CVM Instruction No. 289 of August 7, 1998

CVM INSTRUCTION NO. 289, OF AUGUST 7, 1998.

Amends CVM Instruction No. 243, of March 1, 1996, which regulates the organized over-the-counter market.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes it public that the Collegiate Body, in a meeting held on this date, in accordance with the provisions of item II of art. 1, items I and II of art. 8, and items “a” and “c” of item II of art. 18 of Law No. 6,385, of December 7, 1976,

HAS DECIDED to issue the following Instruction:

Art. 1 The art. 16 of CVM Instruction No. 243, of March 1, 1996, shall be effective with the following wording:

“Art. 16A. The change of registration of a publicly held company from trading on a stock exchange to the organized over-the-counter market is only permitted if:

I - previously approved by the Board of Directors in a meeting specifically convened for this purpose;

II - within a period of up to two days after the Board of Directors' decision, the company publishes a Notice of Act or Relevant Fact, informing its proposal and setting a period of up to 45 days, counted from the publication of the Notice, for minority shareholders, registered in the shareholder register up to the date of the decision, to express their disagreement with the change of the trading market for the company's shares; and

III - there is no disagreement from minority shareholders, holders of at least 51% of the shares in circulation in the market.

Sole Paragraph. The disagreement of minority shareholders must be embodied in a document signed in three copies, containing the complete identification, the number and type of shares owned.

Art. 16B. The change of registration of a publicly held company from trading on a stock exchange or in the organized over-the-counter market to the unorganized over-the-counter market is only permitted if:

I - previously approved by a decision to that effect by shareholders representing at least 51% of the company's capital, with or without voting rights, assembled in an Extraordinary General Meeting specifically convened for this purpose; and

II - minority shareholders, numbering more than one hundred, on the date of the General Meeting, and holding more than five percent of the shares in circulation in the market on the same date, do not expressly oppose the change of registration.

Sole Paragraph. For the purpose of calculating the number of shareholders provided for in item III of art. 16A and item II of art. 16B, shares owned by investment funds shall be considered as belonging to a number of shareholders proportional to the number of participants in the fund, at the rate of one shareholder for every thousand participants in the fund, up to a maximum limit of fifty shareholders per fund.”

Art. 2 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