reglab/statecodes huggingface dataset:
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232e - License

(a) At his discretion, the Commissioner may issue to the applicants a license to operate an international banking entity upon receipt of:
(1) The certification by the Department of State referred to in § 232d of this title;
(2) the payment of five thousand dollars ($5,000) as an annual fee for the license to operate an international banking entity. This license fee shall be paid annually within fifteen (15) days following each anniversary date of the issuance of the original license;
(3) a certified copy of the articles of incorporation, partnership agreement or other written document establishing the international banking entity or the certification of the person of which the international banking entity shall be a unit;
(4) a copy of the bylaws or internal governing agreements adopted by the Board of Directors or similar governing body of the international banking entity, which shall be certified by its Secretary or an individual acting in a similar capacity, before a notary public;
(5) evidence, in the form required by the regulations of the Commissioner, that the capital of the international banking entity has been subscribed to, issued and paid-in, to the extent and under such conditions as the Commissioner may establish at his sole discretion;
(6) a statement, in the form required by the regulations of the Commissioner and authenticated before a notary public, by the Secretary of the Board of Directors or the person acting in a similar capacity for the international banking entity, or for the person of which the international banking entity shall be a unit, to the effect that the international banking entity has complied with the provisions of §§ 232 et seq. of this title and of the regulations of the Commissioner and that it is ready to commence operations; Provided, That a license shall not be issued if the Commissioner believes, or has reason to believe, that the applicants have violated the provisions of §§ 232 et seq. of this title or of the regulations of the Commissioner; Provided, further, That any person to whom a license has been denied, may request a hearing pursuant to the regulations provided in § 232s of this title.
(b) No international banking entity shall commence operations unless it has been previously issued a license in accordance with the provisions of §§ 232 et seq. of this title.
History —Aug. 11, 1989, No. 52, p. 178, § 7.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232e-1 - License renewal

(a) Every license shall remain in effect until its expiration, which shall be on the anniversary date of the original license.
(b) Every license renewal application shall be submitted within thirty (30) days before the expiration date of each license. It shall contain:
(1) A description of any material change in the information provided to OCIF in the initial license application.
(2) Evidence that the licensee maintains the capital required by the Commissioner as provided in § 232c of this title, computed in accordance with generally accepted accounting principles.
(3) A statement, as provided in the regulations of the Commissioner, undersigned by the chief executive officer or any other executive officer expressly authorized by the Board of Directors of the concerned institution, certifying:
(A) That the international banking entity has implemented the necessary and appropriate procedures and systems to comply with the provisions of the Bank Secrecy Act;
(B) a statement acknowledging the entity’s management responsibility to establish in such entity, and to maintain and comply with the Bank Secrecy Act Compliance Program;
(C) that the necessary policies and procedures have been adopted in the entity to comply with the provisions of OFAC, as applicable, and
(D) any other related information that the Commissioner may require by regulations.
(c) Annual license fees totaling five thousand dollars ($5,000) for each office, by cashier’s check, certified check, postal or bank money order, payable to the Secretary of the Treasury. The Commissioner may extend the license renewal period.
(d) If the licensee fails to file the license renewal application and/or fails to pay the applicable fees within the established term or during any additional term that the Commissioner authorizes, if any, it shall be understood that the licensee intends to surrender the license to operate an international banking entity, and shall follow the process established therefor by Regulations, and may not continue operating such business.
History —Aug. 11, 1989, No. 52, p. 178, added as § 8 on Sept. 23, 2013, No. 110, § 3.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232f - Amendments to articles of incorporation

(a) No amendment whatsoever shall be adopted to the articles of incorporation, partnership agreement or other written document establishing an international banking entity or to any certification executed in accordance with § 232c of this title, unless such amendment has been previously approved, in writing, by the Commissioner.
(b) After the due adoption of any amendment to the articles of incorporation, partnership agreement or other written document establishing an international banking entity or to any certification executed in accordance with § 232c of this title, the same shall be filed with the Department of State.
History —Aug. 11, 1989, No. 52, p. 178, § 8.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232g - Unencumbered assets, capital, shares of capital stock

