SML - Local Currency Payment System

The SML is a payment system focused on commercial deals, which allows importers and exporters from Brazil and Argentina to make payments and receive them in their local currencies.

At the beginning it is used just in commercial good deals, including related services and expenses, such as freight and insurance.

Objectives:

• Increase the access of small and medium-sized agents.

• Allow foreign trade in local currency.

• Strengthen the Real/Argentinean peso market.

• Reduce the cost of transactions.

Features:

• Voluntary use.

• Exchange contract not required.

• No change on foreign trade documents, except the export register that will be issued in reais.

• Integration between the Brazilian payment system (SPB) and Argentinean payment system (MEP).

Responsible for implementing:

• Central Bank of Brazil

• Argentine Central Bank

• Financial Institutions participating of the system

Specific legislation:

• Decision 38/06 from the Council of Mercosul Common Market, dated December 15, 2006.

• Resolution 12 from the CAMEX, dated April 25, 2007.

• Decision 25/07 from the Council of Mercosul Common Market, dated June 28, 2007.

• Decree 6.374, dated February 18, 2008.

• Agreement of Local Currency Payment System between Argentina and Brazil, dated September 8, 2008.

• Resolution 3.608 from the National Monetary Council, dated September 11, 2008.

• Circular Letter 3.406 from the Central Bank of Brazil, dated September 26, 2008.