CVM/SRE Circular Letter 01/18

SECURITY AND EXCHANGE COMMISSION OF BRAZIL
SUPERINTENDENCY OF REGISTRATION OF SECURITIES
CIRCULAR LETTER CVM/SRE No. 01/18
Rio de Janeiro, February 27, 2018
SUBJECT: General guidelines on procedures to be observed by issuers and intermediaries in public offerings of securities.

Dear Director,

The main objective of this Circular Letter is to guide offerors of securities and intermediary institutions on how to better comply with the regulations governing public offerings of securities. It also presents guidelines on the interpretation and understanding of certain regulatory provisions and, consequently, their application, as adopted by the Superintendency of Registration of Securities - SRE.
Observance of the recommendations listed below will contribute to minimizing possible deviations and, consequently, to reducing the need for the SRE to formulate requirements, as well as to allowing the activities of market participants to be carried out efficiently and swiftly, in favor of investor protection and market integrity.
This document consolidates the Circular Letters previously issued by the SRE, without, however, dispensing with the reading of applicable regulations, and updates to corporate and capital market legislation and CVM regulation, especially those occurring after this date, must also be observed. The new guidelines contained herein are highlighted in yellow.
Finally, this Circular Letter does not seek to exhaust all subjects related to the SRE's activity. Possible complements and adjustments will be incorporated into future versions of this Circular Letter, to be issued in the coming years.

Sincerely,

(signed originally by)
DOV RAWET
Superintendent of Registration of Securities

CIRCULAR LETTER CVM/SRE No. 01/18

Table of Contents

Communication with the SRE.................................................................................................... 5
Calculation of deadlines............................................................................................................ 7
Analysis deadlines in the event of conversion from automatic to ordinary procedure..... 8
Simplified procedure for registration of public offerings – Agreement................... 10
Inquiries from regulated entities (issuers, offerors, and intermediaries) ................................. 11
Requests for meetings with private parties......................................................................... 12
Requests for inspection and copies of administrative processes................................................... 12
Request for access to information......................................................................................... 14
Request for confidentiality ............................................................................................. 15
Appeals against decisions or understanding statements by the SRE ......................... 16
Commitment Term.................................................................................................... 17
Risk-Based Supervision Plan – SBR............................................................... 18
Inspection fees for registration of public offerings.................................................... 19
Waivers of registration requirements for public offerings ............................................... 20
Setting of retail portions in public distribution offerings .............................. 21
Setting the price of shares in an IPO below the published range .................................... 22
Silence period – Art. 48, item IV of CVM Instruction No. 400/2003 ...................... 22
Suspension of public offerings of distribution of securities ......................... 23
CAV Documentation..................................................................................................... 23
Revolving in CRA offerings....................................................................................... 24
CRI and CRA backed by credits considered real estate or credit rights considered agribusiness by destination ..................................................... 25
Possibility of issuing CRA backed by credit rights in which neither party (creditor or debtor) is characterized as a rural producer or its cooperatives, involving the participation of a distributor or reseller of agricultural product or input .............................................................................................................................. 27
Possibility of issuing CRI backed by credits guaranteed by fiduciary alienation of real estate property........................................................................................................... 28
Transfer to the Securitization Company of the credits that will make up the backing in CRI and CRA operations................................................................................................................................. 29
Possibility of distribution period of up to 2 years in open FIDC offerings ..... 30
Portfolio Administrator acting with distributor ................................................... 31
Fiduciary Agent .............................................................................................................. 32
Cancellation of issuer registration – OPA.................................................................. 33
Discontinuation of BDR program........................................................................... 34
Request for OPA registration ............................................................................................... 34
Update of Valuation Report in OPA ................................................................. 35
Interpretation of article 37, §1º of CVM Instruction No. 361/2002................................... 36
Distribution offerings carried out through Crowdfunding........................................ 37
Virtual assets and public offerings - ICO .......................................................................... 38
Guidelines for the Preparation of the Prospectus and other Public Distribution Offering Documents........................................................................................................................... 39
35.1. General guidelines................................................................................................... 39
35.2. Rules on the preparation and dissemination of information....................................... 39
35.3. Guidelines for drafting offering documents.................................................... 40
35.4. Preliminary Prospectus and Final Prospectus .......................................................... 41
35.5. Availability and submission of the Prospectus to the CVM....................................................... 42
35.6. Identification of persons responsible for the content of the Prospectus...................... 43
35.7. Non-applicable information..................................................................................... 43
35.8. Guidelines for filling out the Prospectus..................................................... 43
Guidelines related to distribution offerings carried out under restricted efforts - CVM Instruction No. 476/2009 ..................................................................................................... 54
36.1. General guidelines................................................................................................... 54

36.2. System for receiving information on Offerings with Restricted Efforts and Waivers of art. 5 of CVM Instruction No. 400/2003 ............................................................................... 55
36.3. Interpretation of art. 9º (4-month period between offerings with restricted efforts) . 56
36.4. Table “Offering Data” of the Partial and Closing Forms of
distribution.............................................................................................................................. 57
36.5. Treatment given to fund unitholders who do not qualify as professional investors in public offerings with restricted efforts ........................................................ 58
37. Advertising Material......................................................................................................... 59
37.1. Most common requirements ......................................................................................... 59
37.2. Institutional Advertising......................................................................................... 62
37.3. Deadlines and Procedures........................................................................................... 63
37.4. Models of pre-approved advertising material..................................................... 64

SECURITY AND EXCHANGE COMMISSION OF BRAZIL
SUPERINTENDENCY OF REGISTRATION OF SECURITIES

Communication with the SRE

The direct service activities for offerors and intermediaries are divided in the SRE between the Registration Departments (GER-1 and GER-2), according to the securities issued, as shown in the table below:

Securities (offerings) Departments
Shares GER-2
Sponsored and Non-Sponsored BDR - Levels 1, 2, and 3 GER-2 DR Program - Levels 1, 2, and 3 GER-2 Subscription Warrants GER-2 Bank Credit Notes - CCB GER-2 Audiovisual Certificates - CAV GER-2 Securities Deposit Certificates ("units") GER-2 Structured Operations Certificates - COE GER-2 Certificate of Additional Construction Potential – CEPAC GER-2 Agribusiness Receivables Certificates - CRA GER-1 Real Estate Receivables Certificates - CRI GER-1 Collective Investment Contract - CIC GER-2 Crowdfunding GER-2 Debentures GER-2 National Cinematographic Industry Financing Fund - Funcine GER-2 Credit Rights Investment Fund - FIDC GER-1 Non-Standardized Credit Rights Investment Fund - FIDC NP GER-1 Participation Investment Fund - FIP GER-2 Real Estate Investment Fund - FII GER-2 Financial Notes GER-2 Promissory Notes GER-2 Public Offers for Acquisition of Shares – OPA GER-1

GER-3 handles enforcement for all SRE cases.

SRE
GER-1 GER-2 GER-3

All documents to be sent to the SRE (including, for example, requests for registration of offerings and OPAs, responses to letters, inquiries, etc.) must be sent to the CVM electronically.

To do so, the regulated entity can choose between two paths: i. via the CVM website by accessing the “Document Protocol” link available in the upper area of the home page; or ii. physically filed at the CVM, accompanied by non-rewritable media (CD or DVD). We ask that you observe the correct addressing in the presentation/filing of the petition, including with regard to the department responsible for the subject within the SRE, as indicated above, in order to allow the best progress of the analysis deadline, which will only begin upon acceptance of the material in the area to which it is destined. Furthermore, we alert that all petitions must present the name, direct phone number, and contact email of their responsible parties, in order to facilitate communication and/or sending of Letters.

Through the CVM website, the presented petition must list in sequential number all attachments or documents referenced therein. The names of the files sent electronically must necessarily contain the attachment number that appears in the petition and the name of the attachment, not exceeding 40 characters (prospectus, reservation request, distribution contract, response to Letter xxx, etc.). The documents must be recorded in PDF (Portable Document Format) non-editable format, in one file for each document or attachment. Documents produced by the petitioner themselves must be sent in searchable PDF format.

The limit for sending documents on the CVM website is 10 documents and 15 MB total per protocol. Documents that separately or together exceed 15 MB or that gather more than 10 items and, therefore, would need to be sent in more than one protocol should, preferably, be filed directly at the CVM, on non-rewritable media.

In the case of physical filing, the petition must be accompanied by non-rewritable media (CD or DVD), which will contain all attachments or documents referenced in the petition (including the petition itself), respecting the guidelines set out in the paragraphs above. The documents must be recorded directly in the root directory of the CD/DVD, without using an archive folder. These attachments should not be sent physically to the CVM.

Additionally, we reiterate the guidelines provided through CIRCULAR LETTER CVM/SEP/SRE 01/18, with regard to registration requests for public distribution of securities issued by companies that are in the process of initial registration analysis, in the sense that those requests as well as the documents that support them should also be presented through the Empresas.NET System. We emphasize that the presentation through the Empresas.NET System will not be considered for the purpose of filing the distribution registration request with the SRE, therefore not triggering the start of the analysis deadlines.

The letters from the SRE, in response to requests and inquiries, will be sent to the email address registered at the CVM of the regulated entity or to the email specifically indicated in the initial request for receiving responses.

The rules set out in this Circular Letter do not apply to documents sent with a request for confidentiality, which must continue to observe the existing norms (for example, art. 9º-A, sole paragraph, of CVM Instruction No. 361/2002; art. 56, §§3º and 4º of CVM Instruction No. 480/09; art. 7º, §1º of CVM Instruction No. 358/2002) – see section 8 – “Request for confidentiality”.

Calculation of deadlines

In the calculation of deadlines, the rule established by art. 66 of Law No. 9.784/1999, which regulates the administrative process within the federal public administration, must be observed. In this sense, the calculation of deadlines in said processes is similar to that established by article 224, caput and §1º, of Law No. 13.105/2015.

Therefore, in the calculation of the deadline, the starting day must be excluded and the due day included.

In the event that the starting day or the due day falls on a day when the CVM headquarters (Rio de Janeiro) is not in operation, such as Sundays and national or municipal holidays, the term is extended to the next business day.

Additionally, as determined by article 23 of Law No. 9.784/1999, the acts of the process must be carried out on business days, during the normal working hours of the agency where the process is proceeding.

Thus, on dates when the CVM headquarters operates in a partial period, closing before normal hours, deadlines will be extended until the next business day. On the other hand, when the CVM headquarters operates in a partial period and the operation ends at the normal hour, in accordance with the provisions of art. 66, §1º, of Law No. 9.784/1999, this day will be considered in the deadline in progress.

It should be noted that the filing of documentation directed to the SRE or its respective Departments in a city other than its location, although admissible, does not affect the calculation of the deadline, which will continue to be governed by the location of the CVM headquarters (Rio de Janeiro).

Specifically regarding requests for registration of distribution offerings, excluding share offerings, notably regarding the analysis deadline for requirements formulated by the SRE at the time of adapting curable defects, we clarify that the period referred to in §2º of art. 16 of CVM Instruction No. 400/2003 will begin after the sending of the last documentation filed within the deadline for compliance referred to in §1º of said article. The reservation made for share offerings arises from the fact that, in this case, some documents are only produced and/or signed upon the conclusion of the bookbuilding procedure, such as the distribution contract and adherence terms, as well as corporate acts approving the issue price. Furthermore, due to the flow of the admission process for trading within B3, it is customary for the declaration regarding the approval for trading of the shares in that market to only be available on a date already close to the end of the SRE's analysis period. Thus, specifically regarding the cited documents or others that are justifiably in the same situation regarding their preparation, such documents are accepted without restarting the calculation of the deadline for analyzing curable defects.

Documents sent to the SRE via the CVM website (through access to the “Document Protocol” link, cited in the previous section), when filed after 6:00 PM or on non-business days, will be considered as having been filed on the next business day. The practical effect of this is that the analysis deadline would start on the business day following the date of filing. That is, for example, if a certain document was filed at 7:00 PM on Wednesday, the filing date would be considered Thursday and the analysis deadline by the SRE would start on Friday.

In the case where an offeror files a series of documents for an offering, with the first filing made before 6:00 PM and the subsequent filings made immediately and consecutively, ending after 6:00 PM, due to the size limit of electronically forwarded files, the filing date, for the purpose of calculating the analysis deadline, will be that of the first filing. We remind you of our guideline that documents exceeding 15 MB should, preferably, be filed directly at the CVM, on non-rewritable media.

Analysis deadlines in the event of conversion from automatic to ordinary procedure

In cases of automatic registration of distribution offerings, possible in the case of distribution of units of structured funds, if there is a provision for the use of a Preliminary Prospectus, the automatic registration request must be accompanied by the Market Notice and the Preliminary Prospectus, as published, as well as the draft of the Start Announcement, and the protocol must be filed at the CVM on the date of publication of the Market Notice. Failure to comply with this guideline will result in the automatic conversion of the analysis to the ordinary procedure. If there is no provision for the use of a Preliminary Prospectus, the automatic registration request must be accompanied by the Final Prospectus and the Start Announcement, both in draft form.

In the event of impossibility of automatic registration of distribution, the SRE will communicate this situation to the intermediary, once the period provided for automatic grant has elapsed, a period regulated in the specific Instructions, namely, 10 business days for distribution of units of Participation Investment Funds - FIP and Real Estate Investment Funds – FII, (respectively CVM Instructions No. 578/2016 and 472/2008) or 5 business days in the case of distribution of units of Credit Rights Investment Fund – FIDC (CVM Instruction No. 356/2001). Within this letter of communication of impossibility of automatic registration, the requirements will be informed, whose deadline for compliance will be equivalent to the deadline for automatic registration, 10 or 5 business days as the case may be. Compliance with such requirements will be verified by the SRE in an equal period, counted from the filing of the response to the requirements.

Having exhausted the steps described in the paragraph above without verifying compliance with the requirements, there will be a conversion from the automatic procedure to the ordinary registration procedure, in which case the analysis of the request will have deadlines aligned with those provided in CVM Instruction No. 400/2003.

For requests for registration of distribution of units of Participation Investment Funds - FIP and Real Estate Investment Funds – FII, the SRE will write to the intermediary informing them of the change in the analysis procedure, communicating the requirements, whether those not met or any new requirements. Regarding this communication, a deadline of 40 business days will be granted for compliance with requirements (art. 9º §1º of CVM Instruction No. 400/2003) counted from the date of sending the SRE letter that initially communicated the impossibility of automatic registration.

The SRE will have 10 business days to analyze this stage of compliance with requirements, after which a deadline may be granted to correct curable defects eventually identified, which will be 10 business days or the remaining period for compliance with requirements, according to the calculation considered in the previous paragraph, whichever is greater.

