The recent statement released on September 7 by the Central Bank of the Republic of Uzbekistan concerning the payment organization BRIO GROUP LLC and the matter of cross-border money transfers. The Central Bank has highlighted several key issues related to BRIO GROUP LLC's activities and has clarified the regulatory framework governing cross-border transactions and payment organizations in Uzbekistan.
The Central Bank's statement comes in response to circulating messages on social networks regarding restrictions on cross-border money transfers for payment institutions. It aims to address concerns and provide clarity on the situation.
Central Bank's Statement:
The Central Bank's statement can be divided into several key points:
Failure to Comply with Regulatory Requirements: The Central Bank asserts that BRIO GROUP LLC did not adhere to the necessary regulatory requirements concerning the documentation and information required for international money transfers. This lack of compliance was in violation of paragraph 31¹ of the Internal Control Rules (No. 3266 of June 30, 2020).
Legal Framework for Foreign Exchange Transactions: The Central Bank highlights the legal framework governing the opening of accounts abroad by resident legal entities and the management of foreign exchange funds in these accounts. Such actions can only be conducted in accordance with decisions made by the President of the Republic of Uzbekistan or the Government.
Unlawful Transactions: BRIO GROUP LLC is mentioned as having opened an account in a foreign bank and conducted transactions through this account, which contradicts the aforementioned legal requirements.
Definition of Payment Organizations: The Central Bank clarifies the definition of payment organizations as legal entities engaged in providing payment services but not classified as banks. They are authorized to offer payment services within the country under the Central Bank's license.
Nature of Payment Services: The Central Bank explains that payment services involve facilitating payments between users (clients) and are not directly related to the buying or selling of goods or services. This clarification underscores the illegitimate categorization of certain payment activities as foreign trade operations.
No Restrictions on International Payments: The statement reiterates that there are no restrictions on international payment services, cross-border money transfers, or payments to international online services within Uzbekistan. These transactions can be conducted through commercial banks' platforms.
Commitment to Regulation: The Central Bank reaffirms its commitment to systematically monitoring compliance with laws by payment organizations. It vows to take necessary measures to ensure these organizations operate within the legal framework.
The Central Bank's statement provides important insights into the regulatory landscape governing payment organizations and cross-border money transfers within Uzbekistan.
Earlier Daryo mentioned about the report illuminates Uzbekistan's loan landscape, emphasizing state banks' dominance while anticipating shifts post-privatization, heralding potential lending dynamics transformation.
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