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Resolution 14-03-01 – SICAD II

Resolution No. 14-03-01, issued by the Venezuelan Central Bank (“VCB”), was published in Official Gazette Extraordinary No. 6,128 of March 17, 2014. Said Resolution establishes that the universal banks and the commercial banks in the process of transformation, as well as the authorized microfinance banks, the Bicentenaria Public Stock Exchange, and the authorized operators of securities market may carry out brokerage transactions in the foreign currency market, both in cash and in securities denominated in foreign currency, issued by the Republic, its decentralized entities or any other public or private, national or foreign entity, solely through the Alternative Foreign Currency Exchange System (Sistema Cambiario Alternativo de Divisas  - “SICAD II”), pursuant to the provisions of Exchange Agreement  No. 27 of March 10, 2014, the rules that develop the same, and subject to the provisions of the Decree with the Status, Value and Force of Law of the Exchange Regime and its Unlawful Acts.

 

The Resolution establishes that the aforementioned persons who act in the market of foreign currency must publicly announce at their offices, by means of notices intended for such purpose, the reference rate of exchange published by the VCB, corresponding to the weighted average rate of exchange of the transactions made each day through SICAD II. Also, they must inform the applicable percentage or amount on account of commission for the purchase and sales transactions made through SICAD II.

 

Without prejudice to the participation of exchange agencies in the Foreign Currency Administration Regime according to the rules established, the VCB and the Ministry of the Popular Power for Economy, Finance, and Public Banking, when they deem it pertinent, will regulate the acts of the exchange agencies in the alternative foreign exchange market.

 

The Resolution prescribes that the liabilities resulting from the offers of sales of foreign currency submitted through SICAD II will not be taken into account for purposes of establishing the legal reserve.

 

The request for foreign currency purchase transactions through SICAD II will involve, for the universal bank processing the same, an application for opening an account in foreign currency with said bank from the client that does not have such type of account in the national financial system.  The institution operating in SICAD II, on the relevant value date, will credit the amount paid in foreign currency to the account to such end indicated by the client whose purchase transaction was agreed.

 

The Resolution became effective upon its publication in the Official Gazette.

 

In order to access the Resolution, please click here

 

“NOTE: THIS INFORMATION SHOULD NOT BE CONSTRUED AS LEGAL ADVICE ON ANY SPECIFIC MATTER AND ITS CONTENT ARE INTENDED AS A MANAGEMENT ALERT AS TO CURRENT DEVELOPMENTS IN VENEZUELA, ANY SPECIFIC LEGAL QUESTIONS REGARDING THE POSSIBLE APPLICATION OF NEW OR PROPOSED LEGISLATION TO PARTICULAR SITUATIONS SHOULD BE ADDRESSED TO TRAVIESO EVANS ARRIA RENGEL & PAZ.”