CVM INSTRUCTION NO. 168, OF DECEMBER 23, 1991.

Provides for operations subject to special procedures in Stock Exchanges.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION makes public that the Collegiate Body, in a session held on this date, and having in view the provisions of Articles 8, item I, and 18, item II, letter "a" of LAW NO. 6,385, of 12/07/76,

HAS DECIDED:

Art. 1 Stock Exchanges shall adopt special trading procedures for operations that represent:

I - a quantity of shares or rights substantially higher than the daily average traded in the last auctions, or any substantial block, even if the trading does not involve the transfer of control;

II - a price substantially higher or lower than the average of the last auctions.

Art. 2 Stock Exchanges shall also adopt special procedures for operations involving:

I - requests from bodies of the Judiciary;

II - requests from representatives of companies in extrajudicial liquidation;

III - sale of shares by shareholders in default, upon request by corporations, as provided for in item II of Art. 107 of LAW NO. 6,404/76;

IV - sale of fractions of bonus shares resulting from capitalization of profits or reserves, upon request by corporations, as provided for in paragraph 3 of Art. 169 of Law No. 6,404/76;

V - surpluses resulting from the non-exercise of preemptive rights in private subscription by shareholders of open companies, as provided for in letter "a" of paragraph 7 of Art. 171 of LAW NO. 6,404/76;

VI - subscription rights belonging to:

a) controlling shareholder or companies controlled by the issuing corporation;

b) financial institutions and other companies referred to in item I of Art. 15 of Law No. 6,385/76;

c) whoever acquired them with the aim of placing them on the market.

VII - alienation of shareholding control;

VIII - any atypical negotiation or whose characteristics are not covered in the trading regulations of the Stock Exchanges.

§1 The operations provided for in items VI and VII shall be submitted to prior approval by the Securities and Exchange Commission, and Stock Exchanges shall, in other cases, fix the conditions for carrying out the operation and monitor its execution.

§2 In the case of item V, the Stock Exchange shall request a declaration from the company, clarifying whether controlling shareholders exercised their subscription rights in full; in the negative case, the operation must be submitted to the Securities and Exchange Commission for prior approval.

§3 In the case of item VII, the alienator may determine that the operation be carried out through an auction with interference only on the buying side, solely for the acquisition of the entire lot offered.

Art. 3 Stock Exchanges shall subsequently inform the Securities and Exchange Commission of the measures adopted to carry out the operations provided for in Article 1 and items V and VIII of Article 2.

• Article revoked by CVM Instruction No. 252, of July 11, 1996.

Art. 4 To analyze the classification of the operations provided for in item I of Article 1 and items VI and VII of Art. 2, Stock Exchanges shall consider consultative transactions of the same client in one or more auctions, or through one or more brokerage firms, and may even cancel transactions already carried out.

Art. 5 For the purposes of this Instruction, the same client is considered to be natural or legal persons acting on behalf of the same interest.

Art. 6 In addition to the cases provided for in this Instruction, Stock Exchanges may establish special procedures for other operations carried out in their auctions in their regulatory norms.

Art. 7 Brokerage firms, upon receiving orders that constitute any of the hypotheses provided for in this Instruction, shall immediately inform the Stock Exchange to adopt the measures required in each case.

Sole Paragraph. The provisions of this article also apply to other members of the distribution system, who shall previously inform the brokerage firms with which they operate about the characteristics of the orders that constitute any of the hypotheses provided for in this Instruction.

Art. 8 For the purposes of this Instruction, special procedures are understood to be those aimed at offering adequate conditions for the equitable participation of investors in operations carried out in Stock Exchanges, as well as the observance of specific procedures required by legislation for certain operations.

§1 Aiming at full compliance with the provisions of this Instruction, Stock Exchanges, taking into account the specific characteristics of each operation, shall adopt, among others, the following special procedures:

PARAMETERS:

I - QUANTITY

a) Registers the operation when:

• Lot inferior to 5 times the national average and inferior to 0.5% of ordinary shares or 1% of preferred shares.

b) Submits to immediate auction when:

• Lot comprised between 5 and 10 times the national average or from 0.5% to 0.99% of ordinary shares.

c) Submits to auction with prior 15-minute announcement, communicated to other stock exchanges, when:

• Lot inferior to 10 times the national average and comprised between 1% to 2.99% of preferred shares.

d) Submits to auction with prior 1-hour announcement, communicated to other stock exchanges, when:

• Lot is superior to 10 times the national average or from 1% to 2.99% of ordinary shares or from 3% to 4.99% of preferred shares.

e) Auction preceded by notice, prepared in accordance with Annex I, published in the daily information bulletin, if any, of the stock exchange where the operation will be carried out and disseminated via telex or fax to other exchanges on the business day prior to the operation.

• Independent of the national average, from 3% to 6% of ordinary shares or from 5% to 20% of preferred shares.

f) Auction preceded by notice, prepared in accordance with Annex I, published in the daily information bulletin, if any, of the stock exchange where the operation will be carried out and disseminated via telex or fax to other exchanges, with a minimum advance of two business days.

