REGULATIONS 2009

REGULATION 09-01 OF FEBRUARY 17TH, 2009 RELATING TO FOREIGN CURRENCY ACCOUNTS OF RESIDENT OR NON

RESIDENT NATURAL PERSONS AND OF NON RESIDENT LEGAL ENTITIES

The Governor of the Bank of Algeria,

Whereas Order 96-22 of Safar 23rd, 1417, corresponding to July 09th, 1996, as amended and completed and relating to repressive measures applicable to the infringement of the law and foreign exchange regulations and capital movement from and toward external countries.

Whereas Order 03-11 of Joumada Ethania 27th, 1424 corresponding to August 26th, 2003 relating to Money and Credit, namely to its article 62, paragraph m,

Whereas Order 05-01 of Dhou El Hidja 1425 corresponding to February 06th, 2005 relating to the prevention and fight against money laundering and financing of terrorism.

Whereas Law 06-01 of Moharram 21rst, 1427 corresponding to February 20th, relating to prevention and fight against bribery, Whereas the presidential Decree of Rabie EL Aouel 10th, 1422 corresponding to June 2nd, relating to the appointment of the members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Dhou Al Quida 24th, 1424 corresponding to January 14th, 2004, relating to the appointment of the members of the Council of Money and Credit, Whereas the Presidential Decree of Djoumada El Aouel, 05th, 1427 corresponding to June 1rst, 2006 relating to the appointment of the Vice-Governor of the Bank of Algeria, Whereas Regulation 91-02 of February 20th, 1991 setting the terms and conditions of opening of foreign currency accounts in favour of foreign resident or non resident natural persons and legal entities, Whereas Regulation 05-05 of December 15th, 2005 relating to the prevention and fight against money laundering and financing of terrorism,

Whereas Regulation 07-01 of Moharram 15th, 1428 corresponding to February 03rd, 2007 relating to the rules applicable to current external transactions and foreign currency accounts,

Whereas the Resolution of the Council of Money and Credit of February 17th, 2009,

Promulgates the regulation the content of which follows:

Article 1: Resident or non resident foreign legal entities shall be authorized to open with an authorized intermediary bank a foreign currency account denominated in a freely convertible foreign currency.

Article 2: We understand by foreign currency any freely convertible foreign currency which is regularly quoted by the Bank of Algeria.

Article 3: Natural persons or legal entities shall not be concerned by the application of this regulation and shall by no means submit a debit balance.

Article 4: Foreign currency accounts opened on behalf of the persons referred to in article 1 above, shall be operating with credit accounts exclusively, and shall by no means submit a debit balance.

Article 5: Foreign currency accounts of the persons referred to in article 1 above can be credited with any amount representing:

a transfer from abroad

a transfer from a foreign currency account or from a CEDAC

account opened with a bank under the Algerian law,

the counter-value of any amount in dinars of its deposit or of its transfer which is conforming to all the terms and conditions required for its transfer, as prescribed by the foreign exchange regulations in force, at the date of its deposit or of its transfer.

a deposit of freely convertible bank notes subject to the submission

– to the authorized intermediate bank- of the original declaration of imports of foreign currencies duly signed by the customs clearance services, when entering the national territory.

Article 6: Within the limits of the balance available in their foreign currency accounts, the account holders shall be authorized to order any withdrawal to:

make any transfer abroad

credit any foreign currency account or any CEDAC account opened

with a bank under the Algeria law

withdraw external means of payment in view of their tangible exportation

proceed with a withdrawal or transfer in dinars for any payment in

Algeria. Article 7: Foreign currency accounts shall be remunerated for amounts which are subject to term investment of 3 months or over. Article 8: The validity of such foreign currency account shall be limited. However, the account holder may at any time request his paying bank to close his account. The latter shall, according to his clients’ convenience, earmark the balance to any debit transaction authorized by this regulation. Article 9: As regards any suspicious transaction –the authorized intermediary shall be compelled to declare it in accordance with the legal and regulatory provisions applicable for the fight against the money laundering and financing of the terrorism. Article 10: the provisions of Regulation N° 91-02 of February 20th, 1991, setting the terms and conditions of opening and operation of foreign currency accounts in favour of resident and non resident foreign natural persons and legal entities and those contrary to the present regulation shall be repealed. Article 11: An instruction from the Bank of Algeria shall state precisely the practical terms and conditions of opening, keeping and movement of foreign currency accounts subject of this regulation. Article 12: This regulation shall be published in the “Journal Officiel” of the People’s Democratic Republic of Algeria.

The Governor Mohammed Laksaci

REGULATION 09-02 OF MAY 26TH, RELATING TO MONETARY POLICY OPERATIONS, INSTRUMENTS AND PROCEDURES

The Governor of the Bank of Algeria, Whereas Order 75-59 of September 26th, 1975, as amended and completed relating to the Commercial Code, Whereas Order 03-11 of Joumada Ethania 27th, 1424 corresponding to August 26th, 2003 relating to Money and Credit, namely its articles 41 through 45 and 62 , paragraphs b and c, Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 2001 relating to the appointment of the Governor and Vice-Governors of the Bank of Algeria, Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 2001 relating to the appointment of the members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Chaâbane 26th, 1423 corresponding to November 2nd, 2002 relating to the appointment of a member of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Dhou El Kaada 1424 24th, corresponding to June 14th, 2006 relating to the appointment of the members of the Coucil of Money and Credit of the Bank of Algeria, Whereas the Presidential Decree of Joumada El Oula 5th, 1427 corresponding to June 1rst, 2006 relating to the appointment of a Vice-Governor of the Bank of Algeria, Whereas Regulation 91-08 of August 14th, 1991, relating to the organization of the Monetary market, Whereas Regulation 2000-01 of Dhou El Kaada 8th, corresponding to February 13th, 2000 relating to rediscount and credit transactions with banks and financial institutions, Whereas Regulation 04-02 of Moharram 1425 corresponding to March 4th, 2004 setting the terms and conditions of the required minimum stockpiling,

