RESOLUTION No. JPRM-2022-009-M

THE MONETARY AND REGULATORY POLICY BOARD

CONSIDERING:

That, Article 226 of the Constitution of the Republic of Ecuador prescribes that public servants and persons acting under state authority shall exercise only the competencies and powers attributed to them in the Constitution and the Law;

That, Article 227 of the same Constitution states that Public Administration constitutes a service to the community governed by the principles of effectiveness, efficiency, quality, hierarchy, coordination, planning, among others;

That, the first paragraph of Article 303 of the Constitution of the Republic determines that the formulation of monetary, credit, exchange, and financial policies is the exclusive authority of the Executive Branch and shall be implemented through the Central Bank of Ecuador;

That, Article 47.1 of the Organic Monetary and Financial Code created the Monetary and Regulatory Policy Board as part of the Executive Branch, responsible for formulating monetary policy, as the highest governing body of the Central Bank of Ecuador, and determines its composition;

That, Article 47.6 of the same Code, regarding the functions of the Monetary and Regulatory Policy Board, among others, establishes: "(...) 1. Formulate policy in the monetary sphere and monitor its application by the Central Bank of Ecuador, to preserve the integrity and sustainability of the dollarization monetary system and the financial system, in accordance with the provisions of this Code; (...) 7. Formulate the policy of the operations of the Central Bank of Ecuador; (...)";

That, Transitory Provision Fifty-Fourth supra prescribes: "Resolutions contained in the Codification of Monetary, Financial, Securities and Insurance Resolutions of the Monetary and Financial Policy Board and norms issued by control bodies shall remain in effect until the Monetary Policy Board and the Financial Policy and Regulation Board resolve what corresponds, within their respective competencies.";

That, Chapter X: "Central Bank Operations", of Title I: "Monetary System", of Book I: "Monetary and Financial System", of the Codification of Monetary, Financial, Securities and Insurance Resolutions, issued by the former Monetary and Financial Policy Board, regulates all matters related to operations

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RESOLUTION No. JPRM-2022-009-M

ALADI, SUCRE operations, financial system operations with the Central Bank of Ecuador, whose analysis and treatment corresponds to this Board, with the exception of what is established in Section IV: "General Provisions on Active and Passive Operations", and Section V: "Titles of the National Financial Corporation", as these are within the competence of the Financial Policy and Regulation Board, as provided in the Organic Monetary and Financial Code;

That, it is necessary to adapt the applicable regulatory norms to the operations of the Central Bank of Ecuador, in light of current regulations;

That, it is the authority of the Monetary and Regulatory Policy Board to resolve on the norms contained in the Codification of Monetary, Financial, Securities and Insurance Resolutions, issued by the former Monetary and Financial Policy Board, which relate to the monetary sphere, with the aim of incorporating such provisions into the own regulations of the Monetary and Regulatory Policy Board, prior to the analysis of the pertinence of each norm and provision, in a disaggregated manner;

That, the Monetary and Regulatory Policy Board, in an extraordinary session by mixed modality, on March 11, 2022, reviewed the proposal sent via memorandum No. BCE-BCE-2022-0053-M, of March 07, 2022, by the General Manager of the Central Bank of Ecuador to the President of the Monetary and Regulatory Policy Board, as well as the technical report No. BCE-SGSERV-2022-013/DNSP-2022-098, of February 21, 2022, and the legal report No. BCE-CGJ-035-2022, of March 04, 2022; and,

In exercise of its functions and in attention to Article 47.7 of the Organic Monetary and Financial Code, the Monetary and Regulatory Policy Board resolves to issue the:

CENTRAL BANK OPERATIONS POLICY

CHAPTER I: CENTRAL BANK OF ECUADOR OPERATIONS

SECTION I.- ALADI OPERATIONS:

Art. 1.- The Central Bank of Ecuador may channel foreign trade operations through the ALADI Convention on Reciprocal Payments and Credits, requested by entities of the private financial sector.