• Independent of the national average, if superior to 6% of ordinary shares or to 20% of preferred shares.

g) Financing operations that fall under letters "e" and "f" above shall be submitted to auction with prior 1-hour announcement, communicated to other stock exchanges.

h) When it is not a controlling shareholder, sales made by an investor, in one or more auctions, to diversified buyers, with characteristics of market operations and price continuity, involving quantities of shares that fall within the parameters established in the items above, do not need to be submitted to the procedures provided for.

i) In cases of trading shares with subscription to be homologated, the sum of the capital to be homologated plus the original capital may be considered, for the purpose of calculations provided for in the items above.

j) National average is understood as the sum of the quantities traded by type in each exchange in the country divided by 30, considering the last 30 auctions.

II - QUOTATIONS

Base Price: For the first transaction of the day, the last quotation on the exchange where the largest quantity of shares, receipts of rights, in the last 30 auctions, was traded will be considered.

The stock exchange may consider as the base price the closing price of a specific share, receipt, and right, if the sum of the quantities traded in the last 30 auctions is up to 50% lower than the stock exchange where the largest quantity of shares, receipts, and rights was traded.

a) Operations whose price presents a fluctuation between 10% to 20% exclusive on the last transaction carried out with shares, receipts, and rights - immediate auction;

b) Operations whose price presents a fluctuation equal to or greater than 20% on the last transaction carried out with shares, receipts, and rights - auction with prior 15-minute announcement, communicated to other stock exchanges;

c) In the specific case of shares, receipts, and rights of very high liquidity, which will be periodically disclosed by the CVM, and whose price presents a variation superior to 5% on the last transaction carried out in the same auction - auction with prior 15-minute announcement, communicated to other stock exchanges.

d) During the course of a direct operation or common auction, if it reaches the limit of 100% above the initial price of the auction or 50% below this price, the bidding will be interrupted for 15 minutes to disclose the new price to the market, provided that this interruption occurs within the trading hours. Upon reopening the auction, only the last bid remains valid; all others will be disregarded.

• The interruption will only occur once.
• There will be no interruption for auctions with 24 or 48-hour disclosure (SPECIAL AUCTION)

e) For the first ex-rights transaction, the technical adjusted price on the last quotation will be considered, and the provisions above will be applied for special procedures.

f) If there is no previous transaction, in the same auction, and in the 5 previous auctions in the stock exchanges, the operation will be automatically submitted to auction with prior 15-minute announcement, communicated to other stock exchanges.

g) When it is the debut of a title in the stock exchange auction, the first transaction must be submitted to auction with prior 15-minute announcement, communicated to other stock exchanges.

h) Operations with subscription rights, whose quotations are inferior to Cr$ 1.00/lote of one thousand, will only be submitted to prior 15-minute auction if there is a price variation superior to Cr$ 0.10/lote of one thousand.

i) In the case where an operation must be submitted to auction by more than one criterion (price or quantity), the auction with the longest term for its realization shall be adopted.

Art. 9 Regardless of the above criteria, the Auction Manager may determine that an operation be submitted to prior auction when, at his discretion, the size of the lot to be traded exceeds the quantity considered normal or to ensure price continuity.

Art. 10 Any security that comes to be traded in stock exchanges, the criteria established here shall apply to the extent applicable.

Art. 11 The Securities and Exchange Commission may suspend the registration of operations and determine that they be submitted to auction, with prior notice to the market, even if they fall within the parameters established above.

Art. 12 The Securities and Exchange Commission may suspend the settlement or cancel operations carried out in violation of this Instruction, and may also determine to Stock Exchanges:

a) the adoption of special procedures for operations deemed worthy of such treatment by it;

b) the adoption of another procedure, deemed more adequate by it, in the case of operations already submitted to a certain special procedure.

Art. 13 Non-compliance with the provisions of this Instruction constitutes a serious offense, for the purposes of paragraph 3 of Art. 11 of LAW NO. 6,385/76.

Art. 14 This Instruction enters into force 5 (five) days after the date of its publication in the Official Gazette of the Union, revoking CVM Instruction No. 35, of July 23, 1984, and other provisions to the contrary.

Signed original by
ARY OSWALDO MATTOS FILHO
President

Published in DOU on 06.01.92 - pág. 153/155

ANNEX I

MINIMUM INFORMATION OF THE AUCTION NOTICE

1. Name of the issuing company of the securities;
2. Price;
3. Quantity and percentage in relation to the type and capital;
4. Name of the intermediary;
5. The stock exchange, date, and time of the auction;
6. Declaration that the seller is unaware of any relevant information about the company that is not public domain.
7. Link of the seller with the control or administration of the issuing company.

ANNEX II

EXPLANATORY TABLE

PREFERRED SHARES

QUANTITY TRADED
1% | 3% | 5% | 20%
REGISTERS | 15 MIN. | 1 HOUR | 24 HOURS | 48 HOURS NATIONAL AVERAGE 5X | IMMEDIATE | 15 MIN. | 1 HOUR | 24 HOURS | 48 HOURS NATIONAL AVERAGE 10X | 1 HOUR | 1 HOUR | 1 HOUR | 24 HOURS | 48 HOURS

ORDINARY SHARES

QUANTITY TRADED
0.5% | 1% | 3% | 6%
REGISTERS | IMMEDIATE | 1 HOUR | 24 HOURS | 48 HOURS NATIONAL AVERAGE 5X | IMMEDIATE | IMMEDIATE | 1 HOUR | 24 HOURS | 48 HOURS NATIONAL AVERAGE 10X | 1 HOUR | 1 HOUR | 1 HOUR | 24 HOURS | 48 HOURS