Presidency of the Republic

Civil House

Sub‑chief for Legal Affairs

LAW No. 6,385, OF DECEMBER 7, 1976

Veto Message

(See Decree‑Law No. 2,064 of 1983)

(See Decree‑Law No. 2,065 of 1983)

(See Decree‑Law No. 2,286 of 1986)

(See Decree No. 91,152 of 1985)

Provides for the securities market and creates the Securities and Exchange Commission.

THE PRESIDENT OF THE REPUBLIC, makes known that the NATIONAL CONGRESS decrees and I sanction the following Law:

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CHAPTER I

General Provisions

Art. 1 The following activities shall be regulated and supervised in accordance with this Law: (Amended by Law No. 10,303 of 31/10/2001)

I – the issuance and distribution of securities in the market; (Amended by Law No. 10,303 of 31/10/2001)

II – the trading and intermediation in the securities market; (Amended by Law No. 10,303 of 31/10/2001)

III – the trading and intermediation in the derivatives market; (Amended by Law No. 10,303 of 31/10/2001)

IV – the organization, operation and activities of Stock Exchanges; (Amended by Law No. 10,303 of 31/10/2001)

V – the organization, operation and activities of Commodities and Futures Exchanges; (Amended by Law No. 10,303 of 31/10/2001)

VI – the administration of portfolios and the custody of securities; (Amended by Law No. 10,303 of 31/10/2001)

VII – the auditing of publicly listed companies; (Clause added by Law No. 10,303 of 31/10/2001)

VIII – consulting and analyst services for securities. (Clause added by Law No. 10,303 of 31/10/2001)

Art. 2 The securities subject to the regime of this Law are: (Amended by Law No. 10,303 of 31/10/2001)

I – shares, debentures and subscription bonuses; (Amended by Law No. 10,303 of 31/10/2001)

II – coupons, rights, subscription receipts and split certificates relating to the securities referred to in item I; (Amended by Law No. 10,303 of 31/10/2001)

III – securities deposit certificates; (Amended by Law No. 10,303 of 31/10/2001)

IV – debenture notes; (Clause added by Law No. 10,303 of 31/10/2001)

V – investment fund units in securities or investment clubs in any assets; (Clause added by Law No. 10,303 of 31/10/2001)

VI – commercial notes; (Clause added by Law No. 10,303 of 31/10/2001)

VII – futures contracts, options and other derivatives whose underlying assets are securities; (Clause added by Law No. 10,303 of 31/10/2001)

VIII – other derivative contracts, regardless of the underlying assets; (Clause added by Law No. 10,303 of 31/10/2001)

IX – when publicly offered, any other titles or collective investment contracts that generate participation, partnership or remuneration rights, including those resulting from service provision, whose returns arise from the effort of the entrepreneur or third parties. (Clause added by Law No. 10,303 of 31/10/2001)

X – the assets that are part of the Brazilian System for Trading Greenhouse‑Gas Emissions (SBCE) and carbon credits, when traded in the financial and capital market. (Included by Law No. 15,042 of 2024)

§ 1 The following are excluded from the regime of this Law: (Amended by Law No. 10,303 of 31/10/2001) (See Art. 1 of Law No. 10,198 of 14/02/2001)

I – federal, state or municipal public debt securities; (Amended by Law No. 10,303 of 31/10/2001)

II – foreign exchange titles for which a financial institution is responsible, except debentures. (Amended by Law No. 10,303 of 31/10/2001)

§ 2 The issuers of the securities referred to in this article, as well as their administrators and controllers, are subject to the discipline provided in this Law, for publicly listed companies. (Paragraph added by Law No. 10,303 of 31/10/2001)

§ 3 It is the competence of the Securities and Exchange Commission to issue norms for the execution of the provisions of this article, being able to: (Paragraph added by Law No. 10,303 of 31/10/2001)

I – require that issuers be constituted as corporations; (Clause added by Law No. 10,303 of 31/10/2001)

II – require that the financial statements of issuers, or information about the enterprise or project, be audited by an independent auditor registered with it; (Clause added by Law No. 10,303 of 31/10/2001)

III – waive, in the public distribution of the securities referred to in this article, the participation of a society that is part of the system provided for in Art. 15 of this Law; (Clause added by Law No. 10,303 of 31/10/2001)

IV – establish standards for clauses and conditions that must be adopted in titles or investment contracts intended for trading on an exchange or over‑the‑counter, organized or not, and refuse admission to the market of issuances that do not satisfy those standards. (Clause added by Law No. 10,303 of 31/10/2001)

§ 4 A condition of validity for the derivative contracts dealt with in items VII and VIII of the caput, entered into after the entry into force of Provisional Measure No. 539 of 26 July 2011, is registration in clearing, settlement and registration chambers or service providers authorized by the Central Bank of Brazil or the Securities and Exchange Commission. (Included by Law No. 12,543 of 2011)

Art. 3 It is the competence of the National Monetary Council:

I – to define the policy to be observed in the organization and operation of the securities market;

II – to regulate the use of credit in this market;

III – to set the general guidance to be observed by the Securities and Exchange Commission in the exercise of its duties;

IV – to define the activities of the Securities and Exchange Commission that must be exercised in coordination with the Central Bank of Brazil.

