MORNBFI Vol. 1 - Planters Development Bank

APP. Q-2908.12.31GUIDELINES AND MINIMUM DOCUMENTARY REQUIREMENTS FORFOREIGN EXCHANGE FORWARD AND SWAP TRANSACTIONS[Appendix to Subsecs. 4625Q.3 - 4625Q.4 and 4625Q.6 (2008 - 4603Q.16 - 4603Q.18)]The following is a list of minimumdocumentary requirements for FX forwardand swap transactions. Unless otherwiseindicated, original documents 1 shall bepresented on or before deal date to QBs.A. FORWARD SALE OF FX TO COVEROBLIGATIONS – DELIVERABLE ANDNON-DELIVERABLE1. FORWARD SALE OF FX – TRADE1.1 Trade transactions1.1.1 Under LCa. Copy of LC opened; andb. Accepted draft, or commercialinvoice/Bill of Lading1.1.2 Under DA/OA arrangementsa. Certification of reporting QB onthe details of DA/OA under Schedule 10(Import Letters of Credits Opened andDA/OA Import Availments andExtensions) of FX Form 1 (ConsolidatedReport on Foreign Exchange Assets andLiabilities); andb. Copy of commercial invoice;In addition to the aboverequirements, the QB shall require thecustomer to submit a Letter ofUndertaking that:(i.) Before or at maturity date of theforward contract, it (the importer) shallcomply with the documentationrequirements on sale of FX for tradetransactions under existing regulations;and(ii.) No double hedging has beenobtained by the customer for the coveredtransactions.1.1.3 Direct RemittanceOriginal shipping documentsindicated in Item "II.a" of Circular Letterdated 24 January 2002.2. NON-TRADE TRANSACTIONSOnly non-trade transactions withspecific due dates shall be eligible forforward contracts, and shall be subject tothe same documentation requirementsunder Circular No. 388 dated 26 May 2003with the following additional guidelines forforeign currency loans and investments.2.1 Foreign Currency Loans owed tonon-residents or AABs2.1.1 Deliverable ForwardsThe maturing portion of the outstandingeligible obligation, i.e., those that areregistered with the BSP registration letter,may be covered by a deliverable forwardsubject to the documentary requirementsunder Circular No. 388. A copy of thecreditor’s billing statement may besubmitted only on or before the maturitydate of the contract.2.1.2 NDFsThe outstanding eligible obligation,i.e., those that are registered with the BSP,including interests and fees thereon asindicated in the BSP registration letter maybe covered by a NDF, subject to thedocumentary requirements under CircularNo. 388, except for the creditor’s billingstatement which need not be submitted.The amount of the forward contractshall not exceed the outstanding amountof the underlying obligation during theterm of the contract.2.2 Inward Foreign InvestmentsThe unremitted amount of sales/maturity proceeds due for repatriation tonon-resident investors pertaining to BSP- registered investments in the followinginstruments issued by a Philippineresident:a. shares of stock listed in the PSE;b. GS;1If copy is indicated, it shall mean photocopy, electronic copy or facsimile of original.Manual of Regulations for Non-Bank Financial InstitutionsQ RegulationsAppendix Q-29 - Page 1