Circular Letter CVM/SSE 06/23

COMMISSÃO DE VALORES MOBILIÁRIOS
Rua Sete de Setembro, 111/2-5º e 23-34º Andares, Centro, Rio de Janeiro/RJ – CEP: 20050-901 – Brasil - Tel.: (21) 3554-8686 Rua Cincinato Braga, 340/2º, 3º e 4º Andares, Bela Vista, São Paulo/ SP – CEP: 01333-010 – Brasil - Tel.: (11) 2146- 2000 SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4º Andar, Brasília/DF – CEP: 70712-900 – Brasil -Tel.: (61) 3327-2030/2031 www.cvm.gov.br Circular Letter No. 6/2023/CVM/SSE São Paulo, July 5, 2023. To service providers involved in the "tokenization" activity ("exchanges" or "tokenizers"), credit consultants, structurers, and assignors of credit rights Subject: Complement to Circular Letter No. 4/2023-CVM/SSE - "receivables tokens" or "fixed-income tokens". Dear Sirs and Madams,

This Circular Letter aims to complement the statements of this Supervision of Securitization Superintendence (SSE), contained in Circular Letter No. 4/2023-CVM/SSE ("CL 4/23"), regarding the so-called receivables tokens or fixed-income tokens (collectively "TR").
Initially, this Circular Letter addresses the objective and scope of a Circular Letter issued by the technical areas of the CVM.
Subsequently, it seeks to detail when a TR can be characterized as a securitization operation or merely as a collective investment contract, both being securities when offered publicly.
Next, the Circular Letter addresses issues involving public offerings of Bank Credit Notes, Certificates of Bank Credit Notes, or Real Estate Credit Notes.
Finally, some interpretations by the SSE regarding the application of provisions of CVM Resolution No. 88/22 to TR offerings are expressed.

I – Characteristics and objectives of a Circular Letter and the context of CL 4/23

The objective of a Circular Letter is highlighted, as provided for in CVM Resolution No. 1/2020:

"to embody the acts by which the CVM superintendencies give Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 1

orientations, recommendations, and guidelines, whose non-compliance does not imply legal consequences, effective or potential, for the recipients, regarding the way to comply with the obligations imposed by Law No. 6.385, of 1976, by Law No. 6.404, of 1976, by CVM Resolutions, as well as regarding the orientations contained in the Normative Instructions, observing the precedents of the Collegiate, if there are."

In these terms, the orientations of CL 4/23 and this one do not have a normative character, but aim to give publicity to the interpretations of this SSE regarding the possibilities of classifying TRs as securities.
Throughout the years 2022 and 2023, this technical area received consultations and carried out supervision actions involving different modalities of tokens, including the TRs that motivated the elaboration of CL 4/23. The consultations received by the SSE demonstrated that there are doubts among participants in this market about the characterization as securities of certain investments offered, that is, it is not a concept that is already crystallized.
The analyses demonstrated that there is the collection of public savings via public offering of certain modalities of investment, characterized as collective investment contracts, attracting the competence of this Autarchy.
Regarding TRs, it is understood that such investment modalities offer possibilities of remuneration to investors, either through income from interest or through the application of a discount rate with the objective of providing a capital gain.
In summary, evidence of expectations of income, capital gain, or both, which are considered, together, as remuneration arising from the effort of the entrepreneur or third parties, as referred to in art. 2º, IX, of Law No. 6.385/76, is noted in TR offerings.
The effort of the entrepreneur or third parties, as detailed in CL 4/23, can be identified in the activity of structuring the public offering or in the formatting and calculation of the remuneration that will be offered.
The purpose of CL 4/23 was not to debate the technology used in emissions, but rather to bring clarity that certain modalities of investment in credit rights may be characterized as securities when offered publicly, in the understanding of this SSE.
In addition, it is emphasized that such understanding is not innovative, given the decision of the Collegiate of January 22, 2008
(https://conteudo.cvm.gov.br/decisoes/2008/20080122_R1/20080122_D01.html) in which, unanimously, it was considered that Bank Credit Notes – CCB were considered securities when offered publicly. The leading vote at the time, incidentally, applied the Howey Test for such conclusion.
As described below, the public offering of CCB ceased to be considered as an offering of securities when the requirements established by Law No. 13.986, of 2020, were met. However, since 2008 there has been a public manifestation of this Autarchy in the sense of considering as an offering of securities certain public offerings of credit rights, when some characteristics are met.
Given the various possibilities of structuring TRs, CL 4/23 was purposefully generic in stating that certain structures "may" be characterized as securities, either because they are considered public offerings of securitization operations (Law No. 14.430/22) or collective investment contracts (Law No. 6.385/76).

Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 2

CL 4/23 did not have the objective of detailing all possibilities of TR, but published some essential characteristics for the possible classification of certain modalities of these tokens as securities.
It is emphasized that CL 4/23 sought to bring the understanding of this SSE regarding receivables or fixed-income tokens, but relied on the general orientations emanating from the Collegiate of this CVM and set forth in CVM Orientation Opinion No. 40/2022 ("PO 40"). According to PO 40: "The CVM understands that a token referenced to an asset may or may not be a security and that its characterization as such will depend on the economic essence of the rights conferred to its holders, as well as it may depend on the function it assumes throughout the performance of the project related to it" (emphasis added).
Another point that should be highlighted is the possible equivalence of a token with a securitization operation, as addressed in a general way in PO 40: "In this sense, it is worth mentioning that market practice has shown that a token can represent not only assets, but also rights to remuneration for an enterprise, right to receive related to structures similar to securitization, or, still, voting right. With regard to this, we note that some of these models bring the tokens issued closer to the concept of security...." (emphasis added).
As mentioned in CL 4/23, PO 40 also brought the mention of the securitization operation as the new possibility of classification of a security:

"Even if cryptoassets are not expressly included among the securities cited in the items of art. 2º of Law No. 6.385/76, market agents must analyze the characteristics of each cryptoasset with the objective to determine if it is a security, which occurs when:
(i) it is the digital representation of any of the securities provided taxatively in items I to VIII of art. 2º of Law No. 6.385/76 and/or provided in Law No. 14.430/2022 (i.e., certificates of receivables in general); or" (emphasis added)

Law No. 14.430/22 brought not only the possibility of securitization via Receivables Certificate, but, in a generic way, via other titles and securities of securitization.
Thus, it is understood that it is up to the offerers of investments to evaluate the total or partial adherence of their offerings to the orientations of PO 40, CL 4/23, and this Circular Letter, in order to conclude on the need or not to submit to the regulation of this Autarchy.

II – Differences between securitization operation and collective investment contract.

CL 4/23 did not distinguish when the modalities of TR offered publicly are characterized as a securitization operation, a collective investment contract, or both.
Thus, it is possible that a certain modality of TR is considered as a collective investment contract, without necessarily fitting as a securitization operation. That is, in this hypothesis, compliance with CVM rules is equally required, however, there would be no obligation for the acting of a securitization company.
As provided in art. 18, sole paragraph, of Law 14.430, of 2022:

"A securitization operation is considered the acquisition of credit rights to back the issuance of Receivables Certificates or other titles and securities Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 3

securities before investors, whose payment is primarily conditioned on the receipt of resources from the credit rights and from the other assets, rights and guarantees that back them."

