CVM Instruction No. 364 (Repealed)

CVM INSTRUCTION NO. 364, MAY 7, 2002

Amends CVM Instruction No. 306, of May 5, 1999, which provides for the administration of securities portfolios.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Board, in a meeting held on this date, having regard to the provisions of Articles 8, items I and III, and 23 of Law No. 6,385, of December 7, 1976, HAS DECIDED to issue the following Instruction:

Art. 1 Articles 3, 4, 5, 7, 8, 9, 11, 12, 13 and 15 of CVM Instruction No. 306, of May 5, 1999, shall enter into force with the following wording:

"Art. 3 ......

Sole Paragraph. The CVM is not responsible for the procedures and orientations of securities portfolio administrators." (NR)

"Art. 4 ......

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II - professional experience of:
a) at least three years in specific activity directly related to the management of third-party resources in the financial market; or b) at least five years in the capital market, in an activity that demonstrates their aptitude for the management of third-party resources; and III - impeccable reputation.

§1o The CVM may, exceptionally, waive compliance with the requirement set forth in item I of this article, provided that the professional experience required in item II of this article is proven to be at least seven years.

§2o The CVM may, exceptionally, waive compliance with the requirement set forth in item II of this article, provided that the interested party possesses notable knowledge and high qualification in a field of knowledge that qualifies them to exercise the activity of securities portfolio administration.

§3o Acting as an investor in the securities market or managing third-party resources without remuneration is not considered professional experience for the purposes of meeting the requirement set forth in item II of this article.

§4o For the purpose of proving the experience set forth in letter 'b' of item II and in § 1o of this article, the interested party must submit to the CVM a request justifying objectively their understanding that they are qualified to administer securities portfolios for third parties." (NR)

"Art. 5 ......

I – application signed by the interested party; II – curriculum vitae containing professional data that demonstrate the applicant's experience, in accordance with Art. 4, duly signed by the interested party; III – duly completed registration form, contained in Annex III to this Instruction; IV – copy of the higher education degree certificate and of the main courses mentioned in the curriculum; V – copy of the Individual Taxpayer Registry card and identity card; VI – declaration from the current and previous employers stating the activities developed by the interested party and listing the corresponding periods in which they were performed, or, if applicable, a copy of the articles of association of companies of which the interested party is or has been a partner; VII – declaration, duly signed by the applicant, informing:
a) whether they are disqualified from holding positions in financial institutions and other entities authorized to operate by the CVM or the Central Bank of Brazil, insurance companies, private pension entities and publicly-held companies; b) whether they have been convicted of bankruptcy crimes, malfeasance, active or passive corruption, extortion, market manipulation, improper use of insider information, irregular exercise of position, profession, activity or function within the scope of the securities market, embezzlement, against the popular economy, public faith, property, the National Financial System or criminal penalty that prohibits, even temporarily, access to public offices; c) whether they are included in the Registry of Issuers of Bounced Checks; d) whether they have titles protested against them;

e) whether, in the last five years, they have suffered any punishment as a result of their performance as an administrator or member of the fiscal council of an entity subject to the control and supervision of the CVM, the Central Bank of Brazil, the Secretariat of Complementary Retirement or the Superintendence of Private Insurance; and f) whether their assets are unavailable due to a judicial decision or administrative authority.

§1o In the cases provided for in letters 'd' and 'e' of item VII, the CVM may examine and evaluate the individual situation of the applicant, with a view to granting the requested authorization, having the discretion to analyze the circumstances of each case.

§2o If it is not possible to obtain the declarations provided for in item VI of this article, the interested party must send a copy of the pages of the professional card that prove the experience mentioned in the curriculum." (NR)

"Art. 7 ......

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II – assign responsibility for the administration of securities portfolios to a director, delegated manager or managing partner authorized to perform the activity by the CVM; and
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§3o The substitution of the director, delegated manager or managing partner responsible or of the person hired, in accordance with § 1o of this article, can only be made by a professional equally qualified by the CVM, in the manner provided for in this Instruction.
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§5o The director, delegated manager or managing partner directly responsible for the administration of third-party securities portfolios cannot be responsible for any other activity in the capital market, in the institution or outside it.

§6o The director, delegated manager or managing partner directly responsible for the administration of third-party securities portfolios can only be responsible for the same activity in affiliated companies, as defined by law.

§7o The CVM may examine the indication of more than one responsible director, if the legal entity administers securities portfolios of different nature, and provided that its administrative structure contemplates the existence of a strict division of activities among them, which must be performed independently and exclusively, especially with regard to investment decision-making.

§8o The technical department is responsible for the preparation of studies and investment analyses that underpin the decisions to be made, maintaining appropriate records with the justifications for the recommendations made.