V – to approve the personnel framework and regulations of the Securities and Exchange Commission, as well as to set the remuneration of the president, directors, holders of trust positions and other employees. (Clause added by Law No. 6,422 of 08/06/1977)

VI – to establish, for monetary and exchange‑rate policy purposes, specific conditions for the trading of derivative contracts, regardless of the nature of the investor, being able, among other things, to:

a) determine deposits on the notional values of the contracts; (Included by Law No. 12,543 of 2011)

b) set limits, deadlines and other conditions on the trading of derivative contracts. (Included by Law No. 12,543 of 2011)

§ 1 Except for the provisions of this Law, the supervision of the financial and capital market shall continue to be exercised, under the terms of the legislation in force, by the Central Bank of Brazil. (Included by Law No. 12,543 of 2011)

§ 2 The specific conditions referred to in item VI of the caput of this article may not be required for open operations on the date of publication of the act that establishes them. (Included by Law No. 12,543 of 2011)

Art. 4 The National Monetary Council and the Securities and Exchange Commission shall exercise the powers provided for in the law for the purpose of:

I – stimulating the formation of savings and their application in securities;

II – promoting the expansion and efficient, regular operation of the stock market, and stimulating permanent investments in the share capital of publicly listed companies under national private capital control;

III – ensuring the efficient and regular operation of exchange and over‑the‑counter markets;

IV – protecting securities holders and market investors against:

a) irregular issuances of securities;

b) illegal acts by administrators and controlling shareholders of publicly listed companies, or by portfolio administrators;

c) the use of material non‑public information. (Subparagraph added by Law No. 10,303 of 31/10/2001)

V – preventing or curbing fraud or manipulation intended to create artificial demand, supply or price conditions for securities traded in the market;

VI – ensuring public access to information about traded securities and the companies that have issued them;

VII – ensuring the observance of fair commercial practices in the securities market;

VIII – ensuring compliance in the market with the credit‑use conditions set by the National Monetary Council.

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CHAPTER II

The Securities and Exchange Commission

Art. 5 The Securities and Exchange Commission is instituted as a special‑regime autonomous autarchy, linked to the Ministry of Finance, with its own legal personality and assets, endowed with independent administrative authority, absence of hierarchical subordination, fixed term for its officers, stability of its leaders, and financial and budgetary autonomy. (Amended by Law No. 10,411 of 26/02/2002)

Art. 6 The Securities and Exchange Commission shall be administered by a President and four Directors, appointed by the President of the Republic, after approval by the Federal Senate, among persons of impeccable reputation and recognized competence in capital market matters. (Amended by Law No. 10,411 of 26/02/2002) (Regulation)

§ 1 The term of office of the Commission’s officers shall be five years, reappointment prohibited, with one‑fifth of the Collegiate members renewed each year. (Amended by Law No. 10,411 of 26/02/2002)

§ 2 The officers shall lose their mandate only by resignation, final criminal conviction, or disciplinary administrative process. (Amended by Law No. 10,411 of 26/02/2002)

§ 3 Without prejudice to the criminal law and the law on administrative improbity, failure by the President or Director to observe the duties and prohibitions inherent to the position shall constitute cause for loss of mandate. (Amended by Law No. 10,411 of 26/02/2002)

§ 4 It is the duty of the Minister of State for Finance to initiate the disciplinary administrative process, which shall be conducted by a special commission; the President of the Republic may determine preventive suspension when appropriate and render the judgment. (Amended by Law No. 10,411 of 26/02/2002)

§ 5 In the event of resignation, death or loss of mandate of the President of the Securities and Exchange Commission, the oldest Director, or the most senior, shall assume the presidency in that order, until a new appointment, without prejudice to his duties. (Amended by Law No. 10,411 of 26/02/2002)

§ 6 In the event of resignation, death or loss of mandate of a Director, a new appointment shall be made in the manner provided for in this Law to complete the substituted member’s term. (Amended by Law No. 10,411 of 26/02/2002)

§ 7 The Commission shall operate as a collegial deliberative body in accordance with its internal regulations, which shall set the duties of the President, the Directors and the Collegiate. (Included by Autonomous Decree No. 3,995 of 2001)

Art. 7 The Commission shall fund the expenses necessary for its operation from:

I – allocations from monetary reserves referred to in Art. 12 of Law No. 5,143 of 20 October 1966, amended by Decree‑Law No. 1,342 of 28 August 1974, that are assigned to it by the National Monetary Council;

II – allocations earmarked for it in the federal budget;

III – revenues derived from the provision of services by the Commission, observed the table approved by the National Monetary Council;

IV – income from patrimonial assets and occasional revenues;

V – revenues from fees arising from the exercise of its police power, pursuant to law. (Clause added by Law No. 10,303 of 31/10/2001)

Art. 8 It is the competence of the Securities and Exchange Commission to:

I – regulate, observing the policy defined by the National Monetary Council, the matters expressly provided for in this Law and the corporation law;

II – administer the registers instituted by this Law;

III – permanently supervise the activities and services of the securities market referred to in Art. 1, as well as the dissemination of information relating to the market, its participants and the securities traded therein;

IV – propose to the National Monetary Council the possible fixing of maximum price limits, commissions, emoluments and any other advantages charged by market intermediaries;

V – supervise and inspect publicly listed companies, giving priority to those that do not present profit in their balance sheets or that fail to pay the mandatory minimum dividend.

