Law Organic Of The Financial National Of Development Agricultural, Rural, Forestry And Fishing

Original Language Title: Ley Orgánica de la Financiera Nacional de Desarrollo Agropecuario, Rural, Forestal y Pesquero

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Organic Law of the National Financial Development Finance, Rural, Forestry and Fisheries

ORGANIC LAW OF THE NATIONAL AGRICULTURAL, RURAL, FORESTRY AND FISHERIES DEVELOPMENT FINANCE

Official Journal of the Federation on 26 December 2002

Latest Reform Published in the DOF January 10, 2014

On the sidelines a seal with the National Shield, which reads: United Mexican States.-Presidency of the Republic.

VICENTE FOX QUESADA, President of the United Mexican States, to its inhabitants known:

That the Honorable Congress of the Union, has served to address the following

DECREE

"THE CONGRESS OF THE UNITED STATES OF MEXICO, D E C R E T A:

ARTICLE 2o IS AMENDED AND ADDED. OF THE LAW OF INCOME OF THE FEDERATION FOR THE FISCAL YEAR 2002 AND THE ORGANIC LAW OF THE RURAL FINANCIAL INSTITUTION IS ISSUED

ARTICLE FIRST.- ..........

ARTICLE SECOND.- The following is issued:

Organic Law of the National Financial Development Financial, Rural, Forestry and Fisheries Development Fund

FIRST CHAPTER

Preliminary Provisions

Article 1o.- This Law creates and governs the National Development Finance Agricultural, , Forestry and Fisheries as a body Federal Public Administration decentralized, sectorized in the Secretariat of Finance and Public Credit, with legal personality and own patrimony.

Article 2o.- The Financial Institution will have as its object to carry out the State's priority activity to promote the development of agricultural activities, forestry, fisheries and all other economic activities linked to the rural environment, with the aim of raising productivity, as well as improving the standard of living of its population. In order to fulfill this objective, it will provide credit in a sustainable manner and provide other financial services to the Rural Financial Producers and Intermediaries, seeking their best organization and continuous improvement. It will also implement the programs that will be determined in rural finance in the Federation's Government Budget. In addition, it will promote investment and financing for national and international institutions, productive projects that promote rural development. In addition, it will operate with the Federal, State and Municipal governments, the programs to be held with the aforementioned institutions.

The Finance will support training and advisory activities for the Producers for the best use of their credit resources, as well as for those who decide constitute as Rural Financial Intermediaries.

In the development of its object and in order to promote the integral development of the rural sector, the Financial Sector will contribute to the improvement of the country's financial sector. linked to agricultural, forestry, fisheries and rural activities, as defined in Article 3o. Fractions I, II and Article 116, as appropriate, of the Sustainable Rural Development Act; and will manage its resources in a prudent, efficient and transparent manner.

Article 3o.- The Financial Officer will have your address in the Federal District. For the fulfilment of its object, it may establish regional coordination, agencies and modules in the national territory.

Financial will have an indefinite duration.

The Organic Statute will indicate the number, location and structure of the regional coordination, which will have a holder appointed by the Board of Directors, proposal of the Director General.

The agencies shall have a permanent character and, for their establishment, the credit claim of the productive geographical areas in the rural environment shall be considered.

The modules will be installed on a temporary basis, in the productive geographical areas whose credit demand requires it at a certain time of year.

Article 4o.- For the purposes of this Act, it shall be understood as:

I. Commission, to the National Banking and Securities Commission;

II. Council, to the Financial Board of Directors;

III. Organic Statute, to the Financial Statute of the Financial Institution;

IV.     Financiera, to the National Financial Agency for Agricultural, Rural, Forestry and Fisheries Development;

V. Rural Financial Intermediaries, to Cooperative Savings Societies and loans and popular financial corporations that are regulated in the Law of Savings and Popular Credit; to the credit unions and general warehouses of deposit referred to in the Law of the Matter, and to the other financial intermediaries that determine the legislation in force, as well as those agreed by the Council and compliance with the Financial Regulation;

VI. Producer or Producers, physical or moral persons including those included in the Agricultural and National Water Laws that are engaged in agricultural, forestry, fishing or any other economic activity linked to the rural environment;

VII. Secretariat of Agriculture, to the Secretariat of Agriculture, Livestock, Development Rural, Fisheries and Food, and

VIII. Secretariat of Finance, to the Secretariat of Finance and Public Credit.

Article 5o.- The name of a rural box may only be used by cooperative societies of savings and loans, credit unions and corporations Financial institutions, which carry out or have carried out operations with the Financial Institution.

Article 6o.- Financial operations and services shall be governed by the provisions of this Law and, in the absence of the following order, by the commercial law, for banking and commercial practices and practices and for the Federal Civil Code.

With regard to its organization and functioning as a decentralized organization, member of the Mexican financial system in terms of article 4. The Federal Law of ParaState Entities will apply the latter, the Organic Law of the Federal Public Administration and other related legal provisions.

The Federal Executive, through the Secretariat of Finance, will be able to interpret the precepts of this Law for administrative purposes.

CHAPTER SECOND

Financial Operations

Article 7o.- For compliance with its object, the Financial Officer may perform the following operations:

I. Grant loans or credits to the Producers;

II. Grant loans or loans to Rural Financial Intermediaries so that These, in turn, grant funding to promote agricultural, forestry, fishing and all activities related to the rural and indigenous environment;

III. Grant guarantees and guarantees, subject to the establishment of the corresponding reserves;

IV. Perform financial factoring operations on documents relating to agricultural, forestry and other economic activities linked to the rural environment;

V. Celebrate leasing contracts and acquire the assets they are the purpose of such contracts, provided that they are related to the subject matter of the Financial Regulation; it may also conclude financing operations guaranteed by certificates of deposit that cover agricultural and forestry products;

VI. Exorder credit cards, based on credit opening contracts;

VII. Constituency deposits in credit institutions of the country and entities financial corporations from abroad or, where appropriate, from popular financial corporations and savings and loan cooperatives;

VIII. Make discounts, without liability, on titles and documents in which consist of the loans or loans granted by the Financial Institution;

IX. Operate, on its own, with values and business documents;

X. Perform financial operations known as derivatives;

XI. Practice trust operations and act as a fiduciary institution like exception to the provisions of the General Law on Credit Titles and Operations, as long as they are related to their object;

XII. Carry out commands and commissions, as long as they are related to your object, be authorised by its Board and not be the assets of the Financial Institution;

XIII. Exorder letters of credit upon receipt of your amount, make effective credits and making payments for account and order of customers;

XIV. Carry out foreign currency operations;

XV. Preserve the service of the activities related to its object, which have the same evidentiary force as the laws assign to the facts by public or expert corridor;

XVI. Support training and advisory activities for the Producers, for the best using your credit resources, as well as promoting your organization;

XVII. Support training and advisory activities for the Producers who decide be constituted as Rural Financial Intermediaries;

XVIII. Run the specific programs that in rural finance determine in the Federation's Government Budget, in which preferential rate programs may be included, as well as coordination with instances that provide risk capital for the support of various projects linked to the object of the Financial;

XIX. Acquire or lease movable and immovable property necessary for the realization of its object, as well as alienate or lease them where appropriate;

XX. Promote to national and international investment-oriented institutions and the financing, productive projects that will boost rural and indigenous development in the different areas of the country and which will lead to sustainable development of each region, being empowered to administer and channel them, as well as to operate with the Federal, State and Municipal Governments the programs that be held with the institutions referred to above, provided that they do not generate any liabilities to the Financial Institution;

XXI.    Hire any type of service required for the performance of its object;

XXII. Coordinate, in the scope of its attributions, with the dependencies and entities of the Federal Public Administration responsible for promoting the technological development of the countryside with programs aimed at technological development and training of the rural and indigenous environment, and

XXIII.         Accept loans or loans from development banks, public trust trusts, and the Institute of Agriculture and Rural Development, established in the Bank of Mexico and the international financial instruments in terms of the applicable provisions, the resources of which are allocated to the financial sector; the total amount of such operations shall not exceed one hundred per cent of the financial assets; and

XXIV. Other similar financial activities relating to the purpose of which the Secretariat of Finance is authorised.

Except as provided for in part XXIII, the Financial Institution may not conduct operations that directly or indirectly capture resources from the public or any other another financial intermediary.