§9o The assignment of responsibility for the administration of securities portfolios to a delegated manager or managing partner must be stated in the articles of association of the legal entity." (NR)

"Art. 8 ......

I - application signed by the legal representative; II - copy of the consolidated constitutive acts; III - copy of the proof of registration in the National Registry of Legal Entities; IV - document containing the indication of the managing partner, delegated manager or director responsible for the activity; V - information about the technical department, including the number of professionals, the nature of the activities developed by its members and the available infrastructure, including a detailed list of equipment, programs and services, own or third-party, used in the portfolio administration activity, or, if applicable, the contract with a person authorized by the CVM to provide services of this nature; VI – information about the investor profile with which the company intends to operate; and VII – duly completed registration form, contained in Annex IV to this Instruction." (NR)

"Art. 9 ......

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§4o The CVM may, by reasoned letter, return to the applicant the authorization request and the documents that supported it without formulating requirements, if it verifies that they present uncurable irregularity or illegality, or that the request is not accompanied by the necessary documents." (NR)

"Art. 11 ......

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II - if, due to a subsequently proven fact, it becomes evident that the person authorized by the CVM no longer meets any of the requirements and conditions established in this Instruction for the granting of authorization; or III - if the securities portfolio administrator does not send the information provided for in Art. 12 of this Instruction for two consecutive years. ......" (NR)

"Art. 12 The securities portfolio administrator, natural or legal person, must send to the CVM, by May 31 of each year, information regarding the portfolios they administer, based on positions as of March 31 of the same year, as established in Annexes I and II of this Instruction, in addition to updated registration information, in accordance with Annexes III or IV, as applicable. ......" (NR)

"Art. 13 Whenever publicly disclosing data based on historical performance of administered portfolios or securities and capital market indices, the securities portfolio administrator must add, in bold, the following message: 'THE ADMINISTRATOR WARNS THAT PAST RESULTS DO NOT GUARANTEE FUTURE RESULTS'." (NR)

"Art. 15 ......

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Sole Paragraph. If the segregation referred to in this article is promoted through the hiring of a securities portfolio administrator, duly accredited with the CVM, to manage all securities portfolios administered by the institution, there is no need to designate a director, delegated manager or managing partner of the administering institution to respond exclusively for the management and supervision of the mentioned resources, and such designation may fall upon a director, delegated manager or managing partner who has a link with other activities provided they are not the administration of the institution's own resources, and the same must also be duly accredited with the CVM as a securities portfolio administrator." (NR)

Art. 2 Annexes III and IV to CVM Instruction No. 306/99 shall enter into force in accordance with the models attached.

Art. 3 The following Art. 11-A is added to CVM Instruction No. 306/99:

"ON CANCELLATION BY REQUEST
Art. 11A. The request for cancellation of the authorization to exercise the activity of securities portfolio administration must be accompanied by a declaration that, on the date of the request, the applicant no longer performs the activity of securities portfolio administration.

§1o The cancellation request shall be approved by a Declaratory Act, to be issued within thirty days, counted from the protocol at the CVM, whose effects shall retroact to the date of the request, being presumed approved if, after such period, there is no manifestation from the CVM.

§2o The approval of the cancellation does not prevent the CVM from initiating or proceeding with a procedure to determine the applicant's responsibility for acts occurring up to that date."

Art. 4 Article 6 of CVM Instruction No. 306/99 is repealed.

Art. 5 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

ANNEX

ANNEX III TO CVM INSTRUCTION NO. 306, OF MAY 5, 1999
NATURAL PERSON
Registration Form for
Securities Portfolio Administration Service Providers:

1. Name:______
2. CPF:______
3. Residential Address:

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4. City/State/ZIP:______ ______ ______
5. (DDD) TELEPHONE and FAX:______ ______ ______
6. Electronic address (e-mail):______
7. Legal Entity of which they are Director, Delegated Manager or Managing Partner responsible for
   provision of Securities Portfolio Administration Services:
   Name:______ CNPJ:______"(NR)

ANNEX IV TO CVM INSTRUCTION NO. 306, OF MAY 5, 1999
LEGAL ENTITY
Registration Form for
Securities Portfolio Administration Service Providers

1. Corporate Name:______
2. Trade Name:______
3. CNPJ:______
4. Headquarters Address:

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5. City/State/ZIP ______ ______ ______
6. (DDD) TELEPHONE and FAX:_______ ______ ______
7. Mailing Address:

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8. City/State/ZIP: ______ ______ ______
9. Electronic address (e-mail): ______
10. Director, Delegated Manager or Managing Partner responsible for Securities Portfolio Administration
    Services:
    Name:______ CPF:______
11. Natural or Legal Person hired to provide Securities and Financial Instruments Analysis services (only to be filled in case of non-existence of own technical department):
    Name:______ CNPJ/CPF:______"(NR)