Creates The Public Bank Within The Framework Of The Provisions Of Article 330 Of The Political Constitution Of The State

Original Language Title: CREA LA ENTIDAD BANCARIA PÚBLICA EN EL MARCO DE LO PREVISTO EN EL ARTÍCULO 330 DE LA CONSTITUCIÓN POLÍTICA DEL ESTADO

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law no 331

LAW OF DECEMBER 27, 2012

EVO MORALES AYMA

CONSTITUTIONAL PRESIDENT OF THE PLURINATIONAL STATE OF BOLIVIA

For the Plurinational Legislative Assembly, has sanctioned the following Act:

THE PLURINATIONAL LEGISLATIVE ASSEMBLY,

D E C R E T A:

CHAPTER I

CONSTITUTIONAL FRAMEWORK AND OBJECT

Article 1. (CONSTITUTIONAL FRAMEWORK).

I. Article 306 of the Constitution of the State, defines among other aspects that the Bolivian economic model is

plural, establishing four forms of economic organization: community, state, private and social

II. Article 309 of the Constitutional Text states that the form of state economic organization comprises the

companies and other state-owned economic entities, which will meet certain objectives of public and social interest, including the direct production of goods and services.

III. Article 316 of the Constitution of the State Political Constitution, referred to the function of the State in the economy,

determines the direct participation of the State in the economy by means of the incentive and the production of economic and social goods and services to promote economic and social equity, and to promote development, avoiding the oligopolistic control of the economy.

IV. The paragraph V of Article 330 of the Constitutional Text, determines that the financial operations of the

Public Administration, in its different levels of government, will be performed by a public banking entity, whose creation will be provided by law.

Article 2. (OBJECT). This Law aims at the creation of the Public Banking Entity within the framework of the provisions of Article 330 of the Constitution of the State and the other constitutional precepts established in the preceding Article of the Constitution.

CHAPTER II

PUBLIC BANK ENTITY AS A FORM OF

STATE ECONOMIC ORGANIZATION

Article 3. (CREATION). Create the Public Banking Entity, as a Financial Intermediation Entity

Public Banking in the person of the Banco Union S.A. and as a form of economic organization in which the State, through the General Treasury of the Nation? TGN will maintain an equity stake greater than ninety-seven percent (97%) of social capital, which will have the purpose of carrying out, as provided for in this Law, the financial operations and services of the Public Administration, in its different levels of government, as well as operations and financial services with the general public as provided for in this Law, and the Law that regulates the activity of financial intermediation entities.

Article 4. (PURPOSE AND SCOPE).

I. The Public Banking Entity will aim to perform the operations and financial services of the entire

Public Administration at its different levels of government, managing the deposits of the public sector entities on behalf of the Central Bank of Bolivia? BCB, for which all of them will have to keep their funds in tax accounts on the BCB. Likewise, the Public Banking Entity will have the purpose of carrying out the operations and financial services to the general public, favoring the development of the national economic activity, by supporting the productive sector constituted mainly by micro and small enterprises, crafts, services, community organizations and production cooperatives, without exclusion of other types of companies or economic units within the framework of public policies established by the State Plurinational.

II. Performing operations and financial services to the Public Administration, at its different levels of

government, reaches all public sector entities without exception, which are mentioned below with an enunciative and non-limiting character: Legislative Body, Executive Body, Judicial Body, Plurinational Electoral Body, Multi-national Constitutional Court, State Attorney General, State Comptroller, Ombudsman Office, Public Ministry, Armed Forces, Police Boliviana, autonomous territorial entities, universities public, public institutions, agencies and companies, and any other legal entity where the State has the majority of the assets.

III. The financial services and operations provided to the entities of the Administration Public, they will be provided in

function of their respective legal and financial capabilities.

IV. Financial operations and services shall mean the set of active, passive, contingent, as

financial services operations authorized to perform to the Public Banking Entity in this Law and legal and regulatory provisions that rule the activity of the Public Banking Entity.

Article 5. (APPLICABLE LAW).

Public Banking Entity shall be governed by the provisions of this Law

the same as that which shall be of preferential application in respect of any other legal provision; the Law governing the activity and entities of financial intermediation, the rules issued by the Ministry which exercises the rectory of the National System of Treasury and Public Credit, the BCB rules concerning the payment system and its powers with the financial system and, in whatever contrary to this Law, shall govern the provisions laid down in the Code of Commerce. General or special provisions relating to the public sector will not apply to it.

