Circular No. 3.771

The Collegiate Board of the Central Bank of Brazil, in a session held on 27 October 2015, based on art. 10, items X and XI, of Law No. 4.595, of 31 December 1964, on art. 1, § 1, of Complementary Law No. 130, of 17 April 2009, on art. 9 of Resolution No. 4.122, of 2 August 2012, and on art. 62 of Resolution No. 4.434, of 5 August 2015,

R E S O L V E S :

CHAPTER I

OF THE PURPOSE AND SCOPE OF APPLICATION

Art. 1 This Circular establishes the procedures to be observed by credit cooperatives in the preparation of the processes for requesting authorization for:

• I - incorporation and operation;

• II - change of category;

• III - amendment of the conditions of association, the area of operation and other amendments to the bylaws;

• IV - holding of positions in statutory bodies;

• V - merger, acquisition and spin-off; and

• VI - cancellation of the authorization to operate.

Art. 2 For the purposes of this Circular, the following is considered:

• I - confederation of centrals: the cooperative society constituted by central credit cooperatives, intended to provide services to its members, being specifically referred to as "credit confederation", when authorized by the Central Bank of Brazil (BCB) to operate as a financial institution; and

• II - cooperative system: the set of credit cooperatives organized on three levels, constituted by a confederation of centrals, by the central credit cooperatives affiliated with it and by the singular credit cooperatives affiliated with those centrals, in addition to the other entities referred to in art. 54 of Resolution No. 4.434, of 5 August 2015.

Sole paragraph. In the absence of a confederation, the set of credit cooperatives organized on two levels, constituted by a central credit cooperative and by the singular credit cooperatives affiliated with it, in addition to the other entities referred to in art. 54 of Resolution No. 4.434, of 2015, is also considered a cooperative system.

CHAPTER II

OF THE INCORPORATION AND THE AUTHORIZATION TO OPERATE

Art. 3 Prior to holding the respective corporate act, those interested in the incorporation of a credit confederation, a central credit cooperative or a singular credit cooperative must file an application containing:

• I - the identification of the members of the group organizing the project, chosen by the group of founders from among its members;

• II - the indication of the person responsible, technically qualified, for conducting the process at the BCB; and

• III - the project constituted by the documentation specified in art. 6 of Resolution No. 4.434, of 2015.

Sole paragraph. The Department of Organization of the Financial System (Deorf) is authorized to adapt the requirements of the business plan provided for in art. 6, item IV, of Resolution No. 4.434, of 2015, to the nature and size of the credit cooperative and to the extent of the request submitted for examination.

Art. 4 Prior to the presentation of the project referred to in art. 3, item III, those interested in the incorporation of a singular credit cooperative that does not intend to affiliate with a central credit cooperative must file the proposal of the enterprise, covering:

• I - the information of art. 3, items I and II; and

• II - the executive summary of the business plan, containing, at a minimum, the following information:

  • a) description of the business;

  • b) target audience;

  • c) indication of the products and services to be provided;

  • d) area of operation;

  • e) location of the head office and any branches;

  • f) short-term goals and long-term strategic objectives;

  • g) capital structure and sources of financing;

  • h) market opportunities that justify the enterprise and competitive advantages of the institution to be incorporated; and

  • i) means by which the singular cooperative may have access to the products and services usually provided by the central cooperatives.

§ 1 After the examination of the executive summary, Deorf may designate a date, time and place for the technical interview provided for in art. 5, § 1, of Resolution No. 4.434, of 2015.

§ 2 In the technical interview, the members of the organizing group may be questioned on any topics related to the proposal of the enterprise, and may not be replaced by attorneys or representatives.

§ 3 If, after the technical interview, Deorf deems the proposal of the enterprise inadequate:

• I - it shall communicate this decision to the organizing group; and

• II - it may summon the organizing group for a new technical interview, if the proposal is resubmitted, with the necessary adjustments, within thirty days.

§ 4 If, upon resubmission of the proposal referred to in § 3, item II, the understanding regarding its inadequacy persists, the request shall be denied by Deorf.

§ 5 If Deorf deems the proposal of the enterprise adequate, it shall communicate this decision to the organizing group, which must, within sixty days, counted from the date of knowledge of the fact, send the project referred to in art. 3, item III.

