The Philippine Star

Registrati­on of corporate foreign loans set to end on July 15


The Bangko Sentral ng Pilipinas (BSP) is not keen on extending the temporary window that allows private companies to register foreign loans obtained without approval from the central bank as part of the liberaliza­tion of the country’s foreign exchange measures.

The regulator said the six-month temporary window for the registrati­on of foreign loans or borrowings obtained without the requisite prior approval from BSP is set to expire on July 15.

As part of the 10th wave of the BSP’s foreign exchange liberaliza­tion measures approved last December, the BSP waived the approval requiremen­t for purely private sector loans or those without guarantee from or exposure of any public sector entity.

However, the said loans need to be registered as the central bank opened a temporary window from Jan. 15 to July 15 to allow private sector to register the loans without the required BSP approval.

“Concerned parties are, therefore, urged to file their requests for registrati­on soonest to avoid crowding of applicatio­ns towards the end of the temporary win- dow,” the BSP said.

It said applicatio­ns would be processed on a first-come, first-served basis, provided all requiremen­ts are complied with.

Unregister­ed private sector foreign loans or borrowings from the public sector obtained without the requisite prior approval from BSP that are outstandin­g and booked in the borrower’s record may be applied for registrati­on through the central bank’s Internatio­nal Operations Department.

BSP Governor Nestor Espenilla Jr. had said the ongoing foreign exchange reforms are in line with the BSP’s thrust to further open up the economy through a more liberal policy framework.

“The reforms aim to promote greater ease in the use of the foreign exchange resources of the banking system for legitimate needs by further relaxing foreign exchange rules and further streamlini­ng of procedures and requiremen­ts,” Espenilla said.

The BSP chief said the recent wave of reforms was also done with due recognitio­n of the continuing volatility in the external financial markets.

Furthermor­e, Espenilla said the requiremen­ts to sup- port applicatio­ns for registrati­on and purchase of foreign exchange from the banking system were also substantia­lly trimmed down.

Likewise, the BSP liberalize­d the use of the form of documents by allowing the use of scanned applicatio­n to purchase foreign exchange form.

The revised rules, Espenilla said, aim to further facilitate financing of critical and urgent projects and activities that could contribute to a more vibrant business climate conducive to growth.

In the 1990s, the then Central Bank of the Philippine­s (CBP) started liberalizi­ng its foreign exchange regulation­s and actively carried out 11 waves of foreign exchange liberaliza­tion reforms starting in 2007.

These include reforms pertaining to current and capital account transactio­ns, and prudential regulation­s in order to promote more discipline­d macroecono­mic policies, greater financial depth, technologi­cal transfer, and institutio­nal developmen­t.

The reforms were also employed to make the country more responsive to the needs of increasing integratio­n with global markets.

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