Notice No. 5/GBM/2009 of 18 May - Regime of Commissions and Other Charges

Banco de Moçambique Governor

NOTICE No. 5/GBM/2009 Maputo, 18 May 2009

SUBJECT: REGIME OF COMMISSIONS AND OTHER CHARGES

The banking of the Mozambican economy, through, notably, the extension of financial services to rural areas and the provision of minimum free services to economic agents and the general population, requires the collaboration of credit institutions and financial societies in implementing good practices that promote competition, transparency, and equity in the setting and disclosure of commissions and other charges charged for the provision of financial services.

Paragraph 1 of Article 45 of Law No. 15/99, of 1 November - Law of Credit Institutions and Financial Societies - imposes the duty on credit institutions and financial societies to inform the public about the rates to be practiced in active and passive operations they are authorized to perform, as well as the prices and other charges of the services they provide. Paragraph 4 of the same article confers powers on the Bank of Mozambique to regulate the minimum requirements that credit institutions and financial societies must satisfy in the disclosure to the public of the rates and commissions practiced and the conditions under which they provide their services.

As it is necessary to establish the regime of commissions and other charges, as well as to regulate the duty of information incumbent on ICFS (Credit Institutions and Financial Societies) in order to provide users of financial services with knowledge of the prices and conditions of the services and products they contract, in a standardized and accessible manner, and to promote transparency and competition in the setting of said commissions and other charges, the Bank of Mozambique, using the powers conferred upon it by paragraph 4 of Article 45 of Law No. 15/99, of 1 November, updated by Law No. 9/2004, of 21 July, and by item d) of paragraph 2 of Article 37 of Law No. 1/92, of 3 January, Organic Law of the Bank of Mozambique, determines:

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Banco de Moçambique Governor

CHAPTER I GENERAL PROVISIONS

Article 1 (Object and Scope)

1. This Notice applies to credit institutions and financial societies, hereinafter designated as institutions, taking into account the type of services they provide.
2. This Notice establishes the minimum services to be provided free of charge, as well as the requirements that institutions must observe in the disclosure, to the public, of commissions and other charges arising from the use of financial products and services.

Article 2 (Definitions)

For the purposes of this Notice, it is considered: a) Commission – the value charged by institutions to clients or users for the provision of services. b) Penalty – the value charged by institutions to their clients, which corresponds to lost profit or damages arising from the client's renunciation or non-compliance with contractual terms. c) Misleading advertising – the provision of any information that, in any way, including its presentation, and due to its misleading nature, induces or is likely to induce its recipients into error or may harm a competitor. d) Public – the users of financial products and services offered by institutions.

CHAPTER II REGIME OF COMMISSIONS AND OTHER CHARGES

Article 3 (Predictability)

The charging of commissions and other charges for the provision of services by institutions subject to the supervision of the Bank of Mozambique must be provided for in the contract signed between the institution

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Banco de Moçambique Governor

and the client or the respective service must have been previously authorized or requested by the client in a document equivalent to said contract, which may be a form of the institution, made according to the type of operation.

Article 4 (Prohibited Commissions)

It is prohibited for institutions covered by this Notice to charge commissions or other charges, in the cases and for the provision of the following banking services, relating to deposit accounts:

a) Return to the depositer, for the first time, of a check that does not meet the conditions for its payment; b) Provision of a monthly account statement; c) Account inactivity when it presents a balance equal to or greater than one hundred Meticais; d) Account inactivity when it presents a balance lower than one hundred Meticais for a period up to six months; e) Withdrawal of cash in national currency at the counter; f) Conducting account balance inquiries once a day at the counter, at the ATM, or through the use of other electronic means; g) Conducting account transaction inquiries once a day at the ATM or through the use of other electronic means, provided they are only displayed on screen; h) Cancellation or revocation of a check; i) Account maintenance; j) Cash deposit; k) Deposit in check denominated in national currency; l) Opening of the account or constitution of a deposit; m) Non-observance of minimum balance in demand deposit accounts, except in situations where the minimum balance is remunerated.

Article 5 (Common Nomenclature of Commissions and Other Charges)

1. Without prejudice to the regime of free price setting in force, institutions shall adopt the common nomenclature for commissions and other charges relating to the provision of their services or supply of their products, contained in Annex 1 to this Notice.
2. Whenever it becomes justified, the Bank of Mozambique shall promote the revision of the nomenclature referred to in the previous paragraph and shall proceed with the appropriate publication.

CHAPTER III DUTIES OF INSTITUTIONS

Article 6 (Duty of Information)

1. Institutions are obliged to inform the public about the costs and benefits of using the financial products or services made available or provided.
2. For the purposes of the previous paragraph, institutions shall keep permanently updated the general conditions for carrying out operations and services offered that represent costs for the clientele and other users.
3. Institutions that offer products and services that can be requested or acquired through electronic means, namely, computer and mobile phone, must enable consultation through their respective devices.

Article 7 (Prior Information)

Without prejudice to good practices, prior to carrying out any operation, or to the alteration of conditions relating to an operation already carried out, which entails charges for the client, the interested party must be informed of the respective conditions.