Article 8o.- The Financial Institution will develop its institutional program, in accordance with the guidelines and objectives of the National Development Plan, of the Program National Financing for Development and other relevant sectoral programmes. The aforementioned institutional program should contain a section on how the Financial Institution will coordinate with the agencies and entities of the Federal Public Administration, especially with those responsible for promoting development. The Council's view is to be taken into account in the field of technology.

According to the framework referred to in the preceding paragraph, the Financial Institution shall annually formulate its revenue estimates, its operational and financial programmes and its budget. general of expenditure and investment.

Item 8o. Bis.- The Federal Government will respond at all times to the passive operations agreed by the Financial Institution with:

I.        Development banking;

II.       Public trusts for economic development;

III.     International financial organizations; and

IV.      Government and intergovernmental foreign institutions.

Article 9o.- The granting of loans or loans referred to in Article 7o (I). of this Law will conform to the amounts, authorization instances and guidelines approved by the Council.

Loans or loans that are subject to authorization by the Council must be previously held by the Credit Committee:

I.        Repeals

II.       Repeals

III.     Repeals

Second paragraph.-Repeated

Loans or loans that are approved by the Council in one year shall not exceed the percentage of the total of the financial portfolio of the Financial Institution that determine annually the Council.

Article 10.- Loans or loans to Rural Financial Intermediaries will be granted in accordance with the global amounts and guidelines approved by the Council.

The above mentioned guidelines should include, among other aspects, those relating to the qualification procedure and risk concentration with the Intermediaries. Rural financiers and the operations that the Financial Institution holds with the Intermediary, taking into account the characteristics of the rural sector.

Article 11.- For the granting of loans or loans, restructuring of operations, the granting of additional resources on loans granted and, in general, for the conduct of its operations and the provision of its services, the Financial Institution shall take into account the credit history of the accredited person, as well as the other elements referred to in Article 65 of the Law of Institutions of Credit.

As an exception to the above, in order to maintain the operation of the production plant, the Financial Institution will be able to grant financing for the fulfillment of obligations. assumed and, in those cases where immediate attention is required, may grant credits considering integrally only the viability of the credit with adequate and sufficient guarantees, in both cases, prior to the authorisation of the Council.

The provisions governing the related credits will be provided on the basis for the granting of financial credits.

Financial will be considered as a financial institution for all purposes of the Law to Regulate Credit Information Societies.

Article 12.- The contracts or policies in which, if applicable, the credits provided by the Financial Institution are recorded, together with the statements of account certificates by the accountant authorised by the Financial Institution itself, shall be executive titles, without the need for signature recognition or any other requirement.

The statement of account certified by the accountant referred to in this Article shall make faith, unless otherwise proved, in the respective judgments for the fixing of the balances resulting from the duties of the accredited or the mutualees.

The certificate statement mentioned above must contain at least the name of the accredited person; date of the contract; notary or broker; and number of writing or policy certified, where applicable; the amount of the credit granted; the capital provided; the date to which the debit was calculated; capital and other payment obligations due to the court date; the subsequent provisions that were made of the credit, if any; Ordinary interest rates applied for each period; payments made on interest, specifying the applied interest rates and the write-downs made to the capital; applied moratoria interest and applicable rate for moratorical interests.

Article 13.- For the conclusion of the refactionary and enabling or avio credit agreements; the creation of mortgages in favour of the Financial complete unit of an industrial, agricultural, livestock or service company; the constitution of garment on goods and securities in favor of the Financial; the pledge of credit in books in favor of the Financial; the opening of commercial credit document by the Financial; as well as to execute with real guarantee of the In addition to the provisions of this Law, the provisions of Articles 66, 67 and 69 to 72 of the Law on Credit Institutions, as appropriate, must be observed.

Article 14.- The Secretariat of Finance will determine the basis for the credit portfolio qualification awarded by the Financial Institution; the documentation and information to be collected by the Financial Institution for the granting, renewal and duration of credits of any kind, with or without collateral, as well as the requirements that such documentation shall meet and the periodicity with which need to be collected.

In the determination of the bases, the Secretariat of Finance will have to consider the nature and object of the Financial.

Article 15.- When performing its operations, the Financial Institution must diversify its risks. The Commission shall determine the maximum limits for the amount of direct and contingent liabilities, of the same person, entity or group of persons as for their assets or liabilities, constitute common risks for the Financial.

The limits which the Commission, as the case may be, set out in accordance with this Article may also refer to market entities or segments representing a concentration excessive risk.

The Commission may establish guidelines for fixing the reserves referred to in Article 7o (III) of this Law.

In the determinations set out in this Article, the Commission shall consider the nature and purpose of the Financial Regulation.

Article 16.- In the trust contracts held by the Financial Institution, the Financial Officer may act in the same business as a trustee and as a trustee, as well as conduct operations with the Financial Institution itself in the performance of such trusts, as an exception to the provisions of Article 383 of the General Law on Credit Titles and Operations.

Financial will be prohibited:

I. Act as a trustee, mandate or commission in trusts, mandates or commissions through which resources are collected, directly or indirectly, from the public, by any act causing direct or contingent liabilities;

II. To perform the trusts, mandates or commissions referred to in the second paragraph of Article 88 of the Investment Company Act;

III. Act on trusts, mandates or commissions through which limitations or prohibitions contained in financial laws are avoided, and

IV. Use funds or securities of trusts, mandates or commissions for the granting of loans, in which the Financial Institution has the power discretionary, in the granting thereof to carry out operations under which their fiduciary delegates are or may be liable; the members of the Council, as appropriate, both owners and alternates, whether or not they are functions; the external auditors of the Financial Committee; the members of the committee the technical staff of the respective trust; the ascendants or descendants in the first degree or spouses of the persons mentioned; the companies in whose assemblies the majority of such persons or institutions have the same institutions; Bank of Mexico by means of general provisions.

Article 17.- In the performance of the operations of services provided for in the sections XI, XII, XIII and XV of Article 7o. of this Law, the Financial Financial will continue to be healthy practices that will promote the security of these operations and seek the appropriate attention of the Producers, and must observe, in addition to the provisions in this same Law, the established in the articles 79 to 85, 85 bis and 85 bis 1 of the Credit Institutions Act.

