Ordering of Regulations. New System for Issuing Circulars and Communications

CENTRAL BANK OF THE ARGENTINE REPUBLIC
COMMUNICATION "A" 1 06/18/80
TO FINANCIAL ENTITIES, HOUSES, AGENCIES, HOUSES, AGENCIES AND OFFICES AUTHORIZED TO OPERATE IN EXCHANGE, EXCHANGE BROKERS AND STOCK MARKETS:
Ref.: Ordering of regulations. New system for issuing circulars and communications We are pleased to address you to inform you and, through you, the general public, of the provisions adopted on the referenced topic, the details of which are included in Annexes I to V of this document. This Institution, in its concern to order and simplify the regulations corresponding to the different areas of its competence, has decided to begin the publication of ordered texts of circulars, by topic, regarding the norms that are in force. To that end, for some time now, circulars and other communications issued by the Central Bank since its creation have been compiled and ordered, a task intended to facilitate the understanding and management of the universe of provisions by financial entities included in the regime of Law 21,526, by persons and entities linked to financial activities, and by the general public. This seeks to strengthen the legal framework that supports the current regulations, through the formation of duly ordered texts, purged of provisions that have fallen into disuse or that have been expressly or tacitly repealed.
2. Having to cover such an extended period, the task has been complex, and regulations that were appropriate at the time and that, in fact, have become obsolete, although their formal expiration has not occurred in practice, have had to be analyzed meticulously. Consequently, although the ordering that is being launched will not essentially modify the norms it addresses, the opportunity will be taken to introduce adjustments to the texts that allow for simplifying concepts and eliminating aspects that are superfluous, redundant, or unnecessary, as they do not align with the current economic-financial orientation. Furthermore, efforts will be made to adapt their expressions to respond to the terminology currently used in banking practices.
3. Simultaneously, the Central Bank has also decided to establish a new system for issuing external circulars and communications. Through it, the entire regulatory framework whose issuance is the responsibility of the Central Bank, in accordance with current legal provisions, will be made known in successive stages.
4. Due to the magnitude of the task, it was considered necessary for the topics to be presented by areas based on the following guidelines:
4.1. The norms will be grouped into "CIRCULARS", each of which will contain the ordered text of a "TOPIC" which, in turn, will be divided into "CHAPTERS", according to the detail in Annex I. Subsequent modifications to the already ordered provisions will be informed through "COMMUNICATIONS", which will distinguish between permanent, temporary, and informative norms.
4.2. In due course, "COMMUNICATIONS 'A'" will accompany the "CIRCULARS" with the first ordered text of each "TOPIC".
4.3. This "COMMUNICATION 'A' 1" is accompanied by a PROVISIONAL NOMENCLATOR comprising the first version of the structure and composition of the set of "CIRCULARS" that will be issued over time.

COMMUNICATION "A" 1 (Continuation)
Likewise, the future issuance of a sufficiently broad GENERAL THEMATIC INDEX has been foreseen, which will be made known when the complete edition of this new system is concluded.
4.4. Until the ordered texts of certain topics are made known, the current series of Circulars R.F., R.C., and F.A. will continue to govern them, following the correlative numbering, as before. The I.E.-R. series has expired as a consequence of the modifications introduced to the foreign investment regime.
For a time, then, two systems will coexist: one, the one in force for norms still in the process of ordering, and another, the one that begins with this COMMUNICATION "A" 1. The text of the first CIRCULAR corresponding to the mechanism established by this document will be provided shortly, through COMMUNICATION "A" 2. Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC Horacio A. Alonso Deputy General Manager Pedro Camilo López General Manager ANNEXES

B.C.R.A. ANNEX I to Communication "A" 1 06/19/80 NEW SYSTEM FOR ISSUING CIRCULARS AND COMMUNICATIONS The new system for issuing circulars and communications of the Central Bank of the Argentine Republic established by this COMMUNICATION "A" 1 is structured as follows:

1. Basic Guidelines.
   1.1. The norms – once ordered – will be grouped into "CIRCULARS", each of which will contain the text of a "TOPIC" which, in turn, will be divided into "CHAPTERS", whose page numbering will be independent.
   1.2. Each "CIRCULAR" will be assigned, in addition to its title, its abbreviation or abbreviated combination (e.g.: CIRCULAR "MONETARY CIRCULATION" – CIRMO; CIRCULAR "NATIONAL PUBLIC SECURITIES" – TINAC; CIRCULAR "LIQUIDITY AND SOLVENCY" – LISOL, etc.). The abbreviation is intended to facilitate computing and identification tasks.
   1.3. Modifications, clarifications, or information related to the "CIRCULARS" will be made known through COMMUNICATIONS "A", "B", or "C", differentiated by color, as follows:
   1.3.1. COMMUNICATIONS "A" will deal with topics inherent to permanent normative aspects.
   1.3.2. COMMUNICATIONS "B" will refer to temporary or circumstantial normative aspects.
   1.3.3. COMMUNICATIONS "C" will be informative.
   This distinction does not affect the category of the norms, which have equal mandatory force.
   1.4. The first and successive ordered texts of each CIRCULAR will be provided through COMMUNICATION "A".
2. On updating.
   Given that the system is structured on the basis of replaceable sheets, COMMUNICATION "A" that announces modifications to the text of a Circular will also include the updated sheet or sheets to be replaced in the respective ordered text. When this is not possible, such dispatch will be made as soon as possible. Likewise, when the scope of the modifications advises it, a new ordered text will be made known at the same time.
3. Numbering of CIRCULARS and COMMUNICATIONS.
   3.1. Circulars.
   They will be numbered sequentially when each ordered text is provided.
   Example: CIRCULAR "MONETARY CIRCULATION" – CIRMO 1, identifies the first ordering; CIRCULAR "MONETARY CIRCULATION" – CIRMO 2, identifies the second ordering and so on.

B.C.R.A. ANNEX I to Communication "A" 1 (Continuation) 06/19/80
3.2. Communications.
3.2.1. COMMUNICATIONS "A" will have a double numbering. The first, located in the header, will indicate its simple sequence as a COMMUNICATION, starting from one.
The second will be located in the reference (e.g., Ref.: CIRCULAR "MONETARY CIRCULATION" – CIRMO 1 – 1) and will express:

• the first number if it is the first, second, third ordered text, etc.
• The second number will represent the number of modifications that the respective norm has undergone since the appearance of the last ordered text (e.g., COMMUNICATION "A" 14 – CIRMO 1 – 2, informs of the second modification produced in the first ordered text that was made known regarding "MONETARY CIRCULATION").
  Therefore, the second number within the "Ref. (Reference)" will not appear when it is a COMMUNICATION "A" that makes known the ordered text of a "CIRCULAR". This way, it will always be possible to be sure which norms must be located to have the complete body of provisions.
  3.2.2. COMMUNICATIONS "B" and "C" will only carry the numbering corresponding to their sequence.

4. Series of Circulars "R.F.", "R.C.", "L.E.-R." and "F.A.".
   Until the ordered texts of certain topics are made known, the current series of Circulars R.F., R.C., and F.A. will continue to govern them, with correlative numbering as before. The L.E.-R. series has expired as a consequence of the modifications introduced to the foreign investment regime. For a time, then, two systems will coexist: one, the one in force for norms still in the process of ordering, and another, the one that begins with COMMUNICATION "A" 1.
5. General Thematic Index.
   The publication of a General Thematic Index has been foreseen when the edition of the new system is concluded. Its basic composition – with sufficient breakdowns – and the references made therein will allow for quickly locating any topic or matter.
6. Identifying Logo.
   With the purpose of differentiating the new system for issuing circulars and communications from the regimes or acronyms that have preceded it, an identifying logo with the effigy of the Republic is created.
7. Models of operation of the new system.
   7.1. Example of operation of the new system (Annex II).
   7.2. Models of COMMUNICATIONS "A" (Annex III).
   7.2.1. With which the ordered text of a CIRCULAR will be accompanied.
   7.2.2. By which the modifications introduced to the ordered texts will be informed.
   7.3. Model of COMMUNICATION "B": (Annex IV).
   7.4. Model of COMMUNICATION "C": (Annex V).

