Circular No. 2861 — Establishes minimum adjusted net equity and operational limits for consortium administrators and alters provisions regarding consortium operations

CIRCULAR NO. 002861

Dispenses with minimum limits of adjusted net equity and operational limits for consortium administrators and alters provisions regarding consortium operations.

The Collegiate Board of the Central Bank of Brazil, in a session held on 10.02.99, based on art. 33 of Law No. 8.177, of 1º.03.91,

DECIDED:

Art. 1º Establish the following minimum limits of paid-in capital and adjusted net equity (PLA), to be permanently observed by consortium administrators:

I - R$180,000.00 (one hundred and eighty thousand reais), for administration of groups referenced in durable movable goods or tourism services;

II - R$470,000.00 (four hundred and seventy thousand reais), for administration of groups referenced in real estate.

Paragraph 1º The PLA of administrators is obtained by the algebraic sum of the following groups included in the Accounting Plan of the Institutions of the National Financial System - COSIF:

(+) 6.0.0.00.00-2 SHAREHOLDERS' EQUITY;
(+) 7.0.0.00.00-9 CREDIT ACCOUNTS OF RESULTS;
(-) 8.0.0.00.00-6 DEBIT ACCOUNTS OF RESULTS.

Paragraph 2º The provisions of this article do not apply to associations or non-profit civil entities authorized to administer consortium groups.

Art. 2º The initial capital of consortium administrators must be paid in current currency.

Sole Paragraph. Capital increases that are not paid in current currency may only result from the incorporation of profit reserves, the use of revaluation reserves for this purpose being prohibited.

Art. 3º The value of the balance of the passive operations of consortium administrators (COSIF - title 4.0.0.00.00-8), added to the value of the balance of liquidity contained in the Statement of Changes in Liquidity of consolidated Groups (COSIF - document No. 7 - code 09.0.0.0.0-7 - CADOC 4350), is limited to:

I - in the case of administrators who fall under art. 1º, item I:

a) 6 (six) times the value of the PLA, when holders of PLA equal to or greater than R$180,000.00 (one hundred and eighty thousand reais) and less than R$300,000.00 (three hundred thousand reais);

b) 7 (seven) times the value of the PLA, when holders of PLA equal to or greater than R$300,000.00 (three hundred thousand reais) and less than R$400,000.00 (four hundred thousand reais);

c) 8 (eight) times the value of the PLA, when holders of PLA equal to or greater than R$400,000.00 (four hundred thousand reais);

II - in the case of administrators who fall under art. 1º, item II:

a) 6 (six) times the value of the PLA, when holders of PLA equal to or greater than R$470,000.00 (four hundred and seventy thousand reais) and less than R$700,000.00 (seven hundred thousand reais);

b) 7 (seven) times the value of the PLA, when holders of PLA equal to or greater than R$700,000.00 (seven hundred thousand reais) and less than R$1,000,000.00 (one million reais);

c) 8 (eight) times the value of the PLA, when holders of PLA equal to or greater than R$1,000,000.00 (one million reais).

Paragraph 1º In the case of associations or non-profit civil entities authorized to administer consortium groups, the respective operational limit must correspond to half of that established in this article, according to the nature of the goods subject to the groups under their administration and the value of their social equity.

Paragraph 2º The operational limit established in this article must be complied with daily.

Paragraph 3º For the purpose of the operational limit established in this article, the amount corresponding to any participations held in the share capital of companies that exercise the same activity must be deducted from the PLA of the administrators.

Paragraph 4º From 31.12.2000, the operational limits established in the "caput", items I and II, letters "a", "b" and "c", will be reduced to 4 (four), 5 (five) and 6 (six) times the value of the PLA of the administrators, respectively, becoming the parameter for the purpose of the provision in paragraph 1º.

Art. 4º In addition to the limits established in the previous article, consortium administrators linked, directly or indirectly, to manufacturers of automobiles, light trucks, and utility vehicles are subject to the sale of quotas in a number strictly sufficient to form consortium groups referenced in these goods that provide for monthly awards in a number not exceeding 30% (thirty percent) of the average monthly production volume of the manufacturer to which they are linked, destined for the domestic market, verified in the last 12 (twelve) months.

Sole Paragraph. In the case of there being more than one administrator linked, directly or indirectly, to the same manufacturer of automobiles, light trucks, and utility vehicles, the limitation provided for in this article applies to the set of administrators linked to the same manufacturer.

Art. 5º For the purpose of the regulation applicable to consortium administrators, administrators and companies are considered linked when:

I - one participates with 10% (ten percent) or more of the capital of the other, directly or indirectly;

II - administrators or their respective spouses and relatives up to the second degree of one participate, jointly or separately, with 10% (ten percent) or more of the capital of the other, directly or indirectly;

III - partners or shareholders with 10% (ten percent) or more of the capital of one participate with 10% (ten percent) or more of the capital of the other, directly or indirectly;

IV - have a common administrator.

Art. 6º Consortium administrators must have as their exclusive object of activity the administration of consortium groups.

Paragraph 1º The provisions of this article do not apply to associations or non-profit civil entities authorized to administer consortium groups.

Paragraph 2º Administrators must adapt to the provisions of this article by 30.04.2000.

Art. 7º Consortium administrators are subject to automatic restriction to form consortium groups, without prejudice to other sanctions provided for in the legislation and regulation in force, when any of the following causes are verified:

I - non-observance of the limits and other conditions established in this Circular;

II - existence of pending submission, to the Central Bank of Brazil, of financial statements and data relating to their operations provided for in the regulation in force;

III - determination of irregularities attributable to consortium administrators or their administrators, characterized by non-compliance with the legislation and regulation in force;

IV - finding of pending issues with consumer protection agencies.

Sole Paragraph. Administrators with restrictions under the terms of items III and IV may only resume forming consortium groups after the irregularities that motivated the situation have been resolved, and with prior authorization in a specific process formalized with the Regional Delegation of the Central Bank of Brazil that has jurisdiction over their headquarters.

Art. 8º The granting of authorization to administer consortium groups remains suspended for an indefinite period.

Art. 9º The following provisions of the Regulation annexed to Circular No. 2,766, of 03.07.97, are amended:

I - art. 2º, which shall enter into force with the following wording:

"Art. 2º May be the object of a consortium group governed by this Regulation:

I - durable movable goods or sets of new durable movable goods, of national or foreign production;

II - real estate;

III - tourism services, including air tickets and/or tourism packages.

"Paragraph 1º The group may only be formed having as its object goods or services of only one of the sets listed in art. 3º, item IX.

"Paragraph 2º It is permitted the formation of a group referenced in a percentage of the value of the good or set of goods, new.";

II - art. 11, item I, which shall enter into force with the following wording:

"Art. 11. The use of the group's resources, as well as the yields from its applications, may only be made through identification of the purpose of the payment:

I - in favor of the supplier who sold the good to the awarded consortium member, in accordance with a document attesting to the operation;

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Art. 10. This Circular enters into force on the date of its publication.

Art. 11. Art. 20 of Circular No. 2,381, of 18.11.93, and Circulars No. 2,027, of 28.08.91, 2,684, of 09.05.96, and 2,817, of 24.04.98, are repealed.

Brasília, February 10, 1999

Sérgio Darcy da Silva Alves
Director