Instruction on the Specific Exchange Regime Applicable to Exploration-Production Oil Companies

BANQUE CENTRALE DU CONGO

THE GOVERNOR

Kinshasa, 04 APR. 2007
D.15/Gouv. 000577

INSTRUCTION ON THE SPECIFIC EXCHANGE REGIME
APPLICABLE TO EXPLORATION-PRODUCTION OIL COMPANIES

• Considering Ordinance-Law No. 67/272 of June 23, 1967, defining the regulatory power of the Central Bank of Congo in matters of exchange, as amended and supplemented to date;

• Considering Ordinance-Law No. 81-013 of April 2, 1981, establishing general legislation on mines and hydrocarbons;

• Considering Decree-Law No. 005 of May 7, 2002, on the organization and functioning of the Central Bank of Congo;

• Taking into account the evolution of exchange regulation in the Democratic Republic of Congo;

• Considering the Agreements between the Democratic Republic of Congo and exploration-production oil companies, specifically their articles governing the exchange regime regulating the operations of the aforementioned companies; the Central Bank of Congo communicates below the provisions relating to the exchange regime applicable to production oil companies:

I. ON THE EXPORT OF SOLID, LIQUID AND GASEOUS HYDROCARBONS AS WELL AS ASSOCIATED SUBSTANCES.

1. Companies are authorized to freely export and commercialize all of their production on the market. The export proceeds related thereto must be collected within sixty days from the date of shipment of said products.

2. Any export operation of products by companies requires the prior subscription with an authorized bank of an Export Declaration model "E.B".

The unit price on the basis of which the value of the "EB" models must be established must correspond to that recorded in the sales contract concluded by the companies; supporting documents must be attached, with the report of the O.C.C. being authoritative.

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II. ON THE IMPORT OF GOODS.

1. Any import carried out by companies requires the prior subscription with an authorized bank of an Import Declaration model "I.B". The amounts of payments to be made must correspond to those indicated on the final invoice, the Verification Certificate of the OCC agent, the customs declaration, and any other supporting document.

However, in order to facilitate regular supply of various goods due to the high frequency of their imports, oil companies are authorized to use the Global Form Import Declarations of Goods model "I.B", provided that the goods to be imported come from the same supplier and are of the same origin and provenance.

2. Global Form "IB" Declarations are established on the basis of an annual forecast (12 months) and are to be countersigned as imports are realized.

3. Companies that have subscribed to "I.B" Global Form declarations are required to transmit to the Central Bank / Directorate of Foreign Services a quarterly report on Imports and countersignings realized on this form, including the exact nature of the goods, the customs tariff number, quantities, FOB value, freight cost, insurance cost, and countries of provenance and origin.

III. ON THE IMPORTS AND EXPORTS OF SERVICES

4. The import and/or export of services by companies must be carried out under the cover of a Declaration model "I.S" or "E.S" to be subscribed priorly with an authorized bank. To this Declaration must be attached all required supporting documents:

• the service or leasing contract,
• the invoice or any other supporting document.

ON THE TRANSFER OF REVENUES AND MOVEMENTS OF CAPITAL

5. Any operation for the transfer of revenues, current transfers, and movements of capital with a value greater than USD 10,000 requires the prior subscription with an authorized bank of a Declaration model "R.C". The subscriber is required to attach to the "RC" model Declaration any supporting document, notably:

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• the service lease contract, trademarks, patents, ...
• the loan contract, the interest statement, the General Assembly decision on the distribution of profits, ...

V. ON THE FOREIGN EXCHANGE CONTROL FEE

6. Companies are required to pay to the Central Bank of Congo or its agent a foreign exchange control fee "R.C.C" of 2‰ (two per thousand) on any payment to or from abroad and on any export without repatriation;

Companies are required to calculate, every 15 days, the amount of the RCC and to credit the BCC no later than the 1st and 16th of each month in the RME/BCC accounts in USD and EUR opened with an authorized bank indicated by the Central Bank of Congo.

The payment orders to be issued for this purpose must indicate the following mention: "Foreign Exchange Control Fee, period from ........... to .............".

VI. ON THE MANAGEMENT OF EXPORT REVENUES

7. Companies may repatriate to the Democratic Republic of Congo the amounts that would be necessary for their cash flow needs.

8. Any transfer to be made on an amount held in an RME account in the Democratic Republic of Congo can only be carried out to the extent that the companies do not have sufficient assets in their accounts abroad.

VII. ON THE TRANSMISSION OF STATISTICS.

9. Companies are required to communicate to the Central Bank of Congo / Directorate of Foreign Services no later than the 15th day of the following month the following statistical data:

• the production report;
• the Statement of production and crude oil exports;
• the statement of payments made to the Public Treasury;
• the statement of operations on accounts abroad according to the model in the annex;

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• the account statement established by the depositary of assets held abroad proving the movements of receipts and expenses incurred by these assets.
• the statement of the amounts of the RCC due on operations according to the model in the annex.

VIII. ON THE MONITORING OF OPERATIONS

10. The Central Bank reserves the right to verify the regularity of operations recorded on the main account of the companies, held abroad, after having previously informed the holder in writing.

IX. ON OFFENSES AND REPRESSIVE MEASURES.

11. Offenses to the Exchange Regulation as well as the regime of sanctions related thereto are provided for by the legal provisions (articles 13 to 20 of Ordinance-Law No. 67/272 of June 23, 1967 defining the regulatory power of the Central Bank of Congo in matters of exchange).

12. This instruction enters into force on the date of its signature and repeals all prior provisions contrary to it, notably those of article 27 of the Exchange Regulation in the Democratic Republic of Congo, February 2003 edition, relating to exemptions granted for the supply of oil platforms.-