R-CNMV-2025-01-MV — Regulation for Public Offering Trust Fiduciaries, Securitization Companies, and Autonomous Assets in Securitization Processes

CERTIFICATION

The undersigned, Mr. Ervin Novas Bello, Manager of the Central Bank of the Dominican Republic (hereinafter "Central Bank"), on behalf of the Governor of the Central Bank, ex officio member and President of the National Securities Council (hereinafter "Council"); and Mrs. Fabel María Sandoval Ventura, Secretary of the Council, CERTIFY that the text below constitutes a complete copy transcribed in accordance with the original of the First Resolution, R-CNMV-2025-01-MV, adopted by the Council in the meeting held on the twenty-fifth (25) day of February of the year two thousand twenty-five (2025), which is kept in the archives of this Secretariat, namely:

"FIRST RESOLUTION OF THE NATIONAL SECURITIES COUNCIL OF DATE TWENTY-FIVE (25) OF FEBRUARY OF THE YEAR TWO THOUSAND TWENTY-FIVE (2025). R-CNMV-2025-01-MV REFERENCE: Approval of the Regulation for Public Offering Trust Fiduciaries and Securitization Companies and Autonomous Assets in Securitization Processes.

WHEREAS:

That, through communication received on the thirteenth (13) day of February of the year two thousand twenty-five (2025), the Superintendent of the Securities Market (hereinafter "Superintendent") brought to the knowledge and consideration of the National Securities Council (hereinafter "Council") the draft Regulation for Public Offering Trust Fiduciaries and Securitization Companies and Autonomous Assets in Securitization Processes (hereinafter "Draft Regulation"), with the aim of receiving final sanction.

That in accordance with the powers recognized by Law No. 249-17 of the Securities Market of the Dominican Republic, which repeals and substitutes Law No. 19-00 of May 8, 2000, promulgated on December 19, 2017, and its modification (hereinafter "Law No. 249-17"), and the Internal Regulation of the Council, adopted by this collegiate body through the First Resolution, R-CNMV-2018-06-MV, issued on November 29, 2018 (hereinafter "Internal Regulation of the Council"): the Council, duly convened and validly sitting, deems it appropriate to expose the following:

CONSIDERING:

That from the combined reading of articles 6 and 7 of Law No. 249-17, it is derived that the Securities Market Superintendence (hereinafter "Superintendence") constitutes an autonomous and decentralized organism of the State, with administrative, financial, and technical autonomy, whose object is to promote an orderly, efficient, and transparent securities market, protect investors, ensure compliance with the aforementioned law, and mitigate systemic risk.

That article 10 of the aforementioned legal statute provides that the Superintendence is integrated by a collegiate body, the Council, and an executive official, the Superintendent; who has in his charge the direction, control, and representation of the institution.

That the aforementioned law, in the capital part of its article 13, establishes that the Council is the superior and supreme organ of the Superintendence, with functions essentially of a normative, supervisory, and control nature.

That, in addition to the above, article 13, in numeral 4, recognizes to the Council the faculty to periodically review the regulatory framework of the securities market, adapting it to market trends and realities, and to propose, on its own initiative or upon proposal of the Superintendent, the modifications that are necessary.

That in accordance with article 17, numeral 14, of Law No. 249-17, the Superintendent is invested with the attribution to "[i]ssue the resolutions, circulars, and instructions required for the development of this law and its regulations."

That, likewise, article 25 of Law No. 249-17 reiterates that "[t]he Council is the competent organ to establish the regulations relative to the activities of the securities market indicated in this law."

That paragraph 1 of said article adds that "[i]n the exercise of regulatory power, the Council and the Superintendence will observe the principles of legality and the rules of public consultation, participation, and transparency contained in the Constitution of the Republic and the laws in force."

That, on this particular, article 37 of the Internal Regulation of the Council establishes that "[t]he preparation of drafts and their placement in prior public consultation is the responsibility of the Superintendent of the Securities Market."

That it is worth highlighting that article 2 of the aforementioned Law No. 249-17 reveals that the provisions contained in said legal statute apply to all natural and legal persons who carry out activities, operations, and transactions in the securities market of the Dominican Republic, with public offering values that are offered or negotiated within the national territory.