Article 8 (Posting of the Commission and Other Charges Table)

Without prejudice to the use of other communication means available in each institution, it is mandatory to post in a clearly visible and easily accessible public location a complete list of commissions and other

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Banco de Moçambique Governor

charges charged by institutions, in accordance with Annex 1, in letters of adequate size and format, adapted to the range of operations that integrate the object of the respective institution and updated according to what is determined, at each moment, by the Bank of Mozambique.

Article 9 (Sending and Availability of Information)

1. Institutions must send to the Bank of Mozambique, quarterly, in electronic form, the information referred to in the previous article.
2. The information referred to in the previous paragraph shall be provided to the Bank of Mozambique within the first fifteen days of the month following that to which the information relates, through the address to be provided by the Banking Supervision Department.
3. Institutions are obliged to publish semi-annually, in one of the newspapers with the largest circulation in the country, an updated table of commissions and other charges charged.
4. Without prejudice to the provisions in the preceding paragraphs, information on commissions and other charges charged shall also be available for verification by the Bank of Mozambique whenever necessary.

CHAPTER IV SANCTIONS

Article 10 (Misleading Advertising)

The promotion of misleading advertising by institutions regarding the products and services they offer to the public is prohibited and subject to sanction under the applicable legislation.

Article 11 (Violations of Other Duties of the Notice)

Violation of the duties imposed by this Notice is punishable under Law No. 15/99, of 1 November, with the alterations introduced by Law No. 9/2004, of 21 July, and other applicable legislation.

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Banco de Moçambique Governor

CHAPTER V FINAL PROVISIONS

Article 12 (Clarification of Doubts)

Doubts that arise in the interpretation and application of this Notice shall be submitted to the Banking Supervision Department of the Bank of Mozambique.

Article 13 (Entry into Force)

This Notice enters into force ninety days counted from the date of its publication.

(Signature) Ernesto Gouveia Gove Governor

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Banco de Moçambique Governor

ANNEX 1

COMMON NOMENCLATURE OF COMMISSIONS AND OTHER CHARGES

Nº	Commissions and Other Charges	Basis/Service
1.	Inactivity	Lack of debit or credit movement in a given account, with a balance lower than one hundred Meticais, for a period greater than six months.
2.	Closing	Termination of the deposit contract by initiative of the client.
3.	Issuance of account statement	Production of the complete listing in paper medium of the movements of a deposit account for a certain period.
4.	Issuance of second copies of the debit or credit justification document	Reproduction, at the client's request, of justification documents of debit or credit movement.
5.	Withdrawal of cash at ATMs of the network attached to the bank	Withdrawal of cash at ATM of the bank's own network in the country.
6.	Withdrawal of cash at ATM attached to another bank	Withdrawal of cash at ATM of another bank's network in the country.
7.	Withdrawal of cash at ATM abroad	Withdrawal of cash at ATM located abroad.
8.	Withdrawal of foreign currency	Withdrawal at the counter of foreign currency in the country.
9.	Intra-bank transfer	Transfer of values between accounts in the same banking institution.
10.	Inter-bank transfer	Transfer of values between accounts involving two banking institutions.
11.	Telegraphic Transfer/Swift sent by the bank	Transfer of funds ordered by a client to the exterior.
12.	Telegraphic Transfer/Swift received by the bank	Receipt of funds from the exterior by the bank transferred in favor of its client.
13.	Constitution of service	Client's adherence to a financial service offered by the bank.
14.	Alteration of service	Modification of the scope of the service requested by a client.
15.	Cancellation of service	Cessation of the provision of a service at the client's request.
16.	Payment of services to third parties	Payment orders from the account holder in favor of third parties made at the counter.

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Banco de Moçambique Governor

Nº	Commissions and Other Charges	Basis/Service
17.	Payment of services via direct debit	Provision of payment services by debit of the ordering party's deposit accounts.
18.	Return of service payments via direct debit due to insufficient funds	Charging, to the ordering party, for the return of payment to third parties via direct debit due to insufficient funds.
19.	Provision of a single check	Availability of a check or other equivalent instrument at the counter for cash withdrawal.
20.	Provision of normal checks	Availability of a checkbook.
21.	Issuance of a certified check	Request for a certified check or other equivalent instrument at the counter.
22.	Return of the check due to insufficient funds	Charging, to the issuer, for the return of the check due to insufficient funds.
23.	Return of the check for technical reasons	Charging, to the issuer, for the return of the check for other reasons attributable to the client.
24.	Issuance of debit or credit card	Charging, to the account holder, for expenses incurred in the production of the debit or credit card, according to the cost allocation criterion previously agreed.
25.	Annual fee of the debit or credit card	Charging, to the account holder, of an annual fee previously agreed upon for the possession of the debit or credit card, according to the cost allocation criterion previously agreed.
26.	Replacement of the card	Charging, to the account holder, for expenses incurred in the replacement of the card for reasons attributable to the client.

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