§ 1 The provision of this article does not exclude the competence of Stock Exchanges, Commodities and Futures Exchanges, and clearing and settlement entities with respect to their members and the securities traded therein. (Regulation by Decree No. 3,995 of 31/10/2001)

§ 2 All documents and administrative process files shall be publicly accessible, except those whose secrecy is essential for the protection of privacy or social interest, or whose secrecy is guaranteed by explicit legal provision. (Regulation by Decree No. 3,995 of 31/10/2001)

§ 3 In accordance with its internal rules, the Commission may:

I – publish draft normative acts to receive suggestions from interested parties;

II – summon, at its discretion, any person who can contribute information or opinions for the improvement of the norms to be promulgated.

Art. 9 The Securities and Exchange Commission, observing the provisions of § 2 of Art. 15, may:

I – examine and extract copies of accounting records, books or documents, including electronic programs and magnetic, optical or any other nature files, as well as auditors’ working papers, which must be kept in perfect order and condition for a minimum period of five years:

a) natural and legal persons that are part of the securities distribution system (Art. 15);

b) publicly listed companies and other securities issuers and, when there is founded suspicion of illegal acts, their controlling, controlled, affiliated and commonly controlled societies; (Amended by Law No. 10,303 of 31/10/2001)

c) investment funds and investment societies;

d) portfolios and securities deposits (Arts. 23 and 24);

e) independent auditors;

f) securities consultants and analysts;

g) any other natural or legal persons, when any irregularity to be investigated occurs under item V of this article, for the purpose of verifying illegal acts or inequitable practices; (Regulation by Decree No. 3,995 of 31/10/2001)

II – summon the persons referred to in item I to provide information or clarifications, under penalty of fine, without prejudice to the application of the penalties provided for in Art. 11; (Amended by Law No. 10,303 of 31/10/2001)

III – request information from any public body, autonomous agency or public company;

IV – order publicly listed companies to republish, with corrections or amendments, financial statements, reports or disclosed information;

V – investigate, through administrative process, illegal acts and inequitable practices of administrators, members of the fiscal council and shareholders of publicly listed companies, of intermediaries and other market participants; (Amended by Law No. 10,303 of 31/10/2001)

VI – apply to the perpetrators of the infractions indicated in the preceding item the penalties provided for in Art. 11, without prejudice to civil or criminal liability.

§ 1 To prevent or correct abnormal market situations, the Commission may:

I – suspend the trading of a specific security or declare a stock exchange recess;

II – suspend or cancel the registers covered by this Law;

III – disclose information or recommendations with the aim of clarifying or guiding market participants;

IV – prohibit market participants, under penalty of fine, from performing acts specified as harmful to the regular functioning of the market.

§ 2 The process, in the cases of item V of this article, may be preceded by an investigative stage, in which necessary secrecy shall be ensured for fact‑finding or as required by public interest, and shall follow the procedure fixed by the Commission. (Regulation by Decree No. 3,995 of 31/10/2001)

§ 3 When public interest requires, the Commission may disclose the initiation of the investigative procedure referred to in § 2. (Paragraph added by Decree No. 3,995 of 31/10/2001)

§ 4 In the investigation of infractions of securities market legislation, the Commission shall prioritize serious infractions, whose sanction provides greater educational and preventive effect for market participants, and may refrain from initiating an administrative sanctioning process when the conduct is of little relevance, the injury to the protected legal good is low, or other supervisory instruments and measures deemed more effective are available. *(Amended by Law No. 13,506 of 2017)

§ 5 The Collegiate’s judgment sessions in the administrative process referred to in item V of this article shall be public, with possible restriction of third‑party access due to public interest involved. (Included by Decree No. 3,995 of 31/10/2001)

§ 6 The Commission shall be competent to investigate and punish fraudulent conduct in the securities market whenever:

I – its effects cause damage to persons residing in the national territory, regardless of where they occurred; (Included by Decree No. 3,995 of 31/10/2001)

II – the relevant acts or omissions were performed in national territory. (Clause added by Decree No. 3,995 of 31/10/2001)

Art. 10 The Securities and Exchange Commission may enter into agreements with similar bodies of other countries, or with international entities, for assistance and cooperation in conducting investigations to ascertain violations of securities market rules occurring in the Country and abroad. (Amended by Law No. 10,303 of 31/10/2001)

§ 1 The Commission may refuse to provide the assistance referred to in the caput of this article when public interest must be safeguarded. (Paragraph added by Law No. 10,303 of 31/10/2001)

§ 2 The provisions of this article also apply to information that, by legal provision, is subject to secrecy. (Paragraph added by Law No. 10,303 of 31/10/2001)

Art. 10‑A The Securities and Exchange Commission, the Central Bank of Brazil and other regulatory bodies may enter into agreements with an entity whose purpose is the study and dissemination of accounting and auditing principles, norms and standards, being able, in the exercise of their regulatory powers, to adopt, in whole or in part, the pronouncements and other technical guidelines issued. (Included by Law No. 11,638 of 2007)

Sole Paragraph: The entity referred to in the caput of this article shall be composed predominantly of accountants, with equal representation of entities representing societies subject to the financial statements regime provided for in this Law, societies that audit and analyze financial statements, the federal auditing body of the accounting profession, and a university or research institute with recognized activity in the accounting and capital market field. (Included by Law No. 11,638 of 2007)

Art. 11 The Securities and Exchange Commission may impose on violators of this Law, Law No. 6,404 of 15 December 1976 (Corporations Law), its resolutions and other legal norms under its supervision the following penalties, singly or cumulatively: (Amended by Law No. 13,506 of 2017)

