CVM Instruction No. 280 (Repealed) - Investment Clubs - FGTS

FULL TEXT OF CVM INSTRUCTION NO. 280, OF MAY 14, 1998, WITH THE CHANGES INTRODUCED BY CVM INSTRUCTIONS NO. 339/00 AND 609/19

CVM INSTRUCTION NO. 280, OF MAY 14, 1998.

Provides for the constitution, administration, and operation of Investment Clubs - FGTS intended exclusively for the acquisition of shares of Mutual Funds for Privatization - FGTS.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Body, in a meeting held on this date, and based on the provisions of item I of art. 8 of Law No. 6,385, of December 7, 1976, Law No. 9,491, of September 9, 1997, Decree No. 2,430, of December 17, 1997, and Provisional Measure No. 1,613-7, of April 29, 1998, RESOLVES TO issue the following Instruction:

OF THE DEFINITION

Art. 1 The condominium constituted exclusively by natural persons, which they use to invest a portion of their Time Service Guarantee Fund - FGTS, in the acquisition of shares of Mutual Funds for Privatization - FGTS, in accordance with Law No. 9,491/97, and Decree No. 2,430/97, shall be called Investment Club - FGTS, subject to the rules of this Instruction.

Sole Paragraph. The denomination of the condominium referred to in this article shall necessarily contain the expression "Investment Club - FGTS".

Sole Paragraph. The denomination of the condominium referred to in this article shall necessarily contain the expression "Investment Club – FGTS" complemented with the identification of the company relevant to the intended investment.

• Sole Paragraph with wording given by CVM Instruction No. 339, of June 21, 2000.

OF THE REGISTRATION

Art. 2 The constitution of the Investment Club - FGTS shall depend on prior authorization from the CVM, and the following must be presented:

I - constitutive documents;
II - statutes of the Club;

III - disclosure document, if applicable.

Art. 3 The following acts relating to the Club shall also depend on prior authorization from the CVM:

I - amendment of the statutes;
II - replacement of the administrator;
III - merger, spin-off, and incorporation into another Investment Club - FGTS; IV - liquidation of the Club.

Sole Paragraph. For the authorization of the acts mentioned in items II, III, and IV, financial statements drawn up on the date of the events must be presented.

OF THE STATUTES

Art. 4 The statutes of the Investment Club - FGTS shall provide for the following matters:

I - investment policy to be adopted;
II - duration period;
III - qualification of the Club's administrator and of the portfolio administrator, when this activity is contracted with third parties; IV - remuneration of the administrator, as well as criteria for appropriation and payment; V - criterion for calculating the share value for issuance and redemption purposes; VI - conditions for subscription and redemption of shares, which shall comply with the provisions of Law No. 9,491/97, and Decree No. 2,430/97; VII - deadline for holding the Ordinary General Assembly, observing the provisions of art. 20 of this Instruction.

OF THE SHARES AND THEIR ISSUANCE

Art. 5 The shares of the Investment Club - FGTS shall correspond to ideal fractions into which its assets will be divided, shall assume a book form, and shall ensure equal rights to their holders.

Sole Paragraph. The net asset value of the Club shall result from the sum of the available funds with the value of the portfolio and amounts receivable, minus liabilities, and complying with the accounting standards established.

Art. 6 The quality of condominium owner of the Club shall be proven by the initial application document or by the deposit account statements, according to the Club's records.

Art. 7 The subscription of shares shall be carried out in accordance with the provisions of the Club's statutes, and their full payment shall be made exclusively with resources originating from the partial conversion of balances related to participation in the FGTS.

§1 The date of subscription of the shares shall correspond to the date on which the FGTS operating agent blocks the respective amount in the FGTS holder's account.

§2 The payment of shares shall occur concomitantly with the financial settlement of the acquisition of the shares of Mutual Fund for Privatization - FGTS referred to in art. 1 of this Instruction.

§3 The share value shall be determined based on an asset valuation carried out in accordance with the standards issued by the CVM.

OF THE REDEMPTION AND TRANSFERABILITY OF SHARES

Art. 8 The transfer and redemption of shares, total or partial, shall be permitted in the following cases:

I - under the conditions established by Law No. 9,491/97 and Decree No. 2,430/97 and, in the case of redemption, such information must be included in the authorization document to be issued by the FGTS operating agent; II - every six-month period from the date of payment of each share, for transferring the investment to another Investment Club - FGTS or to a Mutual Fund for Privatization - FGTS; III - after twelve months have elapsed from the date of payment of the share, for return to the FGTS.

