CVM Circular Letter CVM/SMI 01/12

CVM CIRCULAR LETTER CVM/SMI No. 001/2012
São Paulo, July 2, 2012.

To
Participants of the Distribution System
Subject: CVM Instruction No. 505/2011

Dear Sirs,

1. CVM Instruction No. 505/2011, of September 27, 2011, which updated the regulation of securities transactions in regulated markets, introduced a new regulatory model for transactions based, primarily, on the adoption and supervision of rules, procedures, and internal controls established by the intermediaries themselves, meeting minimum parameters determined by the Instruction itself and by the norms of the entities administering organized markets.

2. The Instruction entered into force on April 2, 2012, but, as established in its Article 37, intermediaries must adapt to the provisions of the norm, as well as to the rules issued by the entities administering organized markets, by October 1, 2012.

3. In this way, intermediaries have until September 28, 2012, to comply with the provision of item II of Article 4 of CVM Instruction No. 505/2011, indicating the Internal Controls Director through the CVMWEB system - Participant Registration Update (link on the CVM page on the World Wide Web), whose first report will be required in January 2013.

4. Regarding the Director mentioned in item I of Article 4, it is necessary that he be indicated immediately through the CVMWEB system - Participant Registration Update, even if the holder of the position is the same one designated to fulfill an analogous function existing in the revoked CVM Instruction No. 387/2003. For purposes of eventual liability, the current designations will be considered until the new designation occurs.

5. Finally, we emphasize that all provisions of CVM Instruction No. 505/2011 that reproduce obligations already present in the revoked CVM Instruction No. 387/2003 have been in force since April 2, 2012, and that the adaptation period mentioned in Article 37 applies only and exclusively to the provisions that introduced new obligations to intermediaries, as well as to the rules issued by the entities administering organized markets for compliance with the Instruction in question.

Sincerely,

Waldir de Jesus Nobre
Superintendent of Market Relations and Intermediaries