Circular No. 1.774

CIRCULAR No. 001774 ------------------ TO THE INSTITUTIONS ADMINISTERING SHORT-TERM INVESTMENT FUNDS ADAPTS THE REGULATION OF SHORT-TERM INVESTMENT FUNDS TO THE PROVISIONS OF DECREE No. 99.374, OF 09.07.90. WE INFORM THAT THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BRAZIL, IN A SESSION HELD ON 09.07.90, BASED ON ARTICLE 9 OF DECREE No. 99.374, OF 09.07.90, AND ON ARTICLE 1, PAR. 1, OF THE REGULATION ANNEXED TO RESOLUTION No. 1.199, OF 10.10.86, HAVING REGARD TO THE PROVISIONS OF THE AFOREMENTIONED DECREE, DECIDED: ART. 1. SHORT-TERM INVESTMENT FUNDS THAT DO NOT ENSURE THE INDIVIDUALIZATION OF THE TERM OF EACH INVESTMENT OF THEIR QUOTAHOLDERS SHALL KEEP THE ENTIRETY OF THEIR INVESTMENTS REPRESENTED BY SECURITIES INTEGRATING THE PORTFOLIO OF INSTITUTIONS AUTHORIZED TO CARRY OUT REPURCHASE AGREEMENT OPERATIONS, IN THE FORM OF THE REGULATION ANNEXED TO RESOLUTION No. 1.088, OF 30.01.86, LINKED TO REPURCHASE COMMITMENTS ASSUMED BY THEM FOR SETTLEMENT WITHIN 1 (ONE) DAY, OBSERVING THE MINIMUM PROPORTION OF 70% (SEVENTY PERCENT) IN FEDERAL PUBLIC SECURITIES. SOLE PARAGRAPH. THE ADAPTATION OF THE FUNDS REFERRED TO IN THIS ARTICLE SHALL OCCUR THROUGH THE DIRECTING OF FUNDS ARISING FROM THE REDEMPTION AND SALE OF THE SECURITIES INTEGRATING THE PORTFOLIO. ART. 2. SHORT-TERM INVESTMENT FUNDS THAT ENSURE THE INDIVIDUALIZATION OF THE TERM OF EACH INVESTMENT OF THEIR QUOTAHOLDERS SHALL CONTINUE TO OBSERVE, IN THE DIRECTING OF THEIR INVESTMENTS, THE GUIDELINE ESTABLISHED IN ITEM 1, SUBITEM "A" OF CIRCULAR No. 1.411, OF 29.12.88. ART. 3. THE INSTITUTIONS ADMINISTERING SHORT-TERM INVESTMENT FUNDS SHALL: A) INFORM THE CENTRAL BANK AND THE FEDERAL REVENUE DEPARTMENT, WITHIN A MAXIMUM PERIOD OF 10 (TEN) DAYS, COUNTED FROM THE DATE OF ENTRY INTO FORCE OF THIS CIRCULAR, WHETHER THE FUNDS ADMINISTERED BY THEM FALL UNDER THE SITUATION OF ARTICLE 1 OR THE SITUATION OF ARTICLE 2; B) DISCLOSE, UNDER THE TERMS OF ARTICLE 31 OF THE REGULATION ANNEXED TO RESOLUTION No. 1.199, OF 10.10.86, AND WITHIN A MAXIMUM PERIOD OF 15 (FIFTEEN) DAYS, COUNTED FROM THE DATE OF ENTRY INTO FORCE OF THIS CIRCULAR, THE INFORMATION REFERRED TO IN THE PREVIOUS SUBITEM, AS WELL AS THE IMPLICATIONS ARISING FROM THE RESPECTIVE SITUATION WITH REGARD TO THE FUND'S INVESTMENTS. ART. 4. THIS CIRCULAR SHALL ENTER INTO FORCE ON THE DATE OF ITS PUBLICATION, PRODUCING EFFECTS AS OF 25.07.90. BRASÍLIA (DF), 10 JULY 1990 GUSTAVO JORGE LABOISSIÈRE LOYOLA DIRECTOR