Article 6. (FUNTIONS).

I. For the purpose and other purposes set out in this Law, the Public Banking Entity,

in addition to the operations established in the Law governing the activity and intermediary entities financial, will fulfill the following functions related to the National System of Treasury and Public Credit, the treasury management of the BCB and with its role of contributing to the development of the national economic activity:

administration of fiscal current accounts on behalf of the BCB of all entities of the Public Administration at their different levels of government, according to regulatory regulations of the Executive Body of the central level of the State and/or the Ministry that exercises the rectory of the National System of Treasury and Public Credit;

Pay payroll payment services to all public entities and companies, payment of rent to retirees and beneficiaries of social programs, payment to suppliers and payment for other concepts according to regulatory regulations of the Executive Body of the central level of the State and/or the Ministry of rectory of the National System of Treasury and Public Credit;

Providing tax collection and tax collection services are taxes, fees, special contributions and patents, in the framework of agreements or contracts subscribed to competent entities;

Act as an intermediary on account and order of the TGN in the placement of securities and, upon the provision of funds, in the redemption thereof;

Grant credits to public sector entities and companies within the framework of the provided for in this Law;

To provide services that may be required by the BCB, including the receipt of deposits for legal lace and the custody and distribution of monetary material on behalf of the BCB, subject to agreements and tariffs that both parties establish;

Perform other operations or services financial authorized by current regulations, compatible with the object, purpose and scope of the Public Banking Entity.

II. To favor the development of the national economic activity and in particular to support the productive sector, the Entity

Public Banking will develop the following functions:

Grant credit to the sectors of the micro and small enterprises, crafts, services, community organizations and production cooperatives, without exclusion of other types of companies or economic units, mainly in the productive sectors, to promote the generation of employment and support policies state of economic and social development;

Manage and act as a trustee of special funds that constitute the central level of the State, autonomous territorial entities, and international financing entities for specific purposes of promoting the productive sector;

Coordinate with State entities and other institutions that have technical assistance programs in charge, to integrate financial support, mainly in the productive sectors;

Establishing conventions with micro-financial entities to meet their purpose;

Promote and contribute to financial inclusion by continuously seeking the extension of financial operations and services to the entire population;

Perform other financial operations or services authorized by the current regulations, compatible with the object, purpose and scope of the Public Banking Entity.

III. According to the rules issued by the Executive Body of the central level of the State and/or the Ministry that exercises the rectory

of the National System of Treasury and Public Credit, the Public Banking Entity will implement the system of account Only for autonomous territorial entities and public universities, in a gradual way.

IV. For the conduct of operations and financial services related to the National System of Treasury and Credit

Public, the Public Banking Entity will be able to establish correspondent relations with financial institutions, under the Monitoring scope of the Financial System Monitoring Authority.

V. The granting of credits to public sector entities and companies, in all cases, will be carried out in the framework of

as provided for in Article 158 (10) and Article 322 of the Constitution of the State, the Law that regulates the activity and entities of financial intermediation, the provisions of public debt and of the National System of Treasury and Public Credit and the rules of prudential regulation of the Supervisory Authority of the Financial System.

VI. The granting of credit to public entities and companies must be made with guarantees that may consist of hedges granted by guarantee funds, insurance companies, the guarantee of the TGN when authorized by law or other mechanisms

VII. The Public Banking Entity may grant credit to the employees, workers or public servants of the

companies and public entities, observing the Law that regulates the activity and entities of financial intermediation and the norms of prudential regulation of the Supervisory Authority of the Financial System, without such credit operations being considered related operations.

VIII. The credit applications that the Maximum Executive Authority could make? MAE and the Deputy Ministers of the

Ministry that exercises the rectory of the National System of Treasury and Public Credit, in addition to complying with the

requirements and procedures established for the granting of credits, will require the express authorization of the MAE of the Ministry of the Presidency, on the basis of a certification that accredits the terms and conditions of the credit operation to be issued by the Public Banking Entity.

