NEW CURRENCY ADJUSTMENT

 

Through Decree No. 4.553 of 08/06/2021, published in Official Gazette No. 42.185 of the same date, the National Executive decreed a new currency adjustment of the bolivar. The most relevant aspects of said currency adjustment are summarized below:

1) The unit of the Venezuelan monetary system, that is, the bolivar as legal currency, will be expressed in the equivalent to current Bs. 1,000,000 as from October 1, 2021; then, any sum or amount expressed in bolivars before said date must be converted into and re-expressed in the new unit, dividing the same by 1,000,000, that is, by means of the removal of 6 zeroes from the bolivar amount expressed before 10/01/2021.

2) As from 10/01/2021, the obligations in bolivars must be reflected and paid in its new expression. Likewise, prices, salaries and other obligations, taxes and other sums in national currency contained in financial statements, accounting documents, credit instruments and, in general, any transaction or reference expressed in bolivars must be reflected in its new expression.

3) Expressions in bolivars contained in any instrument, legal transaction or act carried out before 09/30/2021 will be understood to be automatically re-expressed in the new scale as from 10/01/2021, no need to execute or enter into new instruments or formalities at registries and notary’s offices.

4) The new expression of amounts in bolivars will not entail any expenses, commissions, fees, prices or similar costs. Any agreement to the contrary is null.

5) The Venezuelan Central Bank will regulate all matters relating to the execution of the new currency adjustment, including the rules for rounding of figures and circulation of new currencies.

6) As from 09/01/2021 and up to the time when the Venezuelan Central Bank provides otherwise, all instruments in which goods and services are offered and monetary amounts are expressed will use the currency unit, that is, the bolivar, in both its current expression and its new expression resulting from dividing the same by 1,000,000.

7) The banks and other financial institutions, as well as private and public, natural and legal persons, must adjust their computation systems and business and operations processing mechanisms, so that they may convert and reflect the amounts in bolivars in the new expression resulting from the division by 1,000,000.

The Decree became effective upon publication of the same in the Official Gazette.

In order to access the Decree, please click here.

Should you have any question or comment or require further information, please contact the partner in charge of your account via email.