I – warning;

II – fine;

III – (repealed) (Amended by Law No. 13,506 of 2017)

IV – temporary disqualification, up to a maximum of 20 (twenty) years, from holding the position of administrator or fiscal council member of a publicly listed company, of an entity of the distribution system or of other entities that depend on authorization or registration with the Securities and Exchange Commission; (Amended by Law No. 13,506 of 2017)

V – suspension of authorization or registration for the exercise of the activities covered by this Law;

VI – temporary disqualification, up to a maximum of 20 (twenty) years, from exercising the activities covered by this Law; (Amended by Law No. 13,506 of 2017)

VII – temporary prohibition, up to a maximum of twenty years, from performing certain activities or operations, for members of the distribution system or other entities that depend on authorization or registration with the Securities and Exchange Commission; (Included by Law No. 9,457 of 05/05/1997)

VIII – temporary prohibition, up to a maximum of ten years, from acting, directly or indirectly, in one or more types of operation in the securities market. (Included by Law No. 9,457 of 05/05/1997)

§ 1 The fine shall observe, for purposes of measurement, the principles of proportionality and reasonableness, the economic capacity of the infringer and the reasons justifying its imposition, and shall not exceed the greater of the following amounts: (Amended by Law No. 13,506 of 2017)

I – R$ 50,000,000.00 (fifty million reais); (Amended by Law No. 13,506 of 2017)

II – double the value of the issuance or the irregular operation; (Amended by Law No. 13,506 of 2017)

III – three (3) times the amount of the economic advantage obtained or the loss avoided due to the illicit act; (Amended by Law No. 13,506 of 2017)

IV – double the loss caused to investors as a result of the illicit act. (Amended by Law No. 13,506 of 2017)

§ 2 In cases of recidivism, a fine of up to three times the amounts fixed in § 1 of this article may be applied. (Amended by Law No. 13,506 of 2017)

§ 3 The penalties provided in items IV, V, VI, VII and VIII of the caput of this article shall only be applied in cases of serious infractions, as defined in the regulations of the Securities and Exchange Commission, or in cases of recidivism. (Amended by Law No. 13,506 of 2017)

§ 4 The penalties shall only be imposed observing the procedure provided for in § 2 of Art. 9 of this Law, with the right of appeal to the Financial System Resources Council. (Amended by Law No. 9,457 of 05/05/1997)

(See Decree No. 9,889 of 2019)

§ 5 The Securities and Exchange Commission, after analysis of convenience and opportunity, with a view to serving public interest, may decide not to initiate or to suspend, at any stage preceding the first‑instance decision, the administrative procedure intended to investigate an infraction provided for in the legal and regulatory norms under its supervision, if the investigated party signs a commitment term obligating it to: (Amended by Law No. 13,506 of 2017)

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I – cease the practice of activities or acts considered illicit by the Securities and Exchange Commission; and II – correct the irregularities identified, including compensating damages.

§ 6. The commitment referred to in the preceding paragraph shall not constitute a confession regarding the factual matter, nor an acknowledgment of the illicit nature of the conduct analyzed. (Added by Law No. 9,457, of 5 May 1997)

§ 7. The term of commitment must be published on the Securities and Exchange Commission’s website, with a specification of the deadline for fulfilling any obligations assumed, and shall constitute an extrajudicial enforceable title. (Text given by Law No. 13,506, of 2017)

§ 8. If the obligations are not fulfilled within the deadline, the Securities and Exchange Commission shall resume the administrative procedure previously suspended, for the application of the appropriate penalties. (Added by Law No. 9,457, of 5 May 1997)

§ 9. In the application of penalties provided for in this law, effective remorse and subsequent remorse, or the circumstance of any person spontaneously confessing the illicit act or providing information relating to its materiality, shall be considered. (Added by Law No. 9,457, of 5 May 1997)

§ 10. The Securities and Exchange Commission shall regulate the application of the provisions of §§ 5 to 9 of this article to procedures conducted by Stock Exchanges, Commodities and Futures Exchanges, organized over‑the‑counter market entities and clearing and settlement entities for securities transactions. (Text by Decree No. 3,995, of 31 Oct 2001)

§ 11. The fine imposed for non‑execution of an order of the Securities and Exchange Commission, pursuant to item II of the caput and item IV of § 1 of Art. 9 of this Law, regardless of the administrative process provided for in item V of the caput of Art. 9 of this Law, shall not exceed, per day of delay in its fulfillment, the greater of the following amounts: (Text given by Law No. 13,506, of 2017)

I – 1/1,000 (one‑thousandth) of the total individual or consolidated turnover of the economic group, obtained in the fiscal year preceding the imposition of the fine; or (Added by Law No. 13,506, of 2017)

II – R$ 100,000.00 (one hundred thousand reais). (Added by Law No. 13,506, of 2017)

§ 12. The decision that imposes the fine provided for in § 11 of this article may be appealed to the Securities and Exchange Commission, as a final instance and without suspensive effect, within ten (10) days, as established in the internal regulations. (Text given by Law No. 14,317, of 2022) Production of effects

§ 13. In addition to the penalties provided for in the caput of this article, the Securities and Exchange Commission may prohibit the accused from contracting, for up to five (5) years, with official financial institutions and from participating in bids whose object is acquisitions, disposals, execution of works and services and concessions of public services, within the scope of the federal, state, district and municipal public administration and the entities of the indirect public administration. (Added by Law No. 13,506, of 2017)