Finally, the SRE will have a deadline of 10 business days to appreciate this last formulation of requirements for the offering.

In the case of Credit Rights Investment Fund - FIDC, when converting from the automatic procedure to the ordinary registration procedure, the request will observe the deadlines provided in CVM Instruction No. 400/2003, considering as the starting point for all deadline calculations the date of filing of the initial request, still under the automatic procedure.

Simplified procedure for registration of public offerings – Agreement

The simplified procedure for registration of public distribution offerings is regulated by CVM Instruction No. 471/2008.

Based on this instruction, an Agreement was established with ANBIMA to carry out preliminary analyses and prepare technical reports regarding requests for registration of public distribution offerings through the simplified procedure, for the following securities:

i. debentures;
ii. promissory notes;
iii. shares of the same class and species as others already admitted to trading on a stock exchange or organized over-the-counter market;
iv. subscription warrants of the same class and species as others already admitted to trading on a stock exchange or organized over-the-counter market;
v. deposit certificates of shares of the same class and species as others already admitted to trading on a stock exchange or organized over-the-counter market;
vi. real estate receivables certificates;
vii. financial notes;
viii. units of real estate investment funds;
ix. units of participation investment funds; and
x. units of credit rights investment funds, with the exception of those governed by CVM Instruction No. 444/2006 and/or that enjoy the tax treatment provided for in Law No. 12.431/2011.

The adoption of the simplified procedure will be an option granted to ANBIMA participating institutions, which may always opt for the use of the ordinary procedure directly with the CVM.

In the case of real estate receivables certificates, the backings approved for analysis within the Agreement are: Typical lease contracts; Atypical lease contract (Built to suit); Rural or urban lease contract; Purchase and sale contract

of real estate; Real Estate Purchase and Sale Promise Contract; Financing Contracts; Real Estate CCB or Debenture; and Real Right of Surface.

With the 4th amendment to the Agreement, signed on 02/26/2018, the procedures related to the analysis by ANBIMA of advertising materials to be used in the context of public offerings previously analyzed in accordance with the Agreement were improved. In this sense, a differentiated analysis procedure by the CVM of the ANBIMA report on such documents was established, which also came to contemplate the possibility of the CVM, when determining the approval of the advertising material, requesting the applicant to comply with certain requirements, allowing the automatic use of the material, without the need for re-examination, once the requirements are met.

The full text of the documents representing the Agreement is available on the CVM website (http://www.cvm.gov.br/convenios/index.html).

Inquiries from regulated entities (issuers, offerors, and intermediaries)

Inquiries regarding the application of norms and regulations issued by the CVM and the understanding of provisions of Laws No. 6,385/76 and 6,404/76 must be submitted in writing, via protocol, by the participants or their duly designated representative (accompanied by their respective powers of attorney) to the SRE, with the identification of the regulated entity.

The formulation of the inquiry must be clear regarding its object, avoiding generic form and theoretical inquiries, guiding the presentation of all elements and arguments deemed important for the conclusive manifestation of the CVM.

It is worth highlighting that the submission of an inquiry by the regulated entity does not exempt it from complying, within the due deadlines, with legal and regulatory obligations, even if they are the object of the formulated inquiry.

In the case of simple inquiries, which do not require an in-depth analysis by the SRE, we recommend that their submission be made via the email sreconsultas@cvm.gov.br.

Inquiries and complaints from investors and the general public, which are not directly regulated by the SRE, must be submitted to the Superintendence of Investor Protection and Orientation - SOI via the CVM website (through the Citizen Service - SAC).

Requests for meetings with private parties

Requests to schedule meetings with organizational components of the CVM must be submitted electronically, through the CVM's Internet page, selecting, for this purpose, the option AUDIENCE WITH PRIVATE PARTIES.

It is recommended that the regulated entity fill out the object of the audience as completely and in as much detail as possible, and also inform, in the "Subject" field, whenever possible and if applicable, the number of the Letter, Process, or other CVM act to which the subject of the audience refers. In this request, the clear specification of the subject to be discussed must be included.

It is also advisable for the regulated entity to contact the SRE by telephone before scheduling the private audience in the system, to verify agenda availability.

Confirmation of the scheduling is a prior condition for the holding of the audience. Meetings and audiences that have not been previously scheduled in the system will not be held.

Requests for inspection and copies of administrative processes

In accordance with paragraph 2 of article 8 of Law No. 6,385/76, all documents and records of administrative processes that are pending or archived at the CVM are public, except those whose confidentiality is essential for the defense of intimacy or social interest, or whose confidentiality is assured by express legal provision.

Article 46 of Law No. 9,784/99 – which regulates the administrative process within the Federal Public Administration – must also be taken into account, which guarantees interested parties the right to inspect the process and obtain certificates or reprographic copies of the data and documents that comprise it, except for data and documents of third parties protected by confidentiality or by the right to privacy, honor, and image.

In the case of an administrative process to investigate illegal acts and unfair practices that is preceded by an investigative stage, the confidentiality necessary for the elucidation of facts or required by public interest will be assured, as provided in paragraph 2 of article 9 of Law No. 6,385/76.

In 2005, the Autarchy regulated, through CVM Deliberation No. 481/05, the granting of inspection of records of administrative processes of any nature instituted within the scope of the CVM.

Requests for inspection of processes pending before this Autarchy must be submitted by presenting a signed petition, specifying that it concerns the granting of inspection and/or copies, with the qualification of the signatories and, in the case of their representatives, accompanied by their respective powers of attorney.

In accordance with paragraph 1 of article 3 of CVM Deliberation No. 481/05, the request must specify the requester's interest in obtaining access to the records, except when it concerns an accused in an administrative sanctioning process, in which case the granting of inspection will always be assured.

The granting depends on authorization from the head of the Superintendence responsible for conducting the administrative process or the Relator, if there is a pending appeal or decision by the Collegiate, and the postponement of the granting of inspection may be permitted in the interest of the service when such measure would hinder the performance of an act or the adoption of measures necessary for the conduct of the process.

Furthermore, processes instituted for the purpose of verifying the possible occurrence of violations of legal or regulatory norms whose supervision is incumbent upon the CVM will be conducted under confidentiality, except in cases where the requester has been publicly indicted by the CVM as a possible author of the infraction under investigation, in which case the granting of inspection will be considered mandatory.

It is worth noting that the confidentiality of the process may be lifted by decision of the Superintendent, when he considers it unnecessary for the elucidation of facts and there are no data or information in the records protected by cases of confidentiality assured by express legal provision or for the defense of intimacy or social interest.

As stated in paragraph 2 of article 5 of CVM Deliberation No. 481/05, the provisions in the two paragraphs above, regarding processes for the investigation of irregularities, apply to complaints filed by investors and any other market participants, including regarding inspection requests filed by them.

In administrative sanctioning processes, the accused will be admitted to the granting of inspection upon petition addressed: (i) to the Process Control Coordination – CCP, in processes governed by CMN Resolution No. 454/77; or (ii) to the Superintendence that instituted the process, until the eventual filing of an appeal to the Collegiate, in processes governed by CMN Resolution No. 1,657/89, or to the CCP, after the eventual filing of appeals to the Collegiate.

Inspection requests will be analyzed on a case-by-case basis, and in the event of denial of the request, the requesters may appeal to the CVM Collegiate, in accordance with CVM Deliberation No. 463/03.

According to article 3, paragraph 3, of CVM Deliberation No. 481/05, if the denial decision is issued by the Relator, an appeal against the decision may be filed with the Collegiate within 5 (five) days, counted from the date the interested party becomes aware.

For approved requests, the processes will be made available at the Consultation Center – SOI/GOI of this Autarchy, with the indication of the availability period through a letter or email in response to the request.

Without prejudice to the above, requests for access to information may also be made, based on the "Information Access Law" (see following section).

Request for information access

In view of the institution of Law No. 12,527/2011 ("Information Access Law" or "LAI"), regulated by Decree No. 7,724/2012, the CVM issued CVM Deliberation No. 710/2013, which establishes the procedures for information access provided for in the aforementioned Law.

In accordance with article 2 of the aforementioned Deliberation, the request for information access must be made electronically on the CVM's page on the worldwide web, or physically, at the Citizen Information Service – SIC of the CVM, by filling out a Standard Form.

In the case of partial or total denial of access to information or failure to provide the reasons for the denial of access, the requester may file an appeal, within ten days, counted from the awareness of the decision, to the General Superintendent. If such appeal is denied, the requester may file an appeal within ten days, counted from the awareness of the decision, to the President of the CVM (article 3 of CVM Deliberation No. 710/13).

As provided in article 4 of the aforementioned Deliberation, in the event of omission of response to the request for information access, the requester may file a complaint, within ten days, to the General Superintendent. The deadline to file a complaint begins thirty days after the submission of the request for information access.

Finally, if the appeals provided for above are denied or the complaint mentioned in the previous paragraph is unsuccessful, the requester may file an appeal within ten days, counted from the awareness of the decision, to the Office of the Comptroller General of the Union.

It is important to note that based on art. 13 of Decree No. 7,724/2012 transcribed below, the LAI does not serve to impose the obligation to consolidate or interpret data that are in the possession of the Autarchy, in the event of a request for information regarding them.

Art. 13. Requests for information access will not be attended to:
I - generic;
II - disproportionate or unreasonable; or
III - that require additional work of analysis, interpretation, or consolidation of data and information, or service of production or data treatment that is not within the competence of the agency or entity.
Sole paragraph. In the case of item III of the caput, the agency or entity shall, if it has knowledge, indicate the location where the information from which the requester can perform the interpretation, consolidation, or data treatment is located.

Confidentiality request

In accordance with §2 of article 39 of CVM Instruction No. 400/2003 and item VI of art. 10 of CVM Instruction No. 361/2002, the SRE may request the sending of additional information and documents beyond those required by these Instructions. It may also request, from the offeror and/or the lead institution, clarifications on information and documents sent, granting them a deadline to comply with the request. Such information and documents will be considered public by the SRE.

As provided in article 9-A of CVM Instruction No. 361/2002, and in other CVM norms, exceptional requests for confidential treatment of such information and documents must be accompanied by the presentation of the reasons why the offeror believes that their disclosure to the public would put at risk a legitimate interest of the issuer.

The information subject to the confidentiality request must be sent in a sealed envelope, addressed to the Presidency of the CVM, in which the word "Confidential" appears, in accordance with the sole paragraph of art. 9-A of CVM Instruction No. 361/2002.

In accordance with art. 57 of CVM Instruction No. 400/2003, the offeror may request a preliminary confidential analysis, regarding offerings carried out simultaneously in Brazil and abroad, which require registration with a foreign capital market regulatory authority.

The approval of such request depends, among other things, on the existence of a memorandum of understanding concluded between the CVM and the respective regulatory authority which must grant the registration abroad.

Along with the request, proof of payment of the supervision fee referred to in Law No. 7,940/1989, in the amount due for the definitive registration request, in cases where it is due, must be attached.

The offeror must commit to submit to the CVM the request for definitive registration immediately after the preliminary analysis is concluded, and the deadlines provided for in arts. 8 and 9 of CVM Instruction No. 400/2003 will apply to its analysis.

The confidential treatment of the preliminary analysis will cease immediately if the operation becomes public in other markets or if there is a leak of information about the offering in the Country.

Appeals against decisions or understanding manifestations of the SRE

CVM Deliberation No. 463/2003 disciplines the procedures regarding appeals against the decisions of the CVM Superintendences.

In accordance with the aforementioned Deliberation, the deadline to appeal to the Collegiate against decisions issued by the CVM Superintendents is 15 (fifteen) days, counted from the date the interested party becomes aware. As a rule, it is considered that awareness occurs on the date of sending the email that communicates the decision. In exceptional situations where communication is made only by physical means (mail), awareness occurs on the date of receipt of the correspondence. There is no regulatory provision containing the hypothesis of extension of this appeal deadline.

The Superintendent must, within 10 (ten) business days from the receipt of the appeal, reform or maintain the appealed decision and, in the second case, forward the process to the Collegiate even if he understood the appeal to be untimely or inadmissible.

The appeal will be received with devolutive effect. If there is a just fear of damage of difficult or uncertain repair resulting from the execution of the decision, the Superintendent may, ex officio or upon request, give suspensive effect to the appeal.

If there is a request for suspensive effect and it is denied, the Superintendent must, immediately, notify the appellant and send a copy of the appeal and the decision to the President of the CVM, who will be responsible for the re-examination of the decision denying the suspensive effect.

It is possible to request reconsideration of the Collegiate's decision, but only in the case of the existence of error, omission, obscurity, or material inaccuracies in the decision, contradiction between the decision and its foundations, or doubt in its conclusion,

therefore, the hypothesis of rediscussion of the merits of the decision is excluded. The request must be sent to the member of the Collegiate who drafted the winning vote in the examination of the appeal, within 15 (fifteen) days.

With a view to providing greater speed in the dissemination of decisions issued by the body, the dissemination of Collegiate Newsletters, containing only the decisions issued, was established, and they are made available until the day following the meeting. Such newsletters are made available on the CVM website by accessing the "Collegiate Decisions" link available in the left menu. We remind you that the formal communication of the Collegiate's decision, to be carried out by the technical area to the participant, will take place once the meeting minutes are prepared by the Executive Secretariat of that body, so that the publication of the newsletters does not produce any effects for the purpose of counting deadlines.

Commitment Term

The Commitment Term may be signed between the investigated or accused party and the Securities and Exchange Commission, at the discretion of the CVM, observing the public interest, in accordance with paragraphs 5 to 8 of article 11 of Law No. 6,385/1976 and CVM Deliberation No. 390/2001. It is worth noting that the proposal for the Commitment Term should not be submitted in the name of the issuer, but rather of the investigated or accused party itself.

It is worth highlighting initially that, according to paragraph 3 of article 7 of CVM Deliberation No. 390/2001, the presentation of a proposal for a Commitment Term will be admitted even in the preliminary investigation phase.

In the case of an administrative sanctioning process, article 7 of CVM Deliberation No. 390/2001 provides that the interested party in the celebration of a Commitment Term must manifest this intention until the end of the deadline for presenting a defense, without prejudice to the burden of presenting it. It must also present the Complete Proposal for the Commitment Term to the Coordination of Administrative Process Control – CCP, within 30 days after the presentation of the defense.

In exceptional cases, in which it is understood that the public interest determines the analysis of a proposal for the celebration of a Commitment Term presented outside the aforementioned deadline, such as those involving substantial indemnity offers to those harmed by the conduct object of the process and modification of the factual situation existing at the end of the aforementioned deadline, the Collegiate will examine the request, provided it is formulated before its decision in judgment.

The Commitment Term suspends the ongoing administrative process, for the period stipulated for its compliance, and may be celebrated at any time, although it is recommended to present the intention as soon as possible, given the speed and procedural economy.

