By: André Jerusalem

The new Legal Framework for the Foreign Exchange Market, enacted on December 28, 2021, provides for important changes for financial agents, importers, exporters and all persons (whether individuals or legal entities) who wish to operate in foreign currency. However, for the provisions of the new law to come into effect, the Central Bank must publish its own regulations on the subject, which were initially scheduled for May 2022. However, due to the strike by the agency's employees, fears of delays have spread, since the deadline is tight — the law comes into effect on December 30, 2022.

The measure is being treated as a “revolution” in the foreign exchange market by the Central Bank, since the new framework consolidates and updates legal provisions that began to be enacted around 100 years ago and gives the Central Bank more autonomy. Despite this, most of the points depend on the regulation of the agency, and as a result, the market is even more anxious for the publication of the public consultation and the final rules, so that it can adapt the processes and systems in time. In addition, there is competitive pressure, since the new rules should make operations easier and cheaper, so whoever gets out there first has the possibility of gaining more customers.

In this case, the industry is demanding that the final rule be published by the end of the third quarter to ensure the system is ready when the law goes into effect. Several banks have instituted internal policies to avoid making changes to the system in December due to the closing of their annual financial statements.

The BC server strike is a problem that delays launches and new projects. The servers are on strike for two weeks, but during this period they will be operating normally, with slower activity and 4 hours of downtime per day.

Another concern expressed by executives is the “regulatory arbitrage” between institutions that already operate in foreign exchange and new entrants, another chapter in the dispute between banks and payment institutions. Even before the approval of the new law, the Central Bank announced that from September this year, payment institutions will only be able to operate in the foreign exchange market electronically.