By way of illustration, the public offering of a duplicate bill by the assignor, through a civil assignment instrument, may be considered a securitization operation, if some of the requirements explored further ahead are present, since it is understood that there is the issuance of a security, in this case the collective investment contract itself, backed by the duplicate bill.
As described in PO 40, the fact that an asset is developed or offered digitally, through cryptographic or distributed ledger technology-based means, is irrelevant for its classification as a security.
This technical area understands that "tokenization" is a process of digitally representing an asset or the ownership of an asset, which facilitates its distribution to investors. Therefore, when a token representing a collective investment contract in receivables (i.e.: tokens of an assignment instrument) is offered publicly, it may be considered a security backed by the credit or the credit right.
The SSE considers, in the case illustrated above, that the credit right is the basis for the issuance of the offered contract, thus being considered its backing. In the cases explored within the scope of CL 4/23, it can be understood that the TR corresponds to a collective investment contract, that is, it corresponds to the security that is backed, based, or founded on the credit right.
A duplicate bill, in isolation, for example, does not correspond to a security. But, the collective investment contract backed by the duplicate bill is a security, and, in the example above, it can be materialized by the assignment instrument offered publicly, safeguarding the other analyses contained in CL 4/23.
This SSE understands that some TRs, despite fitting as securities, as explored in CL 4/23, may not be characterized as a securitization operation, when cumulatively:

a) there is a public offering of a single credit right, via assignment instrument or other modality, without co-obligation or other form of risk retention by the assignor or by a third party;

b) the cash flow of the credit right flows directly to the investors, with minimal interference from the assignor or third parties to facilitate the transfer of the flow;

c) there are no predetermined mechanisms for the replacement, repurchase, or rollover of the assigned credit right, nor any co-obligation for the fulfillment of the offered collective investment contract;

d) there are no service providers previously contracted, such as, for example, those equivalent to custody, bookkeeping, depositary, fiduciary agent, ordinary collection of the offered credit right, or monitoring or accompaniment service; that is, there was no "packaging" of the credit right with services, but rather a direct sale; and

e) in case of default, it is up to the investor to adopt judicial or extrajudicial collection measures, the investor being able, directly at their own expense, to hire collection agents.

Considering the perfect and final sale of a single asset (true sale), this SSE understands that the securitization operation may be discharacterized,

Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 4

should the other characteristics described in CL 4/23 be observed to conclude if the offered asset is characterized as a collective investment contract.

This SSE understands that the set comprising the asset (credit right), the public offering of distribution (as a token or through another means) and the expectation of gain (remuneration) for the investor, as explored in CL 4/23, may characterize an investment offering, at least as a collective investment contract, when the other conditions for the characterization of a securitization operation are not present.
The securitization operation is generally characterized by: (i) acquisition of credit rights by a vehicle; (ii) issuance of titles by this vehicle backed by the credit rights; and (iii) linking the payment of the title to the receipt of the credit rights. Not necessarily in this order, as generally investors make the contribution so that the acquisition of credit rights by the vehicle occurs.
This SSE understands that the inverse order of events is a practice of the securitization market, and is even supported by Law 14.430, which allows for issuance with subsequent acquisition of the backing of the receivables certificate at the time of its subscription by investors, according to art. 20, § 2º.
In the case of TRs, there may be a securitization operation when there is acquisition of a credit right for the issuance of a security, in this case the collective investment contract, and the linking of the payment of the contract to the receipt of the credit rights.
The collective investment contract, while being typified as a security, facilitates the acquisition and incorporation of the credit right, when the requirements provided in CL 4/23 are observed, in a manner similar to an "investment vehicle" that promotes the "packaging" of the credit right, with the assignor or third parties offering calculation services to determine the remuneration to be offered or performing the activities of selection, risk analysis, pricing, acquisition, maintenance, custody, or management, either of the credit right(s) or of its cash flow, including in collection activities.
Such flow is similar to the securitization operation via securitization company, in which the separate estate, represented by the receivables certificate, is the economically responsible vehicle for the acquisition of credit rights, after the resources have been contributed by investors. The securitization company is responsible for making such acquisition possible and administering the estate, as, without the resources contributed by investors, there would be no acquisition, by the securitization company, for the public placement of the receivables certificates.
In accordance with Law No. 14.430/22, the carrying out of securitization operations is the purpose of securitization companies, whether they are: (a) publicly held and registered with the CVM under the terms of CVM Resolution No. 60/21, for the carrying out of public offerings registered within the scope of CVM Resolution No. 160/22; (b) privately held for the carrying out of public offerings exempt from registration within the scope of CVM Resolution No. 88/22; or (c) privately held for private placements, which does not attract the competence of this Autarchy.
There is no intention to exhaust, in this Circular Letter, all possibilities and differences between a collective investment contract and a securitization operation, nor the particularities involving the different modalities of TR.
This SSE understands that, by adopting the model provided in CVM Resolution No. 88/22, the public offering of titles and securities representative of

Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 5

securitization operations tends not to increase excessively the operational costs involved, given the possibility that the crowdfunding platform itself may carry out the securitization activity, provided that it is constituted as a corporation that has among its purposes the carrying out of securitization operations and includes the specific CNAE in its CNPJ.

Furthermore, this technical area understands that the "tokenization" of receivables certificates does not differ, in practice, from the "tokenization" of an assignment contract. There is no prejudice, or negative impacts on efficiency, in "tokenizing" certificates or assignment contracts, as the receivables certificates are materialized through the securitization term and the assignment through another legal instrument.
The collective investment contract can be considered as the securitization security and, therefore, subject to the provisions of Law No. 14.430/22. Also, as mentioned in CL 4/23, the securities offered within the scope of CVM Resolution No. 88/22 are exempt from deposit.

III – Exchange titles of responsibility of financial institution.

The understanding manifested in CL 4/2023 does not apply to public offerings of Bank Credit Note – CCB, Certificate of Bank Credit Note - CCCB, or Real Estate Credit Note – CCI (collectively "titles of responsibility of financial institution"), when the requirements of art. 45-A of Law No. 10.931, of August 2, 2004, are met.
As provided in the aforementioned art. 45-A, such titles are exchange titles of responsibility of a financial institution or of an entity authorized to function by the Central Bank of Brazil and, according to art. 2º, § 1º, of Law No. 6.385, of 1976, are excluded from the competence of this Autarchy.
The public offering of a single CCB, CCCB, or CCI does not attract the competence of the CVM, as art. 2º, § 1º, of Law No. 6.385 excludes the exchange titles of responsibility of a financial institution from the regime of the Law, even if the individual offering of these titles may be characterized as a securitization operation when not meeting some requirement exemplified in paragraph 31 of this Circular Letter.
However, when an investment opportunity in a "basket" backed by titles of responsibility of a financial institution is offered, it is understood that the existence of a collective investment contract or of a securitization operation, that is, of a security subject to the competence of this Autarchy, may be characterized.
This "basket" may correspond to the public offering of a single asset that represents or corresponds to the investment in more than one CCB, CCCB, or CCI.
In these cases, there may be a mismatch between the cash flow of the backing and that corresponding to the collective investment contract. That is, the offered investment has a financial flow of interest or amortization different from the titles of responsibility of a financial institution that underlie or back it.
Therefore, in this example, the offering does not correspond to the title of responsibility of a financial institution, but to the investment backed by those titles.
Even if there is no mismatch of the flow, the security may be characterized via securitization operation when the offering of a "basket" of titles does not meet any of the characteristics described in paragraph 31 of this Circular Letter.
Again, in the case of the offering of a "basket", there may not be the offering of a title of responsibility of a financial institution, but rather of a security with its own characteristics, even if the financial flow is identical to that of the backing.
Finally, this SSE understands that CCB, CCI, or CCCB offered individually to investors are not within the competence of this Autarchy. However, a securitization operation and, consequently, a security may be characterized when the public offering corresponds to a "basket" in which: (a) there is a mismatch of cash flow; or (b) one or more of the characteristics listed in paragraph 31 of this Circular Letter are absent.

IV – Interpretations of provisions of CVM Resolution No. 88/22 for TR offerings.

