Czech National Bank Decree No. 434 / 2002 Coll.
Order of the Czech National Bank laying down the formalities for the application for an exchange licence, the assumptions and conditions for carrying out certain foreign exchange transactions and the procedure for handling counterfeit or altered funds
Valid
Order
Effective from 01.11.2002
Text versions:
01.11.2002
09.10.2002
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434
DECLARATION
Czech National Banks
of 13 September 2002
laying down the formalities for the application for a foreign exchange licence, the assumptions and conditions for carrying out certain foreign exchange transactions and the procedure for handling counterfeit or altered funds
The Czech National Bank provides for the Act No. 219 / 1995 Coll., as amended by Act No. 362 / 2000 Coll. and Act No. 482 / 2001 Coll.:
INTRODUCTORY PROVISIONS
Subject matter
This decree sets out the formalities for the application for a foreign exchange licence, determines which transactions are carried out only by a legal person and sets out the minimum amount of its capital, lays down the technical, organisational and financial conditions for the conduct of foreign exchange transactions and the competence and integrity of persons carrying out foreign exchange transactions and lays down the conditions for the execution of foreign exchange transactions. The decree also provides for the procedure for foreign exchange locations for the treatment of counterfeit or altered funds.
Definition of terms
For the purposes of this decree:
(a) purchase of foreign exchange banknotes, coins or cheques in foreign currency for banknotes, coins or cheques in Czech currency;
(b) the sale of foreign currency banknotes, coins or cheques in foreign currency for banknotes, coins or cheques in Czech currency;
(c) other foreign currency transactions, exchange of foreign currency for the currency of the game and exchange of foreign currency wins for another currency in the course of gambling in a casino authorised under a special law, 1)
(d) non-cash transactions in foreign currency, the purchase or sale of foreign currency for another currency carried out on own or on an account by the transfer of funds from accounts, brokering or otherwise procuring such purchase or sale, including the receipt and transmission of instructions for its execution or collateral;
(e) the identification marks of the foreign exchange point by the commercial firm, the identification number, the address of the establishment and the name or names, if any, and the surname and signature of the authorised staff member in accordance with the signature model;
f) deducting the proof of the transaction involving the designation of the foreign currency by ISO code, its quantity and rate, the exchange rate value, which is the amount to be paid or received in CZK, the price of the service in CZK, the identification marks of the foreign exchange point, the date and place of issue,
(g) a set of daily records of all transactions carried out within the deduction data range by the value book and the value diary.
CONDITIONS FOR THE PURCHASING OF THE PURCHASE OF A CIVIL MONETARY OR SELL OF A CIVIL MONETARY IN FITTINGS
(1) Purchases of foreign currency or sale of foreign currency pursuant to § 2 (a) and (b) may offer and carry out only a foreign exchange point to the extent specified in the banking or single licence, (2) a licence for foreign exchange activities (3) or a foreign exchange licence for the sale of foreign currency for the Czech currency.
(2) A foreign exchange location which is not a bank or branch of a foreign bank (hereinafter referred to as "the bank") cannot, when buying a foreign currency or selling a foreign currency, offer and conduct non-cash transactions in foreign currency without a foreign exchange licence.
(3) If a foreign exchange point takes cash from a client when buying a foreign currency or selling a foreign currency, it shall not transfer the consideration of such funds from its account to the client's account without a foreign exchange licence to conduct non-cash transactions in a foreign currency.
(4) When buying or selling a foreign currency, the foreign exchange location shall not be entitled to receive from the client the consideration of the funds into its account, except where the client uses a payment card when buying or selling the foreign currency.
(1) Only a legal person may be an applicant for a foreign exchange licence for the sale of a foreign currency for a Czech currency if he carries out an exchange activity in accordance with the legislation at least 12 months without delay before the application for a foreign exchange licence (the applicant).
