BSP Circular No. 1212 (Series of 2025) amends the FX Manual and MORB rules on FX sales, document submission, FX derivatives involving the peso, and related reporting. The updates tighten hedging limits, clarify electronic submission requirements, and revise reportorial obligations for banks and AAB forex corps.
Key Changes
- Hedging cap reaffirmed: total FX sold/hedged across AABs for a single underlying transaction cannot exceed the underlying amount at any time.
- Electronic submission rules clarified for FX applications and supporting documents, with attestation and retention requirements.
- Inward investments (Form W) filing moved to BSP online system with a one-year filing window.
- FX derivatives rules updated for customer hedging and bank proprietary transactions.
- No FX sale for exposures already fully covered by deliverable FX derivatives.
- Pretermination/roll-over tests defined for customer FX derivatives (eligibility, reasonability, counterparty, mark-to-market).
- Reporting revisions for NDFs and derivative cancellations/roll-overs.
- Appendix/annex updates and deletions across the FX Manual, plus MORB report adjustments.
Who Is Affected
- AABs and AAB forex corps handling FX sales and derivatives.
- Banks authorized to transact in FX derivatives (deliverable and non-deliverable).
- Non-bank BSP‑supervised entities that may be authorized as FX derivatives dealers.
- Compliance, treasury, and reporting teams managing FX documentation and reports.
Effective Date & Transition
The circular takes effect 15 banking days after publication in the Official Gazette or a newspaper of general circulation.
Transitory items
- BSP online filing for Form W will be covered by separate issuance; interim electronic submission remains in place.
- Revised Annex L, NDF reports, and Appendix 18.1 certification begin six months after effectivity; interim reports use old forms and processes.
Compliance Actions Checklist
- Update FX sale controls to enforce underlying-transaction caps across all AAB counterparties.
- Revise document submission workflows for electronic filing, attestation, and five‑year retention.
- Align FX derivatives documentation with Appendix 18 requirements.
- Enforce customer hedging rules (no FX purchase when deliverable hedges already cover exposure).
- Apply pretermination/roll-over tests and retain supporting evidence.
- Update reporting schedules for NDFs, cancellations, roll-overs, and new certifications.
FAQs
Can customers hedge FX exposure beyond the underlying transaction amount? No. FX derivatives notional amounts cannot exceed the underlying exposure at any time.
Are NDFs allowed for bank proprietary transactions? Yes, subject to BSP authorization and legitimate economic purpose requirements.
When do revised reports start? Six months after effectivity; interim reporting uses existing forms and submission methods.
Related Links
- Regulator hub: /regulations/bsp
- Topic hub: /regulations/topics/foreign-exchange
- Ask CHD: /chat (Ask CHD about this regulation)