CVM Instruction No. 349 of March 6, 2001

CVM INSTRUCTION NO. 349, OF MARCH 6, 2001.

Amends CVM Instruction No. 319, of December 3, 1999, which provides for merger, consolidation, and spin-off operations involving public companies.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes it known that the Collegiate Board, in a meeting held on this date, based on § 3 of Art. 177 of Law No. 6,404, of December 15, 1976, combined with items II and IV of § 1 of Art. 22 of Law No. 6,385, of December 7, 1976, RESOLVED to issue the following Instruction:

Art. 1

Article 6 of CVM Instruction No. 319, of December 3, 1999, shall be effective with the following wording:

“Art. 6

§1

The registration of the goodwill referred to in item I of this article shall have as a counterpart a special goodwill reserve in the consolidation, included in shareholders' equity, and the company shall observe the following treatment regarding the registrations referred to in items II and III:

a) constitute a provision, in the consolidated entity, at least in the amount of the difference between the value of the goodwill and the tax benefit resulting from its amortization, which shall be presented as a reduction of the account in which the goodwill was registered;

b) register the net value (goodwill minus provision) as a counterpart to the reserve account referred to in this paragraph;

c) reverse the provision referred to in letter a above to the period's result, proportionally to the amortization of the goodwill; and

d) present, for the purposes of disclosing financial statements, the net value referred to in letter a in current assets and/or long-term receivables, according to the expectation of its realization.

......” (NEW)

Art. 2

Companies that have already concluded a consolidation process may adapt their financial statements to the provisions of this Instruction, constituting the provision referred to in Art. 1 as a counterpart and in proportion to the balance of the special goodwill reserve.

Art. 3

Public companies may opt to adjust their financial statements from the date of the beginning of the 2000 fiscal year, and must present, to the CVM and to the Stock Exchanges in which their securities are admitted to trading, their restated Quarterly Information (ITR).

Art. 4

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

Signed original by

JOSÉ LUIZ OSORIO DE ALMEIDA FILHO
President