In view of the promulgation of Law No. 13,506, of November 13, 2017, the commitment terms celebrated began to be published on the CVM website, instead of in the Official Gazette of the Union, with the discrimination of the deadline for compliance with the obligations eventually assumed (art. 11, § 7). It is noted that the commitment term constitutes an extrajudicial executive title.

Information on Commitment Terms already celebrated with the CVM, which can serve as examples for the presentation of proposals, is available on the CVM website, in the "Processes" link, located in the left menu, followed by "Commitment Terms".

Finally, it is worth highlighting that, according to article 4 of the aforementioned Deliberation, the celebration of a Commitment Term does not imply confession regarding the matter of fact, nor recognition of the illegality of the conduct analyzed in the process that gave rise to it.

Risk-Based Supervision Plan – SBR

Since 2009, the CVM has been carrying out preventive monitoring activities of the markets and entities under its jurisdiction according to a Risk-Based Supervision model – SBR.

With this form of action, established by CMN Resolution No. 3,427/06 and regulated by CVM Deliberation No. 521/07, the regulator focuses its action on risks to the performance of its legal duties, seeking a more preventive than reactive approach.

The SRE, in its activity of supervising public offerings of distribution of securities and public offerings for the acquisition of shares (OPA), carries out various actions to fulfill the legal mandates to protect investors against (i) irregular issuances of securities, (ii) unfair market practices, and (iii) ensure public access to information about the offered securities. Among these, we can cite:

i. Verification of the information provided or disclosed to the market and the documentation presented for registration;

ii. Monitoring of additional information provided about the offering after the registration is granted; and

iii. Supervision of offerings carried out without registration, in disagreement with the granted registration, or in disagreement with the condition of exemption from registration.

Regarding the Biennial Plan of the SBR relating to the 2017-2018 period, it is worth highlighting that the SRE will act by supervising the following risk events:

i. Occurrence of irregularities in the progress of public offerings for the acquisition of shares, registered or not;

ii. Occurrence of irregularities in registered public offerings of distribution.

iii. Occurrence of irregularities in public offerings of distribution with Restricted Efforts.

iv. Occurrence of irregularities in public offerings of distribution of CIC hotel.

For each type of offering under analysis, a sample will be analyzed to determine what occurred during or after the offering.

The offerings announced or closed in the biennium 2017-2018 will be examined, according to the criteria defined in each risk event.

The full text of the public version of the Biennial Plan 2017-18 of the SBR is available at www.cvm.gov.br/menu/acesso_informacao/planos/sbr/bienio_2017_2018.html.

Supervision Fees for registration of public offerings

The supervision fee on the registration of distribution (Table D), based on Law No. 7,940/1989, must be paid prior to the filing of the registration request.

The following link maintains information regarding the fee and registration tables, with the Table D to be considered being that informed in the most recent ordinance of the Ministry of Finance (notably, on the date of issuance of this Circular Letter, Ordinance No. 493 of 11/13/2017). http://www.cvm.gov.br/menu/regulados/taxasmultas/tabelas_taxa.html

The Union Collection Guide (GRU) for payment of the supervision fee can be generated and printed at http://sistemas.cvm.gov.br/?GRUTaxa

In case of underpayment, the difference must be paid, prior to the granting of the registration, plus a fine and interest calculated from the date of

filing of the registration request. The calculation of charges can be done using the Calculation Tool available on the CVM website.

The fee is calculated on the value of the offering registration. The calculation base includes the value of the basic lot and the supplementary lot offering. A fee must be paid for each registration requested/granted.

Concurrent primary and secondary offerings obtain distinct registrations and therefore must pay fees separately. Similarly, concurrent offerings of different series of debentures, CRIs, or CRAs must pay fees separately, to the extent that each series is the object of respective registration as they present characteristics own and distinct from the other series object of the offering. Even as a result of such obligation, in the case of offerings submitted to the bookbuilding procedure, there may be payment of a fee regarding the series for which no demand is verified and which ends up not being issued. In the case of series offered in the "communicating vessels" system, the calculation of fees must be done considering the maximum possible quantity to be registered in each series, including the supplementary lot.

If the registration request for a BDR program is concurrent with the registration request for a public offering of distribution of these BDRs, only the fee for the distribution will be required, based on observation 3 of Table D: "There will be no overlap or double charging of Supervision Fees".

Exemptions from registration requirements for public offerings

CVM Instructions No. 400/2003 (distribution offerings) and CVM No. 361/2002 (OPA) provide for the possibility of exemptions from registration requirements, and even from the registration itself, in various ways. These exemptions are granted by the Autarchy's Collegiate based on requests from offerors, which are previously analyzed by the SRE.

In some cases, the CVM Collegiate delegated to the SRE the competence to grant exemptions from registration or requirements, according to the following Deliberations:

CVM Deliberation No. 476/2005 – Exemption from presentation of the Preliminary and Definitive Prospectus on the internet, under specific conditions; of inclusion of the name and address of individual offerors in announcements of the start and end of distribution; and of prohibition of placement of securities with persons considered linked to the offering with excess demand;
CVM Deliberation No. 533/2008 - Exemption from presentation of the economic-financial feasibility study.

CVM Resolution No. 734/2015 – Waiver, in condo-hotel offerings, of offering registration and registration requirements, under specific conditions.
CVM Resolution No. 751/2016 – Waiver of minimum or maximum limits on shares to be acquired, in a tender offer formulated by a controlling shareholder of a company listed in a special trading segment of securities.
CVM Resolution No. 756/2016 – Waiver of procedures and formalities proper to be followed in public offers for the acquisition of shares governed by the caput of Article 34 of CVM Instruction No. 361/2002 (adoption of a differentiated procedure), as well as to authorize the formulation of a single public offer for the acquisition of shares, aiming at more than one of the purposes provided for in the same Instruction (unification of tender offer).
CVM Resolution No. 772/2017 – Waiver of the requirements provided for in items I and II of Article 6 of CVM Instruction No. 414/2004, enabling the placement of CRIs backed by credits considered real estate due to their destination with non-qualified investors (see item 16).

Setting of retail tranches in public distribution offerings
In public distribution offerings of securities where bookbuilding and reservation acceptance procedures are used and where tranches are established for non-institutional investors, to ensure fair and equitable treatment for all investors, the SRE recommends that a maximum limit for reservation per investor be established, equivalent to the minimum necessary value of financial investments, established for the characterization of a qualified investor (currently R$ 1 million), or, alternatively, to guarantee the use of this limit as a basis in the event of a need for pro-rata allocation.

In the event of a request for waiver of the requirement corresponding to the prohibition on the placement of securities with persons considered linked to the offering, in the case of distribution with excess demand greater by one-third than the quantity of securities offered (Article 55 of CVM Instruction No. 400/2003 and item 'c' of CVM Resolution No. 476/2005), without the establishment of maximum order limits for the reservation of the non-institutional investor tranche in the amount mentioned above, the SRE understands that the possibility of favoritism and use of information to obtain undue advantage by the linked person will not be mitigated, and therefore, the aforementioned waiver will not be granted.

Setting of IPO share prices below the disclosed range
The CVM Collegiate, in a meeting on 05/22/2012, resolved that in initial public offerings of shares (IPO), in the event of price setting at a value lower than 20% of the disclosed price range, the offering coordinators must immediately disclose the occurrence in a prominent place in the announcement of the start of the IPO, and give retail investors the possibility to withdraw from the IPO.

The SRE understands that, in this case, the same procedures and deadlines provided for in the caput and sole paragraph of Article 27 of CVM Instruction No. 400/03 must be used, proceeding with immediate disclosure of the information by means at least equal to those used for the disclosure of the offering itself, and direct communication to investors who have already adhered to the offering.

The IPO Offering Prospectus must contain, in the appropriate sections, clear information about the procedure that will be adopted on the day of publication of the offering start announcement, in case of price setting at a value lower than 20% of the disclosed price range, including a specific risk factor.

Silence Period – Article 48, item IV of CVM Instruction No. 400/2003
The issuer, the offeror, and the Intermediary Institutions must refrain from making statements in the media about the offering or the offeror during the offering period.

We alert that any statement in the media about the offering is prohibited, including the advance disclosure of the result of the bookbuilding process.

Particularly regarding the information generated in the bookbuilding process, it is important to emphasize that these must remain confidential even within the scope of the sales effort with potential investors. In this sense, the reference to information about investment intentions such as prices, demand, and investors who presented intentions, within the scope of the sales approach, contradicts Article 48, item IV of CVM Instruction No. 400/2003.

Violation of the aforementioned provision may result in the suspension of the offering, regardless of any eventual investigation of responsibilities in a sanctioning nature procedure.

The rules regarding the silence period also apply to public distribution offerings carried out with restricted efforts, as indicated by Article 12 of CVM Instruction No. 476/2009.

Suspension of public distribution offerings of securities
In accordance with Article 19 of CVM Instruction No. 400/2003, the CVM may suspend or cancel, at any time, the distribution offering that: (i) is being processed under conditions different from those contained in this Instruction or the registration; or (ii) has been found to be illegal, contrary to CVM regulation, or fraudulent, even after the respective registration has been obtained.

The suspension of public distribution offerings is carried out by the Securities Registration Superintendency – SRE, when the cited elements are present.

The irregularities that historically cause the most suspensions of public distribution offerings are the irregular use of advertising material not approved by the CVM, in violation of Article 50 of ICVM 400, and media statements during the silence period, in violation of Article 48, item IV of the same Instruction. In this sense, we alert offerors to exercise special care in the disclosure of advertising materials for the offering, carefully observing the provisions in item 37 of this Circular Letter and in direct or indirect contact with the media or social networks.

The suspension period of the offering may not exceed 30 (thirty) days, during which the pointed irregularity must be remedied. Upon expiration of the period referred to in §2 without the flaws that determined the suspension having been remedied, the CVM must order the withdrawal of the offering and cancel the respective registration.

Once the flaws that determined the suspension have been remedied, the request for revocation of the suspension must be sent to the SRE and will be analyzed within a period of up to 5 (five) business days.

CAV Documentation
Companies issuing Certificates of Investment for the production, distribution, exhibition, and technical infrastructure of Brazilian audiovisual cinematic works (“CAV”) are obliged, by virtue of the provisions of Articles 24 and 25 of CVM Instruction No. 260/97, to make certain Periodic and Occasional Information available to the CVM.

In accordance with Article 24 of CVM Instruction No. 260/97, CAV issuing companies must prepare by the 10th (ten) day of the month following the reference month, a monthly report on the integration of quotas (“IMA Report”) and a report on the evolution of the project (“IFA Report”), according to the forms contained in Annexes I and II of the aforementioned Instruction.

In accordance with Article 25 of CVM Instruction No. 260/97, once the project is completed, CAV issuing companies must prepare and disseminate, semi-annually, a report containing information regarding the earnings resulting from the commercialization of the project (“ISA Report”), according to the form contained in Annex III of the aforementioned Instruction.

Each IMA, IFA, or ISA Report must be sent to the CVM in a digital file, individualized by competence period (month for IMA Report and IFA Report and semester for ISA Report).

The names to be used for the files corresponding to each report must follow the pattern below:
IMA Report: CAV-XXXX-NNN-IMA-YYYY-MM
IFA Report: CAV-XXXX-NNN-IFA-YYYY-MM
ISA Report: CAV-XXXX-NNN-ISA-YYYY-MM-YYYY-MM

Where:
XXXX-NNN corresponds to the year and sequential number of the CAV registration number YYYY corresponds to the reference year of the report MM corresponds to the reference month of the report YYYY-MM corresponds to the year-month of the start of the reference semester YYYY-MM corresponds to the year-month of the end of the reference semester

Revolvency in CRA offerings
CRA offerings that contain the possibility of revolvency of the credit rights that make up their backing must observe the necessary requirements listed by the SRE in accordance with Memorandum No. 51/2015-CVM/SRE/GER-1 and which were corroborated by the CVM Collegiate in a Decision dated 08/25/2015, within the scope of CVM Process No. RJ-2015-6419, namely:

i. the agribusiness credit rights originally linked to the CRAs must have an amount that supports the remuneration (principal + interest) provided for the CRAs and a maturity date prior to that of the aforementioned titles, which must be duly identified in the Securitization Deed, also complying with what is prescribed by Article 40 of Law No. 11.076/2004 and item 2.1 of Annex III of CVM Instruction No. 414/2004, the latter to the extent applicable;

ii. the Securitization Deed and the other instruments that accompany the offering (Prospectus, including) must clearly provide for the revolvency of the credit rights originally linked and the methodology to be adopted in such revolvency procedure, including the eligibility criteria for the new credit rights;

iii. the cash flow arising from the credit rights originally linked to the respective CRA series must be used to acquire new credit rights that will be linked in an amount and term compatible with the payment of the CRAs (principal + interest);

iv. the portion not used for the acquisition of the new credit rights must be used for the proportional payment of extraordinary amortization of the CRA;

v. if there is indeed the revolvency of the agribusiness credit rights, in any quantity, the Securitization Deed must be amended, so that it continues to include the information required by Article 40 of Law No. 11.076/04 and item 2.1 of Annex III of CVM Instruction No. 414/2004, the latter to the extent applicable;

vi. the CRAs must be destined exclusively to qualified investors, as defined in accordance with Article 9º-B of CVM Instruction No. 539/2013, by analogy with CRI operations, for which fewer formalities will be required, in accordance with the new wording of Article 6 of CVM Instruction No. 414/2004; and

vii. there must be the constitution of a separate patrimony integrated by the totality of the agribusiness credit rights linked to the respective CRA series offered, with the appointment of a fiduciary agent, observing what is prescribed by Articles 9º to 16 of Law No. 9.514/1997.

CRIs and CRAs backed by credits considered real estate or by credit rights considered agribusiness due to destination
Based on precedents analyzed by the CVM Collegiate over time, notably within the scope of CVM Processes No. 19957.000587/2016-51 (Collegiate decision of 08/16/2016, Cyrela case) and 19957.001669/2016-13 (Collegiate decision of 08/30/2016, Burger King case), it has become possible to issue CRIs and CRAs backed respectively by credits considered real estate and by credit rights considered agribusiness due to the destination of the resources originating from the issuance of such titles. Based on such precedents, we list below some of the specific requirements to be observed in offerings with this type of backing.