Article 18.- The Financial Institution may agree to the conclusion of its operations through the use of equipment, electronic, optical or any other technology, automated data processing systems and telecommunications networks, whether private or public, by establishing in the respective contracts the basis for determining the following:

I. The operations whose capability is agreed;

II. The means of identification of the user and the responsibilities for their use, and

III. The means by which the creation, transmission, modification or extinction of rights and obligations inherent in the operations of which is treat.

The use of the means of identification established in accordance with the provisions of this article, replacing the autograph signature, will produce the same effects as the laws give the corresponding documents and, consequently, they will have the same evidentiary value.

The installation and use of the equipment and media referred to in the first paragraph of this article shall be subject to the general rules which, if applicable, issue the Secretary of Finance.

The foregoing, without prejudice to the Bank of Mexico's ability to regulate the operations carried out by the Financial Institution related to payment systems and the transfers of funds, in terms of their law.

Article 19.- The characteristics of trusts, mandates, commissions, and securities and currency transactions, as well as financial transactions known as derivatives held by the Financial Institution, will be in accordance with the provisions that the Bank of Mexico establishes.

Article 20.- Users of the Financial Services will be able to go to the National Commission for the Protection and Defense of Service Users Financial institutions for the protection and protection of their rights and interests, in accordance with the provisions of Article 2 (IV). of the Law of Protection and Defense to the User of Financial Services.

Article 21.- (Repeals)

THIRD CHAPTER

Financial Heritage

Article 22.- The financial assets will be integrated by:

I. The resources that, if any, are assigned to you in accordance with the Federation's Government Budget;

II. The interest, income, capital gains, returns, and other resources you obtain from the investments you make and operations you celebrate;

III. The movable and immovable property that is transferred to it for the proper fulfillment of its object, as well as those it acquires by other means and which may be intended for the same purposes, and

IV. Other assets, rights, and obligations that you acquire for any other title.

Financial will create a fund whose operational support will be in charge. The resources of the fund will be used for the fulfillment of the object of the Financial. Any channelling or contribution of resources to that fund shall be considered expenditure for the purposes of the Financial Budget.

Article 23.- The resources for the granting of credits, as well as the surpluses resulting from their handling, may only be allocated to the fulfillment of the the Financial and to cover its expenses of operation and administration. The Secretariat of Finance shall authorize annually the total amount of the expenses for the operation and administration of the Financial Institution, on a proposal from its Board.

Article 24.- The budgetary transfers assigned to the Financial Institution for operation and operation shall be part of its assets and shall not be Article 1 (1)

Article 25.- The assets that the Financial Institution receives in payment for the transactions it holds in accordance with Article 7o. of this Law, regardless of their nature and characteristics, they will not be considered for any effect national goods, therefore, the corresponding legal and administrative provisions will not be applicable to them, not even the ones of character budget or related to public expenditure.

The Council shall determine the terms and conditions for the application and, where appropriate, the disposal of such goods.

CHAPTER FOURTH

From the Financial Administration

Article 26.- The Financial Administration will be entrusted to a Board of Directors and a Director General, who will assist in the exercise of their functions of the committees provided for in this Law, and in other committees of the Council itself, as well as of the public servants established in the Organic Statute.

Section I

From The Board

Article 27.- The Council shall be composed of the following members:

I. The Secretary of Finance and Public Credit;

II. The Secretary of Agriculture, Livestock, Rural Development, Fisheries and Food;

III.     The Secretary of Agrarian, Territorial and Urban Development;

IV.     A representative appointed by the Governor of the Bank of Mexico within the top 3 hierarchical levels of the central institute;

V. The Undersecretary of Finance and Public Credit;

VI. The Assistant Secretary for Development of Agriculture Secretariat;

VII.    The Head of the Development Banking Unit of the Secretariat of Finance;

VIII. The Director General of Agroasemex, S.A.;

IX. The Director General of the trusts established in the Bank of Mexico in relation to with agriculture;

X. Two representatives of the National Peasant Confederation;

XI. A representative of the National Confederation of Small Property;

XII. A representative of the National Agricultural Council;

XIII. A representative of the Permanent Agrarian Congress, and

XIV. An independent counsel appointed by the Federal Executive, through the Secretary of Finance.

The Council may authorise, on a proposal from the Director-General, the attendance of guests, who shall participate in the sessions in a voice but without a vote.

Article 28.- The appointment of the independent counsel must be placed on a person of Mexican nationality who for their knowledge, good repute, prestige professional and experience in financial or rural matters is widely recognized.

In no case may the following persons be appointed as an independent counsellor:

I. Those who have a nexus or employment relationship with the Financial Institution, as well as an important patrimonial nexus or employment relationship with a natural or moral person who is a creditor, the debtor, client or provider of the Financial or financial intermediaries with whom it operates;

II. Those that have pending litigation with the Financial;

III. Those sentenced for property offences, disabled to exercise trade or to perform a job, office or commission in the public service or in the Mexican financial system;

IV. Those that are subject to a business contest or bankruptcy;

V. The spouse, concubine or concubinaire or persons who have a parentage relationship to the third degree by consanguinity or affinity with any counselor;

VI. Those who have a conflict of interest with the Financial Institution for being clients, suppliers, debtors, creditors or any other nature, or

VII. Those that have the representation of associations, guilds, federations, confederations of workers, employers or sectors of attention that relate to the object of the Financial Institution or are members of its management bodies.

When taking office, the independent counsel will have to subscribe to a document, prepared by the Financial Officer, where he declares in protest of telling truth that no has an impediment to perform as a counsellor in that body and where he accepts the rights and obligations arising from such a charge.

Article 29.- Each owner counselor will designate his or her alternate. In the case of public servants, their alternates shall at least occupy the level of Director-General of the Centralised Public Administration, or their equivalent.

Independent members shall have no alternates and shall attend at least seventy per cent of the sessions which have been convened in an exercise. Otherwise, and if the absence of the Council's opinion is not justified, the Secretariat of Finance shall make a new appointment.

Article 30.- The Secretary of Finance and Public Credit will be the President of the Council. In his absence, he will chair the Secretary of Agriculture, Livestock, Rural Development, Fisheries and Food. In the absence of both, the Undersecretary of Finance and Public Credit or the alternate of the Secretary of Finance and Public Credit will do so, and in the absence of all the former, who appoint the members present.

Article 31.- The Council will meet in ordinary session at least quarterly. The President may convene an ordinary session or extraordinary when deemed necessary, as well as at the request of the majority of the members or the Director-General, through the Secretary of the Council.

Article 32.- For the validity of Council sessions, at least eight of its members will be required to attend.