Art. 2.- The Central Bank of Ecuador will qualify and, if applicable, authorize entities of the private financial sector as "Authorized Ecuadorian Institution" to operate in the ALADI foreign trade mechanism.

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RESOLUTION No. JPRM-2022-009-M

Art. 3.- Import operations, channeled through the ALADI Convention on Reciprocal Payments and Credits, will be carried out once the Central Bank of Ecuador debits one hundred percent (100%) of the equivalent value of the requested import, from the account that the "Authorized Ecuadorian Institution" maintains at the Central Bank of Ecuador.

Art. 4.- For the processing of operations through the ALADI foreign trade mechanism, Authorized Ecuadorian Institutions will verify that natural and legal persons do not present inconsistencies reported by the National Service of Customs of Ecuador or by the Internal Revenue Service.

SECTION II.- SUCRE OPERATIONS:

Art. 5.- The Central Bank of Ecuador must establish mechanisms that allow maintaining the integrity of the technological systems that were used to channel operations through the Regional Unitary Compensation System – SUCRE; as well as safeguarding the physical and digital information of these operations, accounting records, including the realization of an inventory of the technological systems and the information available in the institution.

GENERAL PROVISIONS

FIRST.- The Monetary and Regulatory Policy Board recognizes the provisions contained in Chapter X: "Central Bank Operations", of Title I: "Monetary System", of Book I: "Monetary and Financial System", of the Codification of Monetary, Financial, Securities and Insurance Resolutions, issued by the former Monetary and Financial Policy Board as part of the monetary regulations on which it corresponds to resolve, with the exception of what is established in Section IV: "General Provisions on Active and Passive Operations", and Section V: "Titles of the National Financial Corporation", as these are within the competence of the Financial Policy and Regulation Board, as provided in the Organic Monetary and Financial Code.

SECOND.- To channel foreign trade operations through the ALADI mechanism, the Central Bank of Ecuador must comply with the provisions established in the ALADI Convention on Reciprocal Payments and Credits.

THIRD.- It corresponds to the "Authorized Ecuadorian Institution" to perform due diligence on clients requesting to operate through the ALADI foreign trade mechanism.

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RESOLUTION No. JPRM-2022-009-M

FOURTH.- The procedures for the application of what is established in this norm will be contained in resolutions, manuals, or instructions issued by the Central Bank of Ecuador.

FIFTH.- The Central Bank of Ecuador will implement administrative and legal actions related to the existing commercial trusts in guarantee.

SINGLE REPEALING PROVISION: Chapter X: "Central Bank Operations", of Title I: "Monetary System", of Book I: "Monetary and Financial System", of the Codification of Monetary, Financial, Securities and Insurance Resolutions, issued by the former Monetary and Financial Policy Board, is expressly repealed, with the exception of what is established in Section IV: "General Provisions on Active and Passive Operations", and Section V: "Titles of the National Financial Corporation", as these are within the competence of the Financial Policy and Regulation Board, as provided in the Organic Monetary and Financial Code.

FINAL PROVISION.- This resolution will enter into effect from its issuance, without prejudice to its publication in the Official Register.

Its publication on the institutional website is entrusted to the Document Management and Archive Directorate of the Central Bank of Ecuador.

COMMUNICATE.- Given in the Metropolitan District of Quito, on March 11, 2022.

THE PRESIDENT

Signature: Tatiana Rodríguez

Dr. TATIANA MARIBEL RODRÍGUEZ CERÓN

The preceding resolution was signed by Dr. Tatiana Maribel Rodríguez Cerón - President of the Monetary and Regulatory Policy Board, in the Metropolitan District of Quito, on February 11, 2022.- I CERTIFY.

ADMINISTRATIVE SECRETARY

Signature: María Alexandra Guerrero del Pozo

Law. MARÍA ALEXANDRA GUERRERO DEL POZO