EXAMPLE OF NEW SYSTEM OPERATION
Communication Issued Content
Communication "A" 1 Communicates the initiation of the new system and accompanies the PROVISIONAL NOMENCLATOR with the Topic of each Circular and the detail of the Chapters that comprise it. Communication "A" 2 Circular CIRMO 1 (initial ordered text) (1) Communication "A" 3 Circular TINAC 1 (initial ordered text) (2) Communication "A" 4 Circular LISOL 1 (initial ordered text) (3) Communication "A" 5 Circular CIRMO 1 – 1 (First modification to the first ordered text) Communication "A" 6 Circular LISOL 1 – 1 (First modification to the first ordered text) Communication "A" 7 Circular LISOL 1 – 2 (Second modification to the first ordered text) Communication "A" 8 Circular CIRMO 2 (Second ordered text) Communication "A" 9 Circular CIRMO 2-1 (First modification to the second ordered text) Communication "A" 10 Circular CIRMO 2-2 (Second modification to the second ordered text) Communication "A" 11 Circular LISOL 1 – 3 (Third modification to the first ordered text) Communication "A" 12 Circular LISOL 1 – 4 (Fourth modification to the first ordered text) Communication "A" 13 Circular LISOL 2 (Second ordered text) Communication "A" 14 Circular OPASI 1 (initial ordered text) (4) Communication "A" 15 Circular OPASI 1 – 1 (First modification to the first ordered text) Communication "A" 16 Circular LISOL 2 – 1 (First modification to the second ordered text) Communication "A" 17 Circular CIRMO 2 - 3 (Third modification to the second ordered text)
......................................... .................................. ...........................................................
(1) – Monetary Circulation (CIRMO).
(2) – National Public Securities (TINAC).
(3) – Liquidity and Solvency (LISOL)
(4) – Passive Operations (OPASI).
NOTE: The order in which the examples are listed does not necessarily indicate the order of appearance of the Circulars.

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III to Communication "A" 1 06/19/80
COMMUNICATION "A" 2 Date
TO FINANCIAL ENTITIES:
Ref.: Circular MONETARY CIRCULATION – CIRMO 1.
We address you to accompany the ordered text to date of the provisions issued by this Institution, which are applicable to the referenced topic. Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III
-3-
CONTENTS
Circular MONETARY CIRCULATION CIRMO-1
I - Banknotes and coins in circulation.
II – Imitation of monetary values and alteration of banknotes and coins.
III – Cash exchange services for the public (banknotes and coins) and exchange of deteriorated banknotes. IV – Invalidation of counterfeit banknotes. V – Procedures for the purification of cash. VI – Distribution of coins in the interior of the country. Date -1-

I - Banknotes and coins in circulation. CIRMO-1 Date -1-

Annex III
B.C.R.A. -7-
II - Imitation of monetary values and alteration of banknotes and coins. CIRMO-1 Date -1-

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III
-9-
COMMUNICATION "A" ... Date
TO FINANCIAL ENTITIES:
Ref.: Circular MONETARY CIRCULATION – CIRMO 1-1- We address you to inform you that by Resolution No. of it has been decided to modify point 2. Of Chapter I of the referenced Circular, in the following way
“2. ....
...”
We enclose the sheet to be incorporated into the ordered text made known by Circular CIRMO 1 (or: ".... will be made known shortly"). Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC
ANNEX

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III
-11-
COMMUNICATION "A" ... Date
TO FINANCIAL ENTITIES:
Ref.: Circular MONETARY CIRCULATION – CIRMO 2
We address you to accompany the ordered text of the referenced Circular, with the modifications made known to date. Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC ANNEXES

