Law on Payment and Settlement Systems for Securities

PURPOSE. This Law is of public order and social interest and has the purpose of regulating the proper functioning of payment systems and securities settlement systems that may be operated in the following systems:

• 1)

  Gross Settlement in Real Time (GSRT);

• 2)

  Interbank Fund Transfers;

• 3)

  Electronic Check Clearing;

• 4)

  Clearing of Electronic Payment Transactions;

• 5)

  Central Public Securities Depository (CDVP);

• 6)

  Payment Card Operations Clearing;

• 7)

  Public Fund Transfers;

• 8)

  Cross-Border Payment Transfer System;

• 9)

  Transactions through mobile devices using electronic money; and,

• 10)

  Any other that the Central Bank of Honduras (BCH) determines as such. It also regulates matters concerning the guarantees constituted by participants in payment systems and securities settlement systems, as well as the effects of insolvency procedures on operations and guarantees. It also has the purpose of establishing the legal framework within which the Central Bank of Honduras (BCH) exercises its function of ensuring the proper functioning of payment systems and securities settlement systems.

DEFINITIONS. For purposes of this Law, the following terms are understood as: 1) System Administrator: Entity responsible for the administration and operation of a payment system or securities settlement system, who must exercise the necessary actions to coordinate the performance of participants, in accordance with applicable regulations approved by the Central Bank of Honduras (BCH). 2) Central Public Securities Depository (CDVP): System of the Central Bank of Honduras (BCH) whose function is the provision of custody, clearing, and settlement services for duly authorized public securities. 3) Clearing: The conversion, in accordance with system regulations, of the rights and obligations derived from fund transfer orders or securities accepted by the system, into a single credit or credit obligation that is only enforceable as net credit or net obligation, without requiring express consent of the participants. 4) Payment Card Operations Clearing: Clearing system for payment orders originating from credit cards, debit cards, prepaid cards, or any other type of future payment cards. 5) Electronic Check Clearing: Check clearing system for checks issued by subscribers of Honduran banking system institutions, through electronic transmission of data and images and all general information contained in the check for its payment. 6) Clearing of Electronic Payment Transactions: Electronic clearing system in which payment orders are exchanged between financial institutions, principally through magnetic media or telecommunication networks and are administered by a data processing center. 7) Custody: Safekeeping and administration of securities and other financial instruments belonging to third parties. 8) Electronic Money: Monetary value enforceable in accordance with the amount paid that meets the following characteristics:

• 1)

  Stored in an electronic wallet;

• 2)

  Accepted as a payment facilitator by natural or legal persons;

• 3)

  Issued for an amount equal to the funds required;

• 4)

  Convertible into cash money at any moment;

• 5)

  Does not constitute a deposit; and,

• 6)

