Resolution of the Board of the National Bank of the Kyrgyz Republic No. 3/9 of 24 February 2010 on Amending and Supplementing Resolution No. 4/4 of 19 February 2003 on the Temporary Instruction on Working with Deposits

REPEALED

in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic

of 31 October 2012 No. 41/12

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

of 24 February 2010 No. 3/9

On Amending and Supplementing the Resolution of the Board of the National Bank of the Kyrgyz Republic of 19 February 2003 No. 4/4 "On the Temporary Instruction on Working with Deposits", registered with the Ministry of Justice of the Kyrgyz Republic on 25 March 2003, registration number 25-03

In accordance with Articles 7 and 43 of the Law of the Kyrgyz Republic "On the National Bank of the Kyrgyz Republic", the Board of the National Bank of the Kyrgyz Republic

RESOLVES:

1. To introduce into the resolution of the Board of the National Bank of the Kyrgyz Republic of 19 February 2003 No. 4/4 "On the Temporary Instruction on Working with Deposits", registered with the Ministry of Justice of the Kyrgyz Republic on 25 March 2003, registration number 25-03, the amendments and supplements in accordance with the annex to this resolution.

2. This resolution enters into force upon the expiry of one month after its official publication.

3. After official publication, the Legal Department shall send this resolution to the Ministry of Justice of the Kyrgyz Republic for its inclusion in the State Register of Normative Legal Acts of the Kyrgyz Republic.

4. The Supervision Methodology and Licensing Department shall bring this resolution to the attention of commercial banks.

5. Control over the execution of this resolution shall be assigned to the Deputy Chairman of the National Bank of the Kyrgyz Republic Bokontaev K.K.

Chairman	M. Alapaev

	Annex to the resolution of the Board of the National Bank of the Kyrgyz Republic of 24 February 2010 No. 3/9

AMENDMENTS AND SUPPLEMENTS to the Resolution of the Board of the National Bank of the Kyrgyz Republic No. 4/4 of 19 February 2003 "On the Temporary Instruction on Working with Deposits", registered with the Ministry of Justice of the Kyrgyz Republic on 25 March 2003, registration number 25-03

To introduce into the Temporary Instruction on Working with Deposits, approved by resolution of the Board of the National Bank of the Kyrgyz Republic No. 4/4 of 19 February 2003, registered with the Ministry of Justice of the Kyrgyz Republic on 25 March 2003, registration number 25-03, the following amendments and supplements:

1. In the title of the Instruction, exclude the word "Temporary".

2. Throughout the text of the Instruction, after the word "terrorism", supplement with the word "(extremism)", except for the title of the Law of the Kyrgyz Republic "On Combating the Financing of Terrorism and Legalization (Laundering) of Proceeds from Crime".

3. In Section 1 "General Provisions":

• in the first sentence of the first paragraph, replace the abbreviation "NBKR" with the words "National Bank of the Kyrgyz Republic (hereinafter - the National Bank)";

• in the fourth paragraph, after the words "National Bank", exclude the words "of the Kyrgyz Republic (hereinafter referred to as "NBKR")";

• in the third sentence of the seventh paragraph, replace the letter "No." with the word "number".

4. Throughout the text of the Instruction, replace the abbreviation "NBKR" with the words "National Bank" in the corresponding case forms.

5. Supplement Section 2 "Terms and Definitions Used" with the eighth, ninth and tenth paragraphs as follows:

"Identification - establishment by the bank of data in respect of individuals and legal entities on the basis of originals or duly certified copies of documents provided by individuals and legal entities in accordance with the requirements of the Law of the Kyrgyz Republic "On Combating the Financing of Terrorism and Legalization (Laundering) of Proceeds from Crime" and this Instruction.

Verification - measures to clarify or properly verify the results of identification, carried out by the bank within the framework of internal control.

Beneficial owner - an individual who ultimately owns or controls the client - a legal entity, and/or the person in whose interests the transaction is carried out.".

6. In Section 3 "Types of Deposits":

• in the last paragraph of subparagraph 3.1.1 of paragraph 3.1, replace the words "approved by resolution of the Government of the Kyrgyz Republic and the NBKR of 10 December 2001 No. 773/30/8." with the words "approved by resolution of the Government of the Kyrgyz Republic and the National Bank of the Kyrgyz Republic of 09.09.2005 No. 420/21/4";

• in the first paragraph of subparagraph 3.1.2 of paragraph 3.1, replace the word "Demand deposits - deposit account" with the words "Demand deposit account - account"; replace the words "on commercial" with the words "related to the exercise by the account holder of entrepreneurial";

• in the second paragraph of subparagraph 3.1.2 of paragraph 3.1, replace the words "account to which the deposit was made" with the words "demand deposit", replace the words "on the agreement" with the word "of the agreement";