§ 14. Credits arising from the conviction of the sentenced party to pay compensation in a public civil action brought in benefit of investors and other creditors of the sentenced party, and credits of the Credit Guarantee Fund (FGC) or other reimbursement mechanisms approved by the Central Bank of Brazil or by the Securities and Exchange Commission, if any, shall take priority over credits arising from the application of the fine penalty. (Added by Law No. 13,506, of 2017)

§ 15. In the event of bankruptcy, extrajudicial liquidation or any other form of creditor arrangement of the sentenced party, the credits of the Securities and Exchange Commission arising from the application of the fine penalty referred to in item II of the caput of this article shall be subordinated. (Added by Law No. 13,506, of 2017)

Art. 12. When the inquiry, instituted in accordance with § 2 of Art. 9, concludes that a public‑action crime has occurred, the Securities and Exchange Commission shall notify the Public Prosecutor’s Office for the filing of a criminal action.

Art. 13. The Securities and Exchange Commission shall maintain a service to provide consultative or advisory activity to market participants or to any investor.

Sole paragraph. It is at the discretion of the Securities and Exchange Commission to disclose or not the responses to consultations or the advisory criteria.

Art. 14. The Securities and Exchange Commission may provide, in its budget, allocations of funds to Stock Exchanges and to Commodities and Futures Exchanges. (Text given by Law No. 10,303, of 31 Oct 2001)

CHAPTER III

The Distribution System

Art. 15. The securities distribution system comprises:

I – financial institutions and other companies whose purpose is to distribute issuances of securities:

a) as agents of the issuing company;

b) on their own account, subscribing or purchasing the issuance to place it on the market;

II – companies whose purpose is to purchase securities circulating in the market, to resell them on their own account;

III – companies and investment advisors that carry out mediation activities in the negotiation of securities on stock exchanges or in the over‑the‑counter market; (Text given by Law No. 14,317, of 2022) Production of effects

IV – stock exchanges.

V – organized over‑the‑counter market entities. (Added by Law No. 9,457, of 5 May 1997)

VI – commodity and futures exchanges, special operators and the Commodities and Futures Exchanges; and (Text given by Law No. 10,303, of 31 Oct 2001)

VII – clearing and settlement entities for securities transactions. (Item added by Law No. 10,303, of 31 Oct 2001)

§ 1. It is the competence of the Securities and Exchange Commission to define: (Text by Decree No. 3,995, of 31 Oct 2001)

I – the types of financial institution that may carry out activities in the securities market, as well as the kinds of operations they may perform and the services they may provide in this market;

II – the specialization of operations or services to be observed by market companies, and the conditions under which they may combine types of operations or services.

§ 2. Regarding financial institutions and other companies authorized to simultaneously operate in the securities market and in markets subject to supervision by the Central Bank of Brazil, the attributions of the Securities and Exchange Commission shall be limited to activities governed by this Law, and shall be exercised without prejudice to the attributions of the Central Bank.

§ 3. It is the competence of the National Monetary Council to regulate the provision of the preceding paragraph, ensuring coordination of services between the Central Bank of Brazil and the Securities and Exchange Commission.

Art. 16. The following activities depend on prior authorization from the Securities and Exchange Commission:

I – distribution of issuances in the market (Art. 15, I);

II – purchase of securities for resale on the purchaser’s own account (Art. 15, II);

III – mediation or brokerage of securities transactions; (Text given by Law No. 10,411, of 26 Feb 2002)

IV – clearing and settlement of securities transactions. (Text given by Law No. 10,411, of 26 Feb 2002)

Sole paragraph. Only investment advisors and companies registered with the Commission may carry out mediation or brokerage of securities outside the exchange. (Text given by Law No. 14,317, of 2022) Production of effects

Art. 17. Stock Exchanges, Commodities and Futures Exchanges, organized over‑the‑counter market entities and clearing and settlement entities for securities transactions shall have administrative, financial and patrimonial autonomy, operating under the supervision of the Securities and Exchange Commission. (Text given by Law No. 10,303, of 31 Oct 2001)

§ 1. To Stock Exchanges, Commodities and Futures Exchanges, organized over‑the‑counter market entities and clearing and settlement entities for securities transactions it is incumbent, as auxiliary bodies of the Securities and Exchange Commission, to supervise their members and the securities transactions carried out therein. (Text given by Law No. 10,303, of 31 Oct 2001)

§ 2. (VETOED) (Added by Law No. 10,303, of 31 Oct 2001)

Art. 17‑A. (VETOED) (Added by Law No. 10,303, of 31 Oct 2001)

Art. 18. It is the competence of the Securities and Exchange Commission: (Text given by Law No. 10,411, of 26 Feb 2002)