(a) Every international banking entity shall possess not less than three hundred thousand dollars ($300,000) of unencumbered assets or acceptable financial securities, or that lesser sum that, by request of the interested party, the Commissioner authorizes, when the type of business or powers that the international banking entity intends to exercise or other circumstances thus merit it, in the [judgment] of the Commissioner. The unencumbered assets shall be physically located in Puerto Rico and subject to the requirements regarding the same provided by the regulations of the Commissioner.
(b) The capital of, or assigned to an international banking entity may not be reduced without the prior written approval of the Commissioner.
(c) Without the prior written approval of the Commissioner, no international banking entity may issue:
(1) Additional shares of capital stock or other securities convertible into additional shares of capital stock, in the case of a corporation, or
(2) additional capital or other securities convertible into additional capital, in the case of a person other than a corporation.
(3) Notwithstanding the above, in the case of a corporation, it may issue additional shares of capital stock or other securities convertible into shares of capital stock, and in the case of a person other than a corporation, issue additional capital or other securities convertible into additional capital, without the prior written approval of the Commissioner, provided such additional shares or capital are issued directly to the shareholders of the international banking entity previously identified pursuant to subsection (b)(3) of § 232d of this title. In such event, the international banking entity shall notify the Commissioner of all the particulars of such issuance within the ten (10) business days following said date of the issue.
History —Aug. 11, 1989, No. 52, p. 178, § 9; Aug. 11, 1996, No. 121, § 4.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232h - Transfer of capital or control of an international banking entity

(a) Except as provided in the regulations adopted by the Commissioner, no sale, encumbrance, assignment, merger, barter, exchange or other transfer of shares, interest or participation in the capital of an international banking entity may be initiated without the previous written authorization of the Commissioner, if by way of such transaction, a person could acquire, directly or indirectly, control of ten percent (10%) or more of any class of stock, interest or participation in the capital of an international banking entity.
(b) Every sale, encumbrance, assignment, merger, barter, exchange or other transfer of shares of capital stock, interest or participation in the capital of an international banking entity, as set forth in subsection (a) of this section, shall be null “ab initio” if the written authorization of the Commissioner has not been obtained.
(c) The international banking entity shall notify the Commissioner, thirty (30) days in advance, the transfers referred to in subsection (a) of this section, the identity of the transferor and of the transferee and the nature of the transaction. The Commissioner may require such additional information as he deems necessary to determine if the transfer would be detrimental to the security or financial solvency of the international banking entity or if it would violate any law, rule or regulation governing the international banking entity, in which case the Commissioner may deny the authorization for such transaction; Provided, That any person to whom such authorization is denied shall have the right to request a hearing pursuant to the regulations provided in § 232s of this title.
History —Aug. 11, 1989, No. 52, p. 178, § 10.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232i - No transfer of license

No license issued in accordance with §§ 232 et seq. of this title may be sold, assigned, transferred, pledged, used as security, or otherwise encumbered.
History —Aug. 11, 1989, No. 52, p. 178, § 11.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232j-1 - Responsibilities of the holders of a license to operate an international banking entity

Every holder of an international banking entity license shall:
(a) Adopt written business policies and procedures to ensure that the international banking entity complies with the applicable state and federal laws, including this Act, the Bank Secrecy Act, and the USA Patriot Act.
(b) Faithfully comply with the applicable state and federal laws and the regulations applicable to the international banking entity, including §§ 232 et seq. of this title, the Bank Secrecy Act, and the USA Patriot Act.
(c) File currency transaction or suspicious activity reports required by the Bank Secrecy Act and the USA Patriot Act, when necessary.
(d) Follow the practice rules and procedures that are necessary in the business to meet the requirements of OFAC, as applicable.
History —Aug. 11, 1989, No. 52, p. 178, added as § 14 on Sept. 23, 2013, No. 110, § 5.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232k - Personnel

(a) The international banking entity shall employ on a full-time basis a minimum of four (4) persons at its business office or offices in Puerto Rico.
Provided, That the Commissioner may authorize a lesser number of employees upon request of the interested party, for which authorization the Commissioner shall evaluate factors such as the powers conferred by the license granted under this chapter, the nature and complexity of its operations in Puerto Rico, and those other criteria established in the regulations of the Commissioner.
(b) The full-time employees of a person of which an international banking entity is a unit which render some services to such entity, shall be deemed to be full-time employees of such entity for purposes of the employment requirements set forth in subsection (a) of this section.
History —Aug. 11, 1989, No. 52, p. 178, § 13; Aug. 11, 1996, No. 121, § 6.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232l - Accounts and registers