  Does not generate interest. 8) Electronic Document: Any representation of a fact, image, or document that is created, sent, communicated, or received by electronic means and stored with proper computer security to allow its later use. 9) Entity: Legal person of a public or private nature, legally authorized to administer or participate in an institutional payment system or securities settlement system. 10) Settlement Entity: The Central Bank of Honduras (BCH) is the entity where the accounts used as a basis for carrying out settlement operations of fund transfer orders or securities processed within a system are constituted. 11) Electronic Signature: Data in electronic form recorded or sent by a person or associated or logically associated with the same, that can be used to identify the signatory in relation to the data message and to indicate their willingness with respect to the information recorded in the data message. 12) Guarantee: Financial assets, money, or any other acceptable asset to assure the rights and obligations derived from the operation of a payment system or securities settlement system, in such a way that they protect the interests of its participants and end users. 13) Settlement: The act by which a payment obligation between two (2) participants or systems is extinguished in a payment system and which is perfected through the transfer and recording of corresponding funds from one participant's settlement account to another participant's settlement account in the Central Bank of Honduras (BCH). 14) Gross Settlement in Real Time (GSRT): System of continuous settlement of fund or securities transfers, individually (instruction by instruction), in real time and without netting. 15) Fund Transfer Order: Instruction given by a participant through a payment system to put at the disposal of the designated beneficiary in such instruction a specific amount of money or to assume or cancel a payment obligation as defined in the system regulations. 16) Securities Transfer Order: Instruction given by a participant through a securities settlement system to transmit to the designated beneficiary the ownership or any other right over specific securities. 17) Participant: Any financial institution, public or private entity, national or foreign, that has been admitted by the administrator of a system duly authorized by the Central Bank of Honduras (BCH), to process transfer orders in any payment system or securities settlement system, in accordance with the legal framework in force for that payment system or securities settlement system. 18) Insolvency Procedure: Any measure provided by law for the reorganization or closure of operations of an entity, which is intended to have the effect of suspending or imposing limitations on transfer orders or the suspension or imposing limitations on transfer orders or payments that the participant may or must perform. 19) Systemic Risk: Risk that the failure of a participant in a transfer system (or generally in financial markets) to fulfill its obligations may cause other participants or financial institutions to be unable in turn to fulfill their obligations (including settlement obligations in a transfer system) when due. Such failure may cause significant liquidity or credit problems and threaten the stability of financial markets. 20) Recidivism of the Offender: Natural or legal person that has been sanctioned by means of resolution and that commits a new offense of the same nature. 21) Payment System: Set of rules, agreements, instruments, and procedures whose main purpose is the execution of fund transfer orders accepted among its participating entities. 22) Payment Interconnection System (SIP): Regional payment system that has the purpose of facilitating payments generated by the exchange of goods and services among the countries of Central America and the Dominican Republic. 23) Public Securities Settlement System: Set of rules, agreements, and procedures whose main purpose is the execution of public securities transfer orders and, where applicable, fund transfers associated with the same. 24) Cross-Border Payment Transfer System: Payment transfers between participating entities located in more than one country or jurisdiction. 25) Supervision: Activity carried out by the National Banking and Insurance Commission (CNBS) based on its Law, which empowers it to inspect and review the operations of all supervised institutions as frequently as it deems necessary and without prior notice. 26) Payment Cards: For purposes of this Law, refers to credit cards, debit cards, financing cards, and any other type used as a means of payment for the acquisition of goods and services. 27) Transfers: From an operational point of view, the sending (or movement) of funds or securities or a right related to funds or securities, from one party to another by means of: (

  • i)

    transfer of money or physical instruments; (

  • ii)

    electronic clearing; (

  • iii)

    accounting records processed by a fund and/or securities transfer system. The act of transfer affects the legal rights of the transfer recipient and possibly of third parties in relation to the balance of money, securities, or other financial instruments being transferred. 28) Check Truncation: Procedure of substituting the original physical check with informational records or electronic images processed through the payment system, in which the entity receiving the check transmits to the drawee institution the relevant information about it, without the need to send the original physical document that has been truncated to carry out the operation. 29) Public or Governmental Securities: Fixed or variable income securities issued in national or foreign currency by the Central Bank of Honduras (BCH) or the State Department of Finance for budget purposes or others that are specifically authorized by the Board of Directors of the aforementioned Bank. 30) Private Securities: Any transferable titles or documents, including shares, bonds, futures, options, and other derivatives, participation certificates, and in general any security or investment title and other transferable obligations determined by the National Banking and Insurance Commission (CNBS). 31) Vigilance: Activity carried out by the Central Bank of Honduras (BCH) whose main purpose is to promote the smooth operation of payment systems and to protect the financial market from systemic risks.

SCOPE OF APPLICATION. This Law is applicable to:

• 1)

  Payment systems and public securities settlement systems, administrators, and their participants;

• 2)

  The guarantees that support transactions generated in the framework of the systems referred to in Article 1 of this Law; and,

• 3)

  Transactions derived from the application of monetary policy, credit operations, or those associated with the monetary, credit operations, or those associated with system settlement, carried out by the Central Bank of Honduras (BCH).

