Category: Uncategorized

Through Resolution No. 126 dated October 16, 2023, the Secretariat for the Prevention of Money Laundering ("SEPRELAD") approved the procedures and requirements for the deregistration of Obligated Subjects without natural supervision.

Obligated Subjects without natural supervision are understood to be natural or legal persons that are not directly regulated by a government entity. These include:

1. Pawnshops;
2. Real estate agencies;
3. Non-profit organizations ("NPOs");
4. Money transfer services;
5. Merchants of jewelry, precious stones and metals, art objects, and antiques; and,
6. Individuals and legal entities engaged in philatelic or numismatic investment.

According to the new procedure, to deregister due to reasons such as a change in economic activity, dissolution, and/or business closure, Obligated Subjects without natural supervision must submit a request addressed to the highest authority of SEPRELAD requesting deregistration. This request should be accompanied by the Unique Taxpayer Registry ("RUC") certificate, an authenticated copy of the owner's or legal representatives' Identity Card, as well as a certificate of compliance with anti-money laundering and counter-terrorism financing measures issued by the General Directorate of Supervision and Regulation of SEPRELAD. In addition to the aforementioned documents, legal entities that are obligated subjects must submit an authenticated copy of the minutes of the assembly, whether ordinary or extraordinary, in which the suspension or cessation of activity or business closure was discussed. In the case of NPOs, the minutes mentioning dissolution and/or social change should be presented.

Within a maximum period of 10 (ten) business days, the General Directorate of Supervision and Regulations of SEPRELAD will issue the certificate, with the possibility of requesting additional documentation it deems pertinent, leading to the suspension of the stipulated period.

The regulations also consider the possibility of reinstatement for those Obligated Subjects who deregistered, provided they comply again with all the requirements established for registration in the registry of Obligated Subjects without natural supervision of SEPRELAD. 

Through Circular SS. SG. No. 162 dated December 20, 2023, the Superintendency of Insurance ("SIS") communicated that the external actuarial audit report established in Resolution SS. SG. No. 305/2022 will apply from the fiscal year’s audit concluding in June 2025.

The SIS urges insurers and registered external audit firms to take precautions and anticipate the verification work for the specified period in contracts to be signed in the year 2024.

Through Circular SS. SG. No. 164 dated December 26, 2023, the Superintendency of Insurance communicated to the national insurance system that, starting from January 2, 2024, all transfers in favor of the Central Bank of Paraguay (“BCP”) made by insurers, agents, insurance brokers, external auditors, and other entities within the insurance sector, must be made to the following account:

• Depository Account: 589906710750012
• Holder/Entity: Banco Central del Paraguay
• Tax Identification Number: 80009769-6

Through Resolution SS. SG. No. 247 dated December 28, 2023 (the “Resolution”), the Superintendency of Insurance (“SIS”) decided to suspend the validity of one of the incompatibilities to be a shareholder or director of supervised entities and to hold positions in another supervised entity, as mentioned in Resolution SS. SG. 244 dated October 5, 2020.

Formerly, individuals or legal entities holding or having share ownership, either directly or indirectly, in other entities subject to SIS supervision and regulation to an extent that allows them to exert influence or control over one of them, were incompatible to perform the role of shareholder, director of supervised entities, or any other position in another supervised entity.

According to the recent Resolution, this incompatibility has been suspended until December 31, 2024, due to the need to conduct an impact and scope assessment of the regulations affecting the regulated market.  

Through Circular SB. SG. No. 01 dated January 2, 2024, the Superintendency of Banks communicates that the legally required minimum integrated capital for various entities is structured as follows:

Institution	Minimum Capital Excercise 2023	Adjustment for Consumer Price Index (IPC)	Minimum Capital Excercise 2024
Banks	65.426	2.404	67.830
Financial Institutions	37.713	1.202	33.915
General Deposit Wharehouses	27.196	999	28.195
Currency Exchange Offices	5.093	187	5.280
Fiduciary Companies	31.713	1.202	33.915
Leasing Companies	3.497	128	3.265

Through Resolution No. 268 dated December 14, 2023, the Secretariat for the Prevention of Money Laundering or Assets ("SEPRELAD") authorized the implementation of SIRO to carry out communications regarding Compliance Officers and/or Compliance Managers by Obligated Subjects.

Through Resolution No. 08, Minute No. 73, dated December 26, 2023, the Board of the Central Bank of Paraguay (“BCP”) modified the deadline from which the entities authorized to operate as Credit Information Bureaus (“BIC”) can provide credit reference services.

In this regard, an extension is established until May 1, 2024, allowing the authorized entities to initiate their credit information service activities.

This circumstance is ascribed to the ongoing review of all the required documentation for the entities, as mandated by Resolution No. 03, Minute No. 08, dated February 21, 2023, which has not yet concluded.

Through Resolution No. 4 dated December 6, 2023, the Central Bank of Paraguay ("BCP") established the extension of temporary measures to support the productive sector until March 31, 2024.

These measures aim to mitigate the adverse effects of climate change, particularly for agricultural producers who suffered losses due to the reduction in the prices of their products in previous periods.

In this regard, the BCP has directed that, in the case of loans granted to sectors related to agricultural and livestock activities that were affected by the reasons determined in the previous paragraph, the counting of the overdue period in the formalization of renewals, refinancings, or capital restructurings, including accrued interest and other charges, will be allowed to be interrupted until the date of the new agreement or contract. For higher risks, it will be essential to conduct a prior analysis individually or by economic sectors or similar activities, or by a group of clients with a similar risk profile.

Through Resolution No. 01, Minutes No. 01 dated January 3, 2024, the Central Bank of Paraguay ("BCP") ordered the intervention by the Superintendency of Banks ("SIB") of the Retirement and Pension Fund for Employees of Banks and Related Institutions ("CJPEBA"), due to the disintegration of the Board of Directors. The SIB will intervene until the new authorities of the Board assume their roles, a period that cannot be extended for more than 90 days.

The administration of CJPEBA will be assumed by the interveners designated by SIS before CJPEBA, with the authority to carry out the following acts of administration and conservation: (i) Collect mandatory contributions and dues; (ii) Pay retirements, pensions and other retirement benefits; (iii) Collect principal and interest installment payments, fees, and others, from loans granted by CJPEBA; (iv) Grant pensions, retirements, and other retirement benefits; (v) Physically preserve the assets and documents of the entity, taking appropriate security and conservation measures; (vi) Provide information to SIS and the Board of the BCP, upon their request or on its own initiative, to alert authorities about situations that require immediate action; and (vii) Perform other acts that may be necessary to enable the functioning and continuity of the administration and conservation of the intervened entity, which may be authorized by SIS.

Through Resolution SV. SG. No. 030 dated December 26, 2023, the Superintendency of Securities ("SIV") approved the Unique Chart of Accounts ("PUC") and the Manual of Accounting Records for mandatory use by brokerage firms and investment fund management companies. These are detailed in Annexes I and II, respectively.

The PUC will become effective on January 1, 2024. Consequently, the financial statements for the first quarter of the year 2024 are required to incorporate the detailed records of operations in accordance with the PUC.

Additionally, it is clarified that the mere listing of operations in the PUC does not authorize its validity. Therefore, in case of new transactions, brokerage firms and investment fund management companies must obtain prior approval from the SIV.

The Sectors specified in the PUC are: (i) Assets; (ii) Liabilities; (iii) Net Equity; (iv) Contingency; (v) Off-Balance Sheet Accounts; (vi) Income; and (vii) Expenses.

In Annex II of the Resolution, the Manual of Accounting Records defines each Sector and Chapter that constitutes the PUC.