I – to issue general rules on:

a) conditions for obtaining the authorization or registration required for the activities indicated in Art. 16, and the respective administrative procedures; (Text given by Law No. 10,411, of 26 Feb 2002)

b) integrity, technical qualification and financial capacity requirements that administrators of companies and other persons operating in the securities market must satisfy; (Text given by Law No. 10,411, of 26 Feb 2002)

c) conditions for the constitution and extinction of Stock Exchanges, organized over‑the‑counter market entities and clearing and settlement entities for securities transactions, legal form, administrative bodies and their composition; (Text given by Law No. 10,411, of 26 Feb 2002)

d) exercise of disciplinary power by Exchanges and organized over‑the‑counter market entities with respect to securities trading, and by clearing and settlement entities over their members, imposing penalties and cases of exclusion; (Text given by Law No. 10,411, of 26 Feb 2002)

e) number of brokerage firms, exchange members; admission requirements regarding integrity, financial capacity and technical qualification of their administrators; and representation on the exchange floor;

f) administration of Exchanges, organized over‑the‑counter market entities and clearing and settlement entities for securities transactions; fees, commissions and any other costs charged by the Exchanges and the clearing and settlement entities or their members, when applicable; (Text given by Law No. 10,411, of 26 Feb 2002)

g) conditions for the execution of forward transactions;

h) conditions for the constitution and extinction of Commodities and Futures Exchanges, legal form, administrative bodies and their composition. (Text given by Law No. 10,411, of 26 Feb 2002)

II – to define:

a) the types of operations authorized on the exchange and in the over‑the‑counter market; methods and practices to be observed in the market; and the responsibility of intermediaries in the operations;

b) the configuration of artificial demand, supply or price conditions for securities, or price manipulation; fraudulent operations and inequitable practices in distribution or intermediation of securities;

c) rules applicable to the registration of operations to be maintained by entities of the distribution system (Art. 15)

CHAPTER IV

Trading in the Market

SECTION I – Issuance and Distribution

Art. 19. No public issuance of securities shall be distributed in the market without prior registration with the Commission.

§ 1. Acts of distribution subject to this article’s rule include sale, promise of sale, offer for sale or subscription, as well as acceptance of an order to sell or subscribe securities when performed by the issuing company, its founders or persons equivalent to it.

§ 2. The following are deemed equivalent to the issuing company for the purposes of this article:

I – its controlling shareholder and the persons it controls;

II – the co‑debtor in the securities;

III – the financial institutions and other companies referred to in Art. 15, item I;

IV – anyone who has subscribed to the issuance’s securities, or has acquired them from the issuing company, with the purpose of placing them on the market.

§ 3. Public issuance is characterized by:

I – the use of sales or subscription lists or bulletins, leaflets, prospectuses or advertisements intended for the public;

II – the search for subscribers or purchasers of the securities through employees, agents or brokers;

III – negotiation carried out in a store, office or establishment open to the public, or using public communication services.

§ 4. A public issuance may only be placed on the market through the system provided for in Art. 15, and the Commission may require the participation of a financial institution.

§ 5. The Commission shall issue rules for the execution of this article, and may:

I – define other situations that constitute a public issuance for registration purposes, as well as cases where registration may be dispensed with, considering the interest of the investing public;

II – set the registration procedure and specify the information that must accompany the request, including:

a) the issuing company, the projects or activities it undertakes or intends to undertake, its economic and financial situation, administration and main shareholders;

b) the characteristics of the issuance and the intended use of the proceeds;

c) the seller of the securities, if applicable;

d) the participants in the distribution, their remuneration and their relationship with the issuing company or with the seller.

§ 6. The Commission may condition registration on a minimum capital of the issuing company and a minimum issuance value, as well as on the disclosure of information it deems necessary to protect the interests of the investing public.

§ 7. The registration request shall be accompanied by prospectuses and any other documents to be published or distributed for offering, announcing or promoting the launch.

Art. 20. The Commission shall order the suspension of an issuance or distribution that is being processed in violation of the preceding article, particularly when:

I – the issuance has been judged fraudulent or illegal, even after registration has been effected;

II – the offer, launch, promotion or announcement of the securities is being made under conditions different from those contained in the registration, or with fraudulent or substantially inaccurate information.

SECTION II – Trading on the Exchange and on the Over‑the‑Counter Market

Art. 21. In addition to the registration provided for in Art. 19, the Securities and Exchange Commission shall maintain:

I – the registration for trading on the exchange;

II – the registration for trading on the organized or unorganized over‑the‑counter market. (Text given by Law No. 9,457, of 5 May 1997)

§ 1. Only securities issued by a company registered pursuant to this article may be traded on the exchange and on the over‑the‑counter market.

§ 2. The registration under Art. 19 constitutes registration for the over‑the‑counter market, but not for the exchange or for an organized over‑the‑counter market entity. (Text given by Law No. 9,457, of 5 May 1997)

§ 3. Activities of the unorganized over‑the‑counter market are those carried out with the participation of the companies or professionals indicated in Art. 15, items I, II and III, or in their establishments, excluding operations performed on exchanges or in systems administered by organized over‑the‑counter market entities. (Text given by Law No. 9,457, of 5 May 1997)

§ 4. Each Stock Exchange or organized over‑the‑counter market entity may establish its own requirements for securities to be admitted to trading on its floor or system, subject to prior approval by the Securities and Exchange Commission. (Text given by Law No. 9,457, of 5 May 1997)

§ 5. The organized over‑the‑counter market shall be administered by entities whose operation shall depend on authorization from the Securities and Exchange Commission, which shall issue general rules on:

I – conditions of constitution and extinction, legal form, administrative bodies and their composition; (Added by Law No. 9,457, of 5 May 1997)

II – exercise of disciplinary power by the entities over their participants or members, imposition of penalties and cases of exclusion; (Added by Law No. 9,457, of 5 May 1997)