(a) The original of the account books and registers of the international banking entity shall be kept in its main business office in Puerto Rico and shall reflect such details and be kept in such a manner as may be required by the regulations of the Commissioner.
(b) Such account books and registers have to be segregated and kept separately from the account books and registers of any other person.
(c) The originals of the account books and registers of an international banking entity shall be deemed as belonging to such international banking entity regardless of whether such entity is a person or constitutes a unit of another person, and a duplicate thereof may be kept and maintained in its country of origin.
History —Aug. 11, 1989, No. 52, p. 178, § 14; Aug. 11, 1996, No. 121, § 7.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232m - Reports

Every international banking entity shall submit to the Commissioner all such reports as may be required by the regulations of the Commissioner, including an annual financial statement prepared by certified public accountants, licensed to practice in Puerto Rico, as well as interim financial statements.
History —Aug. 11, 1989, No. 52, p. 178, § 15.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232n - Revocation, suspension or surrender

(a) The license issued under § 232e of this title shall be subject to revocation or suspension by the Commissioner, upon previous notice and hearing pursuant to the regulations provided in § 232s of this title if:
(1) An international banking entity or the person of which said international banking entity is a unit, contravenes or fails to comply with any of the provisions of §§ 232 et seq. of this title, any regulations of the Commissioner, or any of the terms and conditions of the license to operate an international banking entity.
(2) An international banking entity fails to pay the annual license fee of five thousand dollars ($5,000).
(3) The Commissioner finds that the business or affairs of an international banking entity are conducted in a manner that is not consistent with the public interest.
(b) An international banking entity or the person of which said international banking entity is a unit, may at any time, and in the manner provided by the regulations of the Commissioner, surrender its license to operate an international banking entity.
History —Aug. 11, 1989, No. 52, p. 178, § 16; Aug. 11, 1996, No. 121, § 8.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232o - Dissolution

(a) The Commissioner may appoint a receiver and order the dissolution of an international banking entity if the license of said international banking entity or of the person of which the international banking entity is a unit, is revoked or surrendered pursuant to § 232n of this title.
(b) The receiver appointed shall be a person of recognized moral qualities, with vast experience in the field of banking or finance, and his performance with the international banking entity shall be secured by an adequate bond, to be paid by the international banking entity itself.
(c) The receiver shall manage the international banking entity in accordance with the provisions of §§ 232 et seq. of this title and shall:
(1) Take possession of the assets and liabilities, books, records, documents and files which belong to the international banking entity;
(2) collect all loans, charges and fees owed to the international banking entity;
(3) pay all obligations and debts of the international banking entity, after having paid the necessary costs of the receivership, and
(4) supervise the dissolution and liquidation of the international banking entity.
History —Aug. 11, 1989, No. 52, p. 178, § 17.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232q - Confidentiality

(a) The information that the international banking entity provides to the Commissioner under the provisions of §§ 232 et seq. of this title and the regulations adopted thereunder by the Commissioner shall be kept confidential, except:
(1) When disclosure of such information is required by law or judicial order, or
(2) through a formal petition of a domestic or foreign government agency in the exercise of its supervisory function, when the Commissioner has grounds to believe that it is in the best public interest. In such case, the information shall be delivered under a binding agreement with the concerned government entity of maintaining the confidentiality of said information. Provided, That the exception under paragraph (1) above shall under no circumstances be extended to information regarding clients of the international banking entity, unless there is a formal petition by any domestic or U.S. government agency acting in accordance with the powers granted under §§ 232 et seq. of this title.
(b) The requirements under any federal or Puerto Rico law in connection with the privacy or confidentiality of any information or material provided to the Office of the Commissioner of Financial Institutions, and any privilege arising from any federal or Puerto Rico law, including the rules of any federal or Puerto Rico court with regard to said information or material shall continue to apply to such information or material after said information or material is revealed to the Office of the Commissioner of Financial Institutions. Said information and material may be shared with any official of a federal or Puerto Rico agency who has authority to oversee the banking industry, without precluding the protections of privileges or confidentiality provided under federal and Puerto Rico laws.
(c) This section shall not apply to information or material related to the employment history of any official or orders issued by the Commissioner to any licensee.
History —Aug. 11, 1989, No. 52, p. 178, § 19; Aug. 11, 1996, No. 121, § 9; renumbered as § 21 and amended on Sept. 23, 2013, No. 110, § 8.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232r - Transitional provisions

