CVM Instruction No. 254 of September 19, 1996

CVM INSTRUCTION NO. 254, OF SEPTEMBER 19, 1996.
Authorizes the creation of mutual investment funds in stocks - free portfolio intended exclusively for qualified investors and alters provisions of CVM Instruction No. 215/94.

The PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Body, in a meeting held on September 9, 1996, and in view of the provisions of Resolution No. 1,787, of February 1, 1991, of the National Monetary Council and Article 19 of Law No. 6,385, of December 7, 1976, resolved to issue the following Instruction:

Art. 1. Paragraphs 6 and 7 are included in Article 1 of CVM Instruction No. 215, of June 8, 1994, with the following wording:

“§6. Mutual Investment Funds in Stocks - Free Portfolio may be constituted, exclusively for qualified investors.”

Ҥ7. For the purposes of the provision in the preceding paragraph, the following are considered qualified investors:
I - financial institutions;
II - insurance companies;
III - open and closed private pension entities; IV - investment funds regulated and supervised by the Securities and Exchange Commission or by the Central Bank of Brazil; and V - any investors who hold portfolios of securities in an amount greater than R$ 500,000.00 (five hundred thousand reais), managed, at their discretion, by an administrator authorized by the CVM to provide portfolio administration services, in accordance with Art. 23 of Law No. 6,385, of December 7, 1976.”

Art. 2. Paragraph 4 is included in Article 3 of CVM Instruction No. 215, of June 8, 1994, with the following wording:

“§4. The regulations of funds intended exclusively for the investors referred to in § 7 of Article 1 of this Instruction must be explicit regarding the exclusive participation of qualified investors, as well as contain detailed and precise provisions regarding the possibility of using securities or financial instruments in the subscription of the value of quotas and in the payment of redemptions.”

CVM INSTRUCTION NO. 254, OF SEPTEMBER 19, 1996.
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Art. 3. The sole paragraph is included in Article 23 of CVM Instruction No. 215, of June 8, 1994, with the following wording:

“Sole Paragraph. In the case of funds intended exclusively for the investors referred to in § 7 of Article 1 of this Instruction, securities or financial instruments may be used in the subscription of the value of the quotas, provided that their regulations provide for the adoption of such procedure.”

Art. 4. The sole paragraph of Article 26 of CVM Instruction No. 215, of June 8, 1994, is renumbered as § 1, and § 2 is included, with the following wording:

“§2. In the case of funds intended exclusively for the investors referred to in § 7 of Article 1 of this Instruction, securities or financial instruments may be used in the redemption of the quotas, provided that their regulations provide for the adoption of such procedure.”

Art. 5. The sole paragraph of Article 27 of CVM Instruction No. 215, of June 8, 1994, is renumbered as § 1, and § 2 is included, with the following wording:

“§2. In the case of funds intended exclusively for the investors referred to in § 7 of Article 1 of this Instruction, a period distinct from that stated in the main text of this article may be established in their regulations.”

Art. 6. This Instruction shall enter into force on the date of its publication in the Official Gazette of the Union.

Signed original by
MARIA ISABEL DO PRADO BOCATER
Acting President