Norm Reforming Articles 1, 3, 5, 49, and 50 of the Norm on Transparency in Financial Operations

Resolution No. CD-SIBOIF-1240-2-ABR06-2021
Dated April 6, 2021

NORM REFORMING ARTICLES 1, 3, 5, 49, AND 50 OF THE NORM ON TRANSPARENCY IN FINANCIAL OPERATIONS

The Board of Directors of the Superintendence of Banks and Other Financial Institutions,

CONSIDERING

I

That on August 30, 2013, the Norm on Transparency in Financial Operations was approved, contained in Resolution No. CD-SIBOIF-796-1-AGOST30-2013, published in La Gaceta, Official Journal No. 178, on September 20, 2013.

II

That by express mandate of Article 53, numeral "1", of Law No. 842, "Law for the Protection of the Rights of Consumers and Users," published in La Gaceta, Official Journal No. 129, on July 11, 2013, reformed by Law No. 1061, "Law of Reforms and Additions to Law No. 842, Law for the Protection of the Rights of Consumers and Users," published in La Gaceta, Official Journal No. 27, on February 9, 2021, hereinafter Law No. 842, it corresponds: "To the Superintendence of Banks and Other Financial Institutions the application of this Law in matters of financial services provided by banks, financial companies, and other entities subject to its regulation, supervision, and oversight in accordance with what is provided in Law No. 316, Law of the Superintendence of Banks and Other Financial Institutions, and other applicable financial laws."

III

That given the approval of Law No. 1061, "Law of Reforms and Additions to Law No. 842, Law for the Protection of the Rights of Consumers and Users," it is necessary to reform the Norm on Transparency in Financial Operations in order to update it in the following aspects: 1- definitions of: "client," "financial institution," "payment services," "financial services," and "user," for the purposes of the norm; 2- rights and obligations of clients and users of financial services and of providers of these services; and 3- requirements and procedures to be followed for the presentation and admission of complaints.

IV

That Article 4 of the aforementioned Law No. 1061 establishes that "DIPRODEC and other Regulatory Entities must update their internal regulations to comply with the provisions of this Law, within a period not exceeding sixty days counted from its publication."

V

That in accordance with the considerations set forth above and based on the authority established in Articles 3, numeral 2), and 10, numerals 1) and 2) of Law No. 316, "Law of the Superintendence of Banks and Other Financial Institutions," contained in the Nicaraguan Legal Digest of the Matter of Banking and Finance, published in La Gaceta, Official Journal No. 164, on August 27, 2018, and its updates.

In exercise of its powers,

HAS ISSUED

The following:
CD-SIBOIF-1240-2-ABR06-2021
NORM REFORMING ARTICLES 1, 3, 5, 49, AND 50 OF THE NORM ON TRANSPARENCY IN FINANCIAL OPERATIONS

FIRST: Articles 1, 3, 5, 49, and 50 of the Norm on Transparency in Financial Operations, contained in Resolution No. CD-SIBOIF-796-1-AGOST30-2013, published in La Gaceta, Official Journal No. 178, on September 20, 2013, are hereby reformed, which shall read as follows:

"Article 1. Concepts.- For the purposes of application of the provisions contained in this norm, the concepts indicated in this article, both in uppercase and lowercase, singular or plural, shall have the following meanings:

a) Abusive Clauses: All those contractual stipulations, having been established unilaterally by the financial institution, that are considered contrary to the requirements of good faith, causing an imbalance of rights and obligations to the detriment of its clients and users.

b) Client: (1) natural or legal person, public, private, or mixed, with whom the institution maintains a commercial relationship originating from the celebration of a contract; and (2) natural or legal person, public, private, or mixed, with whom the institution is in phases prior to the celebration of a contract.

c) Contract of Adhesion: That whose clauses are established unilaterally by the financial institution, without the client being able to negotiate or modify its content at the time of contracting.

d) Contract: Document containing all the rights and obligations corresponding to the client and the institution, including the annexes that establish specific stipulations proper to the financial operation that is the object of the pact and which has been celebrated by the contracting parties.

e) Directorate for Attention to Users of Financial Services: Administrative instance of the Superintendence of Banks and Other Financial Institutions, created by Law No. 842, Law for the Protection of the Rights of Consumers and Users.

f) Model Contract of Adhesion: Contract model containing all the rights and obligations that would correspond to the client and the institution in the event of contracting, and which is made available to the former on the institution's internet page. It will include the annexes with specific stipulations proper to a financial operation when applicable, with the purpose of understanding the operation or service and/or the obligations and rights of the parties.

g) Formula: Method that allows determining clearly, in detail, and understandably, the principal and the interest that institutions charge or pay for their active and passive products, respectively, as well as the amounts they charge for commissions and expenses derived from the operation.

h) Institution or financial institution: Banks, bank representation offices, and foreign financial companies, special regime financial companies of financial groups, non-bank issuers of credit cards, financial entities, insurance, reinsurance, and surety companies, general warehouses of deposit, and entities operating in the securities market and other entities supervised by the Superintendence of Banks and Other Financial Institutions that as part of their activities provide attention to the public.

i) Active Operations under the installment system: Credit operation under the modality of money disbursement that is repaid according to the payment schedule granted by the institution within the deadline, such as vehicle loans, consumer loans, microcredits, and housing mortgages. Credits granted under the credit card modality are not considered under this definition.

