Santo Domingo. Dominican Republic. The Monetary Board held an ordinary session today corresponding to the month of September, in which it learned about and approved the results of the modification of the Exchange Regulations, a process submitted to public consultation during the month of August 2025, with the purpose of promoting order and transparency in the foreign exchange market.
The modification pursued three fundamental objectives. Firstly, to adapt the regulatory framework of the current foreign exchange market. This will allow the incorporation of a greater number of participants in the Central Bank’s electronic foreign exchange trading platform, including currency intermediaries and other financial intermediation entities. This will imply that all foreign currency purchase and sale transactions greater than US$10,000.00 and EUR$10,000.00 must be reported to the Central Bank through the electronic foreign exchange trading platform.
This way, the Central Bank of the Dominican Republic will have greater visibility over foreign exchange market operations, by capturing more complete information on prices and volumes traded in real time, in accordance with the principles of transparency, efficiency and effectiveness that underpin exchange rate policy.
Secondly, conduct guidelines applicable to all participants in the foreign exchange market were established, aimed at ensuring the best execution of foreign exchange transactions, which implies that all market players must operate for the benefit of their clients, guaranteeing the best prices, speed in the execution of their buy and sell orders of currencies, and transparency.
In practical terms, these new guidelines ensure that foreign exchange buying and selling operations are carried out at fair and transparent prices, avoiding significant deviations from the market reference rate. These provisions align with international best practice standards, such as those contained in the Global Code of Conduct for the Foreign Exchange Market, whose application will now also extend to currency intermediaries and other financial intermediation entities.
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This will imply that the margins between the buying and selling of currencies, both in the retail and wholesale segments, must be in line with market conditions, in line with best international practices.
Likewise, the Monetary Board ordered the Central Bank to sanction and suspend the foreign exchange operations of authorized participants through the electronic foreign exchange trading platform, who engage in practices contrary to current regulations, in particular those related to exchange rate margins, as well as any other breach of good conduct standards that affect the orderly functioning of the foreign exchange market or provisions related to the reporting of information through this system.
On the other hand, the measures adopted by the Monetary Board increase the capital levels to operate as a foreign exchange intermediary and increase the requirement for additional equity reserves, depending on the nature and volume of the operations of said entities. These provisions strengthen the operational framework of these entities and promote a safer and more resilient foreign exchange market.
Finally, the measures approved by the Monetary Board are complemented by the other prudential measures adopted in March 2025, to mitigate exchange rate-credit risk in an environment of global uncertainty, determining stricter limits for net positions in foreign currency, which were reduced to 25% of capital, as well as the reduction of the weekly increase of the same, going from US$10 million to US$5 million.