Whereas Regulation 05-04 of Ramadhan 10th, 1426 corresponding to October 13th, 2005 relating to the Real Time Gross Settlement System of urgent and large payments, Whereas Regulation 05-07 of Dhou El Kaada 26th, 1426, corresponding to December 28th, 2005 relating to the payment system security, Whereas the resolutions of the Council of Money and Credit of May 26th, 2009, Promulgates the Regulation the content of which follows: Article 1: The object of this Regulation is to define the application procedures and instruments relating to monetary policy transactions in accordance with the provisions of articles 41 through 45 and 62 of Order 03-11 of Joumada Ethania 1424 corresponding to August 26th, 2003 relating to Money and Credit, I - Counterparts to monetary policy operations Article 2: The following banks may be considered as counterparts to the monetary policy operations of the bank of Algeria if:

they are obliged to provide the minimum reserve requirement their financial situation does not entail any reserve on the part of the Bank

Commission, they are not excluded from the Real Time Gross Settlement System for

large amounts and urgent payments (ARTS) or from the security delivery system,

their access to the monetary policy operations is not suspended Article 3: Banks are subject to sanctions if they do not respect the obligations of the counterparts in case of participation to the monetary policy operations through invitations to tender or through bilateral transactions which have not been completed by the delivery of the required encashable commercial papers as collateral or cash to be settled in case of liquidities recovery. Banks shall also be subject to sanctions for use of the marginal lending facility in a settlement account in debit at the closing time, whilst the conditions for access to the facility have not been fulfilled. There are two types of sanctions:

Financial compensations calculated at a predetermined rate by the bank commission Non financial sanctions as a suspension – decided by the Bank of Algeria - of the access of the counterpart to all or part of the open market operations. Article 4: Should a judgement be opened for a bankruptcy procedure, the monetary policies operations carried out by the Bank of Algeria with such failing party shall ipso jure be terminated without prior notification. The monetary policy operations carried out by the Bank of Algeria with counterparts, subject to other failing cases in the sense of this regulation, namely:

a judgement for opening a judicial settlement procedure a suspension of payments verified by the bank commission a written declaration from the counterpart stating its incapacity to fulfil

one of its obligations connected with the monetary policy operations a suspension or exclusion of the counterpart from participation to the

ARTS system or to the system of commercial papers delivery ? non- respect of one obligation to provide information provided for

under the monetary policy operations. The following shall ipso jure be terminated further to a notification transmitted to the concerned party. II. Commercial papers eligible for the monetary policy operations. Article 5: The commercial papers accepted by the Bank of Algeria as a collateral for monetary policy operations in the form of a reverse transaction or outright transaction shall be public or private commercial papers eligible for rediscount or advance payments. Those are the papers that are negotiable around the market, that is to say, government papers issued or guaranteed by the State and private negotiable papers and papers which are not negotiable around any market and which represent allocated credits. Article 6: Government papers issued or guaranteed by the State, negotiable around any market, and eligible for the monetary policy operations shall be:

Short-term treasury bills Assimilated treasury bills

Treasury assimilated obligations and Government papers guaranteed by the state

The total amount of the transactions underway over Government papers shall be set according to the monetary policy objectives. Article 7: The negotiable private commercial papers shall be short-term papers negotiable over the market and the obligations which have an unconditional and fixed principal amount and a fixed rate coupon. They shall represent a high level degree quality with respect to their signature (company’s qualities, guarantees submitted payable at the first demand, etc..) and be denominated in Dinars. Non negotiable private papers, admissible for temporary reverse transaction in the monetary policy operations with a maturity date exceeding that of the reverse transaction are:

Commercial papers representing commercial transactions within Algeria or abroad, bearing the signature of at least three solvent natural or legal entities including the assignor’s signature. One of the signatures may be replaced by collaterals such as warrants, goods receipts or original bills of lading of goods exported abroad with usual relevant documents.

Commercial papers representing treasury credits or seasonal credits

bearing the signature of at least two solvent natural or legal entities.

Medium-term credit financing papers granted to non financial companies favourably quoted by the Bank of Algeria and bearing the signature of at least three solvent natural or legal entities one of which may be replaced by the State guarantee.

Article 8: Maturities, liquidities degrees and any other standards relating to the papers admissible to the monetary policy operations shall periodically be set by the Council of Money and Credit in accordance with the provisions of article 62, paragraph b) of Order N° 03-11 of Joumada Enthania 27th, 1424 corresponding to August 26th, 2003, mentioned above. Article 9: In order to determine the value of the eligible public and private commercial papers under reverse transactions, the following principles shall be applicable:

For any eligible commercial paper such as a commercial paper negotiated around the market, the information source for the paper price considered shall be that of the market price,

For each market, (monetary market, Treasury market securities, financial

market) the most representative price shall be that used for the calculation of the market securities. The negotiable paper value shall be calculated on the basis of the most representative rate recorded on the day preceding the pricing operation.

Should a representative price be failing, for any given paper, on the day

preceding the pricing date, le last transaction rate recorded shall be considered. If no transaction rate is available, the Bank of Algeria shall determine a rate on the basis of the last rate known for the paper concerned.

As regards private papers which are not negotiable but which meet the

eligibility criteria, their par value shall apply. The market value of any proof of debt shall include the accrued interests. III. Monetary policy instruments Article 10: In order to achieve the monetary policy targets, set by the Council of Money and Credit, at the beginning of each financial year, the Bank of Algeria shall have available the following monetary policy instruments :

Credit and rediscount transactions minimum reserve requirement open market operations standing facilities

Article 11: Credit and rediscount transactions and the minimum reserve requirement shall be defined by specific regulations. Open market operations and permanent facilities shall be regulated by this regulation. Article 12: According to the provisions of article 62 of Order N° 03-11 of Joumada Ethania 27th, 1424, corresponding to August 26th, 2003, mentioned above, the Council of Money and Credit shall each year, decide on the monetary instrumentation to be effectively used for monetary policy operations.