j) Active Operations: Credit operations that imply the disbursement of cash or the granting of a credit line under any contractual modality.

k) Passive Operations: Fund capture operations under any contractual modality.

l) Passive Operations with a Determined Term: Fund capture operations whose maturity date will depend on the term agreed upon between the client and the institution.

m) Program: Application or software that allows the institution to calculate interest, commissions, and expenses, under the installment system and that can be used by the client to replicate their particular case.

n) Payment Services: Services that allow deposits and withdrawals of cash, the execution of payment operations, the issuance and/or acquisition of payment instruments, and any other service functional for the transfer of money. The foregoing shall also include the issuance of electronic money.

o) Financial Services: Deposit, loan, credit, credit and debit card, transfer, family remittance, purchase and sale and/or exchange of currencies, insurance, stock market operations, services provided by general warehouses of deposit, payment systems, payment service fintech, and any other service provided by regulated financial entities, in accordance with their particular laws according to the sector or industry to which they belong.

p) Superintendence: Superintendence of Banks and Other Financial Institutions.

q) Superintendent: Superintendent of Banks and Other Financial Institutions.

r) Credit Card: Instrument or means of legitimization, which can be magnetic or of any other technology, whose possession accredits the right of the cardholder or holder of an additional card to dispose of the credit line in a checking account, derived from a prior contractual relationship between the issuer and the cardholder.

s) TCEA: Effective Annual Cost Rate.

t) User: Natural or legal person, public, private, or mixed, who, without having a contractual relationship with the financial institution, acquires, uses, or enjoys a specific financial product or service, or who potentially may acquire, use, or enjoy such product or service.

Article 3. Rights of clients and users of financial services.- Without prejudice to what is established in Article 54 of Law 842, clients and users of financial services have, among others, the following rights:

(...)

b) To select and access financial products or services within the scope of free competition, offered by the various institutions providing financial services;

c) To be notified by the financial institution in a verifiable manner, of the negative decision issued by the institution regarding the contracting of the financial product or service previously requested by the user, or of the cancellation or suspension of product or service contracts. Without prejudice to what is established in Article 4, item e) of this norm, in the event of unilateral cancellation or suspension of financial products or services, the affected user may present their complaint directly to the Superintendence in order to request the restitution of their rights, if it so resolves.

(...)

Article 5. Duties of information and transparency.- Financial institutions must provide their clients with clear, adequate, intelligible, and complete information about the products and services they offer and their corresponding costs, as well as the conditions of the contracts that have such products and services as their object.

Financial institutions must provide their clients with relevant information before, during, and after the celebration of the contract. Likewise, financial institutions must inform their clients of the negative decision regarding the contracting of the requested financial product or service or of the cancellation or suspension of contracts for these products or services, leaving verifiable record that the respective notification was made. Such decisions must be notified with a copy to the Superintendence and must be based on express law, in regulations or resolutions issued by this regulatory entity and/or in legally justified cause, which must be made known to the user, except in the cases established in the corresponding legal framework. The negative decision regarding the contracting of a new product or service must be notified by the financial institution to the applicant no later than thirty (30) calendar days, counted from the receipt of all information and/or documentation required for the processing of the application. Negative decisions regarding the contracting of a new product or service, or regarding the cancellations or suspensions thereof, shall not be disclosed to the person affected by such decisions.

Financial institutions must be fully transparent in the dissemination, application, and modification of interest rates, commissions, expenses, and any other fee associated with the active and passive operations they carry out, as well as to the services they provide. It is the obligation of financial institutions to publish on their internet page and inside their public attention offices, the fees charged and the crediting times for each payment service offered to the general public.

Likewise, institutions must provide clients with the basic fiscal information that, according to tax regulation, is applicable to the products or services that they provide, allowing them to know the real fiscal costs of the product or service, all of this with the reasonable scope proper to the activity of a financial institution.

Article 49. Presentation Requirements.- Once notified or informed in writing with acknowledgment of receipt of the complaint response by the institution and if it is negative, or when it does not respond, the client will have a period of thirty (30) calendar days, counted from the date of receipt of the response or from the date on which the institution should have responded, to present their complaint in writing to the Superintendent. The complaint filed outside the aforementioned period shall be considered inadmissible. When it concerns cancellations or suspensions of financial products or services, the client may present their complaint directly to the Superintendence, within the aforementioned period.

(...)

Article 50. Inadmissible Complaints.- The Superintendent will consider inadmissible the complaints that clients or users seek to make when any of the following situations occur:

a) Complaints that have not been previously presented to the financial institution or that have not received a response from the financial institution without the maximum period established for it having expired, except when it concerns complaints for cancellations or suspensions of financial products or services.

(...)

SECOND: This norm shall enter into force upon its notification, without prejudice to its subsequent publication in La Gaceta, Official Journal.

(F) Illegible S. Rosales (F) Illegible (Luis Ángel Montenegro E) (F) Illegible Fausto Reyes (F) Illegible (Silvio Moisés Casco Marenco) (F) Illegible (Ervin Antonio Vargas Pérez).

SAÚL CASTELLÓN TÓRREZ
Ad Hoc Secretary Board of Directors SIBOIF