(2) The application for a foreign exchange licence shall be accompanied by the following particulars:
(a) the company of the applicant, its registered office and its identification number;
(b) the name and, where appropriate, the name and surname, nationality, birth number or date of birth and the address of the place of permanent residence of the person or persons who are the statutory authority of the applicant or who are members of the applicant;
(c) justification,
(d) the addresses of the establishments where the applicant carries out the exchange activity;
(e) an extract from a commercial register not more than one month old or an officially certified copy thereof or a document proving the formation of a legal person in the event that such legal person is not registered;
(f) an officially certified copy of the concession instrument in force for the conduct of the exchange operation;
(g) documents demonstrating the competence and duration of the practice of persons performing management functions and persons purchasing or selling the foreign currency in cash. Persons who will make the purchase or sale of a foreign currency in cash for applicants shall submit a certificate demonstrating that they have completed an expert course on the recognition of the tender suspected of falsification or modification organised by the Czech National Bank or by the persons entrusted to it,
(h) an extract from the Register of Penalties not more than one month old for persons performing management functions who are the founder or members of the applicant, the statutory body, the members of the statutory body or supervisory board, and persons who will sell the foreign currency in cash to the applicant;
(i) a declaration by the applicant that it fulfils the condition of carrying out an exchange activity in accordance with the legislation at least 12 months before the application for a foreign exchange licence (Section 3 (4) of the Foreign Exchange Act).
(3) The natural person referred to in paragraph 2 (i) with a place of residence outside the territory of the Czech Republic shall also submit a document similar to the extract from the record of the Register of Penalties issued for that purpose by the competent authority of the State of residence of that person, as well as the States in which that person has remained continuously for more than 3 months in the last 5 years. If the State of permanent residence of that person is not the same as the State of which he is a citizen, he shall also submit a document issued by the State of which he is a citizen. If such a document is not issued by the competent State, that person shall replace it by a declaration of honour.
(4) The application for a foreign exchange licence for the sale of foreign currency for the Czech currency shall be submitted by the applicant to the Czech National Bank through its branches.
(5) The foreign exchange office shall notify without delay the branch of the Czech National Bank which granted it an exchange licence for the sale of a foreign currency for the Czech currency, any changes in the data contained in the application for the foreign exchange licence and the documents provided for in the application, with the exception of those referred to in § 4 (2) (g).
(1) The Bank carries out the purchase of foreign currency or the sale of foreign currency in its operating premises (hereinafter referred to as the "exchange office") or in exchange machines.
(2) A non-bank foreign exchange location may carry out the purchase of a foreign currency or the sale of a foreign currency only in appropriate, for this purpose, designated establishments or exchange machines. These establishments and vending machines must be approved in advance (4) by a branch of the Czech National Bank, which issued a statement (5) for the issue of a licence to exchange activities (3) or a foreign exchange licence. Purchases or sales of foreign currency may only be made in establishments or establishments approved for use under a specific legislation. 6)
(3) The sale of a foreign currency may be carried out for a non-bank foreign exchange position only by a person holding a certificate of completion of an expert course on the recognition of counterfeit and altered tender (§ 4 (2) (g)).
(1) In carrying out the purchase of a foreign currency or the sale of a foreign currency, the foreign exchange is subject to a deduction on the purchase of a foreign currency or the sale of a foreign currency and it maintains a book of value or a book of value. The foreign exchange point may, instead of the deduction, the value book or the value diary, produce documents of processed computer equipment which must contain the same elements and cannot be amended by additional interventions (hereinafter referred to as "data records on technical media ').
(2) The foreign exchange office shall procure, update and use a cash file showing and describing valid Czech and foreign currency banknotes and coins and collecting information on the issue and validity of such tender, the time to exchange it in the event of termination and the description or, where appropriate, the depiction of known counterfeits.
(3) Deductions on the purchase of foreign currency or the sale of foreign currency, a value book or a value diary or records of data on technical media shall be substituted by the 7) referred to in paragraph 1 shall lead the foreign exchange position for each exchange office or establishment separately. The foreign exchange office shall keep such documents for a period of 10 years following the year to which they relate, of which at least 3 months at the foreign exchange office concerned.
(4) The foreign exchange repository shall indicate its identification characters in all deductions on the purchase of foreign currency or the sale of foreign currency, in the value book or in the value log.
(1) The purchase of a foreign currency or the sale of a foreign currency shall be subject to a purchase or sale deduction which shall be marked by a serial number in an uninterrupted number series and shall indicate on the deduction the following:
(a) the designation of the foreign currency by ISO code, quantity and rate;
b) amount to be paid or received in CZK, determined by exchange rate value,
c) price of service in CZK,
(d) identification marks of the foreign exchange location;
(e) the date and place of issue.
