Resolution JPRF-V-2024-0108: Reforming Public Sector Participation in the Securities Market Regarding Stock Exchange Commissions

Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas, Financial Management Governmental Platform. Red Block, 8th floor | Postal Code: 170507 | Quito - Ecuador | Resolution No. JPRF-V-2024-0108 THE FINANCIAL POLICY AND REGULATION BOARD CONSIDERING: That Article 82 of the Constitution of the Republic of Ecuador prescribes that legal security is based on respect for the Constitution and on the existence of prior, clear, public legal norms applied by competent authorities; That number 6 of Article 132 of the Magna Carta grants public regulatory bodies the authority to issue norms of a general nature in matters within their competence, without being able to alter or innovate legal provisions; That Article 226 of the Fundamental Norm provides that State institutions, their bodies, dependencies, public servants, and persons acting by virtue of a state power shall exercise only the competencies and faculties attributed to them in the Constitution and the law; That Article 227 of the Supreme Norm orders that the Public Administration constitutes a service to the community that is governed by the principles of effectiveness, efficiency, quality, hierarchy, decentralization, coordination, participation, planning, transparency, and evaluation; That Article 13 of the Organic Monetary and Financial Code, Book I, reformed from the promulgation of the Organic Law Reforming the Organic Monetary and Financial Code for the Defense of Dollarization, created the Financial Policy and Regulation Board, part of the Executive Function, as a public law legal entity, with administrative, financial, and operational autonomy, responsible for formulating credit, financial, securities, insurance, and prepaid comprehensive health care services policy and regulation; That Article 14, numbers 1 and 2, of the aforementioned Code, regarding the scope of competence of the Financial Policy and Regulation Board, determines that it corresponds, among others, to formulate securities policy; as well as, to issue regulations that allow maintaining the integrity, solidity, sustainability, and stability of the securities system; That numbers 1, 9, and 27 of Article 14.1 ibid., stipulate that it corresponds to the Financial Policy and Regulation Board, among other faculties, the following: i) regulate the creation, constitution, organization, activities, operation, and liquidation of securities entities; ii) issue the non-prudential regulatory framework for all securities entities; and, (iii) exercise the other functions, duties, and faculties assigned to it by the Organic Monetary and Financial Code and the law; That number 1 of Article 25.1 of the cited Organic Code states that, within the functions of the Technical Secretariat of the Financial Policy and Regulation Board, is the elaboration of technical and legal reports that support the regulation proposals that the Financial Policy and Regulation Board will issue;

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Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas, Financial Management Governmental Platform. Red Block, 8th floor | Postal Code: 170507 | Quito - Ecuador | That the Twenty-Ninth General Provision of Book I of the Organic Monetary and Financial Code prescribes: "In the current legislation where mention is made of the 'Monetary and Financial Policy and Regulation Board', replace it with 'Financial Policy and Regulation Board.'"; That the Fifty-Fourth Transitional Provision ibid. provides: "Transitional Regime of Resolutions of the Codification of the Monetary and Financial Policy and Regulation Board. The resolutions contained in the Codification of Monetary, Financial, Securities, and Insurance Resolutions of the Monetary and Financial Policy and Regulation Board and the norms issued by control bodies will maintain their validity until the Monetary Policy and Regulation Board and the Financial Policy and Regulation Board decide what corresponds, within the scope of their competencies."; That Article 9 of the Securities Market Law, contained in Book II of the Organic Monetary and Financial Code, enumerates the attributions that currently correspond to the Financial Policy and Regulation Board in the context of the Securities Market Law, among which are those indicated in numbers 1, 4, and 6, which are, respectively: establish the general policy of the securities market and regulate its functioning; issue the necessary resolutions for the application of the aforementioned Law; and, regulate the creation and functioning of stock exchanges, as well as the services they provide; That the Fourth General Provision of the Securities Market Law determines that the Financial Policy and Regulation Board is competent to establish the parameters that institutions regulated by said Law must observe for the setting of commissions, fees, or tariffs that they charge to their clients or principals; That the Acting Technical Secretary of the Financial Policy and Regulation Board, through Memorandum No. JPRF-ST-2024-0055-M of April 26, 2024, submits to the President of the Board the Technical Report No. JPRF-CTVS-2024-004 of April 25, 2024, issued by the Technical Coordination of Policy and Regulation of the Securities and Insurance System; as well as the Legal Report No. JPRF-CJF-2024-018 of April 25, 2024, issued by the Legal Coordination of Policy and Financial Norms of this Board, as well as the draft resolution corresponding thereto; That the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on April 26, 2024, and carried out via video conference on April 30, 2024, reviewed the Memorandum No. JPRF-ST-2024-0055-M of April 26, 2024, issued by the Acting Technical Secretary of the Board; as well as the aforementioned Technical Report No. JPRF-CTVS-2024-004 and Legal Report No. JPRF-CJF-2024-018, in addition to the corresponding draft resolution; That the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on April 26, 2024, and carried out via video conference on April 30, 2024, reviewed and approved the following Resolution; and, In exercise of its functions,

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Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas, Financial Management Governmental Platform. Red Block, 8th floor | Postal Code: 170507 | Quito - Ecuador | RESOLVES: ARTICLE 1.- In Title III "Public Sector Participation in the Securities Market", Book II "Securities Market" of the Codification of Monetary, Financial, Securities, and Insurance Resolutions, Section VII is incorporated as follows: "SECTION VII: NEGOTIATION OF THE RULING ENTITY OF PUBLIC FINANCES IN THE STOCK MARKET SEGMENT Art. 22.- Negotiation of the ruling entity of public finances in the stock market segment: It is established as a parameter that negotiations in the primary market of titles issued by the ruling entity of public finances, in the stock market segment of the securities market, do not generate stock exchange commission for the ruling entity of public finances." SINGLE GENERAL PROVISION.- In case of doubt regarding the content or scope of the provisions of this Resolution, it will correspond to the Superintendency of Companies, Securities and Insurance to resolve them. FINAL PROVISION.- This Resolution will enter into force from the present date, without prejudice to its publication in the Official Register, and will be published on the institutional website of the Financial Policy and Regulation Board within a maximum term of two days from its issuance. NOTIFY.- Given in the Metropolitan District of Quito, on April 30, 2024. THE PRESIDENT, Mgs. María Paulina Vela Zambrano The preceding Resolution was processed and signed by Master María Paulina Vela Zambrano, President of the Financial Policy and Regulation Board, in the Metropolitan District of Quito, on April 30, 2024.- I CERTIFY. ACTING TECHNICAL SECRETARY Mgs. Luis Alfredo Olivares Murillo