Art. 5 Once the favorable manifestation of the BCB regarding the incorporation project is obtained, the examination of the request for authorization to operate is conditioned upon the adoption of the following measures:

• I - holding of the corporate act of incorporation, in the form of the law, contemplating the election of the members of the statutory bodies and the approval of the bylaws, in compliance with the provisions of the regulations in force;

• II - publication of a statement of purpose by the elected administrators, when applicable, as established in art. 14; and

• III - payment of initial capital in an amount equivalent to at least the value of the minimum capital established for the cooperative in the form of the regulations in force, and deposit with the BCB of the paid-in amount, in accordance with art. 27 of Law No. 4.595, of 31 December 1964.

Art. 6 Once the corporate act of incorporation is approved, Deorf shall communicate to the interested parties the authorization to operate.

§ 1º In the case where the prior inspection referred to in art. 8 of Resolution No. 4,434, of 2015, has been determined, the interested parties shall, within 180 (one hundred and eighty) days, counted from the date of knowledge of the favorable manifestation referred to in art. 5:

• I - adopt the measures provided for in art. 8, § 2º, items I to III, of Resolution No. 4,434, of 2015; and

• II - request Deorf to carry out the inspection.

§ 2º The prior inspection shall be carried out within up to 90 (ninety) days, counted from the date of its request.

§ 3º After the prior inspection:

• I - if compatibility between the implemented structure and the business plan is verified, Deorf shall communicate to the interested parties the authorization for operation; or

• II - if incompatibility between the implemented structure and the business plan is found, Deorf shall communicate the fact to the interested parties, granting a period for its adjustment.

§ 4º If the incompatibility referred to in § 3º, item II, persists, Deorf shall communicate to the interested parties the denial of the authorization request.

CHAPTER III

ON THE CHANGE OF CATEGORY, THE SPLIT-OFF AND OTHER STATUTORY AMENDMENTS

Art. 7º The project, containing the information listed in art. 6 of Resolution No. 4,434, of 2015, applicable at the discretion of Deorf, as the case may be, must be presented prior to the holding of the corresponding corporate act, if any, in the following requests:

• I - change of category of a singular credit cooperative, except those arising from the provisions of art. 59, sole paragraph, item II, of Resolution No. 4,434, of 2015:

  • a) from capital and loan to classic or full; or

  • b) from classic to full.

• II - statutory amendments aiming at expansion, considered relevant at the discretion of Deorf, of the conditions for admission of members or of the area of operation; and

• III - split-off of a credit cooperative.

§ 1º Deorf may waive the presentation of the project referred to in the caput in cases where the applicant participates in a cooperative system organized on two or three levels, is within the operational limits and has an organizational and internal controls structure compatible with the size and complexity of the operations, upon a reasoned request, accompanied by the respective compliance report.

§ 2º The project dealing with the change of category provided for in the caput, item I, must demonstrate that the cooperative has the technical, administrative and operational capacity to carry out the new operations provided for the requested category, including presenting the effects of this change with respect to expected costs and revenues and their impacts in terms of the cooperative's operational limits.

Art. 8º For the purposes of applying the provisions of art. 9, § 1º, of Resolution No. 4,434, of 2015, Deorf shall observe, among others, the following criteria for verifying the impact of the request on the operation of the cooperative:

• I - irrelevance of the effects for the applicant institution, including with regard to risks; or

• II - lesser complexity of the request.

Art. 9º Once the favorable manifestation of the BCB is obtained in relation to the following projects, the examination of the authorization requests is conditioned upon the deliberation of the general meeting:

• I - of change of category in which there is a statutory amendment;

• II - of statutory amendment for expansion of the conditions of association or of the area of operation; and

• III - of split-off.

§ 1º In requests for change of category to full credit cooperative, their examination is conditioned upon the publication of a statement of purpose by the administrators of the institution, as established in art. 14.

§ 2º In requests for split-off, their examination is also conditioned upon the election of the members of the statutory bodies and the publication of a statement of purpose by the elected administrators, when applicable, as established in art. 14.

§ 3º In requests for change of category in which there is no statutory amendment and the publication of a statement of purpose is dispensable, the favorable manifestation for the project shall correspond to the authorization of the request.

Art. 10. The examination of authorization requests for statutory amendments that do not involve the matters mentioned in art. 7, items II and III, is conditioned solely upon the deliberation of the general meeting.

CHAPTER IV

ON THE EXERCISE OF POSITIONS IN STATUTORY BODIES

Art. 11. The examination of requests for approval of the names of those elected to statutory positions of the credit cooperative is conditioned upon the holding of the respective corporate act, and upon the publication of a statement of purpose by those elected to management positions, in the cases where it is required, as established in art. 14.