That in accordance with article 3, numeral 33, of Law No. 249-17, participant of the securities market "[i]s the natural or legal person, inscribed in the Securities Market Registry and regulated by the Securities Market Superintendence."

That, in this regard, article 36 of the aforementioned law establishes that "[t]he Superintendence will have a Registry available to the public, which may be electronic, and in it will be inscribed the natural and legal persons who participate in the securities market, as well as the public information regarding the values inscribed in the Registry and of the participants of the securities market regulated by this law."

That article 146 of Law No. 249-17 provides that "[o]nly securitization companies and fiduciaries authorized to carry out public offering trusts of values authorized by the Superintendence and inscribed in the Registry, may develop and administer securitization processes."

That, further ahead, article 147 of the precited legal norm specifies that securitization companies will have as their exclusive object to structure, constitute, represent, and administer assets in securitization processes, to carry out the issuance of the corresponding values and to administer integrally the securitization process. It is added that, to administer public offering trusts, fiduciary companies must contemplate these attributions in their corporate object.

That, in addition to the above, paragraphs I and II of the aforementioned article establish that securitization companies will have as their object the acquisition, with own resources, of assets or goods within a securitization process, to keep them in their balance sheet in development of their corporate object; and that both the securitization companies and the fiduciaries will have in their charge the administration, the legal representation, and the defense of the interests of one or more separate assets or public offering trusts, as applicable.

That through communication received in the Secretariat of the Council on the thirteenth (13) of February of two thousand twenty-five (2025), the Superintendent brought before this collegiate body a request by means of which he sought the final sanction of the Draft Regulation in question.

That, from the reading of the aforementioned missive, it is inferred that the object of said draft is to establish the requirements for the authorization and inscription in the Securities Market Registry of the legal persons who wish to act as fiduciary companies for public offering trusts of values or public offerings charged to the trusts they administer or as Securitization Companies, as well as the action of these in name and representation of the autonomous assets in securitization processes they administer. Likewise, to dispose of the requirements, functioning, and procedure for the exclusion of public offerings of securitized values or trusts.

That the indicated communication manifests that, in compliance with the applicable current legal order, through the Second Resolution, R-CNMV-2023-23-MV, of date seven (7) of November of the year two thousand twenty-three (2023), the Council authorized the public consultation of the Draft Regulation, from the twenty-nine (29) of November of two thousand twenty-three (2023), until the six (6) of February of two thousand twenty-four (2024).

That, likewise, from the documents accompanying the communication of the Superintendent, it stands out that, as a result of said consultative process, comments were received from: the Dominican Association of Fund Administrating Societies, Inc. (ADOSAFI), the Dominican Association of Stock Exchanges, Inc. (APB), the BHD Financial Center, the Securitization Company of the Caribbean (TICA), the Association of Dominican Fiduciary Societies, Inc. (ASOFIDOM), the entity Stock and Securities Markets S.A. (BVRD), the OMG Institute; as well as from Mr. Juan Ernesto Jiménez.

That it is highlighted that the technical body involved in the analysis of the observations and comments presented by the market includes officials and collaborators from the Directions of Regulation and Innovation, of Public Offering, and of Participants.

That from the pieces that compose the file, a matrix is highlighted that collects the observations and comments presented, duly analyzed and responded to by the technical team of the Superintendence; subsequently, as part of the administrative procedure and in attention to the principles of transparency and participation, a working table -in virtual modal- was held with the interested sectors on the days five (5) and six (6) of June of two thousand twenty-four (2024).

That, subsequently, thanks to the Second Resolution, R-CNMV-2024-14-MV, of date fifteen (15) of October of two thousand twenty-four (2024), the Council authorized a complementary public consultation, which took place from the fourteenth (14) of November of two thousand twenty-four (2024), until the thirteenth (13) of December of two thousand twenty-four (2024); with the object of including provisions that incorporate and regulate the obligation to maintain a Net Worth Adequacy Index (IAP) by the entities subject to the scope of the Draft Regulation.