Article 13: Open market operations around the monetary market shall be carried out further to the initiative of the Bank of Algeria which also decides on a fixed or variable rate to be applicable for such transactions. Open market operations may have seven (07) maturity days (standard weekly transactions) up to twelve (12) months (longer-term refinancing operations) Article 14: Instruments which may be used under open market operations can be divided into three categories:

reverse transactions Transactions called (outright transactions) (purchase and sale of

government papers) Blank liquidities recovery

Article 15: Reverse transactions are transactions by which the Bank of Algeria shall:

Repurchase eligible papers Grants loans guaranteed by assignments of private commercial papers

(eligible private debts) Repurchase transactions shall be regulated by type agreements signed by the Bank of Algeria and other banks. Article 16: Government and private papers materially created shall be considered as delivered is at the repurchase time, they are effectively and physically delivered to the assignee. Promissory notes shall be subject to a prior endorsement in compliance with the provisions of the commercial code. Government and private papers admissible to rediscount or to phasing out advance payments and those materially created, kept by the central agent or at the Bank of Algeria or circulating through account transfer, shall be considered as delivered if they are subject to a reverse repurchase transaction of any entry in an open account on behalf of the transferee at the central depositor or at the Bank of Algeria. Article 17: In accordance with the restrictions and terms and conditions of intervention set by the Council of Money and Credit, the Bank of Algeria shall intervene on the monetary market through invitations to tender and/or trough exceptional bilateral transactions.

Article 18: Interest terms relating to reverse transactions shall be as follows:

buyback price of commercial papers under guarantee shall include the interests due at the maturity date of the transaction

The interests on a provisional assignment transaction in the form of loan guaranteed by a transfer of debts shall be determined by the simple interest rate applicable to the amount of the simple interest grant on the basis of the calculation principle “ precise number of days /360”

Article 19: The commercial papers reverse transaction shall be used for the following monetary policy operations:

Main refinancing operation longer term refinancing operation Fine tuning operations Structural operations

Article 20: The main refinancing operations shall play a key role in the leading of the interest rate and management of bank liquidities. Liquidities injection transactions shall have a frequency and weekly maturity with a pre-established calendar. They shall be the main refinancing channel of the banking sector. They shall be made through standard invitations to tender and are addressed to all the banks meeting the eligibility criteria defined in article 2 above. Article 21: longer term refinancing operations up to twelve months , shall be liquidities injection operations which shall be carried out on a regular basis. They shall be aiming at providing an additional refinancing. They shall be carried out through standard invitations to tender at a variable rate in general, but they might also be carried out through invitations to tender at a fixed rate. They shall have a monthly frequency according to a pre-established calendar. All banks meeting the eligibility criteria may contribute. Article 22: Fine tuning reverse transactions shall aim at managing the liquidity situation over the market and leading the interest rate to reduce the impact of unexpected fluctuations. Such might be liquidity contribution or withdrawal transactions. The frequency and maturity of such transactions shall not be standardized. Participation in fine tuning transactions shall be reserved to a limited number of banks selected by the Bank of Algeria for this purpose. The fine tuning liquidities injections shall be carried out in the form of reverse transactions through rapid invitations to tender excepting any resorts to bilateral procedures. Withdrawals of fine tuning liquidities in the form of reverse transactions shall be carried out with occasional exception, through bilateral

procedures. All the commercial papers indicated in section II of this regulation may be subject to fine tuning reverse transactions. Article 23: Structural reverse transactions shall be liquidity injection transactions with a frequency which might be regular or irregular and with undetermined assignment duration. They shall be carried out through standard invitations to tender. All banks may contribute to such. Article 24: Transactions called “outright transactions” shall be transactions by which the Bank of Algeria proceeds with “firm “sales or purchases “ of eligible papers. Such transactions shall be carried out only for structural and/or under fine tuning transactions. These transactions may take the form of liquidities injection (“firm sale”) or liquidities withdrawal (“firm” sale). The frequency of such transactions shall not be standardized. These shall be carried out through invitations to tender or bilateral transactions. The assignment maturity may be standardized. Article 25: As part of the bank liquidity fine tuning, banks may be invited by the Bank of Algeria to invest liquidities as deposits at the Bank of Algeria through invitations to tender. Such shall be recoveries of “blank” liquidities “These liquidities shall have a fixed maturity which has not been standardized. No guarantee has been given in exchange of the deposited funds. The interest paid on these deposits shall be calculated according the principle “Correct number of days/360”. The deposit shall be paid to the counterpart at the deposit maturity date. The frequency of such transactions shall not be standardized. These transactions shall be carried out through invitations to tender unless a resort to exceptional procedures has been made. Participation in these transactions shall be reserved to all banks meeting the eligibility criteria. III.2 Standing Facilities Standing facilities shall be intended to withdraw/ or provide banks with liquidities. These transactions shall be carried out upon the initiative of banks in the form of:

Marginal lending facility Remunerated deposits facilities

Article 27: The marginal lending facility shall be a transaction allowing any bank to obtain from the Bank of Algeria, against a submission of eligible papers, a 24 hour liquidities at a predefined rate. Liquidities flow under the marginal

lending facility shall be carried out by 24 hour repurchase agreements concerning eligible negotiable government papers and/or eligible private papers. Article 28: Any bank meeting the eligibility criteria as defined in article 2 above may, at any time, have access to the marginal lending facility upon request to the Bank of Algeria during the working days and within thirty (30) minutes before the closing time of the ARTS payment system. No limit shall be set to the amounts which might be obtained under the marginal lending facility if sufficient papers are provided as a guarantee. The lending granted under such facility shall be reimbursed the following working day, as soon as the ARTS payment system is opened and possibly, the papers delivery system is started. The facility interest lending shall be set by an instruction from the Bank of Algeria, in reference to the rate of the main refinancing operations increased by a margin announced in advance. Article 29: The remunerated deposit facility shall be a 24 hour deposit facility at the Bank of Algeria. Eligible banks, in accordance with article 2 above, shall have access to the remunerated deposit facility every working day, upon a request to the Bank of Algeria. Any request for a remunerated deposit facility shall be taken into account by the Bank of Algeria within a time limit of thirty (30) minutes before the closing time of the ARTS system. 24 hour deposits accepted by the Bank of Algeria, shall be remunerated at the interest rate set by an instruction in reference to the main refinancing transactions reduced by a margin, and which shall be announced in advance. No guarantee shall be given to the counterpart. The cash amount that a counterpart may deposit under the remunerated deposit facility shall not be limited. IV. Procedures Article 30: In view to carry out monetary policy operations, the Bank of Algeria may proceed with an invitation to tender or through bilateral transactions. Under invitation to tender, the Bank of Algeria may launch:

Periodical invitations to tender called “standard invitations to tender” Rapid invitations to tender

Auction procedures concerning such invitations to tender shall be similar except for the chronology and counterparts range. IV . 1 Invitations to tender procedures Article 31: Invitations to tender may be carried out either at a fixed rate, (volume auctions) or at a variable rate (auction of interest rate). In the first case, the interest rate shall be indicated in advance by the Bank of Algeria. In the second case, the counterparts’ bids shall be the amounts and interest rates at which the latter wish to deal. At the end of each invitation to tender transaction, the counterparts who have been selected shall be served at the requested or at the weighted average rate of the auction transaction. Article 32: “standard” invitation to tenders shall be carried out within a 24 hour deadline, which shall be started at the invitation to tender advertisement and ended at the notification of the classification result of the offers received. All banks meeting the eligibility criteria may participate in such invitations to tender transactions. Main refinancing operations longer –term refinancing operations and structural transactions via temporary assignments, shall be made through ordinary invitations to tender on the basis of a pre-established calendar. Article 33: “standard” invitations to tender shall be advertised on the working day preceding the auction day. The content of the advertisement messages shall be standardized. The offers presented after the prescribed time indicated in the advertisement message shall be rejected. Incomplete offers shall also be rejected. The minimum amount of the tender shall equal 10.000.000 Dinars. Higher amounts shall be denominated in instalments of 1.000 000 Dinars. The same amounts shall apply to fine tuning tenders. In case of variable rate auctions, the counterparts shall be authorized to submit a maximum number of six (06) tenders relating to different interest rates levels and with a minimum amount applicable to each interest rate. The interest rates, subject of the tender, shall be multiples of 0,01 point percentage. Article 34: Rapid invitations to tender shall be carried out within a two (02) hour deadline, as from the invitation to tender advertisement. Such shall only be fine tuning transactions whose invitations to tender have not been carried out according to a pre-established calendar. Those invitations to tender are meant

for banks selected by the Bank of Algeria to participate in such transactions. The counterparts who have been selected shall directly be notified by the Bank of Algeria. The content of rapid invitations to tender messages shall be standardized. Article 35: In case of fixed rate invitations to tender, whether for liquidities contributions or withdrawal, the amounts of the offers shall be added. If the overall amount of the offer exceeds the total amount of the liquidities which shall be allotted, the counterpart’s tenders shall be met at the pro rata, on the basis of the ratio between the amount to be auctioned and that of the global offer. Article 36: In case of invitations to tenders for liquidities contributions, at a variable rate, the tender list shall be established per decreasing order of the interests rates offered. The highest rate offers shall be met on a priority basis, less important rates offers shall successively be accepted until the total amount of the liquidities to be auctioned is used up. If the offers total amount exceeds the residual amount to be allotted , at the lowest accepted interest rate, such amount shall be allotted at the pro rata of such offers depending on the ratio between the residual amount to be allotted and the offer total amount at the a marginal interest rate. Article 37: In case of invitations to tenders for recovery at a variable interest rate, the tender list shall be established per decreasing order of the interests rates offered. The lowest interest rate offers shall be accepted on a priority basis and the highest interest rates shall successively be accepted until the total amount of the liquidities to be recovered is used up. If the total amount of the offers exceeds the residual amount to be allotted, at the highest interest rate, such amount shall be calculated on the pro rata of those offers depending on the ratio between the residual amount to be allotted and the total amount of the offers at the marginal interest rate. Article 38: Bilateral procedures shall be applicable for fine tuning open market operations (reverse transactions, blank liquidities recovery, “outright” transactions) and for structural “outright” transactions. Bilateral transactions shall include any procedure in which the Bank of Algeria shall carry out any transaction with one or several counterparts without having to resort to invitations to tender. Counterparts shall be selected and directly contacted by the Bank of Algeria.

IV. 2 Settlement Procedures Article 39: Settlement of funds The settlement of flow of funds, under the monetary policy operations shall be carried out in Dinars and through settlement accounts exclusively opened in the ARTS system and recorded in the books of the Bank of Algeria. Settlement of flow of funds shall be operated only after any irrevocable paper transfer deposited as a guarantee. Paper transfer deposited as a guarantee and managed by the Central depositor shall be carried out through settlement securities account opened on the books of the latter. Article 40: The Settlement of open market operations through standard invitations to tender shall be operated on the first day following the transaction day. In general, the date of settlement of the main refinancing operations and those of longer term refinancing operations shall correspond to that of the reimbursement date of any prior similar oepration. The settlement of open Market operations through rapid invitations to tender and bilateral transactions shall be carried out on the same day of the transaction. Article 41: The flow of funds carried out by the Bank of Algeria, whether for using the marginal lending facility or for open market transactions for liquidities contributions, shall be carried out only through the ARTS system.

