Question & AnswerQ&A (BSP CIRCULAR NO. 435)
The primary purpose of BSP Circular No. 435 is to amend Annex 'A' of BSP Circular No. 407 dated September 30, 2003, specifically regarding the minimum documentary requirements for foreign exchange forward and SAWP transactions.
The amendment was approved by the Monetary Board under Resolution No. 725 dated May 20, 2004.
Investments covered include BSP-registered investments in: a) PSE-listed shares of stock; b) government securities; c) money market instruments; and d) peso time deposits with a minimum tenor of 90 days.
The original BSRD (Bank Sale Redemption Document) must be presented on or before the deal date for covering the outstanding amount of sales/maturity proceeds, with specific requirements for PSE-listed shares which also require a local broker's sales invoice.
For PSE-listed shares of stock, the original BSRD or BSRD Letter-Advice together with the local broker's sales invoice must be presented on or before the maturity date of the FX forward contract.
The Circular takes effect fifteen (15) calendar days after its publication in a newspaper of general circulation in the Philippines.
The caption under Item B.1.2 was changed from 'Under DA/OA' to 'Under DA/OA, Documents Against Payment (DP) or Direct Remittance (DR)'.
In this context, DA/OA refers to Documentary Acceptance or Open Account transactions.
The original BSRD serves as proof of the sales/maturity proceeds that are due for repatriation and is a required document to cover these proceeds with forward foreign exchange contracts.
BSP Circular No. 435 was signed and adopted by Rafael B. Buenaventura, Governor of BSP, on June 11, 2004.