§1 In the redemption request, the condominium owner must indicate the amount in reais or the number of shares to be redeemed and, as applicable, the Club or Fund to which they intend to transfer the corresponding resources or the return to the FGTS.

§2 When the transfer of the investment to another Club or Fund is ordered, the originating administrator shall transfer the resources on the redemption date, through a credit document in which the date of initial payment in favor of the receiving administrator is stated, who shall proceed with the immediate subscription and payment of shares, determining, if necessary, that the service-providing institution execute the same procedures.

§3 In the event of return to the FGTS, the administrator shall transfer the resources upon discharge, in cash, at the CEF branches, through the document established for this purpose by the FGTS operating agent, determining, if necessary, that the service-providing institution execute the same procedures.

§4 Whenever the case provided for in item II of this article occurs, the Club's administrator must inform the FGTS operating agent, within a maximum period of five business days, of the movements carried out.

Art. 9 The redemption shall be made at the share value of the day following the redemption request, and it must be effected within a maximum period of six business days, counted from the date of formalization of the request.

Sole Paragraph. The clubs may provide in their statutes the existence of an early redemption fee under the conditions that may be previously established by specific deliberation of the CVM for this purpose.

• Sole Paragraph added by CVM Instruction No. 339, of June 21, 2000.

OF THE FINANCIAL STATEMENTS

Art. 10. The Club shall have its own accounting records, distinct from those related to the administrator, and shall prepare a trial balance at the end of each month and semi-annual balance sheets.

Sole Paragraph. The Club's financial statements shall be subject to the accounting standards issued by the CVM.

OF THE ADMINISTRATION

Art. 11. The administration of the Investment Club - FGTS shall be exercised by a legal entity authorized by the CVM to practice the activity provided for in art. 23 of Law No. 6,385/76.

§1 The administration of each Club shall be under the direct supervision and responsibility of a statutory director of the institution, who must also be authorized by the CVM to practice the activity of managing securities portfolios.

§2 The Club's statutes may provide for mechanisms for shareholders' participation in administrative decisions related to the Club, under the conditions stipulated in the Statutes, without prejudice to the responsibility of the administrators and the provisions of this Instruction.

Art. 12. The Club's administrator, observing legal limitations and those of this Instruction, shall have powers to perform all acts necessary for the administration of the Club's portfolio, especially the contracting of services for which they are not legally qualified, as well as to exercise all rights inherent to the assets that compose it.

§1 When the administration of the Club is not exercised by a savings bank, multiple bank with investment portfolio, investment bank, brokerage firm, or distribution company, the administrator must contract a legally qualified institution to execute treasury services, such as:

I - opening and moving bank accounts, in the name of the Club; II - subscription and redemption of shares; III - financial settlement of all operations of the Club.

§2 The institutions contracted to execute services shall be jointly liable with the Club's administrator for damages caused to the condominium owners.

Art. 13. The statutes of each Club shall provide for the remuneration of the administrator, which shall be expressed as a fixed annual percentage on the net asset value of the Club.

Art. 14. The administrator may, with three months' prior notice, through written communication addressed to each condominium owner, resign from the administration of the Club, being obliged, in the same act, to communicate their intention to the CVM.

Art. 15. The CVM may, in the exercise of its legal powers, decertify the administrator if they fail to comply with current regulations.

Sole Paragraph. The decertification process shall begin with notification from the CVM to the administrator, indicating the facts that support it and the deadline for presenting a defense, which shall not be less than fifteen days, counted from the date of receipt of the communication issued by the CVM.

Art. 16. In the cases of resignation and decertification, the administrator is obliged to immediately convene the General Assembly to elect their successor, or to deliberate on the incorporation of the Club into another Investment Club - FGTS, administered by another administrator.

Sole Paragraph. The administrator shall remain in the exercise of their functions until their effective replacement.

Art. 17. The administrator, as an agent, shall have powers to exercise all rights inherent to the securities comprising the portfolio of the Investment Club - FGTS, including the right to sue and to attend and vote in general assemblies, and may also perform all acts necessary for the administration of the portfolio, observing the limitations of this Instruction.

