Resolution BCB No. 77 — Establishes the Strategic Management Committee of the Regulatory Sandbox (CESB) and its Regulations

Resolution No. 77

RESOLUTION
BCB No. 77, OF MARCH 3, 2021

Establishes the Strategic Management Committee of the Regulatory Sandbox (CESB) and publishes its Bylaws.

The Collegiate Board of the Central Bank of Brazil, in a session held on March 3, 2021, based on art. 11, items II and VI, clauses “a” and “s”, of the Internal Regulations of the Central Bank of Brazil, annexed to Ordinance No. 84,287, of February 27, 2015, in view of art. 45 of Resolution CMN No. 4,865, of October 26, 2020, of the National Monetary Council, and Resolution BCB No. 29, of October 26, 2020, of the Central Bank of Brazil, and also considering the provisions of Decree No. 9,759, of April 11, 2019,

R E S O L V E:

Art. 1º The Strategic Management Committee of the Regulatory Sandbox (CESB) is hereby established, with the responsibility to act in the processes related to the Controlled Environment for Testing Financial and Payment Innovations (Regulatory Sandbox), in accordance with the attached Bylaws.

Art. 2º This Resolution enters into force on the date of its publication.

Fabio Kanczuk
Director of Organization of the Financial System and Resolution, substitute

Otávio Ribeiro Damaso
Director of Regulation

Mauricio Costa de Moura
Director of Relationship, Citizenship and Conduct Supervision

Paulo Sérgio Neves de Souza
Director of Supervision

Carolina de Assis Barros
Director of Administration

BYLAWS OF THE STRATEGIC MANAGEMENT COMMITTEE OF THE REGULATORY SANDBOX (CESB), ANNEXED TO RESOLUTION BCB No. 77, OF MARCH 3, 2021

CHAPTER I

OBJECTIVE AND COMPETENCE

Art. 1º The Strategic Management Committee of the Regulatory Sandbox (CESB) is the deliberative body of the Central Bank of Brazil responsible, in conformity with the regulation of the Controlled Environment for Testing Financial and Payment Innovations (Regulatory Sandbox), established by Resolution CMN No. 4,865, of October 26, 2020, of the National Monetary Council, and Resolution BCB No. 29, of October 26, 2020, of the Central Bank of Brazil:

I - selecting and classifying candidate projects for participation in the Regulatory Sandbox, as well as authorizing their participation, following the parameters established in the current regulation;

II - requesting and receiving, at any time, complementary information from projects that enroll in the Regulatory Sandbox, whether in the selection and classification stages, or in the functioning of the project within the Regulatory Sandbox itself;

III - deliberating on the invitation to representatives of other public bodies and entities and external experts to the Public Administration to participate in CESB meetings, for the purpose of providing information or advice;

IV - deliberating, in accordance with the current regulation, on the need to adopt or alter technical, operational, or business requirements of selected projects, as well as organizational requirements of participants;

V - deliberating on matters attributed to the Central Bank of Brazil by the regulation of the Regulatory Sandbox;

VI - communicating to the Collegiate Board of the Central Bank of Brazil the selected projects and, annually, preparing a report with a summary of the Committee’s decisions and the performance of ongoing projects; and

VII - deciding on the cancellation of projects.

Art. 2º The performance of the CESB shall be guided by the principles of impartiality and the use of technical criteria to achieve the objectives stipulated in the regulation of the Regulatory Sandbox.

CHAPTER II

COMPOSITION

Art. 3º The CESB is composed of:

I - the Head of the Department of Competition and Financial Market Structure (Decem);

II - the Head of the Department of Strategic Management and Specialized Supervision (Degef);

III - the Head of the Department of Organization of the Financial System (Deorf);

IV - the Head of the Department of Financial Citizenship Promotion (Depef);

V - the Head of the Department of Financial System Regulation (Denor);

VI - the Head of the Department of Conduct Supervision (Decon); and

VII - the Head of the Department of Information Technology (Deinf).

§ 1º The members of the CESB shall be replaced, in their impediments and absences, by the substitutes of their respective positions.

§ 2º The CESB shall have the participation of a representative of the General Prosecutor’s Office of the Central Bank (PGBC), designated by act of the Prosecutor-General, with the right to speak and without the right to vote.

§ 3º The Collegiate Board of the Central Bank of Brazil shall designate, at each call for registrations in a cycle of the Regulatory Sandbox, one of the members indicated in items I to VII of the main text to exercise the presidency of the CESB, which shall last until the closure of all activities of the corresponding cycle or the designation of a new president.

§ 4º The first presidency of the CESB shall be exercised by the Head of Decem.