(2) When buying or selling cheques, the foreign exchange place of deduction shall also indicate:
(a) the name and, where applicable, the names of the client, the type, number and country of issue of the identity card;
(b) check numbers,
(c) the name of the bank or branch of the foreign bank which pays the check (checkbook).
(3) When buying or selling banknotes and coins with a value in excess of CZK 100,000, the foreign exchange point of deduction shall also indicate the name and / or names of the client, type, number, duration and country of issue of the identity card.
(4) The deduction shall be drawn up in two copies. One copy of the deduction remains in the foreign exchange deposit, the other is received by the client.
(5) When making a cancellation, the purchase of a foreign currency or the sale of a foreign currency shall be marked by the word "cancellation" on the foreign currency and shall indicate its identification marks, date and place of issue on the deduction. The deduction is included in the other deductions in the number series.
(1) The purchase of a foreign currency or the sale of a foreign currency shall be carried out by a foreign exchange exchange point according to the purchase or sale rate set out in the foreign exchange rate sheet.
(2) The price charged for the services provided shall be fixed at a fixed rate or as a percentage of the exchange rate value, which may determine the lowest and highest levels of that price. The prices of each service are expressed in Arabic numerals of uniform size.
(3) The foreign exchange card shall be published at a visible location, together with the price list for the services provided, so that the client is clearly and unambiguously informed of the individual prices and courses before the service is carried out.
(1) The foreign exchange position, which is not a bank, reports to the Czech National Bank data on the amount of foreign currencies purchased and sold in the reported calendar quarter for all establishments and exchange machines collectively. Data on the quantity of foreign currencies purchased shall correspond to the sum of the figures on the purchase deductions issued and data on the quantity of foreign currencies sold shall correspond to the sum of the figures on the sales deductions issued. If no foreign exchange purchase or sale of foreign currency has taken place in the reporting period, it shall indicate zero data on the form.
(2) The information referred to in paragraph 1 shall show the foreign exchange point on a form the model of which is set out in the Annex to this Order. The completed foreign exchange place forms are sent to the branch of the Czech National Bank which granted it an exchange licence no later than 15 calendar days after the end of the reported quarter.
CONDITIONS FOR THE IMPLEMENTATION OF OTHER EXISTING MONETARY TRADE
Other foreign currency transactions according to § 2 (b) (c) may carry out a foreign exchange place to which the Ministry of Finance has issued a permit to operate betting games in a casino under special legal regulations (1) and to which the Czech National Bank has granted a foreign exchange licence.
(1) The application for an exchange licence shall be accompanied by the following particulars:
(a) the company of the applicant, its registered office and its identification number;
(b) the name and, where applicable, the name and surname, nationality, birth number or date of birth and the address of the permanent residence of the person or persons who are the statutory authority of the applicant or who are members of the applicant;
(c) justification,
(d) the addresses of establishments where other foreign currency transactions will be carried out;
(e) an extract from a commercial register not more than one month old or an officially certified copy thereof or a document proving the formation of a legal person in the event that such legal person is not registered;
(f) an officially certified copy of the permit to operate betting games in a casino issued under special legislation, 1)
(g) an extract from the Register of Penalties of not more than one month old for persons exercising management functions who are the founder or members of the applicant, his statutory authority, members of his statutory authority or supervisory board, and persons who will conduct other foreign currency transactions for the applicant;
(h) documents proving the competence and duration of the practice of persons performing management functions and persons engaged in other foreign currency transactions.
(2) The natural person referred to in paragraph 1 (g) with his place of residence outside the territory of the Czech Republic shall also submit a document similar to the extract from the record of the Register of Penalties issued for that purpose by the competent authority of the State of residence of that person, as well as the States in which that person has remained continuously for more than 3 months in the last 5 years. If the State of permanent residence of that person is not the same as the State of which he is a citizen, he shall also submit a document issued by the State of which he is a citizen. If such a document is not issued by the competent State, that person shall replace it by a declaration of honour.