Article 33.- The Council will have the following inselectable attributions:

I. Approve the Organic Statute, as well as the other necessary regulations for the operation of the Financial Institution, on a proposal from the Director General;

II. Approving the Financial Program of the Financial Institution;

III. Approve your revenue estimates, your operational programs, and financial and its general budget of expenditure and investment, as well as the requirements of transfers or subsidies of the Financial, which must be submitted to the Federal Executive;

IV. Set the percentage against the average annual balance of the portfolio The previous year's credit for administration and operating expenditure, seeking in the medium term the financial self-sufficiency of the Entity;

V. Approve annually, prior to the Commissioners 'report, and auditors' opinion external, financial statements of the Financial and authorizing the publication of the same;

VI.         Define the strategy and criteria on which to establish, inter alia, rates, time limits, risks of operations and types of business, taking into account the performance of the Board of Directors itself as an objective;

VII. Constituency of the Operation, Credit, and Integral Administration committees Risks, Human Resources and Institutional Development of Financial, as well as any others deemed necessary;

VIII. Dictate the operating rules for the functioning of the committees identified in the previous fraction, as well as approve the reports submitted by them;

IX. Appointing the Council's Secretary and Prosect, on a proposal from the President of the Council, from among the public servants of the Financial;

X.          Appoint, on a proposal from the Director General, the public servants of the Financial Institution who hold positions with the two immediate administrative hierarchies lower than that of the one and the holders of the regional coordination;

XI. Determine intermediaries, other than cooperative societies of savings and loans, to popular financial corporations, to credit unions and general warehouse warehouses, to be considered as Rural Financial Intermediaries;

XII.       Approve the guidelines of the Operation Committee for the granting of loans or credits, taking care that at all times the instances in charge of the granting of the credit are separated from those that promote it;

XIII.      Repeals

XIV. Authorize the granting of loans or credits referred to in the second paragraph of Article 9 of this Law;

XV.        Approve global loan or credit amounts to Rural Financial Producers and Intermediaries, the instances to be authorized by such loans or loans, and the maximum amount to be granted to each instance;

XVI. Approve the guidelines of the Operation Committee for Recovery and settlement, restructuring, settlement and bankruptcy of loans or loans granted by the Financial Institution;

XVII. Authorize the application of the reserves that constitute the Financial;

XVIII. Determine the general policies for the application and, where applicable, the disposal, the assets that the Financial Institution receives in payment for the transactions it holds;

XIX. Authorizing policies for the celebration of trusts, mandates and commissions related to the object of the Financial;

XX. Approve the guidelines according to which the Financial supports activities of training and advice to the Producers, for the best use of their credit resources, as well as those who decide to become Rural Financial Intermediaries;

XXI. Approve general policies and authorize the conclusion of coordination with the governments of the federative entities and municipalities, as well as collaboration with the social and private sectors, for the purposes of their object;

XXII. Approve the rules of operation of the programs that in terms of financing rural is determined in the Federation's Government Budget;

XXIII. Authorize the establishment, relocation and closure of regional coordinates and agencies in the national territory, on a proposal from the Director-General, in accordance with the provisions of Article 3o. of this Act;

XXIV.     Authorize, on a proposal from the human resources and institutional development committee and without requiring any additional authorizations of dependence of the Federal Public Administration, the basic organic structure, levels of posts, tabulators of salaries and benefits, wage policy and for the granting of extraordinary perceptions for the fulfillment of goals that are subject to the evaluation of performance, taking into account the conditions of the prevailing labor market in the field financial; promotion and promotion policies; selection guidelines, recruitment and training; separation criteria; and other economic benefits established for the benefit of financial workers;

XXV. Approve the operation rules of the fund referred to in the last paragraph of the Article 22 of this Law, on a proposal from the Director General;

XXVI.     Approve the annual programmes for the acquisition, leasing and disposal of movable and immovable property, the construction of works and the provision of services, which the Financial Institution requires for the fulfilment of its object, as well as the policies, bases and and general programmes governing the agreements, contracts, orders or agreements which the Financial Institution is required to conclude with third parties in these matters, in accordance with the applicable rules; and to approve the policies and general bases to which it must to secure the procurement of the services required by the Financial Institution to carry out the operations and services provided for in Article 7o. of this law;

XXVII. Analyze and approve, if applicable, the half-yearly reports that the Director gives General, with the intervention that corresponds to the commissars;

XXVIII. Know and resolve matters that the Director submits to his consideration General;

XXIX. Know and resolve those issues that are of importance, transcendence or special features so warrant, and

XXX. The others that this Law points out.

Article 34.- Council resolutions shall be taken by a majority of the votes of the members present. The President of the Council shall have a vote of quality in the event of a tie.

Councillors must communicate to the President of the Council any situation which may result in a conflict of interest, as well as to refrain from participating in the relevant deliberations and votes.

Article 35.- Council members, as well as those attending the sessions with the character of guests, will be required to keep confidentiality about the matters to be discussed. They shall also ensure at all times for the interests of the Financial Institution.

Article 36.- The following shall be caused by the removal of the members provided for in fractions X to XIV of Article 27 of this Law:

I. Mental incapacity, as well as physical inability to prevent the proper exercise of their functions for more than six months;

II. Failure to comply with the Council's agreements or to act deliberately in excess or defect of its privileges;

III. Use, for personal or third-party benefit, confidential information at the time of your charge, as well as disclose such information without Council authorisation, and

IV. Submit to the Council's consideration, with full knowledge, false information.

The members referred to in Article 27 of this Law shall be removed from office when their responsibility is determined by resolution of this Law. final issued by competent authority, in terms of the Federal Law on Administrative Responsibilities of Public Servants.

Section II

From the Financial Committees

Article 37.- The Financial Committee will have the Operation, Credit, Comprehensive Risk Management, as well as the Human Resources and Development committees. Institutional arrangements, without prejudice to the other institutions of the Council.

Article 38.- The committees referred to in the previous article shall be integrated by public servants of the Financial Institution, by representatives of dependencies and entities in the public sector and, where appropriate, by experts in the field concerned for each committee, to be determined in the Organic Statute.

Article 39.- The Operation Committee will have the following powers:

I. Submit for consideration and approval of the Council the strategy and criteria in which it shall be established, inter alia, by interest rates, time limits, guarantees, risks of the operations and types of business and other characteristics of the operations of the Financial Institution;

II. Submit for consideration and approval of the Council the guidelines for granting of loans or credits, taking care that at all times the bodies responsible for granting the credit are separated from those that promote it;

III. Submit to the Council's consideration and approval global loan amounts or credits to Rural Financial Intermediaries, as well as the guidelines for the granting of such loans or loans;

IV. Approve the restructuring of credits granted by the Financial Institution whose instance authorisation of the original credit would have been the local authorities in the Regional Coordinations or the Credit Committee and have a say in the restructures of the loans or credits which had been authorised by the Council;

V. Propose to the Council the guidelines for recovery and settlement, restructuring, quitches and bankrupts of loans or loans granted by the Financial Institution, and

VI. Others to determine this Law, the Organic Statute and the Council.

Article 40.- The Credit Committee will have the following powers:

I.        Authorize the granting of loans or loans, in accordance with the second paragraph of Article 9o. of this Act;

II.       Repeals

III. To view the Comprehensive Risk Management Committee on the methodology for estimation of losses and, where applicable, the constitution of reserves, and

IV. Others to determine this Law, the Organic Statute and the Council.

Article 41.- The Comprehensive Risk Management Committee shall set the methodology for the estimation of credit, market, liquidity risk losses, (i) the establishment of reserves, where appropriate, and shall suggest to the Council the terms for the application of those reserves, and the other powers which the Organic Statute and the Council shall point out.

Article 42.- The Human Resources and Institutional Development Committee will be integrated as follows:

I. Three representatives of the Secretariat of Finance and Public Credit; the Undersecretary The Minister of Finance and Public Credit and the Holder of the Development Banking Unit;

II. A person appointed by the Council who for their knowledge and development has extensive experience in the area of human resources;

III.     Repeals

IV. The member of the Board of Directors that has the character of an independent;

V. The Chief Financial Officer; and

VI. A representative of the Commission, with a voice but no vote.

The Director General of the Financial Institution shall refrain from participating in the Financial Sessions, which shall have the purpose of issuing opinions or recommendations with respect to its salary, economic benefits and social security benefits.