CRIs backed by credits considered real estate in their destination will be those in which cumulatively:

i. an exhaustive list of the real estate properties to which the resources originating from the issuance will be destined is included in the offering documentation, thereby configuring the link provided for in item I of Article 8 of Law No. 9.514/1997;

ii. the obligation of the Fiduciary Agent to verify, throughout the term of the CRIs (at least quarterly), the effective direction of the entire amount obtained from the issuance to the aforementioned real estate properties is included in the offering documentation;

iii. information about the deadline for the effective destination of the resources obtained through the issuance, which must be no later than the maturity date of the CRIs, is included in the offering documentation;

iv. an indicative schedule (amounts and dates) of the destination of the resources obtained through the issuance to the linked real estate properties, defining precisely a percentage, relative to the total value raised in the offering, that will be destined to each of the aforementioned real estate properties, is included in the offering documentation;

v. information that any alteration regarding the percentage of the resources obtained from the issuance to be destined to each of the linked real estate properties must be preceded by an amendment to the Securitization Deed, as well as to any other document that may be necessary, is included in the offering documentation;

vi. the capacity to direct to the linked real estate properties the entire amount of resources that will be obtained from the issuance, within the term of the CRIs, taking into account, for this purpose, the amount of resources spent to date, the need for remaining resources of each of the aforementioned real estate properties, as well as the destination of resources already programmed for such real estate properties due to other CRIs already issued, is demonstrated.

CRAs backed by credit rights considered agribusiness due to their destination will be those in which cumulatively:

i. an exhaustive list of the rural producers, or their cooperatives, to whom the resources originating from the issuance will be destined is included in the offering documentation, thereby configuring the origination provided for in §1 of Article 23 of Law No. 11.076/04 to the credit rights backing the operation;

ii. contracts or other documents that formalize the transactions carried out between rural producers, or their cooperatives, and third parties, within the scope of which the resources originating from the offering will be destined, are presented;

iii. the condition of rural producer, or of rural producer cooperative, of all those who were listed as such in the offering documentation is proven;

iv. the condition of agricultural product or input of all the products involved in the transactions carried out between rural producers, or their cooperatives, and third parties, transactions to which the resources originating from the offering will be destined, is justified;

v. the obligation of the Fiduciary Agent to verify, throughout the term of the CRAs (at least quarterly), the effective direction of the entire amount obtained from the issuance to the transactions carried out between rural producers, or their cooperatives, and third parties, is included in the offering documentation;

vi. information about the deadline for the effective destination of the resources obtained through the issuance, which must be no later than the maturity date of the CRAs, is included in the offering documentation;

vii. an indicative schedule (amounts and dates) of the destination of the resources obtained through the issuance to the transactions carried out between rural producers, or their cooperatives, and third parties, is included in the offering documentation;

viii. the capacity to direct to the transactions carried out between rural producers, or their cooperatives, and third parties, within the scope of the contracts or other documents that formalize such transactions, the entire amount of resources that will be obtained from the issuance, within the term of the CRAs, taking into account, for this purpose, the amount of resources spent to date, as well as the destination of resources already programmed due to other CRAs already issued, within the scope of such contracts, is demonstrated.

Possibility of issuing CRA backed by credit rights in which none of the parties (creditor or debtor) is characterized as a rural producer or their cooperatives, involving the participation of a distributor or reseller of agricultural product or input
Based on the Decision of the CVM Collegiate of 11/21/2017, within the scope of the registration request for the public distribution offering of Certificates of Agribusiness Receivables (“CRA”) of the 1st Series of the 12th Issuance of VERT Securitization Company (CVM Process No. 19957.006751/2017-15, Syngenta Case), it was clarified that certain credit rights could be considered as originating from transactions carried out between rural producers, or their cooperatives, and third parties, for the purpose of constituting CRA backing, in observance of the requirements of Law No. 11.076/04, even if there was no presence of rural producers, or their cooperatives, in the figure of debtor or creditor of such credit rights, but with the participation of distributors or resellers of agricultural products or inputs. For this purpose, the aforementioned titles, when transferred to the Securitization Company, within the scope of the CRA issuance, must be accompanied by the contractual instruments or credit titles issued by the rural producers, or their cooperatives, to which they are linked and from which they originated.

Thus, it is up to the Securitization Company to verify, based on the received documentation, the integrity and completeness of the backing prior to the issuance of the respective CRA. Such documents must also be kept in custody with the Custodian Institution, in order to allow the verification of the backing regularity by the CVM, during its supervision routines.

Possibility of issuing CRI with backing in credits guaranteed by fiduciary alienation of real estate property
In accordance with the Decision of the CVM Collegiate of 01/16/2018, which by majority granted a remedy against the understanding of the SRE, within the scope of the registration request for the public distribution offering of Real Estate Receivables Certificates of the 62nd and 63rd series of the 1st issuance of Barigui Securitization S.A. (CVM Process No. 19957.008927/2017-73), it was resolved that “the loan to natural persons with an adjunct pact of fiduciary alienation of real estate property as guarantee constitutes a real estate credit in its origin, since the owner derives economic benefit from his property, by granting real security, to obtain resources at reduced costs. Furthermore, in this type of loan, the link between the alienation value of the property and the satisfaction of the credit is verified, since the creditor has the security of receiving the due payment from the product obtained with the execution of the guarantee, in case of default.”

The CVM Collegiate also emphasized that, “in the case under analysis, the relevance of this loan to the real estate market is evidenced by the fact that the originator is a mortgage company, part of the Real Estate Financial System (Law 9.514, art. 2º) and the Housing Financial System (Law No. 4.380/1964, art. 8º, VI), whose typical object is the granting of loans and financing guaranteed by fiduciary alienation of real estate property (CMN Resolution No. 2.122/1994, art. 3º, II). Thus, by allowing the loan to serve as backing for the issuance of the CRI, it contributes to the expansion of the activities performed by this participant of the real estate market. Moreover, the admission of this type of loan as CRI backing proves consistent with the understanding that has been adopted by the Central Bank of Brazil and the Monetary National Council regarding the qualification of real estate credit, as seen in BACEN Circular No. 3.614/2012, relating to real estate credit letter – LCI, and CMN Resolution No. 4.598/2017, which regulated the guaranteed real estate letter – LIG. This is, therefore, an interpretation of the concept of real estate credit that promotes regulatory coherence between the different resource-raising instruments used within the scope of the real estate market.”

Based on the aforementioned Decision, we understand that credits guaranteed by fiduciary alienation of real estate property may constitute CRI backing, provided that:

i. Such credits are guaranteed by real estate property since their origination, demonstrating “that the owner derives economic benefit from his property, by granting real security, to obtain resources at reduced costs”;

ii. Such credits have as originator and assignor an institution part of the Real Estate Financial System, in accordance with Article 2 of Law No. 9.514/97, thereby contributing “to the expansion of the activities performed by this participant of the real estate market”, as well as in consonance “with the understanding that has been adopted by the Central Bank of Brazil and the Monetary National Council regarding the qualification of real estate credit, as seen in BACEN Circular No. 3.614/2012, relating to real estate credit letter – LCI, and CMN Resolution No. 4.598/2017, which regulated the guaranteed real estate letter – LIG”; and

iii. The real estate guarantee covers the total value of the credit that is being used as backing in the issuance of the CRI.

Transfer to the Securitization Company of the credits that will make up the backing in CRI and CRA operations
We alert that the issuance and distribution of CRIs and CRAs must be preceded by the effective transfer to the Securitization Company of the credit rights that back them, that is, all conditions for the perfection of the transfer of the credit rights that back the CRIs and CRAs to the Securitization Company must be observed prior to the issuance and distribution of the aforementioned titles, as well as to the registration of the Offering by the CVM, and the contract that formalizes such transfer and the other offering documents must reflect this understanding.
Possibility of a distribution period of up to 2 years in open FIDC offerings

In the Collegiate Board Decision of the CVM within the scope of CVM Process No. RJ-2007-11393, which authorized the extension of the distribution period of Ourinvest FIDC Financeiros – Suppliercard (“Fundo Ourinvest”) to 2 years, following the vote of the Reporting Director, the Collegiate Board considered, for this concession, the decision within the scope of CVM Process No. RJ-2005-3975, which dealt with an appeal filed by the Municipal Urbanization Company (EMURB), representative of the Municipality of São Paulo regarding the Faria Lima Consortium Urban Operation, against a decision by the SRE, which denied a request to extend the public offering distribution period for Certificates of Additional Construction Potential – CEPAC.

In that precedent, a period of 2 years was attributed for the distribution of CEPAC, considering that the 6-month period for the completion of issuance was insufficient. It was also clarified that CEPAC were a pioneering title and still little disseminated, making it reasonable for the distribution period to be longer for the first two unique cases of CEPAC issuance registered with the CVM.

In the Fundo Ourinvest precedent, the Reporting Director of that case voted favorably for the extension of the public offering distribution period for fund shares to up to 2 years “given the analogy to the CEPAC distribution period, according to the Collegiate Board’s decision, and to standardized debentures provided for in CVM Instruction No. 404/04”, further allowing the SRE to treat similar cases of open FIDCs classified under the category provided for in §§1 and 2 of art. 21 of CVM Instruction No. 356/01 in the same manner.

Thus, within the faculty granted to the SRE above, and by analogy with the CEPAC distribution precedent, when intending to carry out a public offering of open FIDC shares with a distribution period of up to 2 years, justifications must be presented along with the registration request for said offering, demonstrating that distributing the shares within 6 months would be insufficient.

Such justifications must consider the grace and redemption periods involved in the offering, which, in order to be entitled to a distribution period of up to 2 years, must represent for the operation “high risk and difficult to measure due to the interruption of the application flow”, “given that the redemption flow would not be interrupted during this period”.

In this sense, we understand that in offerings where the combined grace and redemption periods exceed 6 months, there would not, in principle, be an actual cash outflow during the distribution period provided for in the regulation (6 months), or during any analysis of a new registration request for the offering.

With that said, we understand that open FIDCs with grace and redemption periods that, when summed, result in a value higher than the distribution period provided for in the applicable regulation of 6 months do not fit within the main concern expressed through the Collegiate Board Decision issued within the scope of CVM Process No. RJ-2007-11393, a concern that can be verified through paragraphs 41 and 55 of the vote by then-Director Durval Soledade, in the following terms:

“41. Furthermore, the possibility of unforeseen events in obtaining successive distribution registrations represents high risk and difficult to measure due to the interruption of the application flow. Given that the redemption flow would not be interrupted during this period, the mismatch between cash inflows and outflows would tend to generate losses or even determine the liquidation of the fund. (...)

However, the mere extension of the period does not contain an unequivocal solution facing the Recurrent’s needs – of mechanisms that ensure a firm flow of resources – nor is the suggestion brought by the SRE safe.”
Portfolio administrator acting as distributor

The portfolio administrator of securities, a legal entity, may also act in the distribution of shares of investment funds of which it is administrator or manager, provided it complies with the dictates of art. 30 of CVM Instruction No. 558/2015.

The portfolio administrator that is not an institution authorized to operate by the Central Bank of Brazil cannot hire an autonomous investment agent, hire another institution, or lead a pool to distribute investment fund shares.

The authorization established by the cited Instruction had two main benefits as its objective: (i) to allow direct contact between those responsible for portfolio administration, who are the greatest understanders of the characteristics of the funds managed by the institution, and clients, interested in understanding the investment vehicles in which they intend to invest; (ii) to reduce distribution costs for fund shares managed by a portfolio administrator that is not an institution authorized to operate by the Central Bank.

In light of such rationale, within the scope of public offerings of closed-end investment fund shares that have retail investors as the target audience, the understanding of the SRE is that the participation, as a leading intermediary institution, of portfolio administrators of securities, which are not institutions authorized to operate by the Central Bank of Brazil, does not align with the practice of such distribution offerings, given that the size inherent to such offerings would imply greater obstacles to the observation, by these administrators, of the duties of the leading intermediary, as well as considering that the hiring of third-party intermediaries, in a distribution pool, would invalidate the premise of allowing isolated participation in the distribution of shares of funds for which it is manager/administrator.

Furthermore, in the case of distribution offerings that have qualified investors, professionals, or even offerings carried out under restricted efforts as the target audience, the SRE understands that the activity of portfolio administrators of securities that are not financial institutions is possible only in cases where there is no distribution pool, that is, when the portfolio administrator is the leading intermediary, without, however, subcontracting other intermediaries.

No prejudice is envisioned in the situation where the portfolio administrator, which is not a financial institution, acts as a contractor of a financial institution that leads a distribution pool, regardless of the target audience of the offering. In this hypothesis, the objective of allowing greater contact between the manager/administrator and final investors would be met, while, in principle, the cost structure of an offering distributed through a distribution pool would not be negatively affected by the hiring of the portfolio administrator vis-à-vis any other intermediary.

In the case where distribution takes place in an offering with restricted efforts, the communication regarding the start and end of the offering, in accordance with art. 7-A and art. 8 of CVM Instruction No. 476/09, must be sent via system, as per section 19 below, using the CVMWeb password of the distribution director indicated in the registration.

Fiduciary Agent

From CVM Instruction No. 583/2016, Fiduciary Agents have been included in CVM Instruction No. 510/2011, which deals with the registration of participants in the securities market.

The obligations related to the registration of this participant will take effect within 60 days, counted from January 1, 2018, and the new version of the registration system for Fiduciary Agents, in light of the new determinations imposed by CVM Instruction No. 583/2016, is in the final phase of implementation.

Particularly, we emphasize that according to art. 1, item II, of CVM Instruction No. 510/2011, market participants must confirm, annually between May 1 and May 31, their registration information by sending the Electronic Conformity Declaration. We also remind you that the next DEC will be due even if the participant’s registration was carried out already in the 2018 fiscal year, and it will be sent through access to the participant’s CVMWeb, in the final phase of implementation.

Cancellation of issuer registration – OPA

We clarify that the request for cancellation of issuer registration must comply with what is prescribed in §4 of art. 4 of Law No. 6.404/1976, in CVM Instruction No. 361/2002, and in arts. 47, 48, and 50 of CVM Instruction No. 480/2009, and the company must be previously subject to a public acquisition offer (“OPA”) for registration cancellation, in accordance with the aforementioned legal provision.

Art. 34 of CVM Instruction No. 361/2002 provides, in specific cases, the possibility of carrying out an OPA with a differentiated procedure, such as the waiver of some formalities required by the norm itself, but not the waiver of the OPA itself, whose obligation arises from a legal provision, as already manifested by the Collegiate Board of this Commission, in meetings dated 8/24/2004 and 11/17/2009, the latter within the scope of CVM Process No. RJ 2009-4470.

The CVM must, therefore, express favorable opinion to the non-realization of an OPA only in the following hypotheses: (i) there is no legal provision for it; (ii) there are no circulating share holders, as defined in art. 4-A, §2 of Law No. 6.404/1976 and item III of art. 3 of CVM Instruction No. 361/2002; and (iii) in the event that there are circulating shares, the unanimity of the holders of such shares declare that they waive the realization of an OPA for registration cancellation, either through an Extraordinary General Assembly or through an individual declaration by these shareholders.