III – admission requirements regarding integrity, financial capacity and technical qualification of administrators and representatives of participating companies or members; (Added by Law No. 9,457, of 5 May 1997)

IV – administration of the entities, fees, commissions and any other costs charged by the entities or their participants or members, when applicable. (Added by Law No. 9,457, of 5 May 1997)

§ 6. It is the competence of the Commission to issue rules for the execution of this article, specifying:

I – cases in which registrations may be dispensed with, refused, suspended or cancelled;

II – information and documents that must be presented by the company to obtain registration, and the procedure thereof;

III – cases in which securities may be traded simultaneously on the exchange and on the over‑the‑counter market, organized or not. (Added by Law No. 9,457, of 5 May 1997)

Art. 21‑A. The Securities and Exchange Commission may issue rules applicable to the nature of minimum information and its periodicity for any person who has access to relevant information. (Article included by Decree No. 3,995, of 31 Oct 2001)

CHAPTER V

Open Companies

Art. 22. A company is considered open when its securities are admitted to trading on the exchange or on the over‑the‑counter market.

§ 1. It is the competence of the Securities and Exchange Commission to issue rules applicable to open companies concerning:

I – the nature of information that must be disclosed and the frequency of disclosure; (Text given by Decree No. 3,995, of 31 Oct 2001)

II – the management report and financial statements; (Text given by Decree No. 3,995, of 31 Oct 2001)

III – the purchase of shares issued by the company itself and the disposal of treasury shares; (Text given by Decree No. 3,995, of 31 Oct 2001)

IV – accounting standards, reports and opinions of independent auditors; (Text given by Decree No. 3,995, of 31 Oct 2001)

V – information to be provided by administrators, members of the fiscal council, controlling and minority shareholders, relating to the purchase, exchange or sale of securities issued by the company and by controlled or controlling companies; (Text given by Decree No. 3,995, of 31 Oct 2001)

VI – the disclosure of resolutions of the general meeting and of the company’s administrative bodies, or of material facts occurring in its business that may significantly influence investors’ decisions to buy or sell the company’s securities; (Text given by Decree No. 3,995, of 31 Oct 2001)

VII – the holding, by open companies with shares admitted to trading on an exchange or organized over‑the‑counter market, of annual meetings with their shareholders and market participants at the location of greatest trading of the company’s securities in the previous year, for the disclosure of information regarding its economic‑financial situation, result projections and responses to inquiries; (Text given by Decree No. 3,995, of 31 Oct 2001)

VIII – other matters provided for by law. (Text given by Decree No. 3,995, of 31 Oct 2001)

§ 2. The rules issued by the Securities and Exchange Commission concerning items II and IV of § 1 shall also apply to financial institutions and other entities authorized to operate by the Central Bank of Brazil, insofar as they are not conflicting with the rules issued by that Bank. (Text given by Decree No. 3,995, of 31 Oct 2001)

CHAPTER VI

Administration of Portfolios and Custody of Securities

Art. 23. The professional exercise of portfolio administration of securities belonging to other persons is subject to prior authorization from the Commission.

§ 1. This article applies to professional management and to resources or securities delivered to the administrator, with authorization for the administrator to buy or sell securities on behalf of the client.

§ 2. It is the competence of the Commission to establish the rules to be observed by portfolio administrators and their remuneration, in accordance with Art. 8, item IV.

Art. 24. The provision of securities custody services is subject to prior authorization from the Securities and Exchange Commission. (Text given by Law No. 14,430, of 2022)

Sole paragraph. Custody of securities is understood as deposit for safekeeping, receipt of dividends and bonuses, redemption, amortization or reimbursement, and exercise of subscription rights, without the custodian having powers, unless expressly authorized by the depositor in each case, to alienate the deposited securities or reinvest the amounts received.

Art. 25. Except for an expressly granted mandate not exceeding one year, the portfolio administrator and the securities custodian may not exercise the voting right attached to the shares under their administration or custody.

CHAPTER VII

Independent Auditors, Consultants and Securities Analysts

Art. 26. Only accounting audit firms or independent accounting auditors registered with the Securities and Exchange Commission may audit, for the purposes of this Law, the financial statements of open companies and of institutions, societies or firms that are part of the distribution and intermediation system of securities.

§ 1. The Commission shall establish the conditions for registration and its procedure, and shall define the cases in which registration may be refused, suspended or cancelled.

§ 2. Accounting audit firms or independent accounting auditors shall be civilly liable for damages caused to third parties due to fault or intent in the performance of the functions provided for in this article.

§ 3. Without prejudice to the preceding paragraph, accounting audit firms or independent accounting auditors shall be administratively liable before the Central Bank of Brazil for acts or omissions incurred in the performance of audit activities of financial institutions and other institutions authorized to operate by the Central Bank of Brazil. (Added by Law No. 9,447, 14 Mar 1997)

§ 4. (Revoked by Law No. 13,506, of 2017)

§ 5. (VETOED) (Added by Law No. 10,303, of 31 Oct 2001)

Art. 27. The Commission may set rules on the exercise of activities of securities consultants and analysts.