The Governor Mohammed LAKSACI

REGULATION 09-03 OF AOUEL JOUMADA ETHANIA 1430 CORRESPONDING TO MAY 26TH2003 RELATING TO THE GENERAL RULES DEFINING BANK TERMS AND CONDITIONS APPLICABLE

TO BANK TRANSACTIONS The Governor of the Bank of Algeria, Whereas Order 03-11 of Joumada Ethania 27th, 1424 corresponding to August 26th, 2003 relating to Money and Credit, namely to its articles 62,64,and 66 through 73. Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 20001 relating to the appointment of the Governor and Vice Governors of the Bank of Algeria, Whereas the Presidential Decree of Rabie Ell Aouel 10th, 1422 corresponding to June 2nd, 2001, relating to the appointment of the members of the Board of Directors of the Bank of Algeria Whereas the Presidential Decree of Chaâbane 26th, 1423 corresponding to November 2nd, 2002 relating to the appointment of a member of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Dhou El Kaada 24th, 1424 corresponding to January 14th, 2004 relating to the appointment of the members of the Council l of Money and Credit of the Bank of Algeria, Whereas the Presidential Decree of Joumada El Oula 5th, 1427 corresponding to June 1rst, 2006 relating to the appointment of a vice-governor of the Bank of Algeria, Whereas Regulation 94-13 of Dhou El Hidja 1414 corresponding to June 2nd, 1994 setting the general regulations with respect to the terms and conditions applicable to bank transactions Whereas the resolutions of the Council of Money and Credit, of May 26th, 2009, Promulgates the regulation the content of which follows:

Article 1: The object of this regulation is to set the general rules defining the bank terms and conditions applicable to bank transactions carried out by banks and financial institutions. Article 2: The transactions carried out by banks and financial institutions when dealing with their clients shall be considered as bank transactions as defined by articles 66 through 69 of the above-mentioned Order 03-11 of Joumada Ethania 27th,1424 corresponding to August 26th, 2003. Article 3: Banks and financial institutions may propose to their clients specific bank products. However, in order to ensure a better valuation of the risks relevant to new products and an instrument harmonization, the marketing of any new product shall be subject to a prior authorization to be delivered by the Bank of Algeria. Article 4: Bank terms and conditions mean remuneration, tariffs, commissions etc…applicable to bank transactions carried out by banks and financial institutions. Article 5: Deposit and debit interest rates as well as commission rates and levels applicable to bank transactions shall freely be fixed by banks and financial institutions. The Bank of Algeria may, however, fix the excessive interest rate. Overall effective interest rates on the credits granted by banks and financial institutions shall by no means exceed the excessive interest rate. Value dates relating to bank transactions shall be regulated. They shall be stated precisely by an instruction from the Bank of Algeria. Article 6: Banks and financial institutions shall be compelled to strictly observe the terms applicable to bank transactions that they have determined within the excessive interest rate limit fixed by the Bank of Algeria. Article 7: Banks and financial institutions shall be compelled to notify the bank terms and conditions that are applicable to their clients and to the public under the bank transactions that they are carrying out and namely, nominal interest rates and the overall effective interest rates on such transactions. Banks shall also inform their clients at the opening of their account, about the conditions of use of such account, the prices of access to the various services given by such account and about the mutual commitments of the bank and the client. These conditions shall be mentioned in the account opening agreement or in the documents transmitted for this purpose.

Article 8: As regards any account credit transactions, banks shall compulsorily credit the client account within the time limit corresponding to the regulatory value date. Article 9: Any delay in the execution of a bank transaction, beyond the regulatory value date mentioned above shall result in a remuneration deposited in the client’s account by the bank or financial institution concerned. Article 10: The methods of implementation of the provisions of this regulation, including that of the excessive interest rate, shall be determined by an instruction from the Bank of Algeria. Article 11: The provisions of Regulation 94-13 of 22nd Dhou El Hidja 1414 corresponding to June 2nd, 1994 setting the general rules relating to the bank terms and conditions applicable to bank transactions shall be repealed. Article 12: This Regulation shall be published in the 3Journal Officiel3 of the Peoples’ Democratic Republic of Algeria.

The Governor Mohammed LAKSACI

REGULATION 09-04 OF AOUEL CHAABANE 1430

CORRESPONDING TO JULY 23RD, 2009 RELATING TO THE BANK ACCOUNTING PLAN AND ACCOUNTING RULES APPLICABLE TO

BANKS AND FINANCIAL INSTITUTIONS The Governor of the Bank of Algeria, Whereas Order 03-11 of Joumada Ethania 27th, 1424, corresponding to August 26th, 2003 relating to Money and Credit, namely to its article 62, item j, Whereas Order 75-59 of September 26th, 1975, as amended and completed, relating to the Commercial Code, Whereas Law 91-08 of April 27th, 1991, relating to the profession of chartered accountant, auditor and certified public accountant, Whereas Law 07-11 of Dhou El Kaada 1428, corresponding to November 25th, 2007 relating to the financial accounting plan, Whereas Order 08-02, of Rajab 21st, 1429, corresponding to July 24th, 2008, relating to the complementary budget Law for 2008, namely, its article 62, Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 2001 relating to the appointment of the Governor and Vice-Governors of the Bank of Algeria, Whereas the Presidential Decree of 10 Rabie El Ouel 1422 corresponding to June 2nd, 2001 relating to the appointment of the members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Chaabane 26th, 1423 corresponding to November 2nd, 2002 relating to the appointment of a member of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of 24 Dhou El Kaada 1424 corresponding to June 14th, 2004 relating to the appointment of the members of the Council of Money and Credit of the Bank of Algeria,

Whereas the Presidential Decree of Joumada El Oual 5th, 1427, corresponding to June 1st, 2006, relating to the appointment of a Vice Governor of the Bank of Algeria, Whereas the Executive Decree 08-156 of Joumada El Oula 1429 corresponding to May 26th, 2008 relating to the application of the provisions of Law N° 07-11 of Dhou El Kaada 1428 corresponding to November 25th, 2007 relating to the financial accounting system, Whereas the Executive Decree 09-110 of Rabie Ethani 11th, 1430 corresponding to April 07th, 2009 setting the terms and conditions of accounting by means of computer systems, Whereas the Order of Rajab 23rd, 1429, corresponding to July 26th, 2008 setting the evaluation and accounting rules, the content and submission of financial statements as well as the accounts lists and operational rules, Whereas Regulation 92-08 of November 17th, 1992 relating to bank accounts and accounting rules applicable to banks and financial institutions, Whereas the Resolution of the Council of Money and Credit of July 23rd, 2009, promulgates the regulation the content of which follows: Article 1: The object of this regulation is to set the bank accounting plan and accounting rules applicable to banks and financial institutions hereafter designated as “ subject institutions”, in the sense of this Regulation, we understand by “Accounting rules” the accounting principles and evaluation and accountancy rules Article 2: Subject institutions shall be compelled to record their transactions in the accountancy the list of which shall be attached to this regulation in accordance with the bank accounting plan. The compliance obligation shall concern the codification, title, and content of the operations accounts. Subject institutions shall derogate on a temporary basis, only after obtaining a special authorization from the Bank of Algeria.