In other cases, one must analyze only the possibility of carrying out a public offering with the adoption of a differentiated procedure, in accordance with art. 34 of CVM Instruction No. 361/2002, as well as compliance with the provisions of arts. 47 and 48 of CVM Instruction No. 480/2009.

Furthermore, it is worth noting that, for the purpose of cancellation of issuer registration in category A or B, if there are other securities in circulation other than shares and depositary receipts of shares, all conditions provided for in art. 47 of CVM Instruction No. 480/09 must be observed, regardless of whether such securities were or were not distributed publicly or admitted to trading in regulated markets, according to the vote of Director Pablo Renteria, which was accompanied by the CVM Collegiate Board in a meeting dated 6/14/2016, within the scope of CVM Process No. RJ-2015-4262.

Discontinuation of BDR program

CVM Instruction No. 361/2002 does not apply to the procedure for the discontinuation of BDR programs.

CVM Instruction No. 585/2017 instituted the obligation that requests for cancellation of the registration of BDR programs, to be appreciated by the SRE according to the analysis periods applicable to requests for registration of public distribution offerings, must be accompanied by a declaration from the entity administering the organized over-the-counter market or stock exchange where the certificates are traded, attesting to the compliance with the procedures established by it for the discontinuation of the program.

Furthermore, it now provides that the SRE may request other additional documents and information to support the analysis of the cancellation request.

It is worth remembering that previously, the procedures for the discontinuation of Level II and Level III BDR programs (which involve registered foreign issuers) needed to be previously approved by the CVM. Based on the new model, the procedure provided for in item 6.6.7 of the B3 “Issuer Manual” (http://www.bmfbovespa.com.br/lumis/portal/file/fileDownload.jsp?fileId=8AA8D0975F0E0FCA015F3A9AE2DE3E2A) must be observed. The administering market entity must monitor the program discontinuation procedure and – at the end of the process – send a declaration to the CVM that the depositary institution complied with the procedures established by it.

In exceptional and justified situations, the depositary institution or the Foreign Issuer, as the case may be, may submit to B3 approval differentiated procedures and conditions for the discontinuation of the BDR Program, from those cited in the caput of item 6.6.7 in reference. Such procedures, when they do not involve a Level I Non-Sponsored BDR program, must be submitted to the CVM for approval.

OPA Registration Request

Regarding the registration requests for the mandatory OPA modalities (for registration cancellation, for increase in participation, and for alienation of control) with ordinary procedure, the offeror must instruct the process with at least the documents provided for in Annex I of CVM Instruction No. 361/2002.

Furthermore, in any OPA formulated by the target company, by the controlling shareholder, or by persons linked to them, provided it is not an OPA for alienation of control, if the offeror foresees in the offering notice that it will opt to acquire up to 1/3 of the circulating shares (item I of art. 15 of CVM Instruction No. 361/2002), if acceptance occurs in the OPA by shareholders holding more than 1/3 and less than 2/3 of said shares, the offeror must send to the SRE a Demonstration of increase in participation of any shareholders of the control block of the company, since 9/5/2000, specifying the method of acquisition, the price paid per share, the quantity acquired, and the date of acquisition, as well as other information that the offeror deems necessary for the clear understanding of this CVM.

If some of the documents or procedures ordinarily provided for by CVM Instruction No. 361/2002 are the subject of a waiver request, the offeror must send a justification discriminating the provisions of said Instruction from which it intends to exempt itself from observation.

In this sense, we emphasize that the choice of the differentiated procedure to be adopted in substitution to the ordinarily provided for in the aforementioned Instruction is up to the offeror, and it is not up to the CVM to guide which is the best procedure for each case.

In accordance with CVM Deliberation No. 756/2016, the SRE will appreciate requests for the unification of OPAs (formulation of a single OPA aiming at more than one of the purposes provided for in CVM Instruction No. 361/2002), as well as for the adoption of a differentiated procedure, provided that the same has already been the subject of a previous deliberation by the CVM Collegiate Board within the scope of offerings with similar characteristics. Otherwise, the request for the adoption of a differentiated procedure will be appreciated by the CVM Collegiate Board.

We also highlight that on the electronic address of this Commission (http://www.cvm.gov.br) one can find decisions of the CVM Collegiate Board, as well as offering notices and evaluation reports of OPAs registered with differentiated procedure, which can serve as a basis for any future request.

Update of Evaluation Report in OPA

If the analysis period of the OPA registration request extends beyond 1 year after the publication of the Evaluation Report, it will be presumed that the information on which said document was based is outdated, so that its update, as a rule, will be required by this technical area, with the aim of preserving to the shareholder subject to the offer the right to make a reflected and independent decision, in accordance with item II of art. 4 of CVM Instruction No. 361/2002.

This possibility is provided for in §9 of art. 8 of CVM Instruction No. 361/2002, so the CVM may require, within the analysis period of the OPA registration request, that the Evaluation Report be updated by the appraiser.

It is also worth highlighting that the update of the Evaluation Report may be required in a period shorter than the one mentioned above, if any fact occurs that justifies the update of said document.

Interpretation of article 37, §1 of CVM Instruction No. 361/2002

For the purpose of the calculation, prescribed in §1 of art. 37, of the circulating shares, as provided for in arts. 15, item I, and 26 of CVM Instruction No. 361/02, the formula described below must be considered, confirmed by the Collegiate Board of the autarchy in a decision of December 27, 2011, within the scope of CVM Administrative Process No. RJ No. 2010/15144, Reg. 7310/2010:

L(1/3) = 1/3 (AC00 + AAC – ARC + AOPS) – AQ

Where:
L(1/3): Limit of 1/3 provided for in arts. 15, item I, and 26 of CVM Instruction 361; AC00: number of shares of the class or species in circulation from 05/09/00; AAC: additional number of shares of the class or species in circulation from 05/09/00, as a result of: capital increases with subscription of shares, share bonuses, alienation of shares by the target company itself for treasury maintenance, and conversions of shares of another class or species into shares of the class or species for which L(1/3) is to be determined; ARC: number of shares of the class or species withdrawn from circulation from 05/09/00, as a result of: redemption, amortization or reimbursement, acquisition of shares by the target company itself for treasury maintenance or cancellation, and conversion of shares of the class or species for which L(1/3) is to be determined; AOPS: number of shares of the class or species alienated from 05/09/00 by the controller, by a person linked to him, or by other persons acting in concert with the controlling shareholder or person linked to him, through secondary public distribution offerings; AQ: number of shares of the class or species acquired by the controller/linked person, since 05/09/00, through an OPA or other means.

Distribution offerings carried out through Crowdfunding

In 2017, CVM Instruction No. 588/2017 was issued, establishing a new normative framework for public offerings of securities issued by small-sized business companies, automatically exempted from registration of distribution offerings, carried out through crowdfunding operations. Such instruction revoked the provision existing in CVM Instruction No. 400/2003 (art. 5, item III), of automatic exemption for the case of issuance by small-sized companies and microenterprises, as defined by law, through which such offerings were then classified.

It is important to emphasize that, while the previous discipline brought the legal concept of small-sized company and microenterprise, the new Instruction defines the concept of small-sized business company, which must apply to all offerors who raise funds through the Instruction in question.

Furthermore, it is important to observe that the Instruction in question does not regulate the activity of loans granted by individuals to individuals or legal entities through the worldwide computer network, program, application, or electronic means, which does not involve the issuance of securities.

We remind you that the request for registration of the participant with the CVM of the Electronic Platforms for Participatory Investment, as well as any issue of this nature, must be submitted to the Superintendence of Market and Intermediary Relations (SMI), notably through the Business Analysis Management (GMN), with the certainty that any issue related to the offering carried out under the procedure now in question, including regarding the duties of the platform inherent to its activities, are within the competence of this SRE.

Finally, we remind you that while there is no specific electronic system, the sending of the Start Forms (annex 27-I of CVM Instruction No. 588/2017), for each new offering, must be carried out by the Platforms through the CVM website, accessing the “Citizen Service System - SAC” icon. From this access, a registration must be carried out in the name of the platform administrator in the CVMWeb system, which, at this first moment, will not be associated with any permission other than access to SAC. After registration, select “New Consultation / Complaint / Document Protocol” in the left menu and in the form, in the field “Select the type of service”, identify “Document Protocol”. Then, in the field “Destination Area of the Document”, select “SRE-Superintendence of Securities Registration” and in the area “write your message to the side”, indicate that it is a start form for a crowdfunding offering. The forms must be saved in PDF (Portable Document Format) non-editable and searchable format. The limit for sending documents on the CVM website is 10 documents and 15 MB total per protocol. This guidance will also apply to the sending of the information provided for in Annex 27-II of the Instruction in question, required until March 1 of each year.

As soon as the participant registration module for the Platforms is included in the CVMWeb environment, the sending of information will be carried out in that system, when there will be the appropriate communication to the market.

Virtual assets and public offerings - ICO

Virtual assets and their effects on the structure on which capital markets are based currently represent a great challenge for regulators of the financial and capital markets not only in Brazil but also in other jurisdictions, due to the innovation inherent to this new model of instrument, raising diverse interpretations and still in constant evolution, regarding their economic and legal nature.

Operations known as Initial Coin Offerings (ICOs) can be understood as public fundraising, with the issuance of virtual assets, also known as tokens or coins, to the investing public as consideration. Such virtual assets, in turn, depending on the economic context of their issuance and the rights conferred to investors, may fit within the broad definition of securities established in item IX of art. 2 of Law No. 6.385/1976. Notably, the presence in the contractual relationship of rights conferred to the acquirer, such as participation in capital or in agreements on fixed remuneration on the invested capital or of voting in assemblies that determine the direction of the issuer's business, would support the interpretation that a certain virtual asset is a security.

In this context, the CVM clarifies that certain ICOs may be characterized as public offerings of securities, therefore, subject to specific legislation and regulation, and must comply with applicable rules. Companies (open or closed) or other issuers that raise funds through an ICO, in operations whose economic sense corresponds to the issuance and trading of securities, fall into the same situation.

Offerings of virtual assets that fit the definition of security and are in non-compliance with regulation will be considered irregular and, as such, will be subject to applicable sanctions and penalties. On the other hand, there are ICOs that are not under the competence of the CVM, as they do not constitute public offerings of securities.

Guidelines for Preparing the Prospectus and Other Public Distribution Offer Documents

35.1. General Guidelines
In order to facilitate verification by the CVM of the information that must be included, pursuant to applicable regulations, in the Prospectus and other documents of public distribution offers, a detailed description specifying where the required information is located (page number and item number in the document) must be submitted along with the filing through which the registration request for the offer is made. This description should indicate the location of information required through the annexes of CVM Instruction No. 400/2003, among which, as a non-exhaustive example, we can cite:

The information provided for the Prospectus in Annexes III and III-A of CVM Instruction No. 400/2003;
The information provided for the Start of Distribution Notice in Annex IV of CVM Instruction No. 400/2003;
The information provided for the End of Distribution Notice in Annex V of CVM Instruction No. 400/2003;
The information provided for the Securities Distribution Contract in Annex VI of CVM Instruction No. 400/2003; and
The information provided for the Securitization Term in Annex III of CVM Instruction No. 414/2004.

35.2. Rules on the Preparation and Disclosure of Information
The Prospectus is not an advertising material. It is the document containing information and data about the offer, directed at investors. It must contain necessary and sufficient information to allow investors to make a well-considered investment decision.

All information disclosed by the issuer must be written in simple, clear, objective, and concise language. The information provided by the issuer must be useful for the evaluation of the securities they are offering.

The issuer must disclose true, complete, consistent information that does not mislead the investor. Just as insufficient information harms the investor, excess information can confuse them or even discourage them from reading.

Factual information must be distinguished from interpretations, opinions, projections, and estimates. Factual information must be accompanied by an indication of its sources.

Regarding the organization of the Prospectus, it must facilitate its reading. The SRE emphatically recommends that, in the preparation and presentation of the Prospectus, the order set forth in Annex III of CVM Instruction No. 400/2003 be followed, maintaining the nomenclature of sections and subsections.

We advise issuers that it is not necessary to include in the Prospectus information that is not important to ensure that the document is a true, accurate, and complete portrait of their economic-financial situation and the risks inherent in their activities and the offered securities, such as repetitions of legal texts, explanatory notes, and parts of other documents.

Information contained in articles of incorporation, fund regulations, debenture indentures, and securitization terms, documents that must be attached to the Prospectus, which also need to be presented in the body of the prospectus, must be synthesized and allocated by reference, avoiding pure text repetition.

35.3. Guidelines for Drafting Offer Documents 1
An analysis should be made regarding what information investors need to make decisions before words, sentences, or paragraphs are considered. The drafting of an offer disclosure document must require economy in the use of words and be at a level that the public can understand. Its sentence structure must be concise. Its tone direct and inviting to read. Its design visually attractive. A simple document should be easy to read and appear intended to be read.

Investors need to read and understand offer disclosure documents to fully benefit from the protections offered by our Instructions. As many of them are not lawyers, accountants, economists, or investment analysts, the disclosure documents must be written in a language that investors can understand.

One should question whether the documents highlight the important information that investors need to make decisions. "Legalese," "economese," and other jargons of the past must give way to everyday words that communicate complex information clearly. Thus, investors will be more likely to understand what they are buying. Investment analysts and consultants can make better recommendations to their clients if they can read and understand these documents quickly and easily.

Inspired by the US Securities and Exchange Commission publication "A Plain English Handbook – How to create SEC disclosure documents"

This does not mean excluding complex information to make the document easier to understand. For investors to make informed decisions, disclosure documents must convey complex information, ensuring the orderly and clear presentation of complex information so that investors can understand them.

Five steps for preparing and disclosing information:

i. Present the big picture before the details. Prospectuses routinely begin with a detailed description of the securities. You may read several pages before discovering what the company produces. It is difficult to absorb the details if you do not know why they are being given to you. Imagine trying to put together a complicated puzzle without first seeing the picture of the whole. An individual piece of information means more to your readers if they know how it fits into the big picture.

ii. Use descriptive headers and subtitles to break documents into manageable sections. Prospectuses provide a lot of information. If you present information in small chunks, it is easier to digest. Make sure your titles tell the reader what the upcoming sections will cover.

iii. Always group related information together. This helps you identify and eliminate repetitive information.

iv. The degree of investment specialization of your audience will affect how you organize the document. If you are writing for financially unsophisticated investors, the overall organization of your document may take an educational approach. You may need to explain industry terms or concepts where they appear for the first time.

v. Review your document by taking a good look at the flow of information from start to finish.