CHAPTER V

ON MERGER OR INCORPORATION

Art. 12. The examination of authorization requests for incorporation or merger of credit cooperatives is conditioned upon:

• I - the holding of the pertinent general meetings by all the companies involved, as well as compliance with the other provisions of arts. 57 to 59 and 62 of Law No. 5,764, of 16 December 1971; and

• II - publication of a statement of purpose by the elected administrators, when applicable, as established in art. 14.

§ 1º The examination of merger requests is also conditioned upon the election of the members of the statutory bodies.

§ 2º At the discretion of Deorf, the presentation of a project containing the information listed in art. 6 of Resolution No. 4,434, of 2015, that are considered necessary, may also be required.

CHAPTER VI

ON THE CANCELLATION OF THE AUTHORIZATION FOR OPERATION

Art. 13. The cancellation of the authorization for operation of a credit cooperative, arising from dissolution or from a request for change of corporate purpose, is conditioned upon the adoption of the following measures:

• I - filing of the request with the BCB, directed to Deorf; and

• II - presentation of the corporate act of dissolution or of change of corporate purpose to another type of cooperative that is not a credit cooperative.

CHAPTER VII

ON THE STATEMENT OF PURPOSE

Art. 14. The statement of purpose referred to in art. 6 of Annex Regulation II to Resolution No. 4,122, of 2 August 2012, concerning administrators of full-service single credit cooperatives, must be published on two dates, in a newspaper or newspapers of wide circulation, in the locations of the institution's headquarters and of the domicile of the administrators involved.

§ 1 The statement must be prepared in the form of the models established by Deorf.

§ 2 The publication of the statement of purpose may be waived when the administrator has been previously approved by the BCB in a regular process containing the said publication, except for any determination to the contrary, as provided in art. 6, sole paragraph, item I, of Annex Regulation II to Resolution No. 4,122, of 2012.

§ 3 For the purposes of public notice disclosure, Deorf may determine that the institution provide, in a format defined by it, the information contained in the statement of purpose.

§ 4 The deadline for submission to the BCB of objections by the public, as a result of the publication of the statement of purpose, shall be fifteen days, counted from the date of disclosure of the notice mentioned in § 3.

CHAPTER VIII

ON THE INSTRUCTION OF PROCESSES

Art. 15. The processes relating to the matters mentioned in this article must be instructed by presenting, to the Deorf component that has jurisdiction over the cooperative's headquarters, the documents indicated for each case, contained in the list of documents and information necessary for the instruction of processes, annexed to this Circular, without prejudice to the other applicable provisions of the legislation in force:

• I - constitution of a single credit cooperative whose project provides for affiliation with a central cooperative: documents 1, 2 and 4;

• II - constitution of a single credit cooperative whose project does not provide for affiliation with a central cooperative:

  • a) presentation of the business proposal: documents 1 and 5; and

  • b) presentation of the project, after favorable manifestation to the business proposal: documents 1 and 2;

• III - constitution of a central credit cooperative or credit confederation: documents 1 and 2;

• IV - spin-off project: documents 1, 2 and, in the case of a single cooperative affiliated with a central cooperative or a central cooperative affiliated with a confederation, document 4;

• V - project for changing the category of a single credit cooperative, referred to in art. 7, item I: documents 1, 3 and, in the case of a single cooperative affiliated with a central cooperative, document 4;

• VI - project for relevant expansion of the conditions of association or the area of operation: documents 1, 3 and, in the case of a single cooperative affiliated with a central cooperative or a central cooperative affiliated with a confederation, document 4;

• VII - authorization for operation of a credit cooperative for which prior inspection has not been determined, under the terms of art. 6: documents 1, 6, 8, 10, 11, 12, 17, 18, 19, 20 and 21;

• VIII - authorization for operation of a credit cooperative for which prior inspection has been determined:

  • a) approval of the act of constitution: documents 1, 6, 8, 10, 11, 12, 17, 18, 19, 20 and 21; and

  • b) request for prior inspection: document 1;

• IX - change of category of a single credit cooperative: documents 1, 6, when required, and 7 and 9, in the case of involving statutory amendment;

• X - other statutory amendments: documents 1, 7 and 9;

• XI - merger: documents 1, 6, 7, 10, 13, 14, 15, 16, 17, 18, 19, 20, 21 and, when applicable, 4;

• XII - incorporation: documents 1, 7, 13, 14, 15, 16 and, when applicable, 4, 6, 17, 18, 19, 20 and 21;

• XIII - spin-off: documents 1, 6, 7, 10, 13, 14, 16, 17, 18, 19, 20, 21 and, when applicable, 4;

• XIV - election of members of statutory bodies: documents 1, 6, 7, 9, 17, 18, 19, 20 and 21; and

• XV - cancellation of authorization for operation, due to dissolution or upon request: documents 1, 7 and 9.