CHAPTER III

ATTRIBUTIONS

Art. 4º The attributions of the president of the CESB are:

I - to convene the members of the CESB and other participants of its meetings;

II - to define the agenda of subjects to be discussed in each meeting and approve the inclusion of off-agenda subjects, when characterized by urgency or relevant interest;

III - to authorize the participation of other civil servants in the meeting, without the right to vote;

IV - to ensure the proper recording of activities and the protection of data collected by the Committee;

V - to report the work to the Collegiate Board of the Central Bank of Brazil;

VI - to represent the CESB and be its spokesperson; and

VII - to request the heads of the other Units of the Central Bank of Brazil to indicate civil servants to provide technical advice, according to the competence of their organizational components.

Art. 5º The attributions of the members of the CESB are:

I - to participate in discussions and deliberations;

II - to propose for deliberation the governance of the Committee to conduct the selection, classification, and authorization processes, detailed in Chapters VIII and IX;

III - to inform the area to which their Unit is linked about the agenda and deliberations of the CESB;

IV - to request the postponement of the voting on subjects included in the agenda or presented as off-agenda; and

V - to ensure the protection of data collected by the Committee.

CHAPTER IV

SECRETARIAT

Art. 6º The secretariat of the CESB shall be exercised by the Unit whose head is exercising the presidency.

Art. 7º It is the responsibility of the CESB secretariat to:

I - provide support and assistance to the CESB and its president;

II - issue the acts of convocation for meetings;

III - send in advance to the members of the Committee the documents necessary for participation;

IV - invite, according to the deliberation of the CESB, representatives of other bodies or public entities and external experts to the Public Administration to participate in meetings;

V - provide secretariat services at the Committee meetings, preparing the minutes and collecting the respective signatures;

VI - make public the decisions of the CESB that require dissemination;

VII - promote the sharing of information between the monitoring groups and between them and the competent Units of the Central Bank of Brazil; and

VIII - carry out other tasks assigned to it by the president.

CHAPTER V

TECHNICAL ADVISORY

Art. 8º The CESB may constitute technical advisory with competence to:

I - evaluate whether each project enrolled in the selection process of the Regulatory Sandbox meets the criteria established in the current regulation, to support the selection process by the CESB; and

II - classify projects according to the parameters of the regulation of the Regulatory Sandbox, in the event that the number of entities eligible to proceed in the selection process is greater than the maximum number of participants determined in the regulation, to support the deliberation of the CESB.

Sole paragraph. The evaluations carried out for the purposes of item II of the main text shall identify the potential risks arising from the execution and map the regulatory and supervisory efforts inherent to the innovations of each project.

Art. 9º The technical advisory shall be composed of civil servants of the Central Bank of Brazil on a part-time basis, originating from any of its areas, indicated by the heads of their home Units.

§ 1º The composition of the technical advisory, limited to 7 (seven) members per group, shall be deliberated by the CESB and shall be adequate to the number of projects enrolled in the selection process of the Regulatory Sandbox, observing the provisions of the main text.

§ 2º The constitution of the technical advisory, including the indication of its coordinator, shall be formalized by an ordinance signed by the president of the CESB.

§ 3º The technical advisory shall be constituted for a fixed term, which shall not exceed 1 (one) year.

§ 4º The simultaneous operation of a maximum of 5 (five) technical advisory groups shall be admitted.

§ 5º The technical advisory shall report directly to the CESB.

CHAPTER VI

MEETINGS

Art. 10. The CESB shall meet:

I - ordinarily, according to an annual calendar to be established by the CESB; and

II - extraordinarily, by convocation of its president or the majority of its members.

§ 1º Meetings may occur in person or electronically.

§ 2º The participation of members and other participants who are in different federative entities from the location of the meeting shall be by videoconference.

Art. 11. The minimum quorum for meetings is 5 (five) members, including the president.

Sole paragraph. Executive and procedural deliberations are decided by a simple majority of votes of its members, with the president having the tie-breaking vote, when necessary.

Art. 12. The following shall participate in the meetings, without the right to vote:

I - the representative of the PGBC;

II - the members of the Secretariat;

III - the civil servants of the Central Bank of Brazil who are part of the technical advisory or invited to provide information or advice; and

IV - the civil servants of other bodies and public entities and external experts to the Public Administration invited to provide information or advice.

Sole paragraph. The proposal to invite participants shall be the responsibility of any of the members of the CESB, observing the competence of the CESB to deliberate on the subject, in accordance with item III of art. 1º.

CHAPTER VII

SELECTION PROCESS OF PROJECTS IN THE REGULATORY SANDBOX

Art. 13. All projects enrolled in the Regulatory Sandbox shall be submitted to the selection phase, to be conducted by the CESB.

Sole paragraph. The selection of projects by the CESB shall observe the criteria established in the regulation of the Regulatory Sandbox.

CHAPTER VIII

CLASSIFICATION PROCESS OF PROJECTS IN THE REGULATORY SANDBOX

Art. 14. Projects considered eligible to proceed in the selection process of the Regulatory Sandbox shall be classified by the CESB, when the current regulation so requires.