AUTHORIZATION. For the operation of a payment system, prior authorization by the Board of Directors of the Central Bank of Honduras (BCH) is required, except when that institution or the State Department of Finance act as administrators; with authorized payment systems being subject to the supervision of the National Banking and Insurance Commission (CNBS) and the vigilance of the Central Bank of Honduras (BCH). For its authorization, compliance with the provisions of the Administrative Procedure Law and the following minimum requirements must be met:

• 1)

  The administering entity must be constituted as a corporation with fixed capital, which may not be less than Thirty Million Lempiras (L.30,000,000.00), notwithstanding that the Central Bank of Honduras (BCH) may establish a higher amount depending on the volumes and amounts of transactions carried out by the system. The Central Bank of Honduras (BCH), based on economic performance, must review by resolution every two (2) years the minimum capital amount referred to in this Article. The administering entity has as its exclusive purpose the execution and, where applicable, the clearing of fund transfer orders or securities. The fact that a system also executes transfer orders for other types of authorized assets or financial instruments in the terms provided in this Law;

• 2)

  Request authorization from the Central Bank of Honduras (BCH) of its internal operating regulations, which must be framed within the general regulations that it establishes; and,

• 3)

  The specific requirements that the Central Bank of Honduras (BCH) establishes for each system. For purposes of the authorization provided in this Article, the Central Bank of Honduras (BCH) must require the indemnifications or liabilities that precede, according to the legal system in force.

INFORMATION OBLIGATIONS. The administrators of payment systems or securities settlement systems must inform the Central Bank of Honduras (BCH) and the National Banking and Insurance Commission (CNBS) about their direct participants; likewise, administrators must inform of their participation in other national or foreign payment systems or securities settlement systems and about the regulations that govern such systems. In turn, direct participants of the aforementioned systems must inform the Central Bank of Honduras (BCH) and the National Banking and Insurance Commission (CNBS) of their participation in any national or foreign payment system or securities settlement system. The Central Bank of Honduras (BCH) must publish on its website or on any other written medium of national circulation, the list of recognized national payment systems, authorized administrators, as well as direct participants.

IRREVOCABILITY OF TRANSFER ORDERS. Transfer orders sent through a payment system or securities settlement system by its participants, once received and accepted in accordance with system regulations, are irrevocable for the originator.

FIRMNESS OF TRANSFER ORDERS. Orders referred to in Article 6 above are firm, binding, and legally enforceable against the participant obligated to their performance and enforceable against third parties, and cannot be annulled or challenged for any reason, once they have complied with the clearing that takes place among them as applicable; likewise, the obligations resulting from such clearing are, to assure the correct performance of accepted transfer orders or the clearing carried out. Without affecting in any way the firmness of operations referred to in the preceding paragraph, the rights of those who might consider themselves affected are reserved, without prejudice to the indemnifications or liabilities that precede, according to the legal system in force.

RESPONSIBILITY OF THE SYSTEM ADMINISTRATOR AND SETTLEMENT ENTITY. The system administrator and settlement entity are obligated to guarantee or supply the lack of cash or securities of a participant, in order to carry out the settlement of an order in its corresponding amount, nor to use for such purpose means other than those provided in the system regulations.

UNATTACHABILITY OF ACCOUNTS. For the purpose of effectively guaranteeing the settlement of transfer orders, it is prohibited to issue an attachment order against any deposit account constituted by participants in the Central Bank of Honduras (BCH) or in another institution authorized by it, for the exclusive use of settling fund transfer orders or securities processed through an authorized payment system or securities settlement system.

CHECK TRUNCATION. In addition to the provisions of the Commercial Code and the Financial System Law, the presentation of a check at a clearing house through notification of its essential elements via electronic means has the same effects as the presentation of the physical check. For purposes of its truncation, the essential elements of the check are the following:

• 1)

  The check number;

• 2)

  The code that identifies the drawee bank;

• 3)

  The account number of the check drawer;

• 4)

  The sum of money to be paid;

• 5)

  The signature of the drawer; and,

• 6)

  Place and date of issuance.

OPERATIONS WITH CHECKS DRAWN AGAINST BANKS DOMICILED ABROAD. In the case of checks drawn in any currency against accounts in banks domiciled abroad and in whose operations a bank domiciled in the country participates, the interested party may request from the foreign bank, through the bank domiciled in the country, a paper reproduction of the image of the original check, which must contain all information from the front and back of the same that, for legal purposes in the country, must be considered as the original check.