In complement to the interpretations of CL 4/23 regarding the use of the crowdfunding model, according to CVM Resolution No. 88/22, the SSE seeks to add the understandings and interpretations set forth below.
Considering the public offering of titles or securities representative of securitization operations through crowdfunding platforms regulated by CVM Resolution No. 88/22, this SSE understands that the issuer may be considered as the separate estate for all purposes, including:

a) for the revenue limit of R$ 40 million or R$ 80 million of which art. 2º, item VII and § 2º; b) for the maximum fundraising value of R$15 million, according to art. 3º, item I; c) for the sum of total fundraising set forth in art. 3º, § 3º; and d) for the period of 120 days of interval between offerings, according to art. 3º, § 5º.

This interpretation aligns, for example, with the regulatory framework of investment funds, for which the separate estate is recognized as an issuer (art. 102, § 1º, I, of CVM Instruction No. 555/14 and art. 44, § 1º, I, of Normative Annex I of CVM Resolution No. 175/22).
Thus, this SSE considers that the understanding of paragraphs 38 and 39 of CL 4/23 deserves to be rectified, so that, even in a concentrated issuance, the concept of gross revenue of the issuer can be applied to the separate estate and not to the debtor, thus maintaining uniformity with the rules in force for funds and other vehicles that invest in securitization assets.
Briefly, a separate estate, which issues securities through a privately held securitization company, can be equated to a small-sized business company for all purposes of CVM Resolution No. 88/22 and raise up to R$15 million per year for the same separate estate.
Regarding the investment limit per investor, art. 4º of CVM Resolution No. 88/22 establishes a ceiling of R$ 20 thousand per calendar year for investments made by general investors.
In this sense, this SSE understands that, once part or the total of this invested value is returned within the calendar year, the investor may reinvest in the same year the portion corresponding to the principal of the returned value.
Art. 5º, § 1º, of CVM Resolution No. 88/22 provides that the amounts transferred by investors cannot transit through current accounts: (i)
kept in the name of the platform; (ii) kept in the name of partners,

Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 7

administrators, and persons linked to the platform; and (iii) held in the name of companies controlled by the persons mentioned in items I and II of this paragraph.

In offerings of securities representing securitization operations through a crowdfunding platform, as a general rule, the platform itself or its partners would be barred from forming a securitization company to issue the securitization securities offered in that environment.
However, this SSE understands that the prohibition applies if the securitization company issues without the establishment of a separate estate.
Considering the separate estate as the issuer for all purposes, it is understood that the prohibition of art. 5, § 1, does not apply, since the resources will pass through the current account subject to the same fiduciary regime as the collateral, i.e., through the separate estate provided for in Law 14.430, thus not being confused with the assets of the securitization company, the crowdfunding platform, or its partners.
Finally, this Superintendence communicates that the CVM has a channel for receiving questions on its Internet Portal: https://www.gov.br/cvm/ptbr/canais_atendimento/consultas-reclamacoes-denuncias.

Sincerely,

Luis Felipe Lobianco
Securitization Supervision Manager – GSEC-2

Bruno de Freitas Gomes
Superintendent of Securitization Supervision – SSE

Document electronically signed by Luis Lobianco, Manager, on 05/07/2023, at 08:55, based on art. 6 of Decree No. 8.539, of October 8 2015.

Document electronically signed by Bruno de Freitas Gomes Condeixa Rodrigues, Superintendent, on 05/07/2023, at 08:58, with basis in art. 6 of Decree No. 8.539, of October 8, 2015.

The authenticity of the document can be checked on the site https://super.cvm.gov.br/conferir_autenticidade, informing the verification code 1819617 and the CRC code 9810AE18.

This document's authenticity can be verified by accessing https://super.cvm.gov.br/conferir_autenticidade, and typing the "Verification Code" 1819617 and the "CRC Code" 9810AE18.

Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 8

Reference: Process No. 19957.009383/2021-43 SEI Document No. 1819617 Circular Letter 6 (1819617) SEI 19957.009383/2021-43 / pg. 9

Circular Letter CVM/SSE 06/23

Lineage: In force