Article 3: Subject institutions shall record their operations according to the accounting principles defined by law 07-11 of November 25th, 2007 relating to the financial accounting system and regulatory articles considered for its application. Article 4: Evaluation and accounting rules of assets, liabilities, charges and products shall be those set by the order of July 26th, 2008, mentioned above, under executive decree 08-156 of May 26th, 2008, relating to the application of the provisions of Law 07-11 of November 25th, 2007, relating to the financial accounting system. Article 5: Certain types of operations, namely foreign currency and securities operations shall be subject to a particular evaluation and accounting rules determined by a regulation. Article 6: Instructions from the Bank of Algeria shall state, if necessary, the terms of application of this regulation. Article 7: Any otherwise provisions shall be repealed, particularly, Regulation 92-08 of November 17th, 1992 relating to the banking accounts plan and accounting rules applicable to banks and financial institutions. Article 8: The provisions of this Regulation shall be applicable as from January 1rst, 2010. Article 9: This regulation shall be published in the “Journal Officiel” of the People’s Democratic Republic of Algeria.

The Governor Mohammed LAKSACI

SCHEDULE ACCOUNTS CLASSIFICATION Category 1: Cash operations account and inter-bank operations

10- Cash 11- Central Banks- Public Treasury – Giro cheque centre 12- Ordinary accounts 13- accounts, loans and borrowings 14- Repurchased securities 15- Reverse transactions 16- Non chargeable and other amounts due 17- Network transactions 18- Bad debts 19- Value losses on bad debts

Category 2: Clients’ operations accounts

20 Buyers’ s credits 22 Customers’ accounts 23 Loans and Borrowings 24 Repurchased securities 25 Reverse transactions 26 Non chargeable securities and other amounts due 28 Bad debts 29 Value losses on bad debts

Category 3: Portfolio accounts – securities and adjustment accounts

30 Securities transactions 31 Conditional instruments 32 Float and accounts due after encashment 33 Securities debts 34 Miscellaneous debit and credit accounts 35 Miscellaneous items 36 Adjustment and transitory accounts 37 Transitional and Adjustment accounts 38 liaison accounts 39 Value losses on bad debts

Category 4: Fixed capital accounts

40 subordinated loan 41 shares in bound companies equity security and portfolio activity securities 42 tangible and intangible assets 43 simple renting 44 Appropriations of branches abroad 45 Value losses on fixed capital 46 Depreciations 47 Bad debts 48 Value losses on bad debts

Category 5: Equity and assimilated capital

50 Products and deferred charges- not included in the operational cycle

51 Provisions for risks and expenditures 52 Regulated charges 53 Subordinated charges 54 Funds for general bank risks 55 Premiums connected with capital and reserves 56 Capital 58 Balance carried forward to next account Income or loss for the period

Category 6: Expense Account 60 Bank operating expenses

62 Services 63 Payroll costs 64 Tax, duties and assimilated deposits 66 Miscellaneous expenses 67 External contingency elements 68 Appropriation for depreciation, provisions and value losses 69 Taxes on earnings and similar items Category 7: Production Account 70 Bank operating products 76 Miscellaneous products

77 External contingency elements - products 78 Resumption on securities losses and provisions

Category 9: Extra balance sheet account

90 Financial liabilities 91 Guarantee commitment 92 securities liabilities 93 Foreign currency operations 94 Extra balance sheet - foreign currency adjustment account 96 Other liabilities 97 Bad debts

Category 1 – Cash operations and inter bank operations Such category of accounts record cash and cash securities, cash operations and inter bank operations. Cash operations include namely, loans, borrowings and repurchase agreements carried out over the monetary market. Inter bank operations are those operations carried out with the Bank of Algeria, the Treasury and Giro cheque centres, banks and financial institutions including foreign correspondent banks as well as local and international financial institutions. Category 2 – Customers’ operations The accounts of such category include all customers’ credits, as well as the deposits made by these latter. Customers’ credits include (account 20), all the credits granted to customers, regardless of their maturities. Customers’ credits (account 20) include all the resources brought by customers (sight deposits, time deposits, cash vouchers ….) Also, all loans and borrowings made with financial clients, investment companies, insurance and pension fund companies as well as other companies accepted as intervening parties over the organized market are recorded in such category.

Uses and resources materialized by securities shall be excluded from such category. Category 3 – Securities portfolio and adjustment accounts Besides the operations relating to securities portfolios, accounts of such category also record the debts materialized by securities. Securities portfolios include transaction securities; deposit securities and investment securities. The debts marked by securities include all the debts of subject institution marked by securities such as: negotiable debt securities and bonds, namely, convertible coupons, evidence of debts. Also, collection operations, operations with third parties, other uses, and transitory and adjustment accounts relating to all the operations of the subject institution are recorded in the accounts of this category. Category 4 – Fixed assets Accounts of this category record the uses intended for serving a durable activity on subject institution. Subordinated loans and fixed assets, whether they are financial or tangible or intangible, including those on simple lease are recorded in category. Category 5 – Equity capital and similar items All the financing means are grouped in the accounts of this category whether they were an initial capital or left at the disposal of the institution which has been a tax payer on a permanent or a durable basis. Also, products and deferred expenditures – extra operational cycle- (such as subsidies, appropriated public funds, assets deferred taxes, liabilities deferred taxes, other deferred products and expenditures), earnings of the financial year are also recorded in this category. Category 6: Expenditures The accounts of this category record all the expenditures incurred during the tax payer institution.