That, corollary of the above, comments were received from the Securitization Company of the Caribbean (TICA), and the entity Stock and Securities Markets S.A. (BVRD).

That, likewise, in the documents presented to the Council, there is a list of relevant data in which it is explained that the Draft Regulation contemplated the following improvements from the consultation processes, namely:

• The wording of the Object is adapted.
• The wording of some Definitions is adapted.
• The paragraph indicating how the phases would be developed is eliminated.
• The three (3) day deadline for the review of documents presented before the Superintendence is incorporated.
• The wording is modified to incorporate "corporate name" and at the same time eliminate the corporate object and the mention of general data since they are legal persons.
• The certificates required that are issued by the General Directorate of Internal Taxes are clarified.
• It is established that the prior inspection must be notified to the applicant.
• The wording linked to the requirements requested from the Fiduciary Manager is modified.
• A paragraph is included that establishes that the administrator of Separate Assets cannot have any participation in the valuation, accounting, transfer, custody of the assets of the asset, promotion, and commercialization procedures of said asset.
• It is incorporated that the obligation to report to the Superintendence the deviations that may seriously affect the Administrators, is carried out without prejudice to the obligation to inform its board of directors.
• The shareholders and related persons are eliminated from the wording in the general conduct norms.
• It is incorporated that the insurance will be constituted at the expense of the same, must cover one hundred percent (100%) of the replacement value of the Underlying Asset.
• It is included that accounts must be rendered in accordance with what is established in Law No. 189-11.
• The exception from the program of issuances of securitized values or trusts that the Underlying Asset is a mortgage credit portfolio is eliminated.
• The deadlines of the pre-operational phase are increased.
• The article related to Economic Rights is incorporated."

That, in attention to all that has been exposed above, pondering the reports and documentation rendered by the technical area of the Superintendence, this collegiate organism is of the opinion that the Draft Regulation can be accepted favorably.

HAVING SEEN:

a. The Constitution of the Dominican Republic, voted and proclaimed by the National Assembly on the twenty-seventh (27) of October of two thousand twenty-four (2024). b. Law No. 249-17, of the Securities Market of the Dominican Republic, which repeals and substitutes Law No. 19-00, of May 8, 2000, of date December 19, 2017, and its modification. c. Law No. 107-13, on the Rights of Persons in their Relations with the Administration and of Administrative Procedure, of date August 6, 2013. d. Law No. 200-04, General of Free Access to Public Information, of date July 28, 2004. e. The Regulation of the General Law of Free Access to Public Information, approved through Decree No. 130-05, of date February 25, 2005. f. The Internal Regulation of the National Securities Council, dictated through the First Resolution, R-CNMV-2018-06-MV, of date November 29, 2018. g. The Second Resolution, R-CNMV-2023-23-MV, of date November 7, 2023, by means of which the Council authorized the public consultation of the Draft Regulation for Public Offering Trust Fiduciaries and Securitization Companies and Autonomous Assets in Securitization Processes. h. The Second Resolution, R-CNMV-2024-14-MV, of date October 15, 2024, by means of which the Council authorized a complementary public consultation of the Draft Regulation for Public Offering Trust Fiduciaries and Securitization Companies and Autonomous Assets in Securitization Processes. i. Communication of date February 13, 2025, signed by the Superintendent of the Securities Market, and annexes cited. j. The other documents that integrate the file.

THEREFORE:

After having studied and deliberated on the matter, the National Securities Council, in the exercise of the faculties conferred upon it by Law No. 249-17, by unanimous vote of its members, attending to the motives exposed,

RESOLVES:

FIRST: APPROVE the definitive version of the Draft Regulation for Public Offering Trust Fiduciaries and Securitization Companies and Autonomous Assets in Securitization Processes; according to the document presented by the Direction of Regulation and Innovation, through the Superintendent, whose content is copied textually below:

"DRAFT REGULATION FOR PUBLIC OFFERING TRUST FIDUCIARIES AND SECURITIZATION COMPANIES AND AUTONOMOUS ASSETS IN SECURITIZATION PROCESSES"

TITLE I GENERAL PROVISIONS

Article 1°.- Object. This Regulation has as its object to establish the requirements for the authorization and inscription in the Securities Market Registry (hereinafter, the "Registry") and functioning of the legal persons who wish to act as fiduciary companies to administer Trusts under which Public Offering Values are issued (hereinafter, the "Public Offering Trust Fiduciaries") or as securitization companies, as well as the action of these in name and representation of the Autonomous Assets in Securitization Process that they administer. Likewise, to dispose of the requirements, functioning, and procedure for the authorization and exclusion of public offerings of securitized values or Trusts.