Art. 16. The compliance report referred to in art. 9, § 2, item I, subitem "b", of Resolution No. 4,434, of 2015, to be submitted by a central credit cooperative or by a confederation of centrals, must address the following topics:

• I - technically justified reasons that support the consistency of the project, with a statement on the actions that will be necessary to adapt the applicant's administrative and risk control structure, in order to meet the demand of the public it intends to reach, and on the new products and services to be eventually made available, as well as a commitment to monitor the corresponding execution;

• II - statement regarding the proof of possibilities for meeting, control, carrying out operations and providing services, including regarding the need to open service points;

• III - administrative, economic and financial situation of the applicant cooperative, including a conclusive statement from the central regarding the affiliate's capacity to meet the requirements arising from the requested authorization, based on the data presented;

• IV - adequacy of the organizational structure of the applicant cooperative to the technical and administrative standards established in the specific norms of the cooperative system;

• V - observance of the systemic operation guidelines referred to in art. 34 of Resolution No. 4,434, of 2015; and

• VI - competition with other credit cooperatives in the applicant's area of operation, especially with affiliates of the same central credit cooperative or confederation of centrals.

Sole paragraph. Deorf may require the addressing of complementary aspects for the compliance report, with the objective of adapting it to the complexity of the request submitted.

Art. 17. Credit cooperatives must:

• I - include in the Information System on Entities of Interest of the Central Bank (Unicad), in addition to the documentation specified in art. 15, the information necessary for the instruction of processes, in the form of Circular No. 3,180, of 26 February 2003; and

• II - forward, in processes relating to authorization for operation, merger, demerger or involving amendments to the bylaws, an electronic file containing the bylaws approved in the corresponding corporate act, in accordance with Circular No. 3.215 of 12 December 2003.

Sole paragraph. The Deorf may consider, for the purpose of complying with the provisions of art. 33, caput, of Law No. 4.595 of 1964, the date of insertion of the election data in Unicad, provided that the documentation relating to the respective election is forwarded to the BCB within fifteen days after that date.

Art. 18. The Deorf is authorized to:

• I - establish document templates for the instruction of processes of interest to credit cooperatives; and

• II - determine effective actions, on the part of the central credit cooperative or the confederation of centrals, to correct and prevent deficiencies of their affiliates regarding the instruction of processes.

CHAPTER IX

FINAL AND TRANSITIONAL PROVISIONS

Art. 19. Projects for the constitution of credit cooperatives filed with the BCB before 6 August 2015 shall continue to be examined in accordance with the provisions of art. 3 of Resolution No. 3.859 of 27 May 2010.

Art. 20. The requests referred to in art. 6, items I and IV, of Circular No. 3.502 of 26 July 2010, filed with the BCB before 6 August 2015, shall be treated as relevant alterations of the conditions for admission of members.

Art. 21. The request for change to a category of greater complexity, arising from the provisions of art. 59, sole paragraph, item II, of Resolution No. 4.434 of 2015, is conditioned upon the presentation of the minimum Net Equity (PL) required for the intended category.

§ 1 If the applicant has been previously classified in the classic category, the presentation of a business plan in the request for change to the full category is waived.

§ 2 If the applicant has been previously classified in the capital and loan category, the request for change to a category of greater complexity must be accompanied by the business plan referred to in art. 6, item IV, of Resolution No. 4.434 of 2015.

Art. 22. Information relating to the dates of taking office, resignation, termination and temporary absences exceeding fifteen days, of the holders of statutory positions in credit cooperatives, must be recorded in Unicad, within five business days counted from the date of the event.

Art. 23. The documents and information mentioned in arts. 40 to 42 of Resolution No. 4.434 of 2015, must be forwarded to the Department of Supervision of Cooperatives and Non-Banking Institutions (Desuc), within the period established by it.

Art. 24. Art. 3 of Circular No. 3.180 of 2003, shall take effect with the following wording:

“Art. 3 In the instruction of processes involving the matters mentioned in this article, institutions must record in Unicad, in the form of the complementary instructions to Circular No. 3.165 of 2002, the information indicated for each case, contained in the list of information necessary for the instruction of processes, annexed to this Circular:

• I - ..............................................................

• ..................................................................

  • b) operation of credit cooperative: information nos. 1, 2, 16, 17, 27 and 29;

• ..................................................................