• in the third paragraph of subparagraph 3.1.2 of paragraph 3.1, replace the words "personal deposit of the client in cash" with "personal funds of the client in cash and non-cash payments", also replace the words "deposit account" with "bank account", replace the words "of a one-time nature and are not the subject of commercial and/or similar activity of the account holder" with the words "not related to the exercise by the account holder of entrepreneurial and/or similar activity";

• supplement the third paragraph of subparagraph 3.1.2 of paragraph 3.1 with the following sentence:

"From the demand deposit account of an individual, the client may make personal payments, including payments for goods purchased for personal purposes (services rendered), utility payments and other similar payments of a personal nature and not related to the exercise by the account holder of entrepreneurial and/or similar activity.";

• supplement paragraph 3.1.3 after the first paragraph with the following paragraph:

"Interest on the deposit amount is paid to the depositor upon his demand in accordance with the terms of the bank deposit (deposit) agreement or transferred upon his demand to another account.";

• in the second paragraph of subparagraph 3.1.3 of paragraph 3.1, restate the last sentence "Additional contributions and partial payments of the principal deposit amount under such deposit are not made." as follows:

"Under a time deposit, partial contributions to the principal deposit amount are possible in accordance with the bank deposit agreement.".

7. In Section 4 "Legal Regime of Deposits. Rights of Clients":

• supplement paragraph 4.2 with the following paragraph: "The bank account agreement may provide for the certification of rights to dispose of monetary amounts held in the account by electronic means of communication and other documents using analogues of handwritten signature, electronic digital signature, codes, passwords and other means confirming that the disposal was given by a person authorized to do so.";

• supplement the second paragraph of paragraph 4.3 after the words "acquires the rights of a depositor from the moment the money arrives in his account" with the words "or his presentation to the bank of the first claim based on these rights, or his expression to the bank in another way of the intention to use such rights".

8. In Section 5 "Procedure for Opening Bank Accounts under a Bank Deposit (Deposit) Agreement":

• in the first sentence of the eighth paragraph, after the words "The agreement must be", supplement with the words "drawn up in the state and official languages and", after the words "one copy", supplement with the words "in the specified languages".

9. In the subsection "To open a bank account under a bank deposit agreement, depositors - individuals (residents and non-residents) must submit:" of Section 5:

• in the title of the subsection, exclude the word "depositors";

• supplement item 1) with the following subitem:

"- data of the document confirming the right of a foreign citizen or stateless person to stay (reside) in the Kyrgyz Republic;";

• restate item 2) as follows:

"2) document proving the identity of the client (the original is provided for review, from which a copy is taken);";

• in the sixteenth paragraph of Section 5, replace the words "a person who has not reached the age of sixteen" with the word "a minor", also replace the words "birth certificate of the client;" with the words "document proving the identity of the minor client (for minors under 16 years of age - birth certificate, upon reaching 16 years of age - passport);";

• supplement Section 5 after the sixteenth paragraph with the following paragraph:

"A deposit made in the name of a minor shall be disposed of by:

• until the minor reaches 14 years of age - parents or legal representatives;

• upon the minor reaching 14 years of age - the minor himself.".

10. In the subsection "To open a bank account under a bank deposit agreement, depositors - legal entities (residents) must submit:" of Section 5:

• in the title of the subsection, exclude the word "depositors";

• restate item 4) as follows:

"4) a copy of the Charter (Regulation), with amendments and supplements, certified by a notary or by the seal of the legal entity and the signature of the head in cases where, in accordance with the legislation, notarial certification is impossible;";

• supplement with subitem 9) as follows:

"9) document proving the identity of the person authorized to dispose of the funds of the legal entity (the original is provided for review, from which a copy is taken).".

11. In the subsection "To open a bank account under a bank deposit agreement, depositors - legal entities (non-residents) must submit:" of Section 5:

• in the title of the subsection, exclude the word "depositors";

• consider items 7) and 6) as items 6) and 7) respectively;

• supplement with subitem 8) as follows:

"8) document proving the identity of the person authorized to dispose of the funds of the legal entity (the original is provided for review, from which a copy is taken).".

12. In the subsection "Branches and representative offices of legal entities (residents and non-residents) carrying out economic activity in the Kyrgyz Republic, to open a bank account under a bank deposit agreement, must submit to the bank" of Section 5:

• restate item 2) as follows:

"2) a copy of the Charter (Regulation) on the activities of the parent organization, with amendments and supplements: for residents - certified by a notary or by the seal of the legal entity (if any) and the signature of the head in cases where, in accordance with the legislation, notarial certification is impossible; for non-residents - certified by a notary;";

• restate item 3) as follows:

"3) a copy of the document with amendments and supplements, on the basis of which the subdivision carries out its activities (for example, the Regulation on the branch, etc.): for residents - certified by a notary or by the seal of the legal entity (if any) and the signature of the head in cases where, in accordance with the legislation, notarial certification is impossible; for non-residents - certified by a notary;".

