BSP eases further rules on forex transactions

MANILA, Philippines–Regulators have further relaxed rules on foreign exchange transactions as part of efforts to make it easier to do business in different currencies in the Philippines.

Authorities this week announced new rules that make transactions easier for exporters and importers, foreign credit card companies and remittance firms, among others.

“The continuing review of foreign exchange regulations is consistent with the… commitment to maintain a safe and sound financial system, a stable forex market, and appropriate monetary policy supportive of sustained and inclusive economic growth,” Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. said.

In a statement, the BSP said it would allow the sale of foreign currencies by banks and other financial institutions without prior BSP approval to settle obligations under intercompany arrangements on trade transactions of local firms with foreign entities.

The policy is expected to facilitate legitimate trade transactions and allow the BSP to better capture data on trade transactions through reporting of gross importation, the regulator said.

The BSP said it would also allow the inclusion of payment centers or treasury hubs of corporations as beneficiaries of forex payments and remittances.

This is subject to presentation to the selling institution of supporting documents containing the payment arrangement with the centralized settlement unit.

This is intended to hasten the settlement of transactions among related entities considering current trends involving the use of clearing units such as payment/treasury centers for payments/financial transactions  by members of a group of companies.

In the meantime, the BSP said it would also allow the sale of foreign currencies to residents for settlement of their credit card obligations that were billed and payable in foreign currency.

Tetangco said the changes were part of continuing efforts to have an appropriate regulatory framework for foreign exchange transactions.