CVM Instruction No. 452 of April 30, 2007 (Revoked)

CVM INSTRUCTION NO. 452, OF APRIL 30, 2007.

Provides for coercive fines and revokes CVM Instruction No. 273, of March 12, 1998.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Body, in a meeting held on April 25, 2007, and based on item II of Article 9 of Law No. 6,385, of December 7, 1976, item IV, §1 of the same article, and §11 of Article 11 of the same law, RESOLVED to issue the following Instruction:

Scope and Purpose

Article 1. This Instruction regulates the imposition of coercive fines by the CVM on persons who fail to provide the periodic or occasional information required by normative acts, or who fail to comply with specific orders issued by the CVM.

Types of Coercive Fine

Article 2. For the purposes of this Instruction, the coercive fines imposed by the CVM are of two natures:

I – ordinary fine, understood as the coercive fine for delay in providing periodic or occasional information, the incidence of which is provided for in a normative act, with its daily value fixed; and

II – extraordinary fine, understood as the coercive fine for non-compliance with a specific order issued by the CVM in the cases and legal forms.

Sole Paragraph. For the purposes of this Instruction:

I - periodic information is the information due by the market participant on certain dates, or upon verification of routine events of certain occurrence; and

II - occasional information is the information due by the market participant upon verification of extraordinary events, or of uncertain occurrence.

Ordinary Fine for Periodic Information

Article 3. Upon verification of non-compliance with the obligation to provide periodic information, the Superintendent of the responsible area shall send, within 5 (five) business days following the end of the deadline, a specific communication addressed to the responsible party indicated in the participant's registration with the CVM, alerting them that, from the date informed, the ordinary fine provided for in the applicable regulation, duly indicated, will apply.

Ordinary Fine for Occasional Information

Article 4. Upon verification of non-compliance with the obligation to provide occasional information, the Superintendent of the responsible area shall send a specific communication addressed to the responsible party indicated in the participant's registration with the CVM, alerting them that, from the date informed, the ordinary fine provided for in the applicable regulation, duly indicated, will apply.

Sole Paragraph. The communication referred to in the main text shall be issued within 5 (five) business days after the Superintendent becomes aware of the occurrence of the event to be communicated.

Decision to Apply the Ordinary Fine

Article 5. If the obligation to provide information is only fulfilled after the accrual of the ordinary fine, or if the deadline referred to in Article 14 is reached without the obligation being fulfilled, the Superintendent of the responsible area shall decide, with justification, on the convenience of applying and collecting the coercive fine or initiating an administrative sanctioning process.

§ 1. The initiation of a sanctioning process shall be determined when the Superintendent concludes that the delay in providing information causes a risk of relevant damage to the market or to investors, considering, for this purpose, among other factors, and as applicable, the amount and dispersion of the securities issued by the participant in circulation in the market, the number of clients of the supervised entity, the business usually intermediated by it, and the values under administration, management, or custody.

§ 2. The Superintendent shall only determine the cumulative application of the fine and the initiation of a sanctioning process if he considers that the delay in providing information is part of a broader conduct that should be subject to administrative sanction.

Prohibitions on the Application of Ordinary Fine

Article 6. The application of the ordinary fine is prohibited:

I - if the obligation to provide information is fulfilled with delay, but before the communication referred to in Articles 3 and 4;

II - to market participants who, at the time of the application of the fine, have their registration suspended or cancelled; and

III - if the delay in delivering the same information has already caused the prior initiation of an administrative sanctioning process, except for the hypothesis referred to in §2 of Article 5.

Sole Paragraph. In the cases of items I and II of the main text, the possibility of initiating the potentially applicable sanctioning process is reserved, observed, in this case, the provisions of §1 of Article 5.

Decision to Impose Extraordinary Fine

Article 7. Upon verification of a legal hypothesis for the imposition of an extraordinary fine, the Superintendent of the responsible area or the General Superintendent shall notify the recipient, stating the determination to perform or refrain from performing the act described, under the threat of a daily fine, and indicating the value of the fine, the legal norm on which its imposition is based, the legal or regulatory norm on which the order of action or abstention is based, as well as informing about the availability of an appeal to the Collegiate Body, in the form and deadline established in the current regulation.

Hearing of the Interested Party on the Extraordinary Fine

Article 8. When applicable, and provided that this does not imply prejudice to the market or public interest, the imposition of the fine shall be preceded by the notification of the recipient in order to justify their conduct, within a maximum period of 3 (three) days.

Value of the Extraordinary Fine

Article 9. The daily value of the extraordinary fine shall be up to R$ 1,000.00 (one thousand reais) per day, if fixed by the Superintendent of the responsible area, up to R$ 2,000.00 (two thousand reais) per day, if fixed by the General Superintendent, or up to R$ 5,000.00 (five thousand reais) per day, if fixed based on a Deliberation approved by the Collegiate Body.

Application of the Extraordinary Fine

Article 10. If the obligation is only fulfilled after the accrual of the extraordinary fine, or if the deadline referred to in Article 14 is reached without the obligation being fulfilled, the coercive fine shall be applied and collected, without prejudice to the initiation of an administrative sanctioning process.

Sole Paragraph. The Superintendent of the responsible area, or the General Superintendent, as applicable, may decide, with justification, not to initiate the administrative sanctioning process, if he concludes that the action or omission verified did not cause relevant damage to the market or to investors.

Applicable Norms to Ordinary and Extraordinary Fines

Article 11. The communications provided for in this Instruction shall be effected:

I - by fax or electronic means, if the necessary data are contained in the participant's registration;

II - by letter, sent with acknowledgment of receipt or with acknowledgment of receipt by hand, as applicable; or

III - when urgency requires, by a CVM server, who shall certify the delivery of the communication.

§1. The communications referred to in the main text shall also be valid when effected by any other means that ensure the interested party's awareness.

§2. The CVM may make public the sending of the communications provided for in this Instruction in order to alert investors and market agents regarding the existence of any irregular practice or activity.

Article 12. The coercive fine shall begin to accrue on the day following the receipt of the communications referred to in Articles 3 and 4, or the term provided in the communication referred to in Article 7, and, when applied, shall not include in its calculation the day on which the obligation was fulfilled.

Article 13. Decisions referred to in Articles 5, 7, and 10 of this Instruction may be appealed to the Collegiate Body within 10 (ten) days.

§1. The appeal shall be received with devolutive effect. If there is justifiable fear of damage of difficult or uncertain repair resulting from the appealed decision, the Superintendent may, ex officio or upon request, give suspensive effect to the appeal.

§ 2. The appeal referred to in this article shall follow the procedure established in the regulation regarding appeals to the Collegiate Body of decisions by the Superintendents.

Article 14. The coercive fine shall apply for a maximum period of 60 (sixty) days, after which proceedings shall be carried out as established in Articles 5 or 10, as applicable.

Article 15. Credits resulting from coercive fines, not paid at maturity, plus default interest in accordance with applicable legislation, shall be registered in the Informative Registry of Unpaid Credits of the Federal Public Sector (Cadin) and in the Active Debt of the CVM, and subject to judicial execution.

Final Provisions

Article 16. CVM Instruction No. 273, of March 12, 1998, is hereby revoked.

Article 17. This Instruction enters into force on the date of its publication in the Official Gazette of the Union.

Original signed by

MARCELO FERNANDEZ TRINDADE
President