By no longer requiring submission of income tax receipts filed with the Bureau of Internal Revenue, BSP Governor Amando M. Tetangco Jr. said the Monetary Board has effectively liberalized procedures governing money changers and their registration with the central bank.

The move seem to negate earlier plans to tighten rules on companies or entities dealing foreign exchange transactions.

The Financial Action Task Force, which removed the country from its list of non-cooperative countries and territories, has been asking the BSP to tighten its monitoring on moneychangers and remittance centers to avoid its misuse for money laundering.

It was also suggested that the BSP should require more documentary requirements and reporting of transaction from money changers and FX dealers as well as remittance agents.

The objective is to increase the transparency of payment flows through consistent anti-money laundering and counterterrorist financing measures on all forms of money or value transfer systems.

However Tetangco explained that they have eased documentary requirements for money changers by dropping the ITR requirements.

In the meantime the BSP is also mulling incentives to encourage FX dealers and remittance agents to register with the central bank.

Disappointed with the low turnout of registering foreign exchange dealers, moneychangers and remittance agents, the BSP is considering options such as giving out perks to encourage money transfer and FX dealers to submit their transactions to the central bank for better monitoring.

Of the estimated thousands of FX dealers and remittance center operators in the country, the BSP has so far registered only 2,000 and this is only in the Metro Manila areas.

The central bank is currently studying incentives to encourage more to register.

For agents or FX dealers that fail to report transactions with the BSP, possible sanctions are also being considered, in accordance to the Anti-Money Laundering Act of 2001.

The BSP had previously resisted the registration of non-bank institutions such as FX and moneychangers, however the sale and purchase of foreign currencies of these agencies must be reported back to the central bank.

Last January the BSP was considering imposing stricter rules on the reporting of foreign exchange movements, a requirement under the global anti-money laundering measures.

BSP Circular No. 507, which will take effect this month, require persons leaving the country to declare the foreign currency they will bring with them. This also means travelers checks, drafts, notes and money orders.

Foreign exchange denominated bonds, deposit certificates, securities, commercial papers, trust certificates, custodial receipts, trading orders, transaction tickets and confirmations of sale or investments will also have to be declared.

At the moment the government has no restrictions on the movements of foreign currency, however these amounts should be declared as stipulated in the Anti-Money Laundering Act.

According to the BSP, the circular also requires entities and persons in the business of buying and selling foreign currencies to register with BSP.

For purposes of this regulation, FX dealers and moneychangers will include those regularly engaged in the business of buying and or selling foreign currencies, while remittance agents will refer to persons or entities engaged in the business of remitting and transferring money and may include cash couriers and money transfer agents.