Art. 18. The following are included among the obligations of the Club's administrator:

I - to ensure that the administrative, accounting, and operational records of the Club are maintained, updated, and in perfect order, at their expense, as well as to provide the documents necessary to prove tax obligations; II - to send, bimonthly, to the condominium owners, information regarding the Club's performance in the previous bimonthly period, the composition of the portfolio, the Club's and each condominium owner's particular asset position, and the administrator's remuneration; III - to deliver to the condominium owners, upon receipt, a copy of the Club's statutes, upon their entry into the Club and each time the statutes are amended; IV - to employ the diligence due in each circumstance in the defense of the condominium owners' interests, performing all acts necessary to ensure them, such as lawsuits, appeals, and exceptions; V - to bear all expenses not provided for in this Instruction as Club charges; VI - to pay, at their expense, a penalty fine, in accordance with current legislation, for each day of delay in fulfilling the deadlines provided for in art. 28 of this Instruction; VII - to widely and immediately disclose any relevant act or fact pertaining to it, in order to ensure that all condominium owners have access to information that may, directly or indirectly, influence their decisions regarding staying in the Club and, for other investors, regarding the acquisition of shares.

OF THE ASSEMBLY

Art. 19. It is exclusively the competence of the General Assembly of Condominium Owners, observing, where applicable, the provisions of art. 3 of this Instruction:

I - to take, annually, within a maximum period of four months, after the end of the social year, the accounts related to the Club, as well as to deliberate on the financial statements presented by the administrator; II - to amend the Club's statutes; III - to deliberate on the replacement of the administrator;

IV - to deliberate on the merger, spin-off, or incorporation of the Club into another Investment Club - FGTS and on its eventual liquidation.

Sole Paragraph. The Club's statutes may be amended, independently of a General Assembly or consultation with the condominium owners, whenever such amendment results exclusively from the need to meet requirements of the CVM, as a consequence of legal or regulatory norms, and the necessary disclosure to the condominium owners must be provided within thirty days, counted from the CVM's communication, in the periodicals destined for the disclosure of the Club's information, if applicable.

Art. 20. The convening of the General Assembly, with specification of the agenda, shall be made through:

I - publication of a notice, in a widely circulated newspaper, at least eight days in advance of the date of the General Assembly; and II - issuance of written communication, with proof of receipt, to all condominium owners registered in the "Register of Condominium Owners" up to fifteen days before the date set for its holding, including, in the calculation of the period, the day of the holding of the General Assembly and excluding the day of issuance of the convening instrument.

§1 In the case of the Investment Club - FGTS, whose condominium owners belong exclusively to a specific community, it shall be admitted that the convening referred to in item I is made through publication of internal or local circulation.

§2 If the assembly is not held, a new one shall be called, in second call, with a minimum advance of five business days.

§3 The convening shall necessarily include the day, time, and location where the assembly will be held and, clearly, the matters to be discussed.

§4 The General Assembly may be convened by the administering institution or by shareholders holding at least five percent of the total shares issued by the Club.

§5 Regardless of the convening provided for in this article, the General Assembly shall be considered regular if all condominium owners attend.

Art. 21. In the General Assembly of shareholders, decisions shall be taken by a majority of the shares of the condominium owners present:

I - in first call, with a minimum quorum of five percent of the issued shares; II - in second call, with any number.

Art. 22. A minutes record signed by the condominium owners present shall be drawn up from the Assembly, archived at the institution that administers the Club, a copy of which shall be sent to the CVM within seven days.

OF THE PORTFOLIO COMPOSITION

Art. 23. The Investment Club - FGTS shall maintain its assets invested in shares of Mutual Funds for Privatization - FGTS.

Art. 23. The Investment Club – FGTS shall maintain its assets invested in shares of Mutual Funds for Privatization – FGTS that have as their object securities of the same open company or that is to register with the CVM as such, by virtue of an obligatory clause in the Privatization Notice.

• Caput with wording given by CVM Instruction No. 339, of June 21, 2000.

§1 The Club may maintain up to five percent of its assets in fixed-income securities or investment fund shares to meet its disbursements.

§2 The Club may invest up to one hundred percent of its assets in shares of the same Mutual Fund for Privatization - FGTS.

§3 During the six-month period after the acquisition of the Fund's share, the administrator may redeem, at most, five percent of the initially acquired value.

§4 This percentage may be exceeded in the cases provided for in items I to IV and VI to XI of art. 20 of Law No. 8,036, of May 11, 1990, with the wording given by Law No. 9,491/97, as well as in the case provided for in Law No. 7,670, of September 8, 1988.

