceeds:

• to tallying, via the information system of the Central Bank of Congo, of bank submissions;
• to determining the marginal rate of the auction; to publishing the results, via the information system of the Central Bank of Congo and on its internet site. At the end of each bilateral foreign exchange auction session, an internal minutes document is drawn up and signed by the actual members of said Committee.

Article 7: Auction Method Each accepted offer is executed at the rate proposed by the bidder.

Article 8: Publication of results (Annex III) After the auction session, each selected bank is notified of its foreign exchange purchase and/or sale result, according to the form included in Annex V of this Instruction. The aggregated results of the bilateral foreign exchange auction session are published by the Central Bank of Congo on its Internet site and in its information system or any other communication medium according to the model of which is included in Annex III of this Instruction. A confirmation message of the purchase and/or sale of foreign currency is sent to each selected bank.

Article 9: Settlement of transactions The Central Bank of Congo acts as counterparty for all transactions concluded during the auction session. To comply with Article VIII, Section 3 of the Articles of Agreement of the International Monetary Fund (Multiple Exchange Rates), a mechanism is put in place to ensure that the rates of accepted purchase (sale) offers do not deviate by more than 2% from the marginal rate of the auction. Thus, purchase (sale) offers greater (lower) than 102% (98%) of the marginal rate of the auction will be satisfied at the maximum (minimum) rate of the auction: 102% (98%) of the marginal rate.

563, Colonel Tshatshi Boulevard - Kinshasa - Gombe Email: sgouvemeur@bcc.cd / svicegouve@bcc.cd / cabgouv@bcc.cd - Website: http://www.bcc.cd

BANQUE CENTRALE DU CONGO CONTINUED, PAGE -4- Upon receipt of results: • On the value date specified in the auction announcement, the bank having sold the foreign currency credits the account of the Central Bank of Congo with the amount due, according to standing payment instructions. Its national currency account opened in the books of the Central Bank of Congo is credited with the counter-value on the same value date. • On the value date specified in the auction announcement, the Central Bank of Congo credits the account of the correspondent of the bank having purchased the foreign currency, according to standing payment instructions. Its national currency account opened in the books of the Central Bank of Congo is debited with the counter-value on the same value date.

Article 10: Applicable Sanctions Without prejudice to sanctions provided for by other legal texts, the bank that does not honor its commitments arising from an auction operation is sanctioned in accordance with the Tariffs and Conditions of the Central Bank of Congo in force.

Article 11: Reservation of Rights In case of collusion between participants or offers made at rates manifestly outside market quotation, the Central Bank of Congo reserves the right to cancel the session or reject the concerned offers.

Article 12: Final Provisions This Instruction enters into force on the date of its signature and repeals all prior provisions contrary to it, specifically: • Regulation No. 001/05 relating to foreign currency sale operations by way of call for tenders of February 14, 2005; • Regulation No. 002/05 relating to foreign currency purchase operations by way of call for tenders of June 22, 2005.

Done at Kinshasa, May 5, 2015 563, Colonel Tshatshi Boulevard - Kinshasa - Gombe Email: sgouvemeur@bcc.cd / svicegouve@bcc.cd / cabgouv@bcc.cd - Website: http://www.bcc.cd

-5- ANNEX I: ANNOUNCEMENT OF A BILATERAL FOREIGN EXCHANGE AUCTION SESSION Pursuant to Instruction No. 25, dated ..../05/2015, concerning bilateral foreign exchange auctions, the Central Bank of Congo announces the following auction for the simultaneous purchase and sale of USD. The auction will take place on dd/mm/yyyy and is reserved for eligible participants.

Auction No. ABD........ dd/mm/yyyy Minimum volume of an offer for purchase or sale USD 50,000 Increment (subject to respect of the minimum) USD 10,000 Deadline date and time for submission of offers dd/mm/yyyy hh:00 at the latest Settlement date (value date) dd/mm/yyyy (Submission Date + 2) Maximum number of purchase offers per participant 4 Maximum number of sale offers per participant 4 Exchange rate format Number of CDF per USD

FRONT OFFICE SERVICE Done at Kinshasa, on the Director of Banking Operations and Markets Central Bank of Congo

The specific conditions are as follows: Form: Offers must be submitted using the format provided by the BCC. An incomplete or incorrect offer or one submitted in another format may be rejected by the BCC at its discretion. Place: Offers must be presented directly to the Direction of the BCC having foreign exchange operations within its purview, via the BCC FOREX application. The participant can simultaneously make purchase offers and sale offers. The Price (USD/CDF) for each offer must be rounded to one digit after the decimal point. For clarification: • Examples of Permitted Prices for each offer: 799.7 - 800 - 800.1... • Examples of Non-Permitted Prices for each offer: 799.75 - 800.01 - 850.55 ...

• 6 - Annex II: MODEL FOR SUBMISSION OF OFFERS (purchase/sale of USD against CDF) Bank Name Full Name Amount (USD) Price (1 USD = X CDF)

US Dollar Purchase (Commercial 2. 2. Bank buys USD and BCC 3. 3. sells USD) 4. 4.

1. 1. US Dollar Sale (Commercial
2. 2. Bank sells USD and BCC
3. 3. buys USD)

Submission Date Signature of two authorized persons (in case of application failure requiring recourse to a backup procedure) By submitting this offer, I certify that it is in conformity with Instruction 25, dated ...../05/2015 concerning bilateral foreign exchange auctions.

For clarification: • Examples of Permitted Amounts for each offer: $50,000 - $60,000 - $70,000 ... • Examples of Non-Permitted Amounts for each offer: $40,000 - $49,000 - $55,000 ... For clarification: • Examples of Permitted Prices for each offer: 799.7 - 800 - 800.1 . Examples of Non-Permitted Prices for each offer: 799.75 - 800.01 - 850.55 .

• 7 - Annex III: PUBLICATION OF RESULTS OF THE BILATERAL AUCTION (NUMBER: ............) USD Purchase Proposals (Commercial Bank buys USD) USD Sale Proposals (Commercial Bank sells USD) The marginal rate of the auction is: USD/CDFXXXX. The BCC has purchased XXX USD in the auction The BCC has sold XXX USD in the auction Signature _ Date: _ DIRECTION OF BANKING OPERATIONS AND MARKETS

• 10 - Annex V BILATERAL FOREIGN EXCHANGE AUCTIONS No. ...... date . NOTIFICATION OF RESULT NOTICE Ref.: BCC/ADB/N° ADJ0001819 ABD5-BCC

AUCTION NUMBER ABD dd/mm/yyyy of dd/mm/yyyy SUBMITTING BANK B.C.D.C. BANK CODE 00011 GLOBAL AMOUNT (IN FIGURES): USD Detailed as follows: PROPOSED AMOUNT Exchange Rate CDF RETAINED AMOUNT

Done at Kinshasa, On 30/04/2015 13:44:16 AUDDITION COMMITTEE