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III
-13-
CONTENTS
Circular MONETARY CIRCULATION CIRMO-2
I - Banknotes and coins in circulation.
II – Imitation of monetary values and alteration of banknotes and coins.
III – Cash exchange services for the public (banknotes and coins) and exchange of deteriorated banknotes. IV – Invalidation of counterfeit banknotes. V – Procedures for the purification of cash. VI – Distribution of coins in the interior of the country. NOTE: When the 2nd, 3rd, etc., ordered text is made known, the detail of the Chapters will be adjusted, if applicable. Date -1-

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex III
-15-
ORDERED TEXT
Circular MONETARY CIRCULATION CIRMO-2
I - Banknotes and coins in circulation.
1.
1.1.
1.2.
1.3.
2.
2.1.
2.2.
2.3.
Date -1-

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex IV to
Communication "A" 1
06/19/80
COMMUNICATION "B" ... Date
TO FINANCIAL ENTITIES:
Ref.: Circular “REMON” 1. IV – Monetary Regulation Account. Complementary norms.
We are pleased to address you to inform you that this Institution adopted the following resolution:
“To set at % from , the investment margin exempt from the charge of the Monetary Regulation Account (Law 21,572) referred to in point of the referenced Circular.” Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC

CENTRAL BANK OF THE ARGENTINE REPUBLIC
Annex V to
Communication "A" 1
06/19/80
COMMUNICATION "C" ... ...12...
TO FINANCIAL ENTITIES:
Ref.: Bank holiday on the 31st of this month.
We address you to remind you that, in accordance with the provisions of Decree 24,779/53, on Friday the 31st of this month, financial entity personnel must attend work during the hours of 7 to 14 and that the workday of the 30th of this month may be extended up to four hours, solely for the purpose of enabling the preparation of monthly, quarterly, or annual balances that will bear the date of the following day. Sincerely, CENTRAL BANK OF THE ARGENTINE REPUBLIC

PROVISIONAL NOMENCLATOR OF
EXTERNAL CIRCULARS OF THE B.C.R.A.

A- CIRCULAR NAMES AND THEIR IDENTIFYING ACRONYMS Circulars Acronyms Creation, operation and expansion of financial entities “CREFI” Passive operations............................................................................................ “OPASI” Active operations............................................................................................. “OPACT” National Public Securities.................................................................................. “TINAC” External collections and payments....................................................................... “COPEX” Exchange operations and movements of funds and securities abroad....... “CAMEX” External operations of the public sector.............................................................. “SEPEX” Information regime for exchange operations and obligations abroad.......................................................................................................................... “INFEX” Monetary regulations...................................................................................... “REMON” Liquidity and solvency .............................................................................................. “LISOL” Accounting and auditing......................................................................................... “CONAU” Monetary circulation............................................................................................ “CIRMO” Clearing houses...................................................................................... “CACOM” Special services.............................................................................................. “SERVI” Items included in other regulations..................................................................... “RUNOR”

B – CIRCULAR NAMES AND THE
CHAPTERS THEY COMPRISE

Circular CHAPTERS
CREATION, OPERATION
AND EXPANSION OF ENTITIES
FINANCIAL - CREFI
I – Installation, merger and transformation.
II – Installation of branches of national financial entities in the country.
III – Installation of branches of foreign financial entities in the country.
IV – Installation of operational branches and representative offices abroad.
V – Participation of national and local entities with foreign capital in foreign financial entities. VI – Disqualifications.
1. General rule.
2. Sworn declarations of management personnel.
3. Definition of the expression “managers”.
VII – Draft statutes.
1. Harmonization with Law 21,526.
2. Collaboration of the B.C.R.A.
VIII – Share regime.
1. Negotiation of share packages of financial entities.
2. Nominativity of shares of financial entities. Information regime.
IX – Advertising.
1. Use of financial terminology
2. Institutional
3. Of the interest rate of financial operations
X – Foreign currency operations.
1. Authorization to banking entities (Categories A, B and C).
2. Obtaining credit lines from abroad.
2.1. By banking entities.
2.2. By financial companies.
XI – Representatives of foreign financial entities not authorized to operate in the country.