This Committee will consider and propose the tabulators of salaries and benefits, wage policy and the granting of extraordinary perceptions for the fulfillment of targets subject to performance evaluation, promotion and promotion policies; selection, recruitment and training guidelines; separation criteria; and other economic and social security benefits established for the benefit of the public servants who work in the Financial.

The Secretariat of Finance and Public Credit will establish criteria in terms of occupational structure, wage movements, extraordinary perceptions and benefits, which must be observed by the Committee. The Financial Institution shall also provide the Secretariat with the information it requests.

This Committee will meet at the request of the Director General of the Financial Officer, who will send the respective call to the members of the Financial Committee, where he will establish the order of the day, as well as the place and date for the celebration of the session. Their decisions will be taken by a majority of votes. The Undersecretary of Finance and Public Credit, who will preside over it, will have a vote of quality in case of a tie. The Committee will also have a technical secretary, who will have a voice, but without a vote.

Except for the independent counsel and the professional with experience in the area of human resources, the other members of the committee shall have their respective alternates, who will preferably be public servants of the next immediate lower level and must have at least Director General level.

In the absence of the Deputy Secretary of Finance and Public Credit, without prejudice to the right to vote for his alternate, he will preside over the Committee and will exercise the vote of Holder of the Development Banking Unit.

Section III

From The Director General

Article 43.- The Director General of Finance will be appointed by the Federal Executive, through the Secretary of Finance and Public Credit, and must be that appointment in person who meets the requirements laid down in Articles 21 of the Federal Law on ParaState Entities and 24 of the Law on Credit Institutions.

Article 44.- The Director General shall be responsible for the administration and legal representation of the Financial Institution, without prejudice to the powers of the Financial Institution. Council. You will have the following powers and functions:

I. In the exercise of his/her duties as a legal representative, you may celebrate or to grant all kinds of acts and documents relating to the subject matter of the Financial Regulation. For this purpose, it will have the most extensive powers to carry out acts of dominion, administration, litigation and collection, even of those that require special authorization according to other laws or regulations. In such a virtue and in a non-limiting and non-limiting manner, it may issue, endorse and negotiate credit titles, request and grant forgiveness, exercise and desist from judicial proceedings, including in the judgment of amparo, compromise on arbitrators and compromise, to grant general and special powers with all the powers which are responsible for it, even those requiring special clause, replacing and revoking them, and granting powers of substitution to the proxies, subject to express authorisation by the Council when try to grant general powers for domain acts;

I Bis. Inform the Secretariat, prior to the authorization of the instances operations which may be linked to the object of the development banking institutions.

II. Run the Council agreements;

III. Act as a general fiduciary delegate;

IV. to the Council the proposals that, in accordance with this Law, correspond make to the Financial Committees;

V. Propose to the Council the appointment of the public servants of the Financial that occupy positions with the two immediate administrative hierarchies lower than that of the;

VI. Submit to the authorization of the Council the establishment, relocation and closure of regional coordination and agencies in the national territory;

VII. Authorizing the establishment, relocation, and closing of modules in territory national;

VIII. Submit to consideration and approval of the Council the rules of operation of the fund referred to in the last paragraph of Article 22 of this Law;

IX. Submit the operational and financial programs annually to the Council estimates of annual revenue and the expenditure and investment budget for the following financial year, in which the budgetary requirements for the financial year must be incorporated, which must be included in the budget of the Federation;

X.         To decide on the designation and hiring of the public servants of the Financial Institution, other than those mentioned in the previous V, as well as the appointment and removal of the trust delegates and to administer the staff in their set;

XI. Remove public servants and employees from the Financial;

XII. To report half-yearly reports to the Council, with the intervention that corresponds to the stewards;

XIII. Conduct all kinds of legal acts necessary to comply with the aims of the Financial, and

XIV. The others that the Council and this Law attribute to you.

The powers of the Director General as provided for in fractions III, IV, V, VI, VII and X of this Article shall be inselectable.

Article 45.- The Director General shall be assisted in the fulfilment of his powers by the public servants of command, base and trust personnel who establish the Organic Statute.

Likewise, the Staff Regulations shall determine which of these public servants shall supply the Director General, in order to comply with the obligations of the Director General. The alternate shall have an immediate lower level than that of the Director-General of the Financial Institution.

The Director General shall be removed from office when his/her responsibility is determined, by final decision given by competent authority, to be found in some of the assumptions contained in the Federal Law on Administrative Responsibilities of Public Servants.

Article 46.- Financial public servants holding positions with the two immediate administrative hierarchies below the Director General must to meet the requirements laid down in Article 21 of the Federal Law of State Parahold Entities, as well as those provided for in Article 24 of the Law on Credit Institutions.

CHAPTER QUINTO

Of The Information

Article 47.- The Financial Officer shall provide the authorities and the general public with information regarding their operations using electronic, optical and optical media. or any other technology that allows him to make known such information according to the general rules that the Secretariat of Finance will issue for this purpose.

Also, the Financial, through the electronic means with which it counts, will make known the programs of credits and guarantees, indicating the policies and criteria in accordance with which it will carry out such operations; reports on the current and investment expenditure budget; the contingencies arising from the guarantees granted by the Financial Institution, as well as the work contingencies, or any other the type that would entail a risk to the Financial Institution.

Financial will be applicable to the Federal Law on Transparency and Access to Government Public Information.

Article 48.- The Financial Officer will send the Federal Executive through the Secretariat of Finance, and is in turn to the Congress of the Union, together with the reports on the Economic Situation, Public Finance and Public Debt and in the latter's recesses, to the Standing Committee, the following:

I. In the January-March report of each year, an exhibition on credit programs, guarantees, transfers of subsidies and transfers tax resources, as well as those expenses that could be the subject of subsidies or transfers of tax resources during the respective financial year, based on the facts of the previous year with the best information available, indicating the policies and criteria according to which it will carry out its operations in order to contribute to the implementation of the National Development Plan, as well as a report on its current spending and investment budget, corresponding to the current financial year. In this report, it will also have to take into account the contingencies arising from the guarantees granted by the Financial and the Federal Government, as well as the labor contingencies that it may face, under a study carried out by a prestige rating, in the previous financial year.

II. Within one hundred and twenty days following the closing of each financial year, the Financial Officer shall issue an annual report on compliance with the annual programmes. for the financial year and in general, for current and investment expenditure, as well as for the activities carried out in the course of that financial year, specifying the percentage of credit placed through Rural Financial Intermediaries. In addition, the report or reports prepared by the Commission, which it sends to the Secretariat of Finance, relating to the financial situation and the level of risk of the Financial Institution, will be integrated into this report, and

III. In the report from July to September of each year, a report on the implementation of the annual financial program, during the first half of the year in question.

Likewise, the Financial Institution should publish twice a half year in two newspapers of wide circulation in the country, the state that keeps its patrimony as well as the indicators more representative of its financial and administrative situation.

Article 49.- The Financial Officer shall be obliged to provide the Bank of Mexico and the Commission with the information it requires on its operations, including some or some of them in the individual, the data that allows to estimate their financial situation and, in general, that which is useful for the proper performance of their functions.

