CMF approves new category for foreign currency transactions

The Financial Market Commission (“CMF”) has adopted a resolution by virtue of which a new category of transactions in foreign currency and expressed in foreign currency will be published for the purposes of Law No. 18,010 (law that establishes rules for credit operations and other money obligations).

The previous is a consequence of the recent decision of the Supreme Court (Case Rol Rol C-13.704-2017), in which it decided to apply the maximum conventional interest rate to a money credit operation expressed and payable in foreign currency, being that, until then, the unanimous criterion, both of the same Court and of the CMF, had been to subject to this limit only operations expressed in foreign currency and payable in pesos, but not those both expressed and payable in foreign currency.

In view of this new approach, and in order to avoid future legal disputes, by means of exempt resolution No. 9,077 of November 30, 2007, the CMF executed the agreement of the CMF Board of the same date, in the sense of adjusting the category of interest rates referred to transactions “expressed in” foreign currency that it publishes, including those transactions “in” foreign currency.

This means that, as from the next publication of rates by the CMF, which will take place this December, both transactions in foreign currency and those expressed in foreign currency will be subject to the maximum conventional rate limit, and its violation will be subject to the consequences of Law No. 18,010. In other words, in the event of the establishment of an interest rate above the maximum conventional rate applicable, such interest will be considered as unwritten and will be reduced to the current interest rate.

Finally, although the CMF does not mention it in the resolution, it should be noted that Article 5 of Law 18.010 exempts from the application of the maximum conventional rate, among others, those operations that are agreed with foreign or international banking or financial institutions or companies, and those that are agreed or expressed in foreign currency for foreign trade operations.