An international banking entity, to which a license was issued pursuant to § 10 of Act No. 16 of July 2, 1980, as amended, known as “International Banking Center Regulatory Act” herein repealed, shall be deemed on the effective date of this act as an international banking entity organized pursuant to §§ 232 et seq. of this title and shall enjoy all the rights, privileges, powers and authority and shall be subject to the duties, obligations, penalties, responsibilities, conditions and limitations provided in §§ 232 et seq. of this title.
Any regulations adopted pursuant to said Act No. 16 not in conflict with this §§ 232 et seq. of this title, shall remain in effect until amended or repealed.
History —Aug. 11, 1989, No. 52, p. 178, § 20.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232s - Administrative hearings, adjudication proceedings and judicial review

All matters related to administrative hearings procedure, adjudicatory proceedings and judicial review shall be set forth by regulations to be promulgated by the Commissioner pursuant to the provisions of §§ 2101 et seq. of Title 3, known as “Uniform Administrative Procedures Act of the Commonwealth of Puerto Rico”.
History —Aug. 11, 1989, No. 52, p. 178, § 21.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232t - Inapplicability of existing laws

The provisions of §§ 1 et seq. of this title, known as the “Banking Law”, nor the provisions of §§ 998 et seq. of Title 10, which fix the maximum interest rates or charges permitted on loans, nor § 4591 of Title 31, which fixes the interest rates in the absence of an agreement and the maximum interest rates that can be fixed by special agreements. Notwithstanding the above, nothing in §§ 232 et seq. of this title shall be understood to be a limitation of the powers of the Governor of Puerto Rico or of the person designated by him, conferred in §§ 204 and 205-215 of this title.
History —Aug. 11, 1989, No. 52, p. 178, § 22.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232u - Property tax exemption

The real and personal property belonging to an international banking entity duly authorized under §§ 232 et seq. of this title, shall be exempt from the levying of property taxes.
History —Aug. 11, 1989, No. 52, p. 178, § 23.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232v - Municipal license tax exemption

The international banking entities duly authorized by §§ 232 et seq. of this title, shall be exempt from the payment of municipal license taxes levied by §§ 651 et seq. of Title 21, known as the “Municipal License Tax Act”.
History —Aug. 11, 1989, No. 52, p. 178, § 24.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 16 - International Banking Center (§§ 231 — 232x) › § 232x - Effect of existing legislation

(a) Insofar as the laws of Puerto Rico are not inconsistent with the provisions of §§ 232 et seq. of this title, the laws of Puerto Rico shall prevail.
(b) Insofar as the provisions of §§ 232 et seq. of this title are inconsistent with any other laws of Puerto Rico, the provisions of §§ 232 et seq. of this title shall prevail.
History —Aug. 11, 1989, No. 52, p. 178, § 26.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251 - General definitions

For the purposes of this chapter, the following terms shall have the meaning set forth hereinbelow:
(1) Commissioner. — Means the Financial Institutions Commissioner.
(2) Depositary of public funds. — Means that financial institution which in accordance with the provisions of this chapter is authorized by the Secretary of the Treasury to receive deposits of public funds through the execution of a contract.
(3) Government entity. — Means every public agency, department, instrumentality, board, office, committee, dependency or corporation of the Commonwealth of Puerto Rico and includes municipalities and any of their dependencies, as well as the Legislative and Judiciary Branches.
(4) Financial institution. — Means any bank, savings and loans institution, trust company authorized by the Commissioner to perform banking business, savings and credits unions or branch offices thereof, that are doing business in Puerto Rico.
(5) Secretary. — Means the Secretary of the Treasury of the Commonwealth of Puerto Rico.
History —Aug. 14, 1991, No. 69, § 1.2.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251a - Designation

All government entities’ funds shall be deposited in financial institutions that can answer with sufficient collateral, made up of previously-selected securities pursuant to the regulations approved by the Secretary.
The financial institutions shall be previously designated by the Secretary as depositaries of public funds, but in the case of savings and credit unions, the designation shall be made by the Secretary in consultation with the Inspector of Cooperatives. The designation as depositary of public funds shall be made through the execution of a contract between the Secretary and the financial institution.
Funds under the custody and at the disposal of any official of a government entity shall be deposited in the financial institution that is the depositary of public funds selected by the respective official.
History —Aug. 14, 1991, No. 69, § 1.3.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251b - Exclusion from the rule