CHAPTER VII‑A

THE ACCOUNTING STANDARDS COMMITTEE (Added by Law No. 10,303, of 31 Oct 2001)

Art. 27‑A. (VETOED) (Article added by Law No. 10,303, of 31 Oct 2001)

Art. 27‑B. (VETOED) (Article added by Law No. 10,303, of 31 Oct 2001)

CHAPTER VII‑B

CRIMES AGAINST THE CAPITAL MARKET (Added by Law No. 10,303, of 31 Oct 2001)

Market Manipulation (Added by Law No. 10,303, of 31 Oct 2001)

Art. 27‑C. To carry out simulated operations or other fraudulent maneuades intended to raise, maintain or lower the quotation, price or traded volume of a security, with the aim of obtaining undue advantage or profit for oneself or others, or to cause damage to third parties: (Text given by Law No. 13,506, of 2017)

Pena – imprisonment of 1 (one) to 8 (eight) years, and a fine of up to 3 (three) times the amount of the illicit benefit obtained as a result of the crime. (Added by Law No. 10,303, of 31.10.2001)

Misuse of Insider Information (Added by Law No. 10,303, of 31.10.2001)

Art. 27-D. To use material information that the person knows, not yet disclosed to the market, which is capable of providing, for himself or for another, an undue advantage, through trading, in his own name or on behalf of third parties, of securities: (Text given by Law No. 13,506, of 2017)

Penalty – imprisonment of 1 (one) to 5 (five) years, and a fine of up to 3 (three) times the amount of the illicit benefit obtained as a result of the crime. (Added by Law No. 10,303, of 31.10.2001)

§ 1 The same penalty applies to anyone who passes on confidential information relating to a material fact that he accessed because of a position or role he holds in the issuer of securities or because of a commercial, professional or trust relationship with the issuer. (Added by Law No. 13,506, of 2017)

§ 2 The penalty is increased by 1/3 (one third) if the agent commits the crime provided in the caput of this article by using material information that he knows and must keep confidential. (Added by Law No. 13,506, of 2017)

Irregular Exercise of Position, Profession, Activity or Function (Added by Law No. 10,303, of 31.10.2001)

Art. 27-E. To practice, even on a gratuitous basis, in the securities market, the activity of portfolio manager, investment adviser, independent auditor, securities analyst, fiduciary agent or any other position, profession, activity or function, without being, for that purpose, authorized or registered with the competent administrative authority, when required by law or regulation: (Text given by Law No. 14,317, of 2022) Production of effects

Penalty – detention of 6 (six) months to 2 (two) years, and a fine. (Added by Law No. 10,303, of 31.10.2001)

Art. 27-F. The fines stipulated for the crimes provided for in arts. 27-C and 27-D shall be applied in proportion to the damage caused or the illicit benefit obtained by the agent. (Article added by Law No. 10,303, of 31.10.2001)

Sole paragraph. In cases of recidivism, the fine may be up to triple the amounts set in this article. (Paragraph added by Law No. 10,303, of 31.10.2001)

CHAPTER VIII

Final and Transitional Provisions

Art. 28. The Central Bank of Brazil, the Securities and Exchange Commission, the Complementary Pension Secretariat, the Federal Revenue Secretariat and the Superintendence of Private Insurance shall maintain an information exchange system, concerning the supervision they exercise, within the areas of their respective competencies, in the securities market. (Text given by Law No. 10,303, of 31.10.2001)

Sole paragraph. The duty to keep confidential information obtained through the exercise of supervisory power by the entities referred to in the caput may not be invoked as an impediment to the exchange referred to in this article. (Paragraph added by Law No. 10,303, of 31.10.2001)

Art. 29. (Repealed by Law No. 10,303, of 31.10.2001)

Art. 30. (Repealed by Law No. 10,303, of 31.10.2001)

Art. 31 - In judicial proceedings whose purpose is matters within the competence of the Securities and Exchange Commission, it shall always be summoned to, if it wishes, provide an opinion or give clarifications, within fifteen days from the summons. (Added by Law No. 6,616, of 16.12.1978)

§ 1º - The summons shall be made, immediately after the defense, by writ or by registered letter, depending on whether the Commission has, or does not have, a headquarters or representation in the district where the action was filed. (Added by Law No. 6,616, of 16.12.1978)

§ 2º - If the Commission provides an opinion or gives clarifications, it shall be summoned to all subsequent procedural acts, by the official gazette that publishes judicial documents or by registered letter, under the terms of the previous paragraph. (Added by Law No. 6,616, of 16.12.1978)

§ 3º - The commission is granted standing to file appeals, when the parties have not done so. (Added by Law No. 6,616, of 16.12.1978)

§ 4º - The period for the effects of the previous paragraph shall begin to run, regardless of a new summons, on the day immediately following that on which the parties' period ends. (Added by Law No. 6,616, of 16.12.1978)

Art. 32 - The fines imposed by the Securities and Exchange Commission, after the final decision that imposed them in the administrative sphere, shall have the effect of an enforceable title and shall be collected judicially, in accordance with the procedure established by the Code of Civil Procedure for enforcement proceedings. (Added by Law No. 6,616, of 16.12.1978)

Art. 33. (Repealed by Law No. 9,873, of 23.11.1999)

Art. 34. This Law shall enter into force on the date of its publication. (Renumbered from art. 33 by Law No. 9,457, 5.5.1997)

Art. 35. The contrary provisions are repealed. (Renumbered from art. 34 by Law No. 9,457, 5.5.1997)

Brasília, December 7, 1976; 155th of Independence and 88th of the Republic.

ERNESTO GEISEL

João Paulo dos Reis Velloso Mário Henrique Simonsen

This text does not replace the one published in the Official Gazette on 12/9/1976