(3) The application for a foreign exchange licence is submitted by the applicant to the head office of the Czech National Bank in Prague.
(4) The foreign exchange office shall notify without delay the Czech National Bank's headquarters of any changes to the data contained in the application for the foreign exchange licence and the documents provided for in the application.
(5) The foreign exchange repository shall issue a deduction on the execution of the transaction and shall keep a value book or a balance sheet when carrying out another foreign currency trade. The foreign exchange location may, instead of deduction, the value book or the value diary, produce documents of processed computer equipment which must contain the same elements and cannot be amended by additional intervention.
(6) Deductions on the execution of a transaction, a book of value or a book of value or a record of data on technical media shall be replaced by 6) in accordance with paragraph 5, shall lead the foreign exchange point for each establishment or establishment separately. The foreign exchange office shall keep such documents for a period of 10 years following the year to which they relate, of which at least 3 months at the foreign exchange office concerned.
(1) The foreign exchange repository carries out other foreign currency transactions at the rate specified in the foreign exchange exchange rate sheet.
(2) The price charged for another foreign currency trade shall be fixed at a fixed rate or percentage of the exchange rate, which may set the lowest and highest levels. The price of another transaction is expressed in Arabic numerals.
(3) The foreign exchange office shall publish the price for other foreign currency transactions in the price list together with the exchange card in a visible place, so that the client is clearly informed of their amount before the transaction is executed.
(1) The foreign exchange point of each transaction shall draw up a deduction indicating the serial number and shall indicate on the deduction the following:
(a) the designation of the foreign currency by ISO code, its quantity, the rate;
(b) the amount to be paid, determined at exchange rate,
c) price of service in CZK,
(d) identification marks of the foreign exchange location;
(e) the date and place of issue.
(2) The deduction shall be drawn up in two copies. One copy of the deduction remains in the foreign exchange deposit, the other is received by the client.
(3) When making a cancellation of another foreign currency trade, the foreign exchange point shall indicate the two copies of the deduction by the word "cancellation 'and shall indicate the identification marks, date and place of issue on the deduction. The deduction is included in the other deductions in the number series.
PROCEDURE OF THE DOUBLE POSTS FOR CATCHING WITH MONETARY INSTALLATIONS SUSPECTED FROM THE GRANTING OR AMENDMENT
(1) If the foreign exchange place which purchases the foreign currency or sells the foreign currency or other foreign currency transactions is suspected that the banknotes or coins submitted are counterfeit or amended, it shall proceed in accordance with specific legislation. 8)
(2) In the cases referred to in paragraph 1, a certificate shall be drawn up in at least four copies for:
(a) the petitioner,
(b) the head office of the Czech National Bank,
(c) law enforcement authorities;
(d) an exchange or foreign exchange facility which has detained suspected funds.
CONDITIONS FOR THE IMPLEMENTATION AND IMPLEMENTATION OF TRAVEL TRADE WITH EXISTING MONETARY
(1) A foreign currency non-cash-free licence is granted to a legal person whose paid-up capital is at least CZK 10 000 000, provided that it has the technical, organisational, financial and personnel conditions to carry out such business.
(2) Where a non-bank foreign exchange position is only entitled to brokerage non-cash transactions in foreign currency exclusively between foreign exchange points that are banks and is not entitled to receive the funds of such foreign exchange points, the amount of the paid-up capital provided for in paragraph 1 shall not be required.
(3) A non-bank foreign exchange location may offer and conduct non-cash transactions in foreign currency only to the extent and under the conditions laid down in the foreign exchange licence.
(4) The application for a foreign exchange licence shall be accompanied by the following particulars:
(a) basic information on the applicant;
(b) justification,
(c) paper documents.
(5) The basic data on the applicant are:
(a) the commercial firm, the applicant's registered office and his identification number;
(b) the name and, where applicable, the names and surnames, citizenship, birth number or date of birth and the address of the place of permanent residence of the person or persons who are the statutory authority of the applicant or who are members thereof;
(c) the amount of the capital and the object of the activity;
(d) details of the applicant's property and personnel connection with other persons, relating to such a relationship between two or more persons in which one person has a direct or indirect stake in, or controls, at least 20 per cent of the capital or voting rights of the other person, or the relationship of two or more persons controlled by the same person ("close links").