The Secretary may exempt the Government Development Bank for Puerto Rico, the Economic Development Bank for Puerto Rico, and the Housing Financing Bank and Agency of Puerto Rico from compliance with § 251a of this title, due to the nature of these institutions, as well as the business they conduct.
History —Aug. 14, 1991, No. 69, § 1.4.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251c - Exemption from collateral guarantee

In the case of a contract to finance authorities where the creation of special trust funds is needed, the Secretary may exempt such contract from the rule for general collaterals and accept a different form of collateral, or not require any, when there are circumstances that so merit it.
History —Aug. 14, 1991, No. 69, § 1.5.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251d - Deposits in foreign countries

Deposits of public funds in a foreign country shall be made for the exercise of the duties of government entities in such country, and shall be limited to those amounts that are strictly necessary to cover the operating expenses of the entity in said country.
Deposits in a foreign country shall be made in financial institutions that do business in Puerto Rico, or in an exchange office or affiliate, when said financial institution does not have a branch office in the foreign country.
In the case of deposits in a foreign country, the Secretary shall require the financial institution that does business in Puerto Rico to provide additional collateral that is sufficient to back said deposits.
History —Aug. 14, 1991, No. 69, § 1.6.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251e - Conditions to be a depositary

In order to be designated as depositary of public funds pursuant to the provisions of this chapter, every financial institution shall:
(1) Be organized under the laws of the Commonwealth of Puerto Rico; or
(2) be organized under the laws of the United States of America or any of its states, or those of a foreign country, and must be registered or licensed to do business in Puerto Rico;
(3) actually do business in Puerto Rico;
(4) execute a deposit and rendering of collateral contract with the Secretary, and
(5) comply with the requirements related to the economic condition that are established by regulations.
History —Aug. 14, 1991, No. 69, § 1.7.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251f - Examination

The Secretary or his/her authorized representative shall be empowered to perform periodic examinations of the depositaries of public funds, for the purposes of ensuring compliance with the provisions of this chapter and its regulations.
The Secretary is likewise empowered to establish a daily information system that will allow him to know the data or the transactions performed with public funds and with their collaterals.
History —Aug. 14, 1991, No. 69, § 1.8.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter I - General Provisions (§§ 251 — 251g) › § 251g - Custody of collaterals

The Secretary shall be the depositary and custodian of the collaterals that secure the deposits of public funds. However, he may contract said custody with financial institutions pursuant to the requirements established by regulations, including the type of security that it shall require.
Notwithstanding the above, a financial institution shall never be the custodian of its own collateral.
History —Aug. 14, 1991, No. 69, § 1.9.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter II - Collaterals (§§ 252 — 252c) › § 252a - Collateral guarantees—Form

The Secretary may accept as collateral to secure public funds under the provisions of this chapter, securities evidenced by certificates, securities not evidenced by certificates, and securities in which the ownership thereof is kept in electronic systems. The Secretary shall be empowered to establish preferences in the securities that he shall accept as collateral and to require that the collateral is rendered through a specific security.
All securities designated by the Secretary as acceptable shall be accepted for their market value and shall be sufficient to secure one hundred percent (100%) of the public funds deposited with the designated depositaries. If on the other hand, there is a net excess in favor of the designated depositary, between the market value of the collateral and the total of the deposited funds, the Secretary, by a petition of such depositary, may return the excess collateral and shall exercise his discretion to determine the class or classes of designated securities that he shall return to the designated depositary.
The Secretary shall verify the market value of the assets offered as collateral from time to time. If the assets have dropped below their market value at the time they are accepted as collateral, the Secretary shall require the depositary to complement it.
This provision shall prevail over any other legal provision that is not in harmony with that which is provided herein.
History —Aug. 14, 1991, No. 69, § 2.2.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter II - Collaterals (§§ 252 — 252c) › § 252b - Collateral guarantees—Pledge; constitution