Circular CHAPTERS
PASSIVE OPERATIONS -
OPASI
I – Deposits.
1. Bank current account.
2. Savings account.
2.1. Common
2.2. Special, adjustable or not.
3. Time deposit.
3.1. Basic requirements.
3.2. Nominative non-transferable, adjustable or not.
3.3. Nominative transferable, adjustable or not.
4. Pupillary usury.
5. Judicial
6. Unemployment Fund for Construction Industry Workers.
7. Common provisions.
7.1. Return of deposits.
7.2. Immobilized balances.
7.3. Interest for all types of deposits in pesos.
7.4. Commissions for deposit service.
7.5. Adjustable deposits. Correction factor.
8. Guarantee of deposits. Regulation of Law 22,051.
9. In foreign currency.
10. In official banks of the funds of workers' trade associations.
11. Obligation of state organizations and companies to deposit funds in official banks.
12. Deposit accounts between financial entities.
13. Special.
II – Issuance of financial instruments.
1. Bonds.
2. Obligations.
3. Certificates.
4. Letters.
5. Promissory notes.

Circular CHAPTERS
ACTIVE OPERATIONS -
OPACT
I – Credit provisions.
II – Interest rates and adjustment clauses.

Circular CHAPTERS
CREATION, OPERATION
AND EXPANSION OF ENTITIES
FINANCIAL - CREFI
I – Issuance, placement, negotiation, redemption and other aspects.

1. Loans in circulation with adjustment clause.
   1.1. Adjustable National Securities.
   1.2. Equity Bonds for Financial Entities.
   1.3. Foreign Trade Investment Bonds.
2. Loans in circulation with variable interest rates.
   2.1. External Bonds.
   2.2. National Variable Interest Bonds.
3. National Treasury Bills.
4. Other aspects.
   4.1. Rules for tenders of national public securities.
   4.2. Presentation for collection of national public securities whose financial services have matured.
   4.3. Retention of national public securities with opposition.

Circular CHAPTERS
EXTERNAL COLLECTIONS AND PAYMENTS

• COPEX
  I – Exchange regime for exports.
  II - Exchange regime for imports.
  III - Reciprocal Credit Agreements.

1. Rules for the channeling of collections and payments through the respective accounts.

Circular CHAPTERS
EXCHANGE OPERATIONS AND
MOVEMENTS OF FUNDS AND
SECURITIES ABROAD -
CAMEX
I – Activities that entities can carry out; responsibilities.
1. On the responsibility of entities in carrying out exchange operations.
2. Operations between entities.
3. Intervention of Exchange Brokers in interbank operations.
II - Exchange Market.
1. Exchange rate.
2. Exchange market hours.
3. Operations with the B.C.R.A.
4. Spot operations.
5. Forward operations.
III - Other operations.
1. Gold.
2. Movement of banknotes and traveler's checks.
3. Peso accounts opened in entities authorized to operate in exchange, in the name of foreign banking correspondents.
IV - Other provisions.
1. Currencies for collections and payments abroad.
2. Export and import of securities.
3. Presentation of vouchers to the B.C.R.A.

Circular CHAPTERS
EXTERNAL OPERATIONS OF THE
PUBLIC SECTOR - SEPEX
I – Foreign currency budget and tentative external debt program.
II - Exchange Regime.
1. Authorizations.
2. Forms to be submitted.
2. Other provisions.

Circular CHAPTERS
INFORMATION REGIME FOR
EXCHANGE OPERATIONS AND OBLIGATIONS ABROAD – INFEX.
I – Operations of authorized entities with their clients.
1. Spot purchases.
2. Spot sales.
3. Arbitrages.
4. Forward purchases.
5. Forward sales.
II - Operations between entities and with the B.C.R.A.
III - Summary of operations and General Exchange Position.
1. Banks.
2. Houses, Agencies and Offices.
IV - Bills at the disposal of the B.C.R.A.
V - Bills held by authorized entities.
VI - Financing of promoted exports.
VII - General instructions.
VIII - Surveys on foreign obligations of the public and private sectors.
1. Procedural rules for reporting public sector obligations.
2. Procedural rules for reporting private sector obligations.
3. Procedural rules for authorized entities involved in transfers of funds abroad for public and private sector obligations.