CHAPTER SIXTH

Financial Control, Surveillance, and Evaluation

Article 50.- Financial surveillance will be carried out by the organs and in the terms outlined in the Credit Institutions Act for the institutions of development banking and general provisions issued by the National Banking and Securities Commission.

The provisions of the Federal Law on ParaState Entities will not be applicable in respect of financial supervision.

Article 51.- Repeals

Article 52.- The Commission shall issue the prudential, trade-record, financial information and asset estimation rules of the Financial. It shall also be in charge of supervising and monitoring, in terms of its law, that the operations of the Financial Institution comply with the provisions of this Law.

The Commission may establish preventive or corrective measures of enforced compliance, with the aim of eliminating irregularities or financial imbalances that may affect the liquidity, solvency or stability of the Financial Institution. In any event, the programmes shall be implemented in accordance with the Financial Institution.

Non-compliance or violation of this Law will be sanctioned with a fine that will impose the equivalent Commission of one hundred to fifty thousand times the general minimum wage in the Federal District. For the imposition of the fines, the procedure laid down in Article 110 of the Law on Credit Institutions will be followed, charging the amount against the financial assets of the Financial Institution.

Paragraph 4. -Repeated

In the exercise of its responsibilities, the Commission shall consider the nature and purpose of the Financial Institution.

Article 53.- The external auditor referred to in the second paragraph of Article 48 of this Law, the office of which it is a member or any of its subsidiaries shall not be entitled to to provide financial services other than audit services.

CHAPTER SEVENTH

Final Provisions

Article 54.- The credits granted by the Financial Institution shall be applicable to the same tax regime as the laws for which the institutions grant credit.

Article 55.- The Financial Institution shall be deemed to be creditworthy and shall not be required to constitute legal deposits or bonds, or even to obtain the suspension of the acts claimed in the trials under protection or to ensure the tax interest in the respective proceedings.

Article 56.- The relations between the Financial Institution and its employees shall be governed by the provisions of Article 123 (A) of the Constitution and the Law Regulation of that provision.

Article 57.- The Financial Institution shall constitute, against its assets, the necessary reserves to cover any actuarial deficit arising from the obligations arising from the employment relationship with their employees. For this purpose, at the end of each fiscal year, the Financial Institution will commission an external consultant, whose professional prestige and experience are widely recognized, the corresponding actuarial study.

Article 58.- Administrative infractions that are committed in violation of the provisions of this Law and other applicable laws shall be sanctioned. in accordance with the Federal Law on Administrative Responsibilities of Public Servants.

Article 59.- Illicit crimes committed against the Financial Institution will be sanctioned, as appropriate, in accordance with the provisions of the Federal Criminal Code. and in the other applicable legal provisions.

Article 59 Bis.- A two-year prison sentence of three months and a fine of thirty to two thousand days ' salary shall be imposed when the amount of the operation, Property damage, as appropriate, does not exceed the equivalent of two thousand days ' salary.

When the amount of the operation, bankruptcy or property damage, as appropriate, exceeds two thousand and not fifty thousand days of salary; it will be punished with prison of two to five years and fine of two thousand to fifty thousand days of salary.

When the amount of the operation, bankruptcy or property damage as appropriate, exceeds fifty thousand, but not of three hundred and fifty thousand days of salary, He will sanction five to eight years imprisonment and fine of fifty thousand to two hundred and fifty thousand days of salary.

When the amount of the operation, bankruptcy or property damage as appropriate, exceeds three hundred and fifty thousand days of salary, will be punished with imprisonment of eight Fifteen years and a fine of two hundred and fifty thousand to three hundred and fifty thousand days of wages.

Considering the amount of the operation, bankruptcy or property damage, the penalties provided for in this article will be imposed on:

I. People who for the purpose of obtaining a credit, provide the Financial, false data on the amount of assets or liabilities of an entity or natural or moral person, if as a result it is bankrupt or property damage to the institution;

II. People who to obtain financial credits, present their claims that they do not correspond to the reality, resulting as a consequence of this bankruptcy or damage to the property for the institution;

III. Debtors who do not allocate the amount of credit to the agreed purposes, and as consequence of this is a breach or damage to the institution, and

IV. Accredited who divert a credit for different purposes for which it was granted, if that purpose was decisive for the granting of the credit on preferential terms.

The penalties provided for in this Article will be reduced to one third when the damage has been proven to have been repaired or the damage caused.

In the cases provided for in this Article, a request will be made on behalf of the Financial Institution.

To determine the amount of the operation, bankruptcy or property damage, provided for in this article, will be considered as salary days, the general minimum wage The law in force in the Federal District, at the time of committing the crime in question.

The provisions of this article do not preclude the imposition of penalties that under other laws are applicable, by the commission of another or other crimes.

Article 60.- The Secretariat of Finance, hearing the opinion of the Commission, will dictate provisions of a general nature that aim to establish measures and procedures to prevent and detect in the Financial, acts or operations which may be located in the cases referred to in Article 400a of the Federal Criminal Code or which seek to assist the commission of the offence referred to in Article 139 or 148 bis of the Code. The Financial Institution shall submit to that Secretariat, through the aforementioned Commission, reports on the operations and services it carries out with its clients and users, by the amounts and in the cases in which those provisions are established, as the information related to the same as the Finance Secretariat requests.

In drawing up the provisions referred to in this Article, account shall be taken of the nature and special characteristics of the operations carried out by the Financial.

Article 61.- The Financial Officer shall provide the legal assistance and defense services to the members of its Board of Directors, committees established by the Financial Institution, or provided for by law and by public servants working or working in the institution itself, in respect of the acts which those persons carry out in the exercise of the functions entrusted to them by law and compliance with the guidelines to be issued by the Secretariat of Finance and Public Credit.

Such legal assistance and defense will be provided even if the persons indicated cease to perform their duties or provide their services to the Financial Institution, provided that they are acts performed in the performance of their functions or activities in the service of the Financial Institution.

Legal assistance and defense will be provided by the resources with which the Financial will count for these purposes. If the competent authority gives the subject of the legal aid final judgment which it causes to be enforceable against him, the person concerned shall reimburse the Financial Institution for the costs and any other charges which it has incurred in connection with the reason for legal assistance and advocacy.

The provisions of this article shall apply without prejudice to the obligation of the subjects of legal assistance and defense to render the reports required to them. in terms of the applicable legal provisions as part of the performance of their duties.

TRANSIENT

FIRST.- This Law shall enter into force on the day following that of its publication in the Official Journal of the Federation.

SECOND.- From 1o. of July 2003, the Organic Law of the Banrural System is repealed, published in the Official Journal of the Federation on January 13, 1986, and the organic regulations of the National Bank of Rural Credit, S.N.C.; of the Bank of Rural Credit of the Center, S.N.C.; of the Banco de Crédito Rural del Centro Norte, S.N.C.; of the Banco de Crédito Rural del Centro Sur, S.N.C.; del Banco de Crédito Rural del Golfo, S.N.C.; del Banco de Crédito Rural del Istho, S.N.C.; del Banco de Crédito. Rural Northeast, S.N.C.; Northwest Rural Credit Bank, S.N.C.; Rural Credit Bank of the North, S.N.C.; the Rural Credit Bank of the West, S.N.C.; the North Pacific Rural Credit Bank, S.N.C.; the South Pacific Rural Credit Bank, S.N.C.; and the Peninsular Rural Credit Bank, S.N.C.