A financial institution designated as depositary of public funds shall have constituted an effective and valid pledge against third parties in favor of the Secretary, on any collateral that secures public funds, when it has complied with the provisions of §§ 5001 and 5002 of Title 31 and this section.
For these purposes, a pledge in favor of the Secretary has been constituted:
(1) When the Secretary or a financial institution designated by him as custodian of collateral of public funds, acquires possession of a security evidenced by certificate, or
(2) when the pledge in favor of the Secretary on a security evidenced by certificate is entered in the registry where ownership of said securities is recorded in favor of the financial institution that constitutes the pledge, or
(3) when a financial intermediary other than a compensation corporation, sends confirmation to the Secretary of the constitution of the pledge in his favor, and identifies by journal entry or in any other manner, that there have been pledged in favor of the Secretary:
(a) A specific security evidenced by a certificate in possession of a financial intermediary, or
(b) a number of securities that constitute or are a part of a fungible group of securities evidenced by certificates in possession of a financial intermediary, or of securities not evidenced by certificates registered in the name of a financial intermediary, or
(c) a number of securities that constitute or are a part of a fungible group of securities that appear as credited in the account of a financial intermediary or in the books of another financial intermediary, or
(4) when a compensation corporation makes the proper entries in its books in favor of the Secretary, by decreasing the account of the pledging debtor and increasing the account of the pledging creditor by the total amount of the pledged security or the number of pledged stocks or obligations, provided said security appears in the books of the compensation corporation in the name of the pledging debtor, is under the control of the compensation corporation and is registered in the name of a compensation corporation, a custodian bank or a person designated by any of them. For the purposes of this provision, the term “custodian bank” means a bank or trust company that acts as a custodian of securities for a compensation corporation, that are regulated, supervised and examined by the government of the Commonwealth of Puerto Rico or the government of the United States of America, or the government of any of its states.
If the security pledged in favor of the Secretary is part of a fungible group of securities that meet the characteristics described in clauses (b) and (c) of subsection (3) this section, it shall be understood that the Secretary is a pledging creditor of the proportional interest that said security has in said expendable group.
History —Aug. 14, 1991, No. 69, § 2.3.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter II - Collaterals (§§ 252 — 252c) › § 252c - Collateral guarantees—Exception from pledge requirements

The requirements of §§ 5021—5023 of Title 31 shall not apply to establish a pledge in favor of the Secretary.
History —Aug. 14, 1991, No. 69, § 2.4.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter III - Interests on Deposits (§§ 253 — 253b) › § 253 - Interest—Type; agreement

The Secretary shall require payment of interest on all deposits of public funds. The annual payment of interest on deposits of public funds in current or savings accounts or accounts of any other nature, shall be made at the interest rate agreed upon by the Secretary and the depositary institution thereof.
The Secretary is hereby empowered to review the interest agreed upon by contract with each financial institution, from time to time and to conduct the negotiations on this matter that most benefit the public interest. The interest review shall also apply to contracts executed prior to the effectiveness of this act.
History —Aug. 14, 1991, No. 69, § 3.1.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter III - Interests on Deposits (§§ 253 — 253b) › § 253a - Interest—Obligation to pay

Every financial institution designated as depositary of public funds shall be bound to accrue interest on all deposits, pursuant to what is provided in § 253 of this title and the terms of the contract signed by the Secretary to such purposes.
History —Aug. 14, 1991, No. 69, § 3.2.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter III - Interests on Deposits (§§ 253 — 253b) › § 253b - Interest—Judicial branch, special provision