35.4. Preliminary Prospectus and Definitive Prospectus
The Preliminary Prospectus must be used in public distribution offers where there is the use of advertising material, the conduct of bookbuilding, and/or the receipt of reservations prior to the granting of the offer's registration.

The Definitive Prospectus will be used in all public distribution offers, after registration has been granted by the CVM, containing the registration number and date.

In principle, the content of the Definitive Prospectus differs from the Preliminary Prospectus only by filling in the gaps with the final data of the offer and the CVM offer registration number. In case of relevant divergence between the information contained in the Preliminary Prospectus and the Definitive Prospectus, it will be necessary to allow the withdrawal of reservation requests, without burden on the subscriber or acquirer.

35.5. Availability and Submission of the Prospectus to the CVM
The public offer Prospectus must be submitted to the CVM together with the offer registration request. This submission must be made in the form of an electronic document, preferably using the electronic document protocol on the CVM website.

Even in draft form, it will be made available on the CVM website as soon as the offer registration request is made.

The Prospectus in draft form must not be available on the websites of the issuer/offeror and intermediaries.

The Preliminary Prospectus must not be made available by the issuer/offeror and intermediaries until the Market Notice is made available, as provided in §2 of art. 46 of CVM Instruction No. 400/2003. The Preliminary Prospectus must be available to investors at least 5 (five) business days before the initial deadline for receiving reservations.

The Preliminary Prospectus must not have gaps when the Market Notice is published.

The Definitive Prospectus must not be made available by the issuer/offeror and intermediaries until the Start Announcement is made available. The Definitive Prospectus must be available to investors at least 5 (five) business days before the initial deadline for accepting the offer if a Preliminary Prospectus was not used.

It is important that the Prospectuses be available on the websites of the CVM, the issuer, the offeror, the markets where the securities are traded, and all participating intermediary institutions, in compliance with the provisions of art. 54-A of CVM Instruction No. 400/2003.

On the initial pages of each of these websites, an exclusive icon for accessing the Prospectuses must be made available, or at least the full path to access the Prospectuses must be indicated.

We note that the delivery, for SRE analysis, of a Prospectus containing gaps or in draft form may entail additional requirements regarding issues not raised in a requirement letter, as well as extension of the deadline for responding to requirements.

35.6. Identification of Persons Responsible for the Content of the Prospectus
The Prospectus must clearly identify the persons responsible for its preparation and for the truthfulness, consistency, quality, and sufficiency of the information provided therein.

35.7. Non-Applicable Information
If information requested in Annex III of CVM Instruction No. 400/2003 is not applicable to the issuer due to its characteristics, the same must expressly state this fact in the Prospectus and include justification, explaining the reason why the requested information is not applicable to them.

35.8. Guidelines for Filling Out the Prospectus

35.8.1. Cover
It is preferable that the cover of the Prospectus contains only the information requested in the "Cover of the Prospectus" section of Annex III of CVM Instruction No. 400/2003, those mentioned here, and those expressly requested in specific requirement letters for each offer.

The cover must not contain any image except the logo of the issuer and the institutions intermediating the Offer.

The Prospectus must have, on the cover, the date of its preparation.

The registration number and date of the offer at the CVM must be included on the cover.

The dates of realization and publication of corporate acts that deliberated on the Offer must be listed, including, where applicable, those related to the approval of the price per share, pursuant to Annex III to CVM Instruction No. 400/2003.

It is necessary to include, where applicable, information regarding deliberations concerning the approval of the Secondary Offer by Selling Shareholders who are legal entities.

If applicable, information regarding the possibility of issuing supplementary and additional lots must be inserted, defining its origin, whether from the primary or secondary offer, specifying each portion.

The texts of the notice regarding the registration of the Offer at the CVM, which do not imply judgment of the quality of the Issuer, and the notice regarding the need to read the risk factors, as expressly determined in Annex III of CVM Instruction No. 400/2003, must appear in full and with graphic emphasis (in bold, uppercase, and with a font size two points larger than the rest of the text), and it is not permitted to add comments to them.

In the case where the issuer is a company registered in categories A or B, pursuant to CVM Instruction No. 480/2009, the section of the Reference Form in which the Issuer's Risk Factors are described must also be indicated.

When there is a risk classification note for the offered security, this must be informed on the cover. If the risk classification is preliminary, this must be specified.

In offers where there is provision for a bookbuilding procedure for price fixing, the issuance value may not be evident on the cover of the Preliminary Prospectus, presenting instead a price range, clarifying that the price range is only indicative and may be changed up or down upon conclusion of the bookbuilding.

It is recommended to insert a reference to the page of the Prospectus that presents the minimum, average, and maximum quotes of the Company's shares.

A reference must also be introduced to the page of the Prospectus where the nominal identification of each of the Selling Shareholders is stated, with the individual description of the quantity of shares to be offered by each and the net resources obtained with said alienation.

In the case of Infrastructure Debentures – Preferably highlight on the cover of the Prospectus the number and date of publication of the ministerial ordinance that approved the project(s) of investment as priority project(s) and the commitment to allocate the resources obtained in the offer to the approved priority project(s), in compliance with the provisions of art. 6, item II of Decree No. 7.603/2011.

In prominent display, the information that the Offer refers to "Incentivized Debentures with Tax Benefit pursuant to article 2 of Law No. 12.431/2011" must be placed.

35.8.2. Index
The preparation of a complete index is recommended, also informing the pages of the subsections, so that all content can be easily found.

Attention must be paid to the fact that all pages of the Prospectus must be numbered sequentially, including those of the annexes, continuously with the other sections, and all cross-references in the Prospectus must mention the page where the referenced information is located.

Important, also, to reconcile the numbering presented in the index with the content of the respective pages, when necessary.

It is recommended that the presentation of the Prospectus be organized according to the order set forth in Annex III of the Instruction.

35.8.3. Summary Containing the Characteristics of the Operation
Summarized comments must be included on the following topics, when applicable:

Issuer;
Lead Coordinator;
Offer Coordinators;
Contracted Coordinators;
International Placement Agents;
Fiduciary Agent (Debentures, CRI);
Offer (Primary and Secondary);
Retail Offer;
Institutional Offer;
Priority Offer;
Additional Lot Option;
Supplementary Lot Option;
Target Audience;
Reservation Request;
Reservation Period;
Related Party;
Reservation Period for Related Parties;
Unit Price;
Bookbuilding Procedure;
Total Value of the Offer;
Firm Liquidity Guarantee;
Settlement Date;
Settlement Date of the Supplementary Lot;
Rights, Advantages, and Restrictions of the securities;
Restriction on trading of securities (Lock-up);
Co-Sale Right (Tag-Along Rights);
Trading Markets;
Inadequacy of the Offer to Certain Investors;
Risk Factors;
Destination of Resources;
Share Capital;
Corporate Approvals;
Institutional Investors;
Non-Institutional Investors;
Minority Shareholders;
Price Stabilization;
Free Float - Green Shoe;
Corporate Governance Mechanisms - Diffuse Control;
Participation of related parties in the price formation process;
Withdrawal from the Status of Mechanisms for Guaranteeing Shareholder Dispersion;
Conflict Resolution – Arbitration;
Subscription Bonus - Option Plan;
Registrar Institution.

The summary must necessarily be a summary of all highly relevant aspects of the Offer. Equal attention must be given to relevant negative aspects.

It is important to address the Secondary Offer, information regarding the Selling Shareholders, and, through a table, the quantity to be alienated by each of the Selling Shareholders, including information about supplementary and additional lots.

Separately inform the number of shares of the Primary Offer and the Secondary Offer, and, where applicable, the origin of the supplementary shares, whether from the primary or secondary offer, specifying each portion.

35.8.4. Issuer Summary
It is important to ensure that the information included in the Issuer Summary section is consistent with that of the Reference Form, when applicable.

The organizational structure of the Issuer must also be introduced, in order to describe the economic group in which the company is inserted, indicating the percentage of participation in all items comprising the corporate diagram.

Interesting to add information regarding the shareholding control of the Company, before and after the Offer.

When applicable, the phrase "This Summary is only a summary of the Issuer's information. Complete information about the Issuer is in the Reference Forms, read it before accepting the Offer" must be included.

The five main risk factors relating to the issuer must also be included.

The Issuer Summary must not contain excessive adjectives, so as not to influence the careful formation of investment decisions. Expressions that qualify the Issuer should remain in the Prospectus only if accompanied by public sources, which through research allow such assertions.

To the summary of selected financial indicators, information regarding equity and short and long-term debt, before and after the issuance, must be added.

The inclusion in the Issuer Summary of the Summary of Financial and Operational Information is suggested, presenting the variations of equity and result accounts, considering both the variation in the value of each rubric between fiscal years ("horizontal analysis") and its relative weight in Assets or Liabilities/Equity ("vertical analysis"). For the vertical analysis of result accounts, consider the Net Operating Revenue rubric as base 100.

The above considerations regarding the Issuer Summary must also apply to the section of the Prospectus that brings information about the Debtor in CRI and CRA operations.

35.8.5. Identification of Administrators, Consultants, and Auditors
The addresses of the Administrators listed in the Prospectus must be the same as those referred to in the Market Notice and the Start Announcement.

The persons responsible for the legal entities that will sign the declaration of item 2.4 of Annex III to CVM Instruction No. 400/2003 must be statutory directors.

35.8.6. Information Relating to the Offer

35.8.6.1. Composition of Share Capital
In the case of offers of shares and debentures, a table must be presented relating all shareholders who hold directly or indirectly participation in the Issuing Company greater than 5% before and/or after the Offer, showing the respective participations in quantitative and percentage terms. In the same table, emphasis must be given to shareholders who are part of the control block; We suggest including information regarding the exercise of control power after the Offer, mentioning the possibility of the Company being subjected to diffuse control or clarifying whether, after the Offer, the Company will continue under the current control group.

We advise highlighting existing corporate governance mechanisms to promote alignment between Administrators and Shareholders, including a summary of the rules for election, replacement, and removal of Shareholder representatives on the Board of Directors and Fiscal Council.

35.8.6.2. Characteristics and Deadlines
In the case of primary issuance, justification for the issuance price and the criterion adopted for its fixation must be included.

In secondary emissions offered by a legal entity, information regarding the corporate authorizations necessary for the secondary distribution of the securities must be introduced, identifying the deliberative bodies responsible and the respective meetings in which the operations were approved.

The differentiated allocation criteria that will be observed, for example, for Non-Institutional Investors considered "with allocation priority" and "without allocation priority" must be explained.

Regarding the withdrawal of the Reservation Request, it must be explicit that it will occur without burden on the subscriber or acquirer in the event that a relevant divergence is verified between the information contained in the Preliminary and Definitive Prospectuses.

We understand it is necessary to communicate to investors whether, in the price fixation process, through the collection of investment intentions (bookbuilding procedure), bids from persons related to the distribution, as defined in art. 55, will be accepted, except by intermediaries contracted with a firm subscription guarantee clause.

In the affirmative, define the maximum admitted limit of participation of related parties in the book and alert investors to the risk of poor price formation or liquidity of the securities in the secondary market.

It must be observed that the Schedule of offer stages must present dates, not admitting the simple indication of deadlines. It must also present the deadlines, conditions, and method for subsequent alienation of the securities acquired by the coordinators as a result of providing guarantees, and the deadlines for, if applicable, return and reimbursement to investors.

The schedule of offer stages must be kept updated whenever possible throughout the CVM analysis period.

The information that all scheduled dates are merely indicative and subject to change must be included, alerting that, after the granting of Registration, any modification to the Distribution Schedule must be communicated to the CVM and may be considered as an Offer modification, following the provisions of articles 25 and 27 of CVM Instruction No. 400/2003.

Include information regarding the procedures that must be adopted in the event of suspension, cancellation, or modification of the Offer, pursuant to articles 20, 25, 26, and 27 of CVM Instruction No. 400/2003.

The forms of written communication accepted for the investor to withdraw from the Offer, where applicable, must be indicated.

Communication of the deadline for withdrawal of the reservation or restitution of values delivered by accepting investors, in case of modification or

revocation of the offering. Additionally, insert information regarding the incidence of taxes and monetary correction on such values.
Clarify whether there is or will be a provision for the splitting or grouping of the Company's shares and at what moment this will occur. If the grouping occurs before the Offering, this fact must be duly considered in the dilution calculations and in the other applicable sections of the Prospectus. It must also be informed of the dilution resulting from the exercise of options granted by the company in option plans. When it concerns a Secondary Offering, even if there is no provision for the issuance of new Shares, the dilution suffered by the Offering investors must be shown, comparing the Share Price with the book value per share contained in the latest audited Financial Statements. The dilution of new investors will be represented by the difference between the two previous values. Moreover, the percentage dilution of these new investors must be presented, by dividing the found dilution value by the Share Price. It is true that there will be no variation in the book value per share due to the realization of the Offering, as it is a Secondary Offering, but this does not mean that new investors will not be diluted, as they may pay a Share Price in the Offering different from the book value per share. It must be clarified whether there will be, or not, any incentive for the purchase of shares by the Company's employees and/or subsidiaries, as well as by the holders of their commercial representations (Priority Allocation). Communication is required regarding the eventual destination of the public offering or parts of the public offering to specific investors and the description of these investors, in compliance with the terms of item 3.2.5 of Annex III of CVM Instruction No. 400/2003. Also pay attention to the clarification regarding whether the Reservation Period for Related Persons and the Reservation Period for other non-institutional investors will begin on the same day. If the Reservation Period for Related Persons begins before the Reservation Period for other non-institutional investors, insert information in the Offering documents to make it clear that, in case of allocation in the offering destined to non-institutional investors, the same cannot prioritize the reservations made by Related Persons, even if they were made prior to the start of the Reservation Period for other non-institutional investors (which also cannot occur even if both reservation periods begin on the same day). Inform the distinction and separation of persons subject to restrictions on the sale of shares. Additionally, specify, if applicable, the exceptions to the established restrictions.