ELECTRONIC SIGNATURE. For purposes of granting full legal validity to transfers sent through a payment system or securities settlement system, the orders issued for that purpose may be authorized through electronic signatures with equal legal value as handwritten signatures, notwithstanding the provisions of the Financial System Law, Electronic Signature Law, and other legislation governing the matter.

CONSTITUTION OF GUARANTEES. The guarantees granted by participants, in accordance with the regulations of payment systems and securities settlement systems, must adequately back the accepted transfer orders and the clearing and settlement that result from them. Resources from participant accounts must fully cover accepted transfer orders and the clearing and settlement that result from them.

EXCLUSIVITY OF GUARANTEES. For the purpose of protecting participants and end users of a payment system or securities settlement system, guarantees constituted to assure the performance of fund transfer orders or securities settlement, are exclusive and affected for such purpose, therefore unattachable.

EXECUTION OF GUARANTEES. In the event that execution of the guarantees referred to in Article 13 above is required, it must be carried out without need for any judicial proceeding and the product of such execution must be used, as appropriate, to pay the obligations derived from accepted fund or securities transfer orders, their clearing and settlement, as well as obligations contracted in favor of the Central Bank of Honduras (BCH) for credit operations carried out with participants in payment systems or securities settlement systems. In the event that the guarantees are not sufficient at the time of their execution to fulfill the obligations referred to in the preceding paragraph, participants who are creditors may enforce their rights against debtor participants in accordance with applicable provisions, without affecting the operation of the system. In the event that a guarantee execution results in a balance, this must be placed at the disposal of the participant or in the case of whoever proved their right to such balance.

DETERMINATION AND NOTIFICATION OF THE INITIATION OF AN INSOLVENCY PROCEEDING. An insolvency proceeding of a participant in a payment system or securities settlement system shall be understood as initiated when the competent authority, on its own motion before it, initiates the process for the declaration of suspension of payments or issues a resolution declaring the liquidation of a financial institution, or when a petition is filed before the competent judicial authority for the declaration of bankruptcy of a participant. Without prejudice to the supervision or surveillance obligations of the competent authorities, participants in a payment system or securities settlement system must immediately inform the Central Bank of Honduras (BCH), the National Commission of Banks and Insurance (CNBS), and the system administrator of which they are a part, of any legal action or initiative of which they have or should have knowledge, which could lead to their declaration of bankruptcy in accordance with the provisions of the Commercial Code.

EFFECTS ON TRANSFER ORDERS AND COMPENSATIONS. The initiation of an insolvency proceeding of a participant in a system does not affect the obligations of said participant when:

• 1)

  They derive from transfer orders received and accepted by the system prior to the moment when the initiation of the insolvency proceeding has been communicated to the system or, exceptionally, have been processed after said initiation and are compensated and settled on the same day, provided that the system administrator can verify that it has not been informed of the initiation of said proceeding;

• 2)

  They result from the compensation that, if applicable, is carried out between said orders on the same day the communication is received; and,

• 3)

  Have as their purpose the settlement on said day of any other commitments provided by the system to ensure the correct performance of the accepted transfer orders or the compensation carried out. These obligations must be settled, in accordance with the regulations of the system, charged against the guarantees, assets, and other commitments established for these purposes by the system itself.