The Judicial Branch, through the Chief Justice of the Supreme Court, or the Courts Administrative Director, if delegated by him, may sign agreements with any bank designated as depositary of public funds to agree on the interest that it shall receive for the funds deposited in bank accounts, which may exceed the interest fixed in the contracts negotiated pursuant to §§ 253 and 253a of this title and any other conditions, services or actions directed at improving the services that the Judiciary Branch renders to the citizenry, related to the handling of funds. Said agreements shall guarantee that the liquidity and solvency of the Judicial Branch shall be put at risk.
With respect to public funds, the proceeds of said interest may be deposited by the Judicial Branch in special separate accounts in the banking institutions of its choice that are covered by this chapter. In the case of interest on other funds that are in its custody, which are deposited in any type of bank account, the Judiciary Branch, through regulations adopted by the Chief Justice of the Supreme Court or the Courts Administrative Director, if delegated on him, may determine the reasonable share of those interest that may be deposited in the abovementioned special accounts to cover expenses and other liabilities incurred by said Branch for services rendered in the receiving, accounting, control, custody and delivery of these deposits, and to contribute for the financing of its special projects.
The Department of the Treasury shall continue to receive the resources produced by the deposits considered herein, based on the interest agreed upon of 1/20 of one percent (1%) per annum in current accounts. The negotiable excess shall become part of the Judiciary Branch.
The funds thus deposited shall be used by the Judiciary Branch through the Chief Justice of the Supreme Court or the Courts Administrative Director if delegated on him, to cover the expenses of its special projects.
The Judiciary Branch shall submit a report annually to the Legislature on the use and disposal of funds that are the product of the negotiations established herein.
The interest received and deposited pursuant to the provisions of this section shall not be destined to defray regular and operating expenses. The remainder of said funds in each fiscal year may be used by the Judiciary Branch in following fiscal years with the limitation indicated herein.
The funds generated pursuant to the provisions of this section shall be used for special projects, and therefore, shall not impair in any way, the appropriation of funds in following years for the regular operating expenses of the Judiciary Branch.
History —Aug. 14, 1991, No. 69, § 3.3.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter IV - Final Provisions (§§ 254 — 254c) › § 254 - Administrative sanctions

In addition to any other administrative action in order, any financial institution or person who violates the provisions of this chapter or its regulations, shall be sanctioned by an administrative fine which shall not be less than five hundred dollars ($500), nor more than one thousand dollars ($1,000).
If a like violation is incurred subsequently, the administrative fine shall not be less than two thousand dollars ($2,000), nor more than five thousand dollars ($5,000).
The fines shall apply separately to each violation of law or regulations. Failure to comply with the provisions of this chapter and its regulations may also bring about the cancellation of the designation of a financial institution as a depositary of public funds.
History —Aug. 14, 1991, No. 69, § 4.1.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter IV - Final Provisions (§§ 254 — 254c) › § 254a - Evaluation

The Secretary may request the Commissioner to examine the financial institutions to be designated or which have been designated as depositaries of public funds, to determine the condition of its finances or to ensure compliance with the provisions of this chapter and its regulations. When the examination is performed on a financial institution whose authorization to operate is not issued by the Office of the Commissioner, a fee of one hundred dollars ($100) shall be charged per day or fraction thereof, for each official intervening in said examination. The fees for each examination shall never be less than five hundred dollars ($500).
The funds collected for the fees established herein shall be covered into the Special Fund created by § 7 of Title 13.
History —Aug. 14, 1991, No. 69, § 4.2.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter IV - Final Provisions (§§ 254 — 254c) › § 254b - Construction

This chapter shall be construed liberally in order to attain the greatest effectiveness of its purposes. Substantial compliance of its various provisions shall be sufficient to validate a lien in behalf of the Secretary of the Treasury of Puerto Rico and give jurisdiction to the courts of Puerto Rico in order to make it effective.
History —Aug. 14, 1991, No. 69, § 4.3.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 17A - Regulation of Deposits of Public Funds (§§ 251 — 254c) › Subchapter IV - Final Provisions (§§ 254 — 254c) › § 254c - Regulations

The Secretary shall adopt the regulations needed to implement the provisions of this chapter.
The provisions of the regulations promulgated under Act No. 7 of August 17, 1933 as amended, Act No. 318 of May 13, 1949 as amended, and Act No. 58 of April 17, 1952 as amended, shall continue in effect until amended or repealed, provided they are not in conflict with the provisions of this chapter.
History —Aug. 14, 1991, No. 69, § 4.4.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 19 - Insured Mortgages Reserve Fund (§§ 261 — 272) › § 261 - Creation