Circular CHAPTERS
MONETARY REGULATIONS

• REMON
  I – Minimum cash
  II - Monetary Regulation Account.
  III - Credits to the financial system.
  3.

Circular CHAPTERS
LIQUIDITY AND SOLVENCY - LISOL I – Relationship between financial liabilities and the responsibility of intermediaries. II - Risk fragmentation. III - Immobilization of assets. IV - Irregular compliance portfolio. V - Patrimonial responsibility.

1. Minimum capitals.
2. Legal reserve and other reserves.
3. Revaluations.
4. Patrimonial Adjustment Fund.
5. Results Account.

Circular CHAPTERS
ACCOUNTING AND AUDIT –
CONAU
I – Instructions for the use of balance sheet formulas and the information that must be supplied to the B.C.R.A. II - Accounting standards. III - Accreditation of B.C.R.A. personnel. IV - Inspection conclusions. Their insertion in the minutes books of the respective entity. V - Responsible personnel of the financial entity during the hours in which the activity is carried out. VI - Minimum controls in charge of the authorities of the financial entities. VII - Language to be used in books, documents and records. VIII - Correspondence of foreign banks. Ordering and classification. IX - Registration of documented import credits. X - Shareholders or associates assemblies.

1. Information to the B.C.R.A.
2. Annual report.

Circular CHAPTERS
MONETARY CIRCULATION -
CIRMO I - Banknotes and coins in circulation.
II – Imitation of monetary values and alteration of banknotes and coins.
III – Currency exchange services to the public (banknotes and coins) and exchange of damaged banknotes. IV – Invalidation of false banknotes. V – Procedures for the purification of cash. VI – Distribution of coins within the country.

Circular CHAPTERS
CLEARING HOUSES -
CACOM I - General regime.
II – Special provisions for the Clearing House of the Federal Capital.
III – Special provisions for the Clearing Houses of the Interior.
IV – Interconnection of Clearing Houses.
V – Compensation of values in interior localities where Clearing Houses do not operate.
VI – Additional services provided to government bodies and companies through the Clearing House of the Federal Capital.

SPECIAL SERVICES -
SERVI I - Attention to payment orders on behalf of the Institute of Banking Social Services. II – Payment of pensions and retirements. III – Payment of military retirements and pensions. IV – Payment of old-age, disability, honorary, favorable and life pensions. V – Collection of contributions and taxes destined to the National Directorate of Pension Revenue and to Other Bodies. VI – Collection of fees by the National Directorate of Migrations. VII - Bank intervention in the tax relief regime. VIII - Documents payable in other places. Their processing. IX . Mandates and client commissions.

ITEMS NOT INCLUDED IN
OTHER FRAMEWORKS -
RUNOR
I - Current accounts of financial entities at the B.C.R.A.
II – Schedule for requesting forms from the B.C.R.A.
III – Submissions to the B.C.R.A. Requirements to be met.
IV – Circulars of the B.C.R.A. Treatment by financial entities.
V – Regime of authorized signatures of the B.C.R.A.
VI – Hours of financial entities.
1. Of personnel and public service.
2. Special.
VII - Operations for which financial entities must require the presentation of certificates. VIII - Employer contribution to the Institute of Banking Social Services. IX - Valid identification documents. X - Financial secrecy. XI - Sanctions and appeals.
1. General rule.
2. Procedure for processing inquiries.
XII - Security measures.
XIII - Sale and reservation of tickets. Its prohibition.
XIV - Relations between financial entities and their clients.
XV - Exchange houses, agencies, offices and brokers. Authorization and conditions to operate.
1. Exchange houses, agencies and offices.
2. Exchange brokers.