EFFECTS ON GUARANTEES. In the case of initiation of an insolvency proceeding of a participant in a system, its administrator or the liquidating entity and, if applicable, the other participants in the same system, shall enjoy the right of segregation with respect to guarantees constituted by the participant itself or a third party, in their favor; that is, that the same are not affected by the insolvency proceeding nor can seizure be declared upon them, ordered by an administrative or judicial authority. Said right of segregation also assists the Central Bank of Honduras (BCH) with respect to guarantees constituted in its favor by any entity that is its counterparty or guarantor in operations linked to monetary policy, credit operations, or associated with the settlement of the systems. In particular, neither the constitution nor the acceptance of the guarantees referred to in the preceding paragraph, nor the balance of the accounts or records in which they are materialized, are challengeable in the case of retroactive measures linked to insolvency proceedings. Guarantees are also not subject to replevin. The cash and securities in which the guarantees are materialized, even in the case of initiation of an insolvency proceeding, the administrator, the liquidating entity of the system, or the Central Bank of Honduras (BCH), as appropriate, must proceed in the case of securities to their disposition. For the disposition of securities until delivery by the beneficiary of the guarantee, together with the certification issued by the Central Bank of Honduras (BCH), which certifies the amount of matured, settled, and demandable amounts that are executed, accompanied by the securities themselves or a certificate evidencing their registration in the corresponding registry. The date of constitution of the guarantee that appears in the books or registry of the system or the Central Bank of Honduras (BCH), as well as the balance and date that appear in the aforementioned certification, are proof against the entity that granted them and against third parties. Notwithstanding the provisions of the preceding paragraphs, when it is an insolvency process, it shall be established that the settlement of the corresponding obligations charged against the cited guarantees must be incorporated into the patrimonial assets of the participant subject to the insolvency proceeding. CHAPTER VII VIGILANCE AND SUPERVISION OF PAYMENT SYSTEMS AND SECURITIES SETTLEMENT SYSTEMS

VIGILANCE. The Central Bank of Honduras (BCH) must ensure the proper functioning, security, and efficiency of public payment systems and securities settlement systems. To this end, it must monitor the systems, their administrators, and the operations of the participants. Said vigilance is achieved at least through:

• 1)

  Verifying compliance with the basic internationally accepted principles of systemically important payment systems, securities settlement systems, and other applicable regulations, as well as any other principles or international guidelines that may be issued on the matter, so as to ensure the efficient functioning of these systems, regardless of whether they are operated by the Central Bank of Honduras (BCH) or by another public or private administrator;

• 2)

  Carrying out, in coordination with the National Commission of Banks and Insurance (CNBS), strict monitoring of the functioning of payment systems, in order to identify and assess the nature and magnitude of their risks, their control systems, and the mechanisms established for cases of noncompliance; and,

• 3)

  Ensuring the transparency of the regulations governing payment and securities settlement instruments and services.

FULFILLMENT OF THE DUTY OF VIGILANCE. For the proper fulfillment of its duty of vigilance, the Central Bank of Honduras (BCH) must:

• 1)

  Request from the administrators of payment systems, securities settlement systems, their participants, and service providers of these systems, such information as is necessary to verify their efficiency and security. Said information must be provided on the terms and deadlines determined by the Central Bank of Honduras (BCH);

• 2)

  Establish for the administrators of payment systems and securities settlement systems mandatory compliance adjustment programs, aimed at eliminating irregularities, when deficiencies are detected that could affect their proper functioning, put at risk the security of orders processed through the system, or involve serious noncompliance with current regulations;

• 3)

  Suspend and even nullify the decisions adopted by an administrator of an authorized payment system and adopt appropriate measures, when it considers that said decisions violate current regulations or substantially affect the development of settlement processes of orders introduced into the system;

• 4)

  Request from the National Commission of Banks and Insurance (CNBS) such additional information as it considers appropriate to fulfill its supervision function;

• 5)

  Publish statistics on payment systems and any other information that is relevant for greater transparency; and,

• 6)

  Issue the necessary regulations for the functioning of payment systems, in accordance with the provisions of this Law and other current legal provisions.

MANDATORY INCORPORATION AS PARTICIPANT. The Central Bank of Honduras (BCH), in coordination with the National Commission of Banks and Insurance (CNBS), may require that a legal entity conducting payment or securities settlement operations through a participant or independently, be incorporated as a mandatory participant in the system, remaining subject to the supervision of the National Commission of Banks and Insurance (CNBS) and to the vigilance of the Central Bank of Honduras (BCH). This decision must be notified to the new participant and to the system administrator for compliance.