If necessary, pay attention to the inclusion of a statement detailing the profile of the investor for whom the offering is inadequate; generic statements of inadequacy are not accepted.
Furthermore, the admission to trading on a stock exchange or over-the-counter market must be specified.
35.8.6.3. Securities Distribution Agreement
Highlight any guarantee clauses in the international distribution agreement, especially regarding adverse events that may cause indemnification by the Company and that do not correspond to those in the Brazilian offering agreement.
The location where the copy of the distribution agreement will be available for consultation and reproduction must be specified.
Detail all relevant relationships between the Company, the Lead Coordinator, other intermediaries, and their respective economic conglomerates, informing their object, purpose, dates of celebration and maturity, terms, remuneration, and parameters adopted. The criteria for calculating any remuneration, in addition to those cited in the distribution agreement, paid to intermediaries and referenced by the price of the offered shares must also be detailed. In this case, such values must also be included in the distribution cost table. The use of generic statements such as "usual relationships according to market practices" or "usual practices of the financial market" is prohibited. Additionally, all possible conflicts of interest involving the intermediary institutions and the issuer must be identified, including those related to the linkage of the intermediary institutions' remuneration to the share price, and, if applicable, cross-reference must be made to the risk factor addressing the excessive dependence of the Coordinator on the share price of the Offering. We particularly alert that information provided regarding Incentive or Success Commissions, which are quite common in share and debenture distribution offerings, must be improved in light of the orientations now provided. The acquisitions and sales, by the intermediaries and their respective economic conglomerates, of securities issued by the company, occurring within a minimum period of twelve months prior to the protocol of the registration request for the offering, must be informed, indicating the object, price, and other conditions of each transaction. It is advisable to report the participations of the intermediaries and their respective economic conglomerates in public offerings of securities issued by the company, in financing operations, and in corporate restructuring of the company's economic group, occurring within a minimum period of twelve months prior to the protocol of the registration request for the offering, informing the remuneration received or to be received and the other characteristics of each operation. In the Preliminary Prospectus, upon publication of the Market Notice, the demonstrative values of distribution costs must be filled in. Considering, for example, for the said calculation, the upper limit of the estimated price range for the Offering as the issuance price per share. The criterion used must be explicit. Additionally, the unit cost of distribution must be specified. It is necessary to discriminate, separately, the costs of auditing, risk classification, legal advisory, and commissions; it is not permitted that these be presented in the "other costs" line. For other costs, a criterion analogous to that set forth in §2 of art. 176 of Law No. 6,404/1976 must be adopted, which stipulates: "In the statements, similar accounts may be grouped; small balances may be aggregated, provided that their nature is indicated and they do not exceed 0.1 (one tenth) of the
value of the respective group of accounts; but the use of generic designations, such as 'various accounts' or 'current accounts', is prohibited." All forms of remuneration of the intermediaries, due by the issuer and/or selling shareholders, must be described, as well as any and all other remuneration, beyond those provided in the distribution agreement, even if indirect, such as those resulting from loans and guarantees linked to the public offering, including: (i) commissions; (ii) reimbursement of expenses related to the offering, except those resulting from printing or registration; (iii) fees received or to be received due to the provision of consulting services related to the offering; (iv) shares issued by the company or securities referenced or convertible into these shares, which have been delivered or will have to be delivered in exchange for the granting of a loan to the company or members of the company's economic group, or as a form of remuneration for any other service provided to the company or members of the company's economic group. Inform whether the company, in the case of a secondary offering, will bear all distribution costs or if these will be shared with the selling shareholder, specifying, in this case, the basis of the sharing. The distribution cost table must be subdivided so that it is clear the costs paid by the Selling Shareholders and by the Company. Inform whether a liquidity guarantee contract and/or Market Maker Contract has been or will be signed, specifying its main characteristics and indicating the location where a copy of the contract can be obtained.

35.8.6.4. Destination of Resources
Already in the Preliminary Prospectus, upon publication of the Market Notice, clearly and objectively expose the estimated percentage for each item of the destination of resources, as well as the impact on the Company's equity situation and results.
Mention in the Prospectus, based on the provisions of the caput of art. 30 of CVM Instruction No. 400/2003, information regarding the treatment to be given in case of partial primary distribution of securities, specifying, if applicable, the minimum quantity of securities or the minimum amount of resources for which the public offering will be maintained and about the eventual alternative source of resources provided to achieve its objective. And in the event that there are several objectives and only part of the resources is obtained, which objectives will be prioritized.
35.8.7. Offering Risk Factors
It is necessary that risk factors be presented clearly and objectively, without mitigation, i.e., they must be described without attenuation. In this sense, expressions to be avoided include: "however", "despite", "on the other hand", "however", "although", "in an inverse manner", "even considering the point addressed previously", among others.
It is recommended that risk factors be presented in descending order of importance.
In offerings with the participation of related persons (as defined in art. 55 of CVM Instruction No. 400/2003) in the bookbuilding process, it is essential that the risk of improper price formation and/or loss of liquidity of the securities in the secondary market be described.
A risk factor must be included addressing the fact that a significant portion of the administrators' remuneration is linked to the quotation of the Company's shares.
This section should also introduce a risk factor identifying all possible conflicts of interest involving the intermediary institutions, the issuer, and/or the selling shareholders, including, when applicable, those related to the linkage of the intermediary institutions' remuneration to the share price.
35.8.8. Information regarding the third guarantor provider
Item 7.2 of Annex III (Prospectus) of CVM Instruction No. 400/2003 deals with information regarding the third guarantor provider or recipient of resources, and makes references to several items of the reference form (the content of which is described in Annex 24 of CVM Instruction No. 480/2009).

The content of the reference form was modified by CVM Instruction No. 552, of October 9, 2014, without item 7.2 of Annex III of CVM Instruction No. 400/2003 having undergone the necessary alterations, which will occur opportunistically.
Thus, while the due modifications are not made to CVM Instruction No. 400/2003 to reflect the changes arising from CVM Instruction No. 552/2014, the items of the reference form that must be presented as a result of item 7.2 of Annex III are the following: 3.7, 6.1 to 6.3, 7.1, 8.3, 12.1, 12.5, 13.2, 15.1, 15.4, 15.7, 15.8, 16.2, 17.1, and 18.5.
35.8.9. Statistical information on credit rights – CRI and corporate CRA
For the purpose of complying with item 2.6 of Annex III-A of CVM Instruction No. 400/2003 in CRI and CRA "corporate" operations, statistical information on defaults, losses, or prepayments of credits of the same nature as the credit rights that will compose the offering party's assets must be calculated based on information existing regarding any and all debt instruments issued by the debtor company of the collateral, covering a period of 3 years immediately prior to the date of the offering. Based on item 3.5.1 of Annex III of CVM Instruction No. 400/2003, in CRI and CRA "corporate" operations, a specific section must be inserted in the Prospectus exposing the economic-financial indicators of the debtor company, prepared based on the Financial Statements attached in the manner provided by item 5.3 of Annex III-A of CVM Instruction No. 400/2003, accompanied by these same indicators updated solely and exclusively by the raising of resources that will occur through the offering, in order to allow visualization of the impact on the debtor's indicators with the said raising. In this sense, indicators of the following types must be included in the Prospectus: (i) liquidity indices (for example: net working capital, current liquidity index, and quick liquidity index); (ii) activity indices (for example: inventory turnover, average collection period, average payment period, turnover of fixed assets, and turnover of total assets); (iii) indebtedness indices (for example: general indebtedness index, interest coverage index, and fixed payment coverage index); and (iv) profitability indices (for example: gross margin, operating margin, net margin, return on total assets, return on equity, earnings per share, price/earnings index).
35.8.10. Information on debtors or co-obligors
For the purpose of complying with item 5.3 of Annex III-A of CVM Instruction No. 400/2003 and art. 5 of CVM Instruction No. 414/2004, we clarify that, if the limit of 20% referred to by the cited normative devices is exceeded by both the debtor and the co-obligor, the financial statements of both must be attached to the Prospectus, as such devices aim to guarantee that the investor can evaluate all risk inherent to the operation, which passes through both the risk of the debtor and the risk of the co-obligor. In this situation, the investor would be exposed to the risk of the co-obligor after being exposed to the risk of the debtor, which is different from being exposed only to the risk of one or the other in isolation.
36. Guidelines related to distribution offerings conducted under restricted efforts - CVM Instruction No. 476/2009
36.1. General Guidelines
Initially, we remind you that private offerings of securities are outside the legal mandate of this CVM.
Thus, we reiterate the provisions of art. 1, §2 of CVM Instruction No. 476/2009, in the sense that such norm does not apply to private offerings of securities.
It is also important to highlight the definition of public distribution acts contained especially in items I and II of art. 19 of Law No. 6385/1976:
§3º - Public issuance is characterized by:
I - the use of sales or subscription lists or bulletins, brochures, prospectuses, or advertisements intended for the public; II - the search for subscribers or acquirers for the titles through employees, agents, or brokers; In this manner, within the scope of offering supervision, it is appropriate to eventually request that intermediaries evidence the distribution acts which characterize the public sales effort within the scope of offerings conducted with restricted efforts, including in light of the obligation contained in CVM Instruction No. 476/2009, notably in art. 7, §2 (The offeror and the lead intermediary of the offering must maintain a list containing: I – the name of the persons sought; II – the number of the Individual Taxpayer Registry (CPF) or National Registry of Legal Entities (CNPJ); III - the date on which they were sought; and IV - their decision regarding the offering.). Another aspect that must be pointed out is the fact that the maintenance of an ongoing offering under the procedure of CVM Instruction No. 476/2009 is only justified by the continuity of sales efforts. When analyzing offerings that have been conducted and are ongoing, it can be verified that some Investment Fund offerings have been kept open, even without subscription by new unitholders, thereby prejudicing the very characterization of a public offering. Finally, we remind you that the Professional Investor declaration, required by force of CVM Instruction No. 539/2013 (art. 9-A item IV), in the case of natural or legal persons who possess financial investments in a value superior to R$ 10 million, may be made by the manager for all funds under management.
36.2. Information Reception System for Offerings with Restricted Efforts and Dispensations from art. 5 of CVM Instruction No. 400/2003
In the case of distribution offerings with restricted efforts, communications regarding the start and end of the offering must be sent to the CVM, in accordance with art. 7-A and art. 8 of CVM Instruction No. 476/2009, in the form of annexes 7-A and 8 of the same Instruction.
Partial communications (semi-annual) must also be sent, if the offerings have a duration superior to 6 (six) months.
In the case of offerings with dispensation of registration by single and indivisible lot (art. 5, II, of CVM Instruction No. 400/2003), the information is required in accordance with art. 5, §3 of the same Instruction.
The information must be provided by the lead intermediary institution of the offering.
All institutions integrated into the securities distribution system already have authorization to send information using the master password of the institution in CVMWEB ("director responsible for IN 505").
Access will be performed via the CVM page (http://www.cvm.gov.br): Systems Center, Public Offerings, Offerings with Restricted Efforts and Dispensations from Art. 5 ICVM 400 / Sending Communications (via CVMWeb).
Authorization for the use of the Restricted Effort Public Offerings System may be delegated to: Systems Center / CVMWEB / Account Administration / Delegation of Tasks.
The deadlines for sending the information are:
In Offerings with restricted efforts:
i. The Initial Form must be sent within 5 (five) business days, counted from the first inquiry to potential investors;
ii. The Final Form must be sent within 5 (five) days, counted from the end of the offering;

iii. If the public offering distributed with restricted efforts is not closed within 6 (six) months of its start, the Partial Form must be sent.
While the offering is not closed, a new partial form must be sent every six months, with the accumulated placement data until the sending.
In single and indivisible lot offerings, the Final Form must be sent within 5 (five) days of the end of the offering.
Information sent with errors may be altered by the lead intermediary institution itself. Up to two alterations of each form sent may be performed. Only the last form sent regarding each offering may be altered, that is, the form may only be altered while no subsequent form has been sent.
As stated in Circular Letter No. 02/2016/CVM/SIN/SRE, the administrator of an investment fund regulated by CVM Instruction No. 555/2014 must inform all its public distribution offerings of quotas through the CVMWeb System, observing that the information of the initial distribution is a requirement for the fund's registration status in this Commission to change to "in normal operation". And, if the public distribution of quotas of closed investment funds is conducted with restricted efforts, the lead intermediary institution of the offering must provide the information provided in articles 7-A and 8 of CVM Instruction No. 476/2009, in the form of its annexes 7-A and 8, through the information reception system for distribution offerings with restricted efforts, available on the CVM portal. Thus, the information must be sent through both systems. We have observed a significant quantity of communications sent with incorrect, duplicate, or incomplete information. We request that the information be checked before sending. Before sending a second communication, the accuracy of the previous communication must be verified and it may be altered eventually. We remind you that these communications are directed to the general public. The sending of incorrect information, even if unintentional, constitutes a serious violation of the norm that disciplines offerings conducted under restricted efforts and may generate a procedure for the investigation of irregularities and eventual sanctioning proceedings. To communicate system errors, send an email to suporteexterno@cvm.gov.br.
36.3. Interpretation of art. 9 (4-month period between offerings with restricted efforts)
In the understanding of the SRE, corroborated by the Special Federal Prosecutor, in the absence of prescription in law or regulatory norm through which different species of a certain security have been created, as occurs, for example, with shares (art. 15 of Law No. 6,404/1976) and debentures (art. 58 of Law No. 6,404/1976), the species will be unique, and thus, the provisions of art. 9 of CVM Instruction No. 476/2009 must be understood as referring to each of the securities listed in art. 1, §1 of the Instruction. In this manner, it is not possible to conduct offerings with restricted efforts of different emissions or series of the same species of the same security without observing the 4 (four) month period between the offerings, observing the exceptions provided in the sole paragraph of art. 9. We particularly highlight that it will be considered a single offering, for the purposes of the limits contained in art. 3, items I and II of CVM Instruction No. 476/2009, offerings of different emissions, series, or classes of the same species of the same security conducted simultaneously. Therefore, in such case, these offerings must comply, jointly, with the limits of the number of investors sought and of investors subscribing. Furthermore, we alert that the period provided in art. 9 in question must be observed even if the offering is closed without subscribers. The closing of the offering, whether by voluntary decision due to the absence of investors or by the subscription of the securities, must be communicated in accordance with art. 8 of the Instruction in question and must be considered as a benchmark for the purposes of determining the time lapse, to which two successive offerings under restricted efforts must be submitted. Regardless of whether there are subscribers or not, the decision to cease the search for investors ("cancellation of the offering") characterizes the closing of the procedures related to the offering.
36.4. "Offering Data" Table of the Partial and Closing Forms of distribution
Regarding the classification of the non-resident investor within the scope of such offerings, it is important to identify where the distribution efforts were carried out, taking into consideration the location of the sales effort and the material that was made available to the investor/manager. In this sense, in the case of a public offering where there were no placement efforts abroad (144a and Reg S), that is, where the approach of the potential investor took place in Brazil, the non-resident investor must be considered for the purposes of applying the limits established for inquiry and subscription in offerings under restricted efforts, and will be informed in the "Foreign Investors" item of the Partial and Closing Forms, and not through the selection "Concurrent Offering Abroad?". Furthermore, subscribers who are exercising priority or preference rights will be disregarded for the purposes of verifying the limits provided in article 3,

incisos I and II of CVM Instruction No. 476/09 and must be listed in the "Others" item of the Partial and Closing Forms, specifying which hypothesis applies.