Article 7. (INVESTMENTS IN OTHER COMPANIES). The Public Banking Entity may maintain

equity or equity participation in entities within the scope of supervision and regulation of the System Supervision Authority. Financial and/or the Authority for the Taxation and Control of Pensions and Insurance, as well as carrying out feasibility studies to establish in the country new societies whose activities are related to their object and are in the fields of Monitoring and regulation outlined above. New companies may be incorporated in public limited liability companies. The Statute will set the approval levels required for these operations.

Article 8. (DOMICILE AND DURATION).

I. The Public Banking Entity will be domiciled in the city of La Paz and may open or close, within or outside the

national territory, branches and agencies, observing the legal and regulatory provisions governing the activity and financial intermediation entities.

II. The duration of the Public Banking Entity will be indefinite.

Article 9. (CAPITAL).

I. The capital of the Public Banking Entity will be represented by shares and will not be less than the minimum amount

established for banking entities in the Law that regulates the activity and entities of financial intermediation. The constitution of the capital of the Public Banking Entity may allow the participation of natural or legal persons in a proportion less than three percent (3%) of the total amount.

II. The State shall maintain the participation The company will

ownership of one hundred percent (100%) of the shares with at least two other public entities or state-owned enterprises at the central level of the State

The TGN must at all times maintain an equity stake greater than ninety-seven percent (97%).

III. The actions that belong to the State through public entities or state enterprises of the central level of the

State, are not transferable to the private sector or to public entities or companies of the sub-national level. They shall be transferable only between public entities or state enterprises at the central level of the State.

IV. Public entities and/or State-level enterprises at the central level of the State may acquire private holders or

public the shares of the Public Banking Entity according to their budgetary availabilities entered in the General Budget of the State.

Article 10. (INCREASE AND DECREASE IN CAPITAL).

I. The Executive Body of the central level of the State, by means of a Supreme Decree, will be able to make new contributions of

capital for the purpose of expansion of its operations, coverage of the requirements of requirements assets arising from their growth and others related to the fulfillment of the object of the Public Banking Entity.

II. When the new capital contributions are intended to replace the capital affected by losses, the same

must be carried out with the authorization of the Legislative Assembly Plurinational, through State Law.

III. Private shareholders may subscribe to new shares in proportion to the number they hold. In no case will the

social participation of private shareholders be greater than the percentage they own.

IV. Public sector shareholding may not be subject to a decrease in voluntary reduction of capital

state contributed.

Article 11. (PREFERRED RIGHT). When the capital structure also integrates the participation of the

private sector, the State shall have the right to purchase the ordinary shares owned by private operators.

Article 12. administration of the Public Banking Entity will be governed according to the

established in the statutes of the Public Banking Entity, framed as provided for in the Law that regulates the activity and entities of financial intermediation and the Code of Commerce for the public limited liability company, in all that is not contrary to this Law.

Article 13. (DISTRIBUTION OF UTILITIES). The distribution of effective and liquid utilities, after

constituted the legal and voluntary nature reserves that the Public Banking Entity deems appropriate, and provided that such distribution does not affect the compliance with legal relations established in the Law that regulates the activity and entities of financial intermediation and other provisions of the Supervisory Authority of the Financial System, will be approved by the Shareholders ' Meeting.

Article 14. (REPRESENTATION ON SHAREHOLDERS ' MEETINGS).

I. The representation in the General Meeting of Shareholders with full powers, voice and vote, of the actions in the name of the TGN, will be exercised by the Minister of Economy and Public Finance or, by express delegation, by the Deputy Minister of the Treasury and Public Credit.

II. When the shareholding structure provides for the participation of another state entity (s) or company (s), the

corresponding representation shall be exercised by the Maxima (s) Executive authority (s), and where appropriate, through the delegation to an authority of the same entity whose titular authority expressly designates.

Article 15. (RELATED TO THE EXECUTIVE BODY). The relationship of the Public Banking Entity with the

Executive Body of the central level of the State, will be carried out only through the Ministry of Economy and Public Finance, except as for the Operational or mere processing matters, in which cases the communication with the public repartitions will be direct.

Article 16. (STAFF REGIME). The labor relations between the Public Banking Entity and its

workers will be governed by the General Labor Law, its Rules of Procedure, and complementary rules.