• w) subscription of capital increase or increase of relative position in the capital of financial institutions or similar abroad: information no. 28;

• x) change of category of credit cooperative: information no. 30;

• y) authorization to operate in foreign exchange in the free rate market: information no. 24;

• z) cancellation of authorization to operate in foreign exchange in the free rate market: information no. 25.” (NR)

Art. 25. The Annex to Circular No. 3.180 of 2003, is added with item 30, with the following wording:

“Annex to Circular No. 3.180 of 26 February 2003

Information to be recorded in Unicad

..................................................................

30 - data on change of category of credit cooperative.” (NR)

Art. 26. This Circular enters into force on the date of its publication.

Art. 27. Circular No. 3.502 of 26 July 2010 is revoked.

Sidnei Corrêa Marques Otávio Ribeiro Damaso Director of Organization of the System Director of Financial Regulation and Control of Rural Credit Operations Anthero de Moraes Meirelles Director of Supervision

ANNEX TO CIRCULAR No. 3.771 OF 4 NOVEMBER 2015

List of documents and information necessary for the instruction of processes:

• 1 - application, in the form established by Deorf, signed by members of the organizing group, in the case of societies under constitution, or by administrators whose representativeness is recognized by the bylaws of the operating institution;

• 2 - project, consisting of the documentation referred to in art. 6 of Resolution No. 4.434 of 5 August 2015, including business plan and draft bylaws to be adopted in the case of approval of the process;

• 3 - project, consisting of the documents referred to in art. 6, items I and IV, of Resolution No. 4.434 of 2015, observing the provisions of art. 8, caput, of Circular No. 3.771 of 4 November 2015;

• 4 - compliance report of the respective central credit cooperative or confederation, observing the provisions of art. 16 of Circular No. 3.771 of 2015;

• 5 - executive summary of the business plan, as per art. 4 of Circular No. 3.771 of 2015;

• 6 - complete page of a copy of the newspapers containing the publication of the statements of purpose, if applicable, and a printed page of the electronic version of said newspapers may be accepted;

• 7 - complete page of a copy of the newspaper in which the notice of convening the general meeting was published, and a printed page of the electronic version of said newspaper may be accepted, dispensable if the date, the number of the page or of the page of the official publication body or of the private newspaper, as well as the content of said notice, are transcribed in the minutes of the general meeting;

• 8 - two authentic copies of the minutes of the general meeting or of the public instrument of constitution of the cooperative;

• 9 - two authentic copies of the corporate act that resolved on the matter;

• 10 - two authentic copies of the bylaws, when they are not an integral part of the minutes of the meeting;

• 11 - subscription list of the founding members, in the regulatory form;

• 12 - proof of payment to the BCB of the amount related to the paid-in capital;

• 13 - two authentic copies of the minutes of the extraordinary general meetings that resolved on merger, incorporation or demerger, of all institutions involved, in the form of the law;

• 14 - two authentic copies of the report of the joint committee referred to in art. 57 or 61, as the case may be, of Law No. 5.764, of 1971, if it has not been transcribed in the minutes of the meeting that approved it;

• 15 - substantiated justification for the operation, highlighting the aspects of a strategic, corporate and economic-financial nature, if such information is not contained in the report of the joint committee;

• 16 - one copy of the balance sheet or asset trial balance on the base date, of the cooperatives involved in a merger or demerger process, of the cooperatives being incorporated, or of the non-financial confederation in the process of transformation into a credit confederation, accompanied by the respective external audit opinion;

• 17 - declaration referred to in art. 4 of Regulation Annex II to Resolution No. 4.122, of 2 August 2012, signed by the elected person. In this document, the institution must declare that it has conducted research regarding the elected person in public and private registration and information systems, being responsible for the veracity of the information provided by him;

• 18 - authorization, signed by the elected person, to the Secretariat of the Federal Revenue of Brazil, for the supply, to the BCB, of a copy of his Annual Personal Income Tax Adjustment Returns, as established in the regulation in force;

• 19 - authorization, signed by the elected person, for the BCB to have access to information regarding him contained in any public or private registration and information system, as established in the regulation in force;

• 20 - document containing an express, substantiated declaration signed by the institution, that the elected person meets the technical qualification requirement referred to in art. 5 of Regulation Annex II to Resolution No. 4.122, of 2012, dispensable when it concerns a fiscal council member and a director or administrative council member with a term in force at the cooperative;

• 21 - curriculum vitae of the elected persons, dispensable when it concerns a fiscal council member and a director or administrative council member with a term in force at the cooperative.