(6) The reasons for the application shall include:
(a) the applicant's business plan;
(b) a business plan submitted for the next three years at least to the extent of the data reported in the publication of the accounts (balance sheet and profit and loss account, cash flow overview);
(c) a comment on the individual data of the business plan referred to in point (b), which includes the assumptions and conditions on which the business plan is based, the expected profit, the analysis of the reality or the ability to conduct activities related to the conduct of non-cash transactions in foreign currency with regard to the applicant's capital equipment, the creation of reserves and any effect on liquidity, profitability, asset quality and so on;
(d) means of ensuring against risks, their measurement, monitoring and management;
(e) materially technical, organisational and personnel security of activities related to the conduct of non-cash transactions in foreign currency;
(f) the procedure for the negotiation, execution and settlement of transactions, including the pricing mechanism;
(g) the addresses of the premises in which the applicant will offer and conduct non-cash transactions in foreign currency.
(7) The paper documents are:
(a) the instrument of incorporation or the social contract of a legal person;
(b) the statutes of a legal person, if any,
(c) an extract from a commercial register not more than 1 month old or an officially certified copy or document proving the formation of a legal person where that legal person is not registered; a legal person having its registered office outside the Czech Republic shall submit a document of a similar nature,
(d) an extract from the Register of Penalties not more than 1 month old for persons performing management functions who are the founder or members of the applicant, the statutory body, the members of the statutory body or the supervisory board, and persons who will conduct non-cash transactions with foreign currency for applicants;
(e) a CV containing the employment and business activities carried out over the last 10 years by the persons referred to in point (d); the persons proposed for executive management functions as well as persons responsible for carrying out non-cash transactions shall submit at least 2 independent financial statements;
(f) documents demonstrating the professional competence and duration of the experience of persons performing management functions and persons conducting non-cash transactions in foreign currency;
(g) documents proving the amount of the applicant's paid-up capital;
(h) the applicant's financial statements for the last financial year and, where the applicant is part of a consolidated entity, consolidated financial statements; where specific legislation so provides, the financial statements and, where appropriate, consolidated financial statements shall be verified by the auditor;
(i) documents relating to the applicant's close connection, in particular a list of persons closely linked to the applicant, including the indication of the company, the identification number or the birth number, the registered office or place of business or the place of residence and the means of interconnection;
(j) models of contracts concluded with clients, including models of certificates of the agreed and executed transaction;
(k) a statement by the applicant that all the particulars and documents submitted by him are up to date, complete and true.
(8) The natural person referred to in paragraph 7 (d) with a place of residence outside the Czech Republic shall also submit a document similar to the extract from the record of the Register of Penalties issued for that purpose by the competent authority of the State of residence of that person, as well as the States in which that person has remained continuously for more than 3 months in the last 5 years. If the State of permanent residence of that person is not the same as the State of which he is a citizen, he shall also submit a document issued by the State of which he is a citizen. If such a document is not issued by the competent State, that person shall replace it by a declaration of honour.
The application for an exchange licence for non-cash foreign currency transactions is submitted by the applicant to the head office of the Czech National Bank in Prague.
(1) The foreign exchange licence holder's foreign exchange licence to conduct non-cash transactions in foreign currency shall notify without delay the Czech National Bank's headquarters of any changes to the data contained in the foreign exchange licence application and the changes in the documents provided for in the application.
(2) The foreign exchange office shall without delay notify the head office of the Czech National Bank of a decision authorising the registration of a merger, transfer of assets to a shareholder, division or change of legal form, application for bankruptcy or settlement, winding-up decision, entry into liquidation.
(3) Non-cash transactions in foreign currency may be conducted only at the premises indicated in the application for a foreign exchange licence pursuant to § 15 (6) (g) or previously notified to the Czech National Bank. The change of the address of the establishment, cancellation or establishment of the new establishment shall be notified in advance of the foreign exchange point to the head office of the Czech National Bank and at the same time to the branch of the Czech National Bank.