Article 17. (LIQUIDITY NEEDS). The Public Banking Entity to cover its needs of

liquidity may apply for financing from the BCB, an entity that it may grant in accordance with the rules governing liquidity credit operations. for banks and other private financial entities.

Article 18. (SUPERVISION AND AUDIT). The supervision and supervision of the operations and services

financial performed by the Public Banking Entity, shall be carried out exclusively by the Supervisory Authority of the Financial System, as the governing body of the control system for any collection of public resources and financial intermediation of the country which exercises and supervises external control, determining, and where appropriate, the enforcement of legal provisions, technical standards and regulations for all entities operating in the national territory intermediation in the supply and demand for financial resources.

Article 19. (SURVEILLANCE). The Ministry that exercises the rectory of the National System of Treasury and Credit

Public, in the field of its functions and attributions related to the aforementioned System, will fulfill the function of surveillance of the Public Banking Entity in respect of the financial operations carried out by public entities and undertakings within the framework of the National System of Treasury and Public Credit, without prejudice to the powers of the Supervisory Authority of the Financial System. The surveillance function will consist of the following activities:

To ensure that the public sector financial operations that the Public Banking Entity processes in the framework of the National System of Treasury and Public Credit, perform with security and efficiency criteria;

Coordinate and monitor the proper access, use and delivery of services and products; forms and means of payment; procedures and other aspects related to the effectiveness and efficiency of financial operations conducted with the sector public Treasury and Public Credit System;

Verify the consistency of the information reported by the Public Banking Entity on the financial transactions and services provided to the institutions of the public sector through reconciliations and other evidence of consistency and, where considers relevant, propose operational and other adjustments that it considers appropriate to improve the processes of interaction of the Public Banking Entity with the National System of Treasury and Public Credit. For the purpose, the Ministry that exercises the rectory of the National System of Treasury and Public Credit, will have access to all information that requires related to such financial operations;

To instruct the Banking Entity It publishes debits, transfers and immobilizations of resources from the fiscal current accounts of public administration entities at all levels of government, for the purpose of ensuring compliance with the legal provisions and regulations, related to the National System of Treasury and Public Credit;

Sanctioning with pecuniary fines to the Public Banking Entity for non-compliance with the public administration functions described in Article 6 of this Law, in accordance with the specific Regulation issuing the a body that exercises the rectory of the National System of Treasury and Public Credit;

To carry out other actions aimed at promoting or preserving the supply of financial services to the public sector in a continuous and appropriate manner quality standards.

Article 20. (ANNUAL MEMORY). The Public Banking Entity shall draw up the annual report on the

developed activities and present a copy of the same for remission and knowledge to the Plurinational Legislative Assembly, General Comptroller the State, the Supervisory Authority of the Financial System and other competent bodies; a document which must be minimally contained in the annual management report, specifying among other important aspects, the development of assets, sindicated, external audit report on financial statements and any other relevant document relating to the management of the Public Banking Entity.

Article 21. (LINKAGE).

I. For the purposes of applying the limitations and prohibitions set forth in the Act regulating the activity and entities of

financial intermediation, none of the entities and companies in the sector shall be deemed to be public, whether or not they have a stake in the Public Banking Entity, have any connection to it, or make up an economic group among them.

II. The credit operations granted to public servants and employees or workers of state enterprises or where the

State has a stake actuary, no linked loans will be considered.

Article 22. (FEE FOR PUBLIC SECTOR FINANCIAL OPERATIONS). The operations and

financial services provided by the Public Banking Entity in favor of the Public Administration, at all levels of government, shall be remunerated on the basis of a fee to be counted against the non-objection of the Ministry that exercises the rectory of the National System of Treasury and Public Credit for its application, owing the Public Banking Entity for that purpose, to present the tariff backed in a cost structure analysis and other technical and financial support They are either required. The construction of the tariffs will allow a reasonable margin of utility that will allow to maintain systems and technologies in force, to expand points of attention and to execute new investments that contribute continuously to improve the standards of quality with which financial services should be provided. The tariff may be reviewed periodically.

Article 23. (TAXATION). The Public Banking Entity is subject to compliance with the obligations

tax and all provisions governing the matter.

CHAPTER III

EFFECTS OF THE CREATION OF THE ENTITY PUBLIC BANK

Article 24. (INSTITUTION OF THE PUBLIC BANKING INSTITUTION).