Besides the bank operating expenditures relating to the very bank activity, the columns in this category, include general costs as well as the grants for depreciations, provisions, and securities losses. Also, the grants from the fund for general bank risks are recorded in this category. Finally, external contingency elements are also recorded in this category such as expenditures, taxations on earnings and similar items. Category 7: Products Accounts of this category include all financial products encashed by subject institution. Besides the banking products relating to the very banking activity, the columns of such category include all the losses on securities and provisions. Resumptions from the fund for general banking risks are recorded in this category. Banking financial products are distinguished according to the type of operation, whether they are interests or commissions, as are expenditures. Also, the external contingency elements – products are recorded in this category. Category 9 - Off balance sheet The columns of this category include all the liabilities of the subject institution whether they have been given or received. The various liabilities are distinguished according to the nature of the liabilities and that of the counter party agent. In this respect, adequate accounts shall be provided for financial liabilities, guarantee liabilities, securities liabilities and foreign currency liabilities. Financial liabilities correspond to grants in favour of the beneficiary. Guarantee liabilities, carried out as a bank security, are transactions for which the subject institution undertakes to ensure - in favour of a third party - the expenditure subscribed by the latter, in case of failure on his part.

All the obligations secured and accepted liabilities are recorded in the “guarantee liabilities” column. The “Securities liabilities” column includes sale and purchase operations on behalf of the subject institution. The “Securities liabilities” column includes underwriting liabilities, and intermediation operations. Foreign currency operations include: Foreign exchange operations in cash, as long as the life time limit has not expired. Forward exchange transactions: Foreign currency purchase and sale transactions between parties who decide to defer the completion of such for reasons other than the applicable deadline. Loan and borrowings in foreign currencies as long as the deadline for making the funds available has not expired.

REGULATION 09-05 OF CHAOUAL 29TH, 1430 CORRESPONDING TO OCTOBER 18TH, 2009 RELATING TO THE DRAWING UP AND PUBLLICATION OF FINANCIAL STATEMENTS OF BANKS AND

FINANCIAL INSTITUTIONS

The Governor of the Bank of Algeria, Whereas Order 03-11 of Joumada Ethania 27th, 1424, corresponding to August 26th, 2003, relating to Money and Credit, namely, to its article 62, item j, Whereas Order 75-59 of September 1975, as amended and completed, relating to the Commercial Code, Whereas Law 91-08 of April 27th, 1991, relating to the profession of chartered accountant, auditor, and certified accountant, Whereas law 07-11 of Dhou El Kaada 15th, 1428, corresponding to November 25th, 2007, relating to the financial accounting system, Whereas order 08-02 of Rajab 21rst,1429 corresponding to July 24th, 2008 relating to the complementary budget law for 2008, namely its article 62, Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 2001, relating to the appointment of Governor and Vice-Governors of the Bank of Algeria, Whereas Presidential Decree of Rabie El Aouel 10th,1422 corresponding to June 2nd, 2001, relating to the appointment of members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Châabane 26th, 1423 corresponding to November 2nd, 2002, relating to the appointment of a member of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Dhou El Kaada 24th, 1424, corresponding to January 14th, 2004, relating to the appointment of the members of the Council of Money and Credit of the Bank of Algeria,

Whereas Presidential Decree of Joumada El Oula 5th, 1427, corresponding to June 1rst, 2006, relating to the appointment of a Vice-Governor of the Bank of Algeria, Whereas Executive Decree 08-156 of Joumada El Oula 28th, 1429 corresponding to May 26th,2008 relating to the application of the provisions of law N° 07-11 of Dhou El Kaada 15th, 1428 corresponding to November 25th, 2007 relating to the financial accounting system, Whereas Executive Decree 09-110 of Rabie Ethani 11th, 1430, corresponding to April 07th, 2009, setting the terms and conditions for accountancy keeping by means of computer systems, Whereas the Order of Rajab 23rd, 1429, corresponding to July 26th, 2008, setting the terms of evaluation and accountancy , content and presentation of the financial statements as well as the classification of the accounts operational rules, Whereas Regulation 92-09 of November 17th, 1992, relating to the drawing up and publication of the yearly individual accounts of banks and financial institutions, Whereas Regulation 09-04 of July 23rd, 2009, relating to the bank Accounting plan and accounting rules applicable to banks and financial institutions, Whereas the Resolution of the Council of Money and Credit, of October 18th, 2009, Promulgates the regulation the content of which follows: Article 1: The object of this regulation is to state the terms and conditions for drawing up and publishing the bank financial statements hereafter designated as “subject institutions”. Article 2: The publishable financial statements of subject institutions shall include the balance sheet and off balance sheet, the profit and loss account, the cash flow table, the equity capital variation table and schedule. Article 3: The balance and off balance sheets , the profit and loss account , the cash flow table, the equity table variation table, and schedule shall be drawn up according to type models attached to this regulation.

Article 4: The balance sheet of subject institutions shall be established according to a decreasing order of the liquid assets. Article 5: Financial statements shall be prepared on the basis of accounting principles and accountancy and valuation rules mentioned in regulation N° 09-04 of July 23rd, 2009 relating to the bank accounting plan and accounting rules applicable to banks and financial institutions. Article 6: The Computerized accountancy of subject institutions shall be organized in accordance with the provisions of executive decree N° 09-110 of Rabie Ethani 1430 corresponding to April 07th, 2009 setting the terms and conditions of bookkeeping by means of computerized systems. Article 7: Subject institutions shall publish their financial statements within the six (06) months following the end of the financial year in the official bulletin of the legal and compulsory advertisements in compliance with article 103 of order N° 03-11 of August 26th, 2003 relating to money and credit. Article 8: Instructions from the Bank of Algeria shall set, as required, the terms of application of this regulation. Article 9: The provisions of regulation N° 92-09 of November 17th, 1992 relating to the drawing up and publication of the individual accounts of banks and financial institutions shall be repealed. Article 10: The provisions of this regulation shall be applicable as from January 1rst, 2010. Article 11: This regulation shall be published in the “Journal Official” of the People’s democratic republic of Algeria.

