Resolution CMN No. 2575 — Redefines Criteria for Brazilian Export Financing under PROEX

RESOLUTION NO. 002575

Redefines the criteria applicable to the financing of Brazilian exports under the Export Financing Program - PROEX.

THE CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the MONETARY COUNCIL, in a session held on December 17, 1998, based on Article 4, items V, VI, XVII, and XXXI, of the aforementioned Law and in view of the provisions of Provisional Measure No. 1,700-20 of November 27, 1998,

RESOLVED:

Article 1. Brazilian exports of goods and services, as well as computer programs ("software") as provided in Law No. 9,609 of February 19, 1998, may be financed with resources from the Export Financing Program (PROEX) under the following modalities:

a) negotiation of the respective titles or documents of the export; or

b) financing contract signed between the Brazilian Government and foreign entities.

Paragraph 1. The allocation of PROEX resources for the establishment of credit lines is prohibited.

Paragraph 2. Financing under the modalities provided in this article is not granted when:

a) the exporter, in the capacity of the credit borrower, is delinquent with the National Institute of Social Security (INSS), with the Severance Indemnity Fund (FGTS), with the Federal Revenue Secretariat (SRF), or is registered in active debt with the Union; or

b) the borrower and the external guarantor(s), individually or jointly, are delinquent with the Union or any of its entities controlled, by public or private law, except in cases where there is renegotiation of debts directly by the Union or through international organizations or forums.

Article 2. In financings covered by this Resolution, the following shall be observed:

a) payment currency: those normally accepted internationally;

b) amortization: in installments, as applicable, counted from the date of shipment or delivery of the goods, the invoice, the commercial contract, or the financing contract, or from the date of consolidation of shipments and/or invoicing of services;

c) interest rate: compatible with that practiced in the international market. Interest must be calculated on the outstanding balance and due on the same dates as the principal installments;

d) late payment interest: 1 (one) percentage point per year above the contractual rate.

Paragraph 1. Distinct conditions from those provided in the items of this article may be granted, at the discretion of the Credit Committee for Exports (CCEx), when international practice so recommends.

Paragraph 2. The maximum period for consolidation of shipments and/or invoicing of services is 30 (thirty) days, with the date of consolidation being considered the date of the last event that integrates it.

Article 3. It is a condition for the release of resources to exporters, in the export financings provided for in this Resolution, the prior proof of:

a) the shipment of the goods and, when applicable, the invoicing of services;

b) the settlement of the foreign exchange operation related to the non-financed portion, if any; and

c) the constitution of guarantees that ensure the full return of the granted financings and the respective interest.

Article 4. The following guarantee instruments are admitted:

a) suretyship, guarantee, letter of credit, or instruments similar to suretyship and guarantee, according to the legislation of the guarantor's country, signed by first-tier credit or financial institutions;

b) documentary credits or titles issued or guaranteed by authorized institutions of the countries participating in the Convention on Payments and Reciprocal Credits (CCR), complying with all formalities for automatic reimbursement;

c) export credit insurance;

d) guarantee by the government or official banks of the importing country, when dealing with operations with foreign entities of the public sector; or

e) others, at the discretion of the Credit Committee for Exports (CCEx).

Paragraph 1. There is no recourse by the National Treasury against the exporter if the guarantee is represented by the instruments indicated in items "a" or "b" of this article.

Paragraph 2. In the case of item "c" of this article, the exporter's liability is limited to the unpaid debt not covered by credit insurance.

Paragraph 3. In the case of item "d" of this article, the CCEx may, exceptionally, waive the right of recourse against the exporter, providing immediate notice to the Monetary Council.

Article 5. The Financial Agent of the National Treasury for PROEX is Banco do Brasil S.A., to which it is incumbent to:

a) receive requests for the classification of export operations of goods, services, and computer programs ("software");

b) submit to the CCEx requests containing exceptionalities and those related to the export of services;

c) submit to the CCEx requests in the degree of appeal, only once;

d) carry out the monitoring and control of the financial and budgetary execution of PROEX; and

e) issue instructions on the operational processing of PROEX and provide exporters with the information necessary regarding the use of the Program;

Sole Paragraph. The CCEx may establish levels of authority, assign other competencies, and recommend procedures to Banco do Brasil S.A. - Financial Agent of the National Treasury for PROEX.

Article 6. The remaining aspects related to the financing of exports of goods, services, and computer programs ("software") shall be defined in acts by the Ministers of State of Finance and of Industry, Commerce, and Tourism.

Article 7. This Resolution enters into force on the date of its publication, but its effects may retroact to cover operations in which there has been no shipment or delivery of the goods and/or invoicing of services, if so desired by the interested parties through a new request to Banco do Brasil S.A.

Article 8. Resolutions Nos. 2,224 of December 20, 1995, and 2,381 of April 25, 1997, are hereby repealed.

Brasília, December 17, 1998

Gustavo H. B. Franco
President