POWERS OF THE CENTRAL BANK OF HONDURAS (BCH) AS ADMINISTRATOR OF PUBLIC PAYMENT AND SECURITIES SETTLEMENT SYSTEMS. The Central Bank of Honduras (BCH), in order to promote the proper functioning of payment systems and securities settlement systems, may implement and administer systems and corresponding internal operating regulations, adopting the necessary measures to ensure the separation of these functions from those derived from its duty of vigilance over the systems. The Central Bank of Honduras (BCH), as a support mechanism for liquidity management functions and implementation of monetary policy, must also exercise functions proper to a central depository of public securities. The Central Bank of Honduras (BCH) may provide custody and administration services for private securities through the central depository of public securities, for which its Board of Directors must issue the corresponding resolution.

SUPERVISION OF DIRECT PARTICIPANTS IN THE SYSTEMS. Within the powers of supervision, inspection, and sanctions that correspond to it pursuant to its Law, other laws, and applicable regulations, the National Commission of Banks and Insurance (CNBS) must supervise that all direct participants in the systems maintain adequate solvency that allows them to timely meet their obligations within the system, and verify that they comply with the obligations contained in the Law Against the Crime of Money Laundering, in its regulations and other provisions issued by the Central Bank of Honduras (BCH) and the National Commission of Banks and Insurance (CNBS) related to the matter. When it involves private foreign participants, supervision agreements must exist between the National Commission of Banks and Insurance (CNBS) and its counterparts in the countries of origin, prior to their admission to a system. In the case of the Central Bank of Honduras (BCH), the supervisory attributions that the National Commission of Banks and Insurance (CNBS) exercises over the Central Bank of Honduras (BCH) must be limited to the proper banking operations that it carries out. CHAPTER VIII CRIMES, INFRACTIONS, AND ADMINISTRATIVE SANCTIONS

CRIMINAL OFFENSES. The following are financial crimes, punishable in accordance with the Penal Code:

• 1)

  Noncompliance with the provisions of Article 4 of this Law incurred by members of the board of directors or administrative council and officials involved in the society administering the payment system or securities settlement system. In this case, the penalties established in Article 394-B of the Penal Code are applicable;

• 2)

  Noncompliance with the provisions of the second paragraph of Article 16 of this Law, by members of the board of directors or administrative council and the legal representative of the participating entity, the penalty established in Article 394-F of the Penal Code is applicable; and,

• 3)

  The omission incurred by members of the board of directors or administrative council and the legal representative of the society administering the system, Central Bank of Honduras (BCH), when it is within their knowledge that a participant has been subject to one of the insolvency proceedings indicated in Article 16 of this Law. In this case, the penalty established in Article 394-F of the Penal Code is applicable.

ADMINISTRATIVE INFRACTIONS. Administrative infractions are constituted by any action or omission incurred by direct participants, system administrators, their officials and employees, that violate the provisions of this Law, the regulations, resolutions, and other provisions issued by the Central Bank of Honduras (BCH) and the National Commission of Banks and Insurance (CNBS), without prejudice to the obligation that participants have to comply with other laws insofar as they are applicable to payment systems and securities settlement systems. The following are also administrative infractions:

• 1)

  Noncompliance with the obligation to submit information referred to in numeral 1) of Article 20 of this Law;

• 2)

  Noncompliance with the adjustment programs stipulated in numeral 2) of Article 20 of this Law;

• 3)

  Operating as a payment system or securities settlement system without prior authorization from the Board of Directors of the Central Bank of Honduras (BCH);

• 4)

  Modifying the internal operating regulations of a payment system or securities settlement system without authorization from the Central Bank of Honduras (BCH);

• 5)

  Failing to adjust the internal operating regulations of the Payment System in accordance with general provisions that, if applicable, are issued by the Central Bank of Honduras (BCH) or failing to make the modifications that it requires within the period it determines; and,

• 6)

  Providing false information related to the payment system or securities settlement system. The knowledge, investigation, and sanctioning of administrative infractions corresponds to the National Commission of Banks and Insurance (CNBS) in accordance with the following Article. In accordance with (CNBS) in accordance with the following Article.