§ 1º Each member of the CESB shall evaluate and score the project according to the parameters of the regulation of the Regulatory Sandbox.

§ 2º The final score of each project shall be the sum of the scores received from the members of the CESB.

§ 3º In the event of a tie in the score, the tie-breaking criterion shall be the number of maximum scores obtained by the selected projects in the evaluation by the members of the Committee, unless otherwise provided in the regulation of the Regulatory Sandbox.

§ 4º If the tie persists, the tie-breaking shall occur through voting by the members of the CESB.

CHAPTER IX

AUTHORIZATION TO PARTICIPATE IN THE REGULATORY SANDBOX

Art. 15. Upon completion of the classification process, the authorization to participate in the Regulatory Sandbox shall be granted by the CESB.

Sole paragraph. It shall be the responsibility of Deorf to support the CESB in the authorization process and in decisions related to the origin of resources and the reputation of administrators and controllers, observing the criteria established in the regulation of the Regulatory Sandbox.

CHAPTER X

NUMBER OF SPOTS FOR PROJECTS IN THE REGULATORY SANDBOX

Art. 16. It shall be exclusively the responsibility of the CESB to decide on the expansion of the number of spots for projects in the Regulatory Sandbox, when provided for in the respective selection process.

CHAPTER XI

MONITORING GROUP OF THE REGULATORY SANDBOX

Art. 17. The CESB may constitute monitoring groups for projects authorized to participate in the Regulatory Sandbox, with competence to:

I - evaluate the execution of the project, reporting its assessment to the CESB quarterly and whenever extraordinary facts are detected; and

II - prepare reports, containing, at a minimum, an assessment of the viability and effectiveness of the project, as well as its adherence to the rules imposed on it.

Art. 18. Each monitoring group shall be composed of, at a minimum, 3 (three) and at a maximum 7 (seven) civil servants of the Central Bank of Brazil, on a part-time basis, originating from any of its areas and indicated by the heads of their home Units.

§ 1º The composition of each monitoring group shall consider all areas of the Central Bank of Brazil that have competence or interest in the aspects to be evaluated in the authorized projects.

§ 2º The assessment interest referred to in § 1º shall be manifested by the indication or not of civil servants, after a request to the Units made by the president of the CESB, observing the provisions of the main text.

§ 3º The constitution of a monitoring group, including the indication of its coordinator, shall be formalized by an ordinance signed by the president of the CESB.

§ 4º Each monitoring group shall be constituted for a fixed term, which shall not exceed 1 (one) year, and may be extinguished prematurely in the event of the closure of all projects under its responsibility, in accordance with art. 22.

§ 5º The simultaneous operation of a maximum of 5 (five) monitoring groups shall be admitted.

§ 6º The monitoring group shall report directly to the CESB.

Art. 19. In the exercise of its competencies, the monitoring groups shall:

I - monitor the execution of the project in the Regulatory Sandbox;

II - evaluate the compatibility of the execution of the project with what was proposed in the authorization process of the Regulatory Sandbox;

III - identify risks arising from the execution of the project;

IV - anticipate regulatory and supervisory efforts inherent to the innovations adopted by the project;

V - monitor the viability of the project;

VI - propose to the CESB the establishment of operational limits and additional criteria for the execution of the project; and

VII - propose to the CESB the cancellation of the project under its monitoring, justifying the reasons for the proposal and the need to initiate the discontinuation plan of activities.

Art. 20. For the execution of the attributions described in art. 19, the coordinator of each monitoring group may request, at any time, information directly from the director or the legal representative designated before the Central Bank of Brazil by the participant.

CHAPTER XII

CLOSURE OF PARTICIPANTS' ACTIVITIES

Art. 21. It shall be the responsibility of the CESB to decide on the execution of the participant's discontinuation plan of activities in the Regulatory Sandbox, in accordance with the current regulation.

CHAPTER XIII

ACCOUNTABILITY

Art. 22. The accountability of the CESB shall be carried out through:

I - publication of the minutes of the CESB meetings on the website of the Central Bank of Brazil that deals with the Regulatory Sandbox; and

II - presentation of an annual accountability report to the Collegiate Board of the Central Bank of Brazil.

CHAPTER XIV

FINAL PROVISIONS

Art. 23. The CESB shall function for an indefinite period.

Sole paragraph. The activities of the CESB shall be suspended when the last project is closed within a cycle of the Regulatory Sandbox and resumed when a new call for registrations is approved.

Art. 24. Decisions of the CESB may be appealed, in the second and last instance, to the authority with appellate attributions specified in the Internal Regulations of the Central Bank of Brazil.

Sole paragraph. Appeals shall be directed to the CESB, which may reconsider the decision or forward the appeal for decision by the competent authority.

Art. 25. It is the responsibility of the CESB to decide on situations not provided for in these Bylaws.