In order to guarantee sufficient safe and hygienic dwellings in Puerto Rico, to develop the construction and housing industries and the resulting additional employment opportunities for the citizens of the Commonwealth of Puerto Rico, and to facilitate housing programs financed or sponsored by the Puerto Rico Housing Bank and Financing Agency, and any other agency, public corporation, municipality or instrumentality of the Commonwealth of Puerto Rico, the Puerto Rico Housing Bank and Financing Agency, henceforth denominated as the “Agency”, is hereby authorized to insure by itself or jointly with others, and reinsure the payments of any mortgage loan or interim financing granted with the purpose of constructing, rehabilitating, acquiring, leasing or refinancing housing under the terms and conditions determined by the Agency. In the case of permanent financing, the mortgage insurance may be applied to any loan in the portfolio of the Agency or the Office for the Liquidation of the Accounts of the Housing and Urban Renewal Corporation.
For the purpose of meeting the obligations assumed by the Agency in the insurance of mortgages as provided by this chapter, the Agency shall create an Insured Mortgage Reserve Fund, which shall be used to pay for all commitments incurred on account of insurance, operating expenses, and any other expenses incidental to mortgage insurance, as provided for under the Mortgage Security Insurance Regulation, to be established subsequently in this chapter. Such Fund shall be nourished by the following revenue sources:
(1) Premiums charged on account of mortgage insurance;
(2) fees for the [issuance] or extension of insurability pledges;
(3) interest earned by the Insured Mortgage Reserve Fund itself;
(4) funds appropriated by the Agency in order to maintain the Insured Mortgage Reserve Fund at the level required under the Mortgage Security Insurance Regulation to ensure its solvency;
(5) the remaining proceeds of the sale of properties acquired by the Agency through the foreclosure of mortgages insured by the Agency;
(6) legislative appropriations from the General Fund of the Treasury of Puerto Rico or from any other source approved by the Legislature;
(7) appropriations from the Puerto Rico Economic Stimulus Fund, or
(8) any other fee established by the Authority for these purposes.
History —June 25, 1965, No. 87, p. 216, § 1; July 23, 1974, No. 215, Part 2, p. 123, § 1; Aug. 9, 1991, No. 57; Mar. 9, 2009, No. 9, § 16.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 19 - Insured Mortgages Reserve Fund (§§ 261 — 272) › § 262 - Mortgage Security Insurance Regulation

The Puerto Rico Housing Secretary, who hereafter shall be known as the Secretary, shall adopt a Mortgage Security Insurance Regulation providing for the establishment and maintenance of those actuarial reserves deemed by him necessary and adequate to insure the solvency of the Insured Mortgages Reserve Fund created hereunder. The Regulation on the Mortgage Security Insurance shall be exempt from the provisions of former §§ 1041—1059 of Title 3 but the Agency shall give it the proper diffusion and publicity for public knowledge. This regulation shall also provide the rules and conditions for insurance against any losses that through mortgage-secured obligations, either by reason of loans, credit advances, or the purchase of obligations evidenced by promissory notes, may be sustained by the Agency or other financial entities such as banks, trust companies, insurance companies, retirement systems, personal loan companies, mortgage investment companies, housing construction and loan associations, installment-loan companies, housing cooperatives, or any other institutions which the Secretary may determine that qualify through their experience, resources and facilities as eligible for such insurance. The Secretary may, from time to time, establish the maximum amount on any loan to be insured under this chapter.
History —June 25, 1965, No. 87, p. 216, § 2; July 23, 1974, No. 215, Part 2, p. 123, § 1.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 19 - Insured Mortgages Reserve Fund (§§ 261 — 272) › § 263 - Payment in debenture bonds

In those cases in which the Agency must discharge its liability assumed as Mortgage Insurer, it shall make the corresponding payment in debenture bonds, or in cash, from the moneys deposited in the Insured Mortgages Reserve Fund or in a merger of both to be determined by the Secretary.
History —June 25, 1965, No. 87, p. 216, § 3; July 23, 1974, No. 215, Part 2, p. 123, § 1.
2023 Laws of Puerto Rico › TITLE SEVEN - Banking (§§ 1 — 3116) › PART I - Banks (§§ 1 — 278) › Chapter 19 - Insured Mortgages Reserve Fund (§§ 261 — 272) › § 264 - Issuance of debenture bonds

All debenture bonds issued by the Agency in accordance with the provisions of this chapter shall be secured by the moneys deposited in the account of the Insured Mortgages Reserve Fund. Said debenture bonds shall bear such date, fall due on such date or dates, be redeemable before maturity with or without premium, draw interest at such rate or rates, be payable on such date or dates, and be executed, as the Secretary may determine.
History —June 25, 1965, No. 87, p. 216, § 4; July 23, 1974, No. 215, Part 2, p. 123, § 1.