The Governor Mohammed LAKSACI

REGULATION 09-06 OF DHOU EL KAADA 1430 CORRESPONDING TO OCTOBER 26TH, 2009 RELATING TO FOREIGN CURRENCIES

BALANCE OF DIRECT OR IN PARTNERSHIP INVESTMENTS

The Governor of the Bank of Algeria, Whereas Order 03-11 of Joumada Ethania 27th, 1424 corresponding to August 26th, 2003 relating to Money and Credit, namely to its articles 62,63 and 64 Whereas Order 01-03 of Aouel Joumada Ethania, 1422 corresponding to August 20th, 2001, as amended and completed , relating to the development of investments Whereas Order 09-01 of Rajab 29th, 1430 corresponding to July 22nd, 2009 relating to the complementary budget law for 2009, namely, its articles 58, (paragraphs 2, 5, 6, and 7 ) and 62 (paragraphs 2 and 3) Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 2nd, 2001, relating to the appointment of the governor and vice-governors of the Bank of Algeria, Whereas the Presidential Decree of 10 Rabie el Aouel 1422 corresponding to June 2nd, 2001 relating to the appointment of the members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Châabane 26th, 1423, corresponding to November 2nd, 2002, relating to the appointment of the members of the Council of Money and Credit, Whereas the Presidential Decree of Dhou El Kaada 24th, 1424 corresponding to June 14th, 2004, relating to the appointment of the members of the Council of Money and Credit, Whereas the Presidential Decree Of Joumada El Oula 5th, 1427 corresponding to June 1rst, 2006, relating to the appointment of a vice-governor of the Bank of Algeria,

Whereas the Resolution of the Council of Money and Credit, dated October 18th and 26th 2009, Promulgates the regulation the content of which follows: Article 1: The object of this regulation is to set the terms of application of paragraphs 6 of article 58 of Order 09-01 of Rajab29th,1430,corresponding to July 22nd, 2009 relating to the complementary budget law for 2009, relating to the surplus foreign currencies balance in favour of Algeria, during all the project life span, as far as direct and in partnership foreign investments are concerned. Article 2: When the foreign currencies balance is elaborated, for each project concerned, the following elements are taken in to account: In credit: repatriations in foreign currencies generated by: -Any contribution , under the investments, including the nominal capital - Proceeds of goods and services exports

-Part of the production sold around the national market , in substitution to imports

- External borrowings exceptionally raised

- The value of any imported contribution in nature is added to such credit elements

In debit: transfers abroad under: - Importations of goods and services

- Profits, dividends, fees attendance fees, wages and bonuses for expatriated personnel

- Partial assignments of investments - Exceptional external debt service - Of any other external payment

The balance of the foreign currencies balance is the difference between the sum of the credit elements and the sum of debit elements. The foreign currency balance shall be presented in the dinar equivalent. Article 3: The terms of the data collection relating to the balance in foreign currencies, of their processing and control as well as their reporting shall be stated precisely through an instruction from the Bank of Algeria. Article 4: The present regulation shall be published in the “Journal Officiel” of the People’s Democratic Republic of Algeria.

The Governor Mohammed LAKSACI

REGULATION 09-07 OF DECEMBER 10TH, 2009 AMENDING REGULATION N° 95-01 OF FEBRUARY 28TH, 1995, RELATING TO

THE DEROGATION IN FAVOUR OF THE “CNMA (NATIONAL AGRICULTURAL MUTUAL FUND) IN ORDER TO CARRY OUT

BANK TRANSACTIONS The Governor of the Bank of Algeria, Whereas Order 03-11 of Joumada 27th, 1424 corresponding to August 26th, 2003, relating to Money and Credit, namely to its articles 62, 63, 64, 65, 71, 88, 89, 90, Whereas the Presidential Decree of Rabie El Aouel 10th, 1422 corresponding to June 02nd, 2001 relating to the appointment of the Governor and Vice-Governors of the Bank of Algeria, Whereas the Presidential Decree of Rabie El Aouel 10th, corresponding to June 02nd, 2001 relating to the appointment of the members of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Châabane 26th, 1423, corresponding to November 02nd, 2002, relating to the appointment of a member of the Board of Directors of the Bank of Algeria, Whereas the Presidential Decree of Dhou El Kaada 24th, 1424 corresponding to January 14th, 2004 relating to the appointment of the members of the Council of the Money and Credit of the Bank of Algeria, Whereas the Presidential Decree of Djoumada El Oula 05th, 1427, corresponding to June 1rst, 2006, relating to the appointment of a Vice-Governor of the Bank of Algeria, Whereas Regulation 95-01 of February 28th, 1995 relating to a derogation in favour of the National Agricultural Mutual Fund (CNMA) in order to carry our bank operations. Whereas Regulation 05-02 of March 05th, 2005, amending and completing regulation 95-01 of February 28th, 1995 relating to a derogation in favour of the National Agricultural Mutual Fund, “CNMA” in order to carry out bank operations.

Whereas Regulation 08-04 of December 23rd, 2008, relating to the minimum capital of banks and financial institutions operating in Algeria, Further to the resolutions of the Council of Money and Credit of December 10th, 2009, Promulgates the Regulation the content of which follows: Article 1: The object of this regulation is to amend the modified Regulation 95-01 of February 28th, mentioned above. Article 2: Article 4 of Regulation 95-01 of February 28th, 1995 relating to the derogation in favour of the National Agricultural Mutual Fund, “CNMA” has been amended as follows: “Article 4” the joint stock company shall be subject to the bank legislation and regulations in force as regards its incorporation and operation in order to implement the provisions of article 3 above. The company shall be authorized to carry out the bank operations devolved to financial institutions as provided for in Article 71 of Order 03-11 of August 26th, 2003, excepting the foreign exchange and external trade transactions. Article 3: Any otherwise provision with regard to this regulation shall be repealed. Article 4: This Regulations shall be published in the “Journal Officiel” of the Peoples’ Democratic Republic of Algeria.

The Governor Mohammed LAKSACI