CVM Orienting Opinion No. 31 of September 24, 1999

CVM ORIENTING OPINION NO. 31, OF SEPTEMBER 24, 1999.

Intelligence of art. 3 of CVM Instruction No. 301, of April 16, 1999 ("Money Laundering"), regarding the maintenance and updating of client registration data.

1. This opinion concerns CVM Instruction No. 301, of April 16, 1999, hereinafter referred to simply as the Instruction, which embodies the discipline, within the scope of the CVM, of Law No. 9.613, of March 3, 1998, which provides for the crimes of "money laundering" or concealment of assets, rights, and values. The opinion specifically addresses art. 3 of the Instruction.

2. Subject to the obligations provided in the Instruction (art. 2):

• legal entities that have, on a permanent or occasional basis, as their main or accessory activity, custody, issuance, distribution, settlement, negotiation, intermediation, or administration of securities or financial assets;
• stock exchanges;
• entities of the organized over-the-counter market;
• commodities or futures exchanges;
• other persons referred to in art. 9 of Law No. 9.613/98 who are under the discipline and supervision exercised by the CVM; and
• administrators of all the above legal entities.

3. Art. 3 of the Instruction provides for the identification and maintenance of a client registry, which must contain, at minimum, the data fixed therein. By virtue of Law No. 9.613/98 itself (art. 10, item I), the registries must be kept permanently updated. To achieve this, § 2 of that art. 3 additionally establishes that clients must immediately communicate any changes to their registration data. Those responsible for maintaining the registry must verify, with each service provision or periodically, if the data is updated, taking appropriate measures in situations that indicate outdated information, as well as requesting the client to do so.

4. The minimum diligence required of those obligated to maintain the registry also consists of disseminating, among their clients, the content of the Instruction, alerting them that providing any false or incomplete information regarding financial and asset status, or failing to provide such data, may give rise to a presumption of lack of economic foundation, due to the incompatibility between the operation performed and the declared financial and asset status, with the consequent communications to the CVM (art. 7 of the Instruction).

CVM ORIENTING OPINION NO. 31, OF SEPTEMBER 24, 1999.
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5. Effective submission to the Instruction, with regard to registration data, presupposes that the persons subject to its commands have clients who operate in the securities market - MVM. Thus, a foreign exchange, securities, and financial assets brokerage company that does not have this type of client, because it does not actually operate in the MVM, despite being duly authorized, does not fall under the specific rules of the Instruction.

6. Regarding the requirement to indicate the corporate name or trade name of holding companies, subsidiaries, or affiliates, concerning the registry of corporate client persons (art. 3, § 1, item II, letter "g"), the registry maintainer may restrict itself to obtaining the corporate name or trade name of those linked persons who are also its clients.

7. Indeed, the requirement pointed out in the previous item arises from the provision of art. 4, sole paragraph, of the Instruction, which contemplates the obligation to register negotiations of securities or financial assets carried out with the same person, conglomerate, or group, in the same calendar month, by the corporate client or entities linked to it, whose values, collectively, exceed R$ 10,000.00 (ten thousand reais).

8. Finally, it should be noted that the fact that certain persons are not obligated to maintain a registry does not exempt them from observing and complying with the other obligations of the Instruction that are not related to registration data.

9. Therefore, persons subject to the obligations provided in the regulatory norm under examination must, under the principle of reasonableness and acting with good sense, comply with the rules established by the Instruction that are applicable to them.

Signed original by
ALEXANDRE PINHEIRO DOS SANTOS
Lawyer
Signed original by
SUELI DA SILVA
Chief Prosecutor
Approved by the Board on 09/24/99.
Signed original by
FRANCISCO DA COSTA E SILVA
President
Published in the Official Gazette (DOU) on 09/30/99, page 13, section 1.