Joint Decision SPC/CVM 07/98

JOINT DECISION NO. 07, OF JULY 23, 1998

Provides for the option of closed private pension entities (EFPP) to use open companies, exclusively in the capacity of investment vehicles.

The Collegiate Board of the Securities and Exchange Commission of Brazil – CVM and the Secretary of the Complementary Pension Secretariat – SPC, of the Ministry of Social Security and Assistance, having regard to the provisions of CMN Resolution No. 2,324, of October 30, 1996, and Law No. 6,435, of July 15, 1977,

DECIDE:

Art. 1. It is permitted for EFPPs to disregard the limits provided for in items IV and V of Article 4 of CMN Resolution No. 2,324/96, when investing in any open company(s) whose exclusive purpose is the acquisition and disposal of securities of open companies or other securities traded within the scope of the National Privatization Program (PND) governed by Law No. 9,491, of September 9, 1997, and other privatization processes of the Union that have been subject to specific legislation or other normative instruments regarding the matter.

Art. 2. When using the option provided for in the preceding article, for investments made by open companies – whose exclusive purpose is the acquisition and disposal of securities – the requirements provided for by CMN Resolution No. 2,324/96 and other complementary normative instruments must be observed.

Sole Paragraph. The investments mentioned in the caput of this article, for the purpose of complying with legal limits, must be added to those held in any form by the EFPPs.

Art. 3. The investments, effected through the aforementioned open companies, must be communicated to the Complementary Pension Secretariat of the Ministry of Social Security and Assistance within two business days, after they are formally completed, clarifying:

I – the objective of the transaction, the quantity traded, and the value involved;

II – the number of shares with voting rights, subscription rights for shares with voting rights, and subscription bonuses for shares held by the EFPP on a date prior to that of the transaction;

III – a statement encompassing the visualization of the EFPP's participation, including in percentage terms, in the open company(s) whose exclusive purpose is the acquisition and disposal of securities and the assets acquired by such company(ies), in order to demonstrate the investment chain;

IV – the number of debentures convertible into shares with voting rights held by the entity, as well as the corresponding number of shares with voting rights arising from the possible conversion of these debentures; and

V – the existence of any contract or agreement for the exercise of voting rights or that ensures to the EFPP the right to buy and sell shares with voting rights or debentures convertible into shares with voting rights.

§ 1. The investments made based on Joint Decision CVM/SPC No. 1, of December 19, 1996, must comply with the deadline provided therein.

§ 2. Any changes in the information referred to in the caput of this article must also be communicated to the SPC within two business days of their occurrence.

Art. 4. Closed private pension entities that use the option provided for in this Joint Decision must send the SPC the information previously requested and other pertinent information on the matter, in the form and within the timeframe to be determined by the Secretariat.

Art. 5. Failure to observe the provisions of this Joint Decision will subject the EFPPs and their administrators, as well as the administrators of the open companies – whose exclusive purpose is the acquisition and disposal of securities mentioned in Article 1 of this Decision – to the sanctions provided for in the legislation and regulations in force.

Art. 6. This Joint Decision enters into force on the date of its publication in the Official Gazette of the Union.

FRANCISCO DA COSTA E SILVA
President of the
SECURITIES AND EXCHANGE COMMISSION OF BRAZIL

PAULO KLIASS
Secretary of the
COMPLEMENTARY PENSION SECRETARIAT