THIRD.- The dissolution is decreed and the liquidation of the national credit companies that make up the Banrural System is ordered, and they are listed below:

I. National Rural Credit Bank;

II. Rural Credit Bank of the Center;

III. North Central Rural Credit Bank;

IV. South Central Rural Credit Bank;

V. Gulf Rural Credit Bank;

VI. Isthmus Rural Credit Bank;

VII. Northeast Rural Credit Bank;

VIII. Northwest Rural Credit Bank;

IX. North Rural Credit Bank;

X. West Rural Credit Bank;

XI. North Pacific Rural Credit Bank;

XII. South Pacific Rural Credit Bank, and

XIII. Peninsular Rural Credit Bank.

The dissolution and liquidation of these national credit companies will start 1o. of July 2003.

FOURTH.- In order to ensure that the support to the Producers is not interrupted, from the entry into force of this Law and until 30 June 2003, the National credit companies in the Banrural System may continue to grant refactional and habilitation or avio and pignoraticios only, even if the maturity of such claims is after the date of their commencement liquidation.

During this period, restructurings of credits previously granted may also be agreed.

For the granting of credits and restructurings mentioned above, the criteria contained in the bases for the granting of credit should be taken into account of the Banrural System, in force at the date of entry into force of this Law. In particular they should be considered:

I. The economic viability of the respective investment projects and the time limits for their recovery;

II. The relationships between the different concepts of the financial statements and the economic situation of the Producer;

III. The administrative and moral rating of the Producer, and

IV. The credit history of the accredited.

The restructurings will require express authorization from the respective Board of Directors of the national creditor credit company.

Operations to be held in accordance with this Article shall be transferred directly to the Financial Institution, once the Financial Institution is wound up. National creditor credit companies. This provision shall be contained in the legal acts forming the operations referred to in this Article.

QUINTO.- The national credit companies of the Banrural System will contribute to consolidating the start of the financial operations and, for these purposes, they will be able to conclude agreements with this one to provide the financial support that the financial institution requires.

SIXTH.- The Finance Secretariat will instruct the Liquidator Trust of Credit Institutions and Organizations to perform as liquidator of the national credit companies that are settled.

In the process of dissolution and liquidation, adequate protection of the public's interests must be taken care of at all times.

The liquidator shall allocate the resources resulting from the recovery of the assets of the national credit companies referred to in the Third Transitional Article of this Law, to cover the liabilities and contingencies arising from the liquidation itself, as well as the administrative expenses it carries out in compliance with its position. If necessary, the remaining balance will be handed over to the Federation's Treasury, once the final balance sheet has been published.

SEVENTH.- In its dissolution and liquidation, the national credit companies of the Banrural System will continue to hold the obligations for them.

During dissolution and liquidation, the Federal Government will continue to respond to the concerted operations by these national credit companies, in the same Terms and conditions set out in the Organic Law of the Banrural System, published in the Official Journal of the Federation on January 13, 1986, will likewise respond to any firm judgment against it after the settlement of the Banrural System.

EIGHTH.- To meet the requirements linked to the Banrural System mentioned in this Law, the Federal Executive is authorized to transfer to the National Bank of Rural Credit, S.N.C., in the financial year 2002 and from the budget of the Federation of Fiscal Year 2002, the amount of $31,363,000,000.00 (thirty-one thousand three hundred and sixty-three million pesos 00/100 national currency).

The amount indicated in the first paragraph of this article, will be used up to $15,682,000,000.00 (fifteen thousand six hundred and eighty two million pesos 00/100 national currency) to meet the following requirements:

I.- Liabilities and contingencies, as well as adjustments to the value of the assets of the national credit companies that make up the Banrural System, including its portfolio;

II.- The transfers of movable and immovable property that the Banrural System makes to public administration departments and agencies Federal in terms of Article 13th Transient of this Act;

III.- Liabilities linked to the losses that these national credit companies have accumulated, and

IV.- The administrative expenses that the liquidator of the national credit companies that make up the Banrural System do in compliance with his office.

In addition to the amounts referred to in this Article, the liquidator shall also allocate the resources resulting from the recovery of the assets of the Banrural system to meet the requirements set out in fractions I to IV of the second paragraph of this same article.

In the same way, they will be used for the amount indicated in the first paragraph of this article up to $4,034,000,000.00 (four thousand thirty-four million pesos 00/100 currency national) in order to attend to the contingencies and to comply with the labor obligations referred to in the Transitional Article 14 of this Law.

Of the amount indicated in the first paragraph of this article, for the fulfillment of the obligations to retired workers and pensioners of the Banrural System This Law will be used for up to $11,647,000,000.00 (eleven thousand six hundred and forty-seven million pesos/100 national currency).

The Commission shall determine the manner in which the National Bank of Rural Credit, S.N.C., shall record the resources referred to in the first paragraph of this Article. Article. Likewise, the Secretariat of Finance will determine the conditions to which its administration will be subject and authorize the necessary adjustments to those requirements, provided that the amount authorized in the first paragraph of this article is not exceeded. Article, updated by products derived from both their interests and the recovery of assets.

In the event that the resources to meet the requirements referred to in this article are less than the amount fixed in that paragraph, the remainder must be reintegrated into the Federation's Treasury, in terms of the Revenue Act of the corresponding year. In the event that these requirements are higher, the Secretariat of Finance will have to take care that the difference is provided for in the budget of the Federation of the Federation of the respective fiscal year.

In the final balance sheet of the liquidation of the national credit companies that make up the Banrural System, the disaggregated destination of all the The remainder will be handed over to the Treasury of the Federation once it has been published.

NINTH.- To constitute the initial patrimony of the Financial, the Federal Executive is authorized to transfer in the financial year 2002 and in charge of the Budget of the Funds of the Federation of Fiscal Year 2002 the amount of $17,515,000,000.00 (seventeen Fifteen million pesos (fifteen million pesos).

The amount set in the previous paragraph of this article will be transferred $10,944,000,000.00 (ten thousand nine hundred and forty-four million pesos). 00/100 national currency) directly to the Financial as liquid resources, of which up to $9,644,000,000.00 (nine thousand six hundred and forty-four million pesos 00/100 national currency) will be destined for the credit placement; until $500,000,000.00 (five hundred million pesos 00/100 national currency) for training, organization and advisory activities for Rural Financial Producers and Intermediaries, in terms of the provisions of Section XVI and XVII of the article 7o. of this Law; and up to $800,000,000.00 (eight hundred million pesos 00/100 national currency) for the initial expenses of administration and operation of the Financial.

The initial equity of the Financial will be complemented by up to $6,571,000,000.00 (six thousand five hundred and seventy-one million pesos 00/100 national currency) constituted by assets that in terms of the following Decimofirst and Thirteenth Transitory articles the National Bank of Rural Credit, S.N.C., transfers to the Financial itself. The Federal Executive will channel the resources indicated to the National Bank of Rural Credit, S.N.C., so that it will turn over the financial assets up to the amount indicated without any consideration. The accounting record and the administration of these resources shall be subject to the provisions of the previous Article.

In the case of a portfolio, such a transfer shall be made at net reserve value.