SANCTIONING OF ADMINISTRATIVE INFRACTIONS. The administrative infractions indicated in the preceding Article must be sanctioned taking into account the current minimum salary established for financial institutions in the following manner:

• 1)

  Fine of up to two (2) times the monthly minimum salary for each day of noncompliance, in the case of numeral 1);

• 2)

  Fine of up to five (5) times the monthly minimum salary for each day of noncompliance, in the case of numeral 2), until it has been proven that the adjustment programs have been executed in full by the payment system administrator;

• 3)

  Fine of up to ten (10) times the monthly minimum salary and immediate suspension of the system, in the case of the infractions indicated in numerals 3), 4), and 5), until such time as compliance with the provisions of Article 4 of this Law is achieved or the modifying act is nullified; and, 4) Fine of up to ten (10) times the monthly minimum salary, definitive suspension, and cancellation of the authorization to operate as a payment system or securities settlement system in the case indicated in numeral 10). Fines imposed on financial system institutions must be deposited in the Deposit Insurance Fund (FOSEDE); those imposed on Securities Brokerage Firms and Stock Exchanges must be deposited in the Guarantee Fund referred to in the Securities Market Law, and those imposed on other participating entities must be delivered to the General Treasury of the Republic. The procedure for payment of fines must be in accordance with the provisions of the Law of the Financial System. The imposition of sanctions for administrative infractions must be executed without prejudice to the deduction of criminal responsibility that corresponds given the gravity thereof, with the National Commission of Banks and Insurance (CNBS) required to file the respective complaints with the competent authorities, in accordance with the provisions established in the preceding Article 24 of this Law and the current Penal Code.

CRITERIA FOR VALUATION OF SANCTIONS. Sanctions for administrative infractions provided for in Article 26 of this Law shall be graduated, insofar as they are applicable, taking into account one or more of the following valuation criteria:

• 1)

  The gravity of the fault;

• 2)

  The threat or damage caused;

• 3)

  The duration of the violating conduct; and,

• 4)

  The recidivism of the offender. CHAPTER IX GENERAL PROVISIONS

AUTHORIZATION OF ADMINISTRATORS AND RECOGNITION OF PAYMENT SYSTEMS AND SECURITIES SETTLEMENT SYSTEMS. The following are authorized as administrators and recognized as payment systems and securities settlement systems:

• 1)

  The systems administered and operated by the Central Bank of Honduras (BCH): Electronic Foreign Exchange Trading System (SEND), Book Entry System, Fund Transfer System (STF), Payment Interconnection System for Central America and Dominican Republic (SIP), Central Banking System of Honduras in Real Time (BCH-TR), and Securities Depository of the Central Bank of Honduras (DV-BCH);

• 2)

  The system administered by the State Secretariat of Finance: Comprehensive System of Financial Administration - Treasury Module (SIAFI Treasury); and,

• 3)

  The systems administered by the Interbank Processing Center (CEPROBAN): Electronic Check Clearing Chambers (CCECH) and Electronic Payment Transaction Compensation (ACH Pronto). All system administrators operating at the time this Law enters into force must certify to the Central Bank of Honduras (BCH) compliance with the requirements established in this Law and their commitment to comply with the regulations and other provisions issued by the Central Bank of Honduras (BCH).

REGULATORY AUTHORITY. Except as regards the sanctioning regime which is the responsibility of the National Commission of Banks and Insurance (CNBS), it is the responsibility of the Central Bank of Honduras (BCH) to issue the regulations and adopt the necessary internal operating regulations of each of the payment systems and securities settlement systems.

This Law shall enter into force as of the day of its publication in the Official Gazette "LA GACETA". Given in the city of Tegucigalpa, municipality of the Central District, in the Session Hall of the National Congress, on the twenty-ninth day of the month of April in the year two thousand fifteen. MAURICIO OLIVA HERRERA PRESIDENT MARIO ALONSO PÉREZ LÓPEZ SECRETARY JOSÉ TOMÁS ZAMBRANO MOLINA SECRETARY To the Executive Branch. Therefore: Let it be executed. Tegucigalpa, M.D.C., June 12, 2015. JUAN ORLANDO HERNÁNDEZ ALVARADO PRESIDENT OF THE REPUBLIC THE SECRETARY OF STATE IN THE OFFICE OF FINANCE.