13. In Section 7 "Re-issuance and Closing of a Deposit Account":

• supplement paragraph 7.3 with the following paragraph: "The balance of funds in the account is issued to the client or, upon his written instruction, transferred to another account no later than five working days.";

• restate paragraph 7.5 as follows:

"In the absence of funds in the bank account for a period specified by the agreement or when the funds held in the client's account fall below the minimum amount provided for by the agreement, the bank may close the account, if this is provided for by the agreement, with mandatory notification of the account holder of its closure at least one month before the closure of the account. In this case, the funds must be accounted for in a separate consolidated account in the deposits section with mandatory off-system accounting for each client in accordance with the legislation of the Kyrgyz Republic.";

• in subitem 1) of paragraph 7.6, replace the words "this Regulation" with the words "this Instruction".

14. In Annex 1:

• supplement subitem 1.1 of paragraph 1 after the words "identification of the client" with the words "and establishment of the beneficial owner";

• supplement subitem 1.1 with the following paragraph:

"Information about the client and the beneficial owner obtained as a result of identification shall be recorded in the client's questionnaire (file) drawn up in accordance with the requirements of the authorized body.";

• supplement paragraph 1 with subitem 1.1-1 as follows:

"1.1-1. conducting verification of the client's data after opening a bank account;";

• in paragraph 8, replace the words "initiate measures to verify" with the words "conduct verification";

• in paragraph 9, replace the words "additional identification of the client and/or verification of the information received" with the words "verification of the client".

15. In Annex 2:

• after the sixth paragraph, supplement with the following paragraph:

"The card with specimen signatures and seal impression must contain the bank's mark on the validity period of the identity document of the persons authorized to dispose of the funds of the legal entity.";

• supplement with the twelfth paragraph as follows:

"When there is a change of officials of a legal entity authorized to dispose of the funds of the legal entity held in its account, a document confirming the authority of the new officials of the legal entity to dispose of the funds of the legal entity and a new document with specimen signatures and seal impression, certified in the manner specified in this Instruction, shall be submitted to the bank.".

16. In Annex 3:

• supplement paragraph 4 with the following paragraph:

"In the event that the bank establishes correspondent relations with banks from states and territories that do not apply or insufficiently apply the recommendations of the intergovernmental organization (group) for the development and implementation of international standards for combating money laundering and the financing of terrorism (FATF), the bank's risk of involvement in activities related to the financing of terrorism (extremism) and legalization (laundering) of proceeds from crime increases.";

• restate paragraph 5 as follows:

"5. In all cases of establishing correspondent relations, the bank must carry out the following measures in respect of the correspondent bank with which the bank intends to establish correspondent relations:

• establishment of the fact that the correspondent bank was established in its country in accordance with the legislation;

• establishment in the correspondent relations agreement of the duties and powers of the parties regarding measures taken for the purposes of combating the financing of terrorism (extremism) and legalization (laundering) of proceeds from crime;

• receipt of the annual financial report of the correspondent bank (with the conclusion of the audit commission);

• analysis of the measures applied by the correspondent bank for the purposes of combating the financing of terrorism (extremism) and legalization (laundering) of proceeds from crime, including on the basis of information obtained from conversations with employees of the correspondent bank;

• analysis of reports on the assignment of a credit rating to the correspondent bank (if available and the information on the report is publicly available);

• determination of the main business directions of the correspondent bank;

• assessment of the creditworthiness of the correspondent bank;

• requesting information on whether the correspondent bank has such clients as shell banks, banks registered in offshore zones;

• determination of whether the correspondent bank is state or private;

• identification and verification of the main owners of private correspondent banks;

• on the basis of publicly available information, conducting an assessment of the reputation of the correspondent bank and determining the presence of a supervisory body in the field of combating the financing of terrorism (extremism) and legalization (laundering) of proceeds from crime;

• identification and verification of the data of the correspondent bank.

When opening a "loro" account, the bank must additionally request from the correspondent bank the following documents:

• application/letter of intent to establish correspondent relations;

• a copy of the document confirming the registration of the correspondent bank as a legal entity in the country of origin, legalized and certified in accordance with the requirements of the legislation of the Kyrgyz Republic;

• a copy of the license certifying the right of the correspondent bank to carry out operations that the bank intends to conduct within the framework of the established correspondent relations, legalized and certified in accordance with the requirements of the legislation of the Kyrgyz Republic;

• information about the expected activity of the correspondent bank that will be carried out through this correspondent account.

After establishing correspondent relations, the bank must monitor information about the correspondent bank on the issues specified in this paragraph. In the event that the bank discovers that the correspondent bank fails to comply with measures to combat the financing of terrorism (extremism) and legalization (laundering) of proceeds from crime, the bank should take appropriate measures up to and including termination of correspondent relations.".

17. In footnote 2, replace the words "identity card" with the words "documents proving identity (for foreign citizens and stateless persons - passport of a foreign citizen, residence permit, temporary residence permit, refugee certificate; identity card of an officer, warrant officer or military ID of a conscript serviceman).".