36.5. Treatment given to unitholders of funds that do not qualify as professional investors in public offerings with restricted efforts

The understanding expressed in this section was the subject of Circular Letter No. 01/2016/CVM/SIN/SRE, of 05/16/2016.

Article 151 of CVM Instruction No. 555/14 allows "the permanence and the making of additional investments, in funds for qualified investors, by unitholders who cease to fit into the category of qualified investor" established by CVM Instruction No. 554/14, provided that the conditions set forth therein are respected.

Similarly, Article 152 of that Instruction provides for similar permission for unitholders of exclusive funds or "those that require a minimum investment per investor of R$ 1,000,000.00" and that have also adapted "to the rules applicable to the professional investor category", as defined by CVM Instruction No. 554/14.

The interpretation of the technical areas is that unitholders of funds provided for in the conditions of Articles 151 and 152 of CVM Instruction No. 555/14 may participate in public offerings carried out based on CVM Instruction No. 476/09, even if they do not meet the qualification requirement required by that norm (as professional investors).

Also, the participation of investors in public offerings with restricted efforts of units of funds in which they already invest and that meet the provisions above should not be considered within the limits of demand of 75 unitholders; or of acquisition of units by 50 investors, to guarantee the right of priority in the acquisition of units in order to maintain proportionally their participations in the fund.

On the other hand, it should be highlighted that the distribution of units of new investment funds, or even distributions of units of existing funds, but intended for new investors, must fully comply with the requirement set forth in Article 2 of CVM Instruction No. 476/09, regarding the exclusive participation of professional investors.

Finally, it is worth informing the interpretation of the technical areas that, by virtue of the application of Article 1 of CVM Instruction No. 555/2014, the transitional rules provided for in Articles 151 and 152 of that Instruction extend to investment funds regulated by other CVM Instructions.

Advertising Material

This section brings guidelines for the preparation of advertising material for public distribution offerings. Adherence to the guidelines set forth here will make the approval of advertising material submitted for prior analysis by this agency more agile.

Before providing such guidelines, given what has been identified during its Supervision activity, the SRE considers it relevant to make some specific reservations regarding the use of advertising material or dissemination and support material in cases of offerings automatically exempt from distribution registration (COE offerings, under restricted efforts, offerings carried out in the crowdfunding structure, or still under the exemption provided for in art. 5 of CVM Instruction No. 400/2003).

In this sense, in such offerings, special attention is requested to the language employed as well as to the correct approach to risks related to the investment. It is worth noting that in the case of automatic exemption from registration, it is essentially presumed a particularly rigorous, diligent, and cautious performance by those involved in the offering. This is because there is no interaction process with the CVM, characteristic of the registration analysis stage, interactions through which preventive adequacy to what the norm provides for is sought, including regarding the informational content to be provided to investors, the central pillar of the function of public offering registration.

37.1. Most Common Requirements

37.1.1. For written materials (printed, sent by e-mail or available on sites)

That all advertising material, on all its pages, contain the following warning: "READ THE PROSPECTUS AND THE REFERENCE FORM BEFORE ACCEPTING THE OFFER, ESPECIALLY THE RISK FACTORS SECTION" or "READ THE PROSPECTUS AND THE FUND REGULATIONS BEFORE ACCEPTING THE OFFER, ESPECIALLY THE RISK FACTORS SECTION", as applicable, in order to fully comply with the provisions of §3 of art. 50 of CVM Instruction No. 400/03. That the said text be located preferably in the lower part of the page of the advertising material and that such information occupy about 20% of the length or width of each page, as the text is arranged, with emphasis and, preferably, on a white background and black letters.

That all advertising material contain, on all its pages, the banner "ADVERTISING MATERIAL", in attention to the provisions of §3 of art. 50 of CVM Instruction No. 400/2003. That this banner be located, always, in the upper part and above any other content of the advertising material, in a prominent way,

preferably on a white background and black letters, and in a font size equivalent to, at least, 50% of the size of the largest font used on the page.

That all advertising material inform the locations where the prospectus, the reference form, and equivalent documents are available. Among these locations include the CVM, the issuer, the offeror, the leading intermediary institutions of the offering, and, when applicable, the trading environments or platforms for the securities to be distributed. That it also inform the complete electronic address, that is, the one that gives direct access to the Prospectus and the reference form, or explain, step by step, how to access it.

As provided in §2 of art. 50 of CVM Instruction No. 400/2003, that the advertising material be prepared in a calm and moderate language. In this sense, that the advertising material present, for example, the risk factors of the Offer in a font size equivalent to that used in the favorable information to the Offer contained therein. Another example: if the favorable information to the Offer occupies seven pages of the advertising material and the risk factors section occupies seven pages of the prospectus, this section can be fully transcribed in the advertising material. However, if the advertising material has only two pages, it may be sufficient to include the titles of the risk factors, if self-explanatory, or a summary of the risk factors.

The aim is thus to achieve a balance between "favorable" and "unfavorable" information in the advertising material.

It is important to emphasize that the presentation of risk factors must be an integral part of the body of the advertising material, and cannot be placed in appendices or in any way that might suggest it is detached from the rest of the material.

When the advertising material adopts the form of questions and answers, that it maintain a balance between favorable and unfavorable answers to the offer. In this sense, that it contain questions about the risk of the operation, such as "can I lose all the invested money?", "how do I find out all the risks of this investment?" etc.

37.1.2. For audio and video materials

Given that the "radio spot" is advertising material, it requires prior approval by the CVM, under the terms of art. 50 of CVM Instruction No. 400/03, by presenting its text in writing and also the recorded audio. The latter, with a slow intonation, so as to allow full hearing of the mandatory warning about the need to read the Prospectus and the reference form, especially the risk factors section. The recorded audio can be sent after the submission and approval of the written text.

The advertising film for TV must also be submitted for prior approval by the CVM, under the terms of art. 50 of CVM Instruction No. 400/2003, by presenting the written text and the recorded video. The audio of the film also deserves a slow intonation, so as to allow full hearing of the mandatory warning about the need to read the Prospectus and the reference form or the fund regulations, especially the risk factors section. Preferably, this warning should also be displayed in writing in the film, in size, color, and time sufficient for easy reading by viewers.

37.1.3. Other important information

When referring to target yield, that the advertising material contemplate, in a prominent way, that this does not represent and nor should it be considered, under any hypothesis, as a promise, guarantee, or suggestion of yield, given the provisions of article 38, item V, of CVM Instruction No. 209/1994, article 36, items VIII and IX, of CVM Instruction No. 356/2001, article 35, item VIII, of CVM Instruction No. 472/2008, and article 43, item V, of CVM Instruction No. 578/2016.

That the advertising material, even if not directly referring to target yield, comply with the provisions of this recommendation.

That the advertising material not contain information that is not in the Prospectus or the reference form, considering the provisions of §2 of art. 50 of CVM Instruction No. 400/2003.

That the advertising material be sent to the CVM for approval with its pieces individually identified (with name), in final layout and that we be informed in which media it will be broadcast (printed, site, newspaper, radio, TV, etc.).

That the letter, e-mail, or any other means that will serve to send the advertising material to investors also be sent for analysis.

To facilitate the review of the advertising material by the CVM, the petition that forwards it must indicate the pages of the Prospectus and the reference form where the content presented in the advertising material is found.

That the advertising material used not contain modification of form, color, font size, arrangement of information, etc., when compared to that approved by the CVM.

As established by the caput and §2 of art. 50 of CVM Instruction No. 400/2003, and also in a decision of the CVM Collegiate Board issued on 09/27/2011, within the scope of Process CVM RJ 2011/9865, it is not possible to use advertising material if the offering does not have a prospectus, or if the Prospectus is not yet available in the mandatory locations. This rule is excepted for offerings of Structured Operations Certificates ("COE"), Collective Hotel Investment Contract ("CIC Hotel" or "Condo-Hotel") and Crowdfunding.

The insertion of information about the offering in an internal newspaper or directed to employees of any institution related, directly or indirectly, to the offering, is considered advertising material, therefore subject to compliance with art. 50 of CVM Instruction No. 400/03 and observance of this Circular Letter. It is not considered advertising material that intended to inform the employees themselves about the differentiated way to adhere to the offering or the material used for sales team training as long as it is not distributed.

We remind you that the provisions of §3 of art. 9 of CVM Instruction No. 400/2003, to give agility to the approval of advertising material by the CVM, establish that in compliance with the requirements formulated by the CVM, the documents must be presented in two versions: the first with the marking of the alterations determined by the CVM, differentiated from those that do not result from compliance with such determinations, and the second without any marks.

The use of advertising material on social media is not permitted, as they allow comments that cannot be controlled by the offerors and that, potentially, may mislead investors.

37.2. Institutional Advertising

For the purposes of this Circular Letter, "institutional advertising material" is understood as all and any advertisements, propaganda, advertising campaigns, and other dissemination materials of the issuer's brand and not of its products, broadcast during the offering, in printed, electronic, digital, and/or functional media, both for external dissemination and for internal dissemination in the issuer, by any means, such as newspapers, magazines, internet, open and/or subscription TV, radio, banners, and billboards.

It is up to the issuer, together with the leading intermediary institution, to carefully analyze each advertisement, propaganda, advertising campaign, and other materials of the issuer to be used during the offering, to verify if these can be classified as institutional advertising material, and evaluate the implementation of the additions described in the item below.

37.2.1. Inclusion of Warnings

The institutional advertising material must contain the following text at the end of its broadcast:

"The [name of the issuer or offeror] is carrying out a public distribution offering [primary and/or secondary] of [type of securities object of the Offer] issued by it (or issued by [name of issuer]) in a process of registration with the Securities and Exchange Commission. Read the Prospectus and the Reference Form before accepting the Offer, especially the Risk Factors sections."

We also recommend that the text have a font size equivalent to, at least, 50% of the size of the largest font used on the page and in bold. In the case of institutional audiovisual advertising material, that the text be displayed at the end of the advertisement, in size and time sufficient to allow easy reading by the public.

In the case of audio advertising material, that the text be narrated at the end of the advertisement and in a slow manner, for easy comprehension by the public.

37.3. Deadlines and Procedures

We recommend that all modalities of advertising material be sent to the CVM at once, both in the initial protocol and in the compliance with requirements, in order to give speed to its analysis.

The use of advertising material during the offering depends on prior approval by the CVM, under the terms and deadlines set forth in article 50, §1, of CVM Instruction No. 400/2003, namely:

10 (ten) business days, counted from the date of protocol of the advertising material, for public distribution offerings of investment fund units; and
5 (five) business days, counted from the date of protocol of the advertising material, for other offerings.

It is important to alert that the support documents for presentations offered to investors ("support material" provided for in art. 50, §5 of CVM Instruction No. 400/2003) must not present the same content as advertising materials under analysis at the CVM, and the use of material not yet approved is prohibited under any circumstances. It is worth observing that the subsequent approval of the advertising material would not exempt the irregularity practiced in the eventual distribution to potential investors of the support material containing advertising material pending approval, remembering that the distribution of support material is prohibited.

The SRE understands that the advertising material must be presented for approval during the analysis period of the registration request for the offering. Repeated sending of advertising material within the scope of the same offering is not expected, especially after the granting of its registration, considering the difficulties imposed for its subsequent analysis and eventual developments in the distribution schedule and eventual modification of the offering, generating rework and potentially implying updating of the Prospectus and the reference form. The advertising material cannot be used while it has not been approved by the CVM, as established in the caput of art. 50 of CVM Instruction No. 400/03. It must be observed that under the terms of art. 59 caput and item VIII, the broadcasting of advertising material without prior approval by the CVM or in disagreement with the provisions of CVM Instruction No. 400/03 is considered a serious offense.

37.4. Pre-approved advertising material models

Model I - Presentation of the offering on the websites of intermediary institutions, where there must be links to the reservation request and to the prospectus, with the access to the reservation request remaining blocked until the investor accesses the prospectus;

Model II - Text for dissemination of the offering by e-mail to potential investors.

We emphasize that the use of Model II necessarily presupposes the use of Model I, that is, for the forwarding of e-mail to potential investors to be considered approved, it will be necessary to present the offering on the websites of the senders. If the advertising document known as "take one" is also used, it must be made available, under the terms of Model I, on the websites of all intermediary institutions participating in the offering that use the said model.

The SRE will understand that the use of the said models, without any alteration in their structure, nor addition or reduction of information beyond the insertion, in the indicated location, of the logos of the intermediary institution and the issuer of the securities, meets the provisions of article 50 of CVM Instruction No. 400/2003, which establishes that the advertising material must (i) be expressly identified as such, (ii) be prepared in a calm and moderate language, (iii) warn its readers about the risks of the investment and (iv) recommend, with letters notably larger than those used in the rest of the text, the careful reading of the Prospectus before accepting the offer.

In this case, it will not be necessary to present these advertising materials by the leading institution of the distribution for examination by this technical area, provided that the Preliminary Prospectus of the offering has been presented to the CVM, as provided in the caput of art. 50 of CVM Instruction No. 400/2003.

Finally, we remind you that the leading institution of the distribution will remain co-responsible for the compliance, by the intermediary institutions that it hires, of the provisions of CVM Instruction No. 400/2003, especially its art. 50, therefore, it must effectively control the use of advertising material by its contractors.

SECURITIES AND EXCHANGE COMMISSION
REGISTRATION OF SECURITIES SUPERINTENDENCY

Model I
Advertising Material (font size 16)
Public Distribution Offering of Shares of (company name) Official links (font size 12) Preliminary Prospectus Definitive Prospectus (when available) Market Notice and other Official Communications of the Offering Take One (if any) Offer Schedule start date of the reservation period end date of the reservation period of related person, if any end date of the reservation period of non-related person date of bookbuilding and fixing of the share price date of start of negotiation other events of the offer Broker Specific Rules Registration, Guarantees and liquidation Reservation Request (only release this access after the prospectus has been accessed) Attention: Read the Prospectus before accepting the offer, especially the Risk Factors section. (font size 20) Company Name

Model II
E-mail Public Offering
Informative Advertisement (font size 16)
Dear Customer (or customer name), (font size 12) Starting this (day of the week), day (XX), the reservation period for the Public Offering of distribution of (shares) / (units) issued by (company name) begins.
The (Broker Name) is participating in this launch through its (Homebroker) /(or its Trading Desk).
As part of this Offering (Type of Offering), the following asset(s) will be offered to the market:
(Asset Code) – (Company Name – Asset Type).
To make your reservation, access our site at www.(broker name).com.br Right on the first page you will find a direct link.
Attention: Before making your request, read the Prospectus available on our site and stay informed of all the conditions of this Operation.
Attention: Read the Prospectus before accepting the offer, in the Risk Factors section. (font size 20) Broker Brand Name of the Offered Company

CVM/SRE Circular Letter 01/18

Lineage: In force