A foreign exchange location which is not a bank shall conduct non-cash transactions in foreign currency only as immediate unless the foreign exchange licence expressly authorises it to trade in financial derivatives, subject to the following conditions:
(a) non-cash transactions in foreign currency shall be carried out only through accounts held with banks;
(b) the foreign exchange point shall keep separate records of non-cash transactions in foreign currency in the form of daily records;
(c) to conduct non-cash transactions in foreign currency, enter into a written contract with the client in advance containing procedures and conditions for the negotiation, execution and settlement of individual transactions;
(d) the foreign exchange point shall issue the client with a document confirming the negotiation of the transaction on the basis of the order received and a document confirming the settlement of the agreed transaction;
(e) the foreign exchange location shall conduct non-cash transactions in foreign currency by cash transfers of funds; the foreign exchange point is not entitled to take cash from clients and transfer their consideration from its account to the client account; cash funds may only be deposited by the client into the foreign exchange account;
(f) the foreign exchange point ensures the transfer of funds to the benefit of the client within the time limit agreed with the client as the settlement date for the settlement of the transaction;
(g) the foreign exchange location shall ensure that internal control of all activities relating to the conduct of non-cash transactions in foreign currency is carried out.
(1) The foreign exchange location shall ensure that, when carrying out cash-free transactions in foreign currency, the following are organised and staffed:
(a) negotiation of transactions;
(b) settlement of transactions;
(c) internal control; and
(d) accounting.
(2) Furthermore, the foreign exchange point:
(a) establish internal procedures, control and security arrangements for the processing and recording of data and an internal control mechanism for such procedures and measures, including rules on transactions concluded by its staff for their own account or for the account of persons close to them;
(b) keep customers' funds in separate bank accounts separate from other foreign exchange account accounts;
(c) establish accounting for the status and movement of individual clients' funds separately from other assets;
(d) may not use clients' money for transactions on their own account at a foreign exchange point;
(e) establish information and organisational barriers limiting the possibility of conflicts of interest between him and his client or between his clients;
(f) ensure qualified provision of services and advice in the interests of its clients, in a demonstrable manner, draw clients' attention to the important facts relating to trade, in particular the potential risks of financial losses resulting from trade, and other monetary liabilities if they result from the execution of the transaction;
(g) does not use false or misleading information when promoting its services, does not disclose important facts, does not offer benefits whose reliability cannot be guaranteed.
(1) The foreign exchange office shall keep daily records of non-cash foreign currency transactions. The record of each non-cash transaction in foreign currency shall contain at least the following information:
(a) the serial number of the alert;
(b) the registration number of the transaction;
(c) data identifying individual participants in the transaction;
(d) the designation of the requested currency by ISO code, quantity, rate,
(e) exchange rate value;
(f) the price of the service;
(g) the date of the negotiation and the settlement deadline;
(h) bank links for the transfer of funds (payment instructions).
(2) Daily records of non-cash transactions in foreign currency are kept by foreign exchange positions under order numbers in an uninterrupted number series. The foreign exchange office shall record each transaction in this way immediately after its conclusion.
(3) Any non-cash transaction in a foreign currency shall indicate the foreign exchange place with the registration number. Each document confirming the negotiation or settlement of a transaction shall bear the same registration number of the transaction to which the documents relate.
(4) The documents referred to in Article 18 (b) to (d) or records on technical data media replacing them are kept by the foreign exchange point for each establishment separately. The foreign exchange office shall keep such documents for a period of 10 years following the year to which they relate, of which at least 3 months at the foreign exchange office.
(5) The foreign exchange location indicates its identification marks on all documents.
(6) The agreed transaction shall be accompanied by a foreign exchange document indicating the registration number of the transaction and bearing the following particulars:
(a) the designation of the requested currency by ISO code, quantity, rate,
(b) exchange rate value;
(c) price of service, fees,
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Regulation Information
| Citation | Decree of the Czech National Bank No. 434 / 2002 Coll., laying down the formalities for the application for an exchange licence, the assumptions and conditions for carrying out certain foreign exchange transactions and the procedure for handling counterfeit or altered funds |
|---|---|
| Regulation Type | Order |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 09.10.2002 |
|---|---|
| Effective from | 01.11.2002 |
| Effective until | - |
| Status | Valid |
Legal Areas:
Finance
The regulation text is for informational purposes only.
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