The Financial Institution shall constitute the fund referred to in the second paragraph of Article 22 of this Law with the liquid and assets referred to in this Article, which shall be channelled in order to carry out the operations referred to in Article 7o. of that Law. The Council shall establish the rules for the operation of the Fund.

The Secretariat of Finance will authorize the necessary adjustments to the requirements set out in this article, provided that the authorized quantity is not exceeded in the first paragraph of the same.

DECIMAL.- Within 90 days after the publication of this Law in the Official Journal of the Federation, the Secretariat of Finance may instruct the national credit companies of the Banrural System or, where appropriate, the liquidator, to carry out all acts that are conducive to the deposit of the checking account and the deposits of those, are transferred to the credit institutions that the Secretariat of Finance itself designates.

13TH.- The Finance Secretariat, in consultation with the Financial Institution and the liquidator, shall determine those loans or loans granted by the national credit companies that are settled liable to be transferred, together with their respective guarantees, to the Financial Institution itself, as well as the time limits, terms and conditions in which such transfers are made.

For such purposes, the Secretariat of Finance shall consider, inter alia, the classification of the appropriations in accordance with the Rules for the Qualification of the Credit Portfolio of the National Credit Societies and Development Banking Institutions, published in the Official Journal of the Federation on October 24, 2000.

12TH.- The liquidator may conclude coordination and collaboration agreements with federative entities and/or the organizations of the debtor producers in the banking sector, in order to assist in the recovery of the maturing portfolio of the companies. national credit institutions which are settled on 20 November 2002, which must be done taking into account the conditions governing the secondary market in the expired portfolio and the economic circumstances of the regions and in particular the capacity payment of the debtor.

The respective conventions shall include, inter alia, the distribution of the resources arising from the net recovery of loans or loans which are treat, as well as the obligation of the federal entities or organizations of debtor producers, to allocate those resources exclusively to credit programs or guarantees linked to the object of the Financial Regulation.

THIRTEENTH.- The movable and immovable property of the national credit companies which are settled, as well as those which have been awarded in payment, shall be transferred or disposed of, depending on their nature and best use, to the Financial Institution or to the Federal Public Administration agencies and agencies, in accordance with applicable legal provisions.

The Secretariat of Finance shall determine the procedures and authorizations necessary for such transfers or transfers to be carried out.

14TH.- Active workers who, as at 30 June 2003, work in the national credit companies which are settled, must be compensated and their employment relationship shall be extinguished, in accordance with the rules of law applicable. All of your employment rights will be respected in terms of Law.

The national credit companies that make up the Banrural System or the liquidator will be responsible for the termination of the employment relationship and the liquidation of the workers mentioned above.

In terms of the previous Eighth Transitional Article, the Federal Government will take the necessary actions to ensure that the liquidator has sufficient resources to these effects and for the contingencies that the Banrural System has.

FIFTEENTH.- The pensioners and pensioners of the national credit companies that are settled will continue to receive their pensions and pensions under the respective General Conditions of Employment and the respective retirement agreements.

Pensioners and pensioners shall be entitled to receive medical-surgical, pharmaceutical and hospital care in accordance with the terms laid down in Article 41 of the General Working Conditions, in accordance with the condition of pensioners and pensioners, as appropriate.

The benefits of death will continue to be provided to those entitled to pensioners and pensioners, in accordance with the provisions applicable to entry into force. of this Law.

For the purposes of this Article, the reserves set up for this purpose shall be used by the national credit companies that are settled. In terms of the previous eighth transitional article, the Federal Government will take the necessary actions to ensure that the liquidator has the necessary resources to comply with the provisions of this article.

The resources referred to in the preceding paragraph shall be deposited in an escrow expressly constituted for these purposes and administered by the liquidator.

Benefits in favour of pensioners, pensioners and their rightholders, in terms of this Article, may be covered either directly or through the conclusion with third parties of the respective contracts.

SIXTEENTH.- The transfers of goods and rights provided for in the Transitional Articles Ninth, Tenth, Thirteenth and 14th above shall not be taxed by any federal tax.

SEVENTEENTH.- Not later than 1o. In April 2003, the Secretariat of Finance will issue the basis on which the form and terms of the dissolution and liquidation of the national credit companies of the Banrural System will have to be made.

EIGHTEENTH.- The Secretariat of Finance, the Secretariat of Comptroller and Administrative Development, and the Commission, in the field of their respective competences, shall monitor the procedures for dissolution and liquidation to be carried out in accordance with the provisions of the transitional articles of this Law, the settlement bases and other applicable provisions.

DECIMAL.- As long as the first session of the Council is held, the Director General may designate the public servants of the Financial Institution to hold positions with the lower immediate administrative hierarchy and fiduciary delegates. These designations shall be submitted to the Council for ratification in the session referred to above.

While the organic structure of the Financial Institution is approved, the Director General may designate the strictly indispensable staff to initiate operations.

The first organic structure of the Financial Institution shall be submitted to the Council for approval and subsequent registration with the Secretariat of Finance.

TWENTIETH.- The provisions of the second paragraph of Article 9o (III). of this Law shall not be applicable, within seven years of the entry into force of the Law, to the loans or credits which the Financial Institution grants to the accredited national credit companies of the Banrural System, which have been and keep current in the payment of their credit obligations.

21ST.- The Financial Institution shall participate, on the same terms and conditions, in the committees, commissions and other collegiate bodies of the Federal Public Administration in which the national credit companies of the Banrural System participate.

22ND.- The Financial Statute of the Financial Officer shall be published in the Official Journal of the Federation, within 180 calendar days following the date of publication of this Law, after approval by the Council.

22ND.- The Chamber of Deputies, through the Superior Audit of the Federation, and the corresponding Commissions, as well as the Secretariat of Comptroller and Administrative Development in the field of its competence will review the operations carried out by the National Bank of Rural Credit, S.N.C. and the other national credit companies that make up the Banrural system, and will also provide timely and periodic follow-up to the process of its dissolution and liquidation, guaranteeing that the The amounts referred to in the Eighth Transitional Article are to be carried out in a transparent manner. compliance with the current regulations.

In case the Supreme Audit of the Federation or the Secretariat of Comptroller and Administrative Development will detect irregularities, it will proceed immediately to to disallow liability, by promoting legal action in accordance with the relevant provisions.

The Director General of the National Bank of Rural Credit, S.N.C., or, where appropriate, the liquidator, as well as the agencies and entities involved in the process of dissolution and liquidation will grant the necessary facilities for the Higher Audit of the Federation to fulfill its functions according to the corresponding legal framework and will inform you quarterly the state that the processes of recovery of the maturity of the national credit companies which are liquidate.

DECREE TRANSIENT

ONLY.- This Decree shall enter into force on the day following that of its publication in the Official Journal of the Federation.

Mexico, D. F., as at 13 December 2002.-Dip. Beatriz Elena Paredes Rangel, President.-Sen. Enrique Jackson Ramírez, President.-Dip. Adela Cerezo Bautista, Secretary.-Sen. Rafael Melgoza Radillo, Secretary.-Rubicas".

In compliance with the provisions of Section 89 of the Political Constitution of the United Mexican States, and for their due publication and observance, I ask for this Decree in the Federal Executive Branch, in Mexico City, Federal District, at the twenty-three days of December of two thousand two.- Vicente Fox Quesada.-Heading.-The Secretary of the Interior, Santiago Creel Miranda.-Heading.