I. The creation of the Public Banking Entity in the person of the Banco Union S.A. by express mandate of this Law does not

the fulfilment of any requirement or formality under which the State, through the TGN, is a shareholder with the ninety-seven point forty-two percent (97.42%) of that Public Banking Financial Intermediation Entity.

II. The institution of the Banco Union S.A. as a Public Banking Entity, does not dissolve the society, does not alter your rights and

pre-existing obligations, does not condition the continuity of its operation to the fulfilment of a requirement, nor does it require reregistration or adaptation in public or private registers, remaining and unchanged those that are in force, except for the updating of the statutes in the matters amending this Law.

III. For all purposes, the initial balance sheet of the Banco Union S.A. as a Public Banking Entity shall be the Balance Sheet

of that bank, drawn up at the end of the month in which this Law is published.

ADDITIONAL PROVISIONS

FIRST. It is incorporated into Article 1 of Law No. 1488, of April 14, 1993, of Banks and Entities

Financial (ordered text), the following definition:

Public Banking Financial intermediation Entity (Public Banking Entity)

Bank entity with shareholding of the State greater than ninety-seven percent (97%), with private competence to administer the tax accounts of the Public Administration at its different levels of government on behalf of the Central Bank of Bolivia, with a mandate to carry out financial operations and services, established in its Organic Law, aimed at the modernization of the financial management of the State and support for the development of the activity ?

SECOND. Article 24 of Law No 1670 of 31 October 1995, of the Central Bank of Bolivia, is amended,

with the following text:

? Article 24. All non-financial Public Sector entities shall maintain their funds in

tax accounts at the Central Bank of Bolivia. The public banking entity shall be the financial institution entrusted with the administration of the tax accounts on behalf of the Central Bank of Bolivia.?

THIRD. The social statutes of the Banco Union S.A. as Public Banking Entity shall be adequate

within one hundred and eighty (180) working days of the publication of this Law.

FOURTH. The Union Bank S.A. as a Public Banking Entity, in a coordinated manner with the TGN, will develop an investment and operation plan that should gradually provide for the adequacy and/or expansion of its physical, organizational, and financial infrastructure. technology and other means which it requires to fully cover the supply of financial services to the entire Public Administration at their different levels of government.

QUINTA. The Ministry of Economy and Public Finance is authorized to commit and to carry out on behalf of the

TGN, additional contributions of capital to the Banco Union S.A., up to the amount of Bs.350,000,000.-(THREE HUNDRED AND FIFTY MILLION BOLIVIANS) according to the availability of the TGN, for the purpose of sustaining the growth of that bank.

FINAL DISPOSITION

ONLY.

I. The Executive Branch of the central level of the State and the Ministry that exercises the rectory of the National System of

Treasury and Public Credit are empowered to regulate by Supreme Decree or Ministerial Resolution, according to corresponds, the provision of financial operations and services to the Public Administration, its processes, procedures and all other aspects related to the National System of Treasury and Public Credit, which must be applied by the BCB, the Entity Public Banking and public sector entities at all levels of government.

II. As long as the regulations referred to in the preceding paragraph are issued, the provisions and contractual arrangements for delegated administration, operational guidelines and other related provisions shall apply.

REPEAL AND ABROGATORY PROVISION

ONLY. Article 29 (g) of Law No 1670 of 31 October 1995, of the Central Bank of

Bolivia is repealed and all other provisions are repealed and abrogated contrary to this Law.

Remitase to the Executive Body for constitutional purposes.

It is given in the Session Room of the Plurinational Legislative Assembly, at the eighteen days of December

of the year two thousand twelve.

Fdo. Lilly Gabriela Montano Viana, Rebeca Elvira Delgado Burgoa, Mary Medina Zabaleta, María Elena Méndez

Leon, Wilson Chancaray T., Angel David Cortez Villegas.

Therefore, it has been enacted to comply with the law of the State. Plurinational of Bolivia.

City of Cochabamba, at the twenty-seventh day of December of the year two thousand twelve.

FDO. EVO MORALES AYMA, Juan Ramon Quintana Taborga, Elba Viviana Caro Hinojosa, Luis Alberto Arce

cataclya, Daniel Santalla Torrez, Amanda Davila Torres.