CVM Instruction No. 394 of July 22, 2003 (Repealed)

CVM INSTRUCTION NO. 394, OF JULY 22, 2003.

Provides for the possibility of private negotiations with securities by Investment Funds regulated by the CVM and intended exclusively for qualified investors, and gives other provisions.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Body, in a meeting held on this date, in view of the provisions of Art. 1, §3, and 19 of Law No. 6,385, of December 7, 1976, HAS DECIDED to issue the following Instruction:

Art. 1 Investment funds regulated by the CVM and intended exclusively for qualified investors, as well as their shareholders, may, during the validity of the Provisional Contribution on Movement or Transmission of Securities and Credits and Rights of a Financial Nature - CPMF, carry out private transactions with securities, provided they are associated with applications and/or redemptions of fund shares.

Art. 2 The operations referred to in the previous article shall be carried out obligatorily under the following conditions:

I – the subscription of shares must be made by check, bank order document (DOC) or electronic available transfer (TED) and will be simultaneous with the sale, by the shareholder to the fund, of securities, in a value corresponding to the subscribed amount, in the form and proportion established in the respective regulations and other applicable provisions;

II – the redemption of shares will be effected by check, bank order document (DOC) or electronic available transfer (TED) simultaneously with the purchase, by the shareholder, of securities belonging to the fund's portfolio, in a value corresponding to the redeemed amount, in the form and proportion established in the respective regulations and other applicable provisions;

III – the sale of the fund's securities to the shareholder must be proportional to the assets held in the fund's portfolio, and the choice, by the shareholder, of the assets to be alienated by the fund is prohibited, unless exceptionally authorized by the CVM through prior consultation.

§1 The negotiations provided for above may only be made with securities that can compose the fund's portfolio, according to its regulations and applicable legislation.

§2 Shares of investment funds organized in the form of an open condominium cannot be the object of the negotiation provided for in this Instruction.

Art. 3 Articles 8 and 99 of CVM Instruction No. 302, of May 5, 1999, shall enter into force with the following wording:

CVM INSTRUCTION NO. 394, OF JULY 22, 2003.
2

“Art. 8 ……

“§1 The restriction provided for in the main text does not apply when the shareholder is a fund of funds in investment funds in securities and financial assets, an investment fund, a fund for application in shares of financial investment funds, or the investors referred to in items II and III of Art. 99.”

(NR)

“Art. 99. ……

……

VI - Investment funds of any kind regulated by the CVM that are intended exclusively for qualified investors; and

……” (NR)

Art. 4 The titles and securities and operational modalities included in the portfolios of investment funds in securities and financial assets, investment funds in shares of investment funds in securities and financial assets, and mutual funds for privatization – FGTS must be duly registered and maintained in deposit accounts directly in the name of the fund, as the case may be, in the Special Settlement and Custody System - SELIC, in the registration and financial settlement system administered by the Custody and Financial Settlement Center for Securities – CETIP or in registration, settlement and Custody systems authorized by the Central Bank of Brazil or by the CVM.

Sole Paragraph. The provisions of this article do not apply to the fund's applications in shares of investment funds.

Art. 5 Investment funds of any kind regulated by the CVM intended exclusively for qualified investors and that have benefited from faculties that are only granted to them by the current regulations may only be converted into investment funds intended for other types of investors with prior CVM approval.

Art. 6 CVM Instruction No. 314, of September 24, 1999, is hereby repealed.

Art. 7 This Instruction enters into force 30 (thirty) days from the date of publication in the Official Gazette of the Union.

Original signed by

LUIZ LEONARDO CANTIDIANO

President