OF THE PROHIBITIONS

Art. 24. It is prohibited for the administrator, in the name of the Club:

I - to contract or make, using the Club's resources, loans or advances or to open credits under any modalities; II - to provide guarantee, surety, or acceptance or to co-oblige under any other form.

Art. 25. It is prohibited for the administrator:

I - to promise predetermined returns to the condominium owners;

II - to make promises of withdrawals and returns based on the Club's historical performance, another Investment Club's performance, or the performance of securities and capital market indices.

OF THE CLUB'S CHARGES

Art. 26. The following expenses, in addition to the remuneration referred to in art. 13, shall constitute charges of the Club, which may be debited to it by the administering institution:

I - taxes, fees, or federal, state, municipal, or autonomous contributions that fall or may fall on the Club's assets, rights, or obligations; II - expenses with printing, dispatch, and publication of reports and financial statements, forms, and periodic information, provided for in this Instruction or in relevant regulation; III - correspondence expenses of interest to the Club, such as communications to condominium owners; IV - lawyers' fees, costs, and related expenses incurred in the defense of the Club's interests, in court or out of court, including the value of the condemnation imposed on the Club, if applicable; V - any expenses inherent to the liquidation of the Club or the holding of a condominium owners' assembly. VI - emoluments and commissions paid for securities purchase and sale operations.

Sole Paragraph. Other expenses not provided for in this Instruction shall not be imputable as charges of the Club.

OF THE INFORMATION

Art. 27. The administrator shall send to each condominium owner, at least bimonthly, a document containing, at a minimum, the following information:

I - number of shares held and their value;
II - value and composition of the portfolio, discriminating quantity, type, and value of the Mutual Fund for Privatization - FGTS shares contained in the Club's portfolio; III - trial balances and financial statements for the period;

IV - any relevant information for the adequate evaluation by the condominium owner regarding their investment in the Club.
V - administrator's remuneration.

Sole Paragraph. The information referred to in this article shall be sent to the condominium owners within thirty days after the end of the period to which they refer.

Art. 28. The Investment Club - FGTS shall provide the CVM, monthly, within a maximum period of fifteen days after the end of the period to which they refer, the following information, without prejudice to others that it may require:

I - statement of sources and applications of resources, which shall include information regarding transfers of condominium owners to and from other Clubs, number of participants, as well as entries and withdrawals that occurred during the month; II - net asset value and share value, at the end of each month; III - trial balance and statement of portfolio composition; IV - any relevant information sent to the condominium owners; V - list of judicial or extrajudicial demands, whether in defense of the condominium owners' rights or by them against the Club's administration, indicating the date of their start and the stage in which they are.

Sole Paragraph. The administrator shall send, semi-annually, the balance sheet and other financial statements, within a maximum period of sixty days after the end of the period to which they refer.

OF THE PENALTY FINE

Art. 29. The administrator who fails to send the information provided for in this Instruction to the CVM shall be subject to a daily penalty fine of R$ 500.00 (five hundred reais), which shall apply from the day following the end of the deadline provided for fulfilling the obligation, without prejudice to responsibility, in accordance with item V of art. 9, and art. 11 of Law No. 6,385/76, with the wording given by Law No. 9,457, of May 5, 1997.

Art. 29. The administrator who fails to send the information provided for in this Instruction to the CVM shall be subject to the daily fine provided for in the specific norm that deals with penalty fines, without prejudice to the provisions of art. 11 of Law No. 6,385, of 1976.

• Art. 29 with wording given by CVM Instruction No. 609, of June 25, 2019.

OF LIABILITY AND OFFENSES

Art. 30. Compliance with the provisions of this Instruction is the responsibility of the administrator, natural or legal person, as well as the administrators of the legal person directly responsible for the administration of the Fund.

Art. 31. A serious offense, for the purposes of art. 11, § 3º, of Law No. 6,385/76, with the wording given by art. 2 of Law No. 9,457/97, is the transgression of the provisions of this Instruction, except those related to arts. 2, 3, 8, 9, 18, 19, and 22 to 28, which constitute cases of objective nature offense for the purposes of the summary procedure of the administrative process.

OF THE FINAL PROVISIONS

Art. 32. While the CVM does not disclose the norms referred to in art. 10 of this Instruction, the provisions of COSIF - Accounting Plan of the Financial System, issued by the Central Bank of Brazil, shall apply to the Clubs.

Art. 33. This Instruction enters into force on the date of its publication in the Official Gazette of the Union.

Original signed by
FRANCISCO DA COSTA E SILVA
President