Article 2°.- Scope. The legal persons constituted as anonymous societies whose object is to structure, constitute, represent, and administer Autonomous Assets in Securitization Process and to issue securitized values or Trust values, as applicable, charged to the same, are subject to the formalities provided in this Regulation.

Paragraph. Also subject to the provisions of this Regulation are the natural and legal persons who participate in the Securitization Processes insofar as the activities, obligations, and responsibilities derived from them are concerned.

Article 3°.- Definitions. Without prejudice to what is established in article 3 of Law No. 249-17 of December 19, 2017, of the Securities Market of the Dominican Republic, which repeals and substitutes Law No. 19-00 of May 8, 2000 (hereinafter, the "Law No. 249-17") and its application regulations, Law No. 189-11 for the Development of the Mortgage Market and Trust in the Dominican Republic, of July 16, 2011 (hereinafter, the "Trust Law") and the Application Regulation of the Trust Law issued through Decree No. 95-12 of March 2, 2012, for the purposes of this Regulation, the following terms are defined:

1. Underlying Asset. These are the goods or assets susceptible to a Securitization Process established in article 134 of Law No. 249-17.

2. Administrator of Securitization Processes. These are the securitization companies and the Public Offering Trust Fiduciaries, as applicable, in charge of the administration of the Autonomous Assets in Securitization Processes.

3. Administrator of the Underlying Asset of Securitization. It is the Administrator of Securitization Processes or the legal person delegated by this, in charge of carrying out the functions of conservation, custody, and administration of the goods or assets that form the Underlying Asset transferred to the Autonomous Asset in Securitization Process.

4. Administrator of the Separate Asset. It is the natural person designated by the securitization company for the management of the Separate Assets in their charge, assuming responsibility for the acts, contracts, and operations carried out by the securitization company that relate to the referred Separate Assets.

5. Primary Placement. It is the initial subscription or acquisition process in the Securities Market by investors of an Issuance of Values through the placement agents contracted by the Administrator of Securitization Processes.

6. Constitutive Documents. These are the documents necessary for the constitution of the Autonomous Assets in Securitization Processes, that is, the constitutive act of the Trust signed between the Public Offering Trust Fiduciary and the Trustor or the issuance regulation issued by the securitization company, as applicable.

7. Identity Document. It is the identity and electoral card in the case of Dominican citizens, the identity card, work or residence permit in the case of resident foreigners, or the valid passport in the case of non-resident foreigners.

8. Issuance Date. It is the date on which the Values of an Issuance begin to generate obligations and rights of economic content.

9. Fiduciary Manager. It is the natural person provided for in the constitutive act as the legal representative and in charge by the Public Offering Fiduciary for the conduct and direction of the Public Offering Trusts, assuming responsibility for the acts, contracts, and operations carried out by said company that relate to the referred Trusts in the manner provided by the current legal framework.

10. Loss Index. It is the index or coefficient of deviation of the expected cash flow that represents the percentage of possible losses from the materialization of any risk, event, or accident that affects the Underlying Asset and that must be mitigated with the use of Coverage Mechanisms.

11. Coverage Mechanisms. These are the mechanisms that constitute the backing in favor of investors in the presence of any risk, event, or accident that may affect the cash flow of the Underlying Asset or of the operation itself of the Autonomous Asset in Securitization Process.

12. Autonomous Asset in Securitization Process. These are the Separate Assets or the trust assets of Public Offering Trusts.

13. Prepayment. It is the advanced or extraordinary payment of the capital of a debt that leads to the total or partial cancellation of the same before the agreed term.

14. Budget of Income, Costs, and Expenses. It mathematically and statistically establishes the cash flow...