Resolution CMN No. 1190 — Grants Competence to BCB and CVM to Approve, Supervise, Regulate and Suspend Operations in Commodities or Futures Exchanges

RESOLUTION NO. 001190

The CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the President of the National Monetary Council, by act of September 17, 1986, based on Article 1, Paragraph 2 of Decree No. 83,323 of April 11, 1979, with the wording given to it by Article 1 of Decree No. 85,776 of February 26, 1981, "ad referendum" of that Council, in view of the provisions of Article 4 of the aforementioned Law, of Article 2 of Law No. 4,728 of July 14, 1965, of Article 3 of Law No. 6,385 of December 7, 1976, and of Decree-Law No. 2,286 of July 23, 1986,

RESOLVES:

I - To determine that, prior to its implementation, contract models for trading on commodities or futures exchanges be submitted for approval by the Central Bank of Brazil or by the Securities and Exchange Commission, the latter in the event that the respective object is referenced in any of the securities subject to the regime of Law No. 6,385 of December 7, 1976.

II - The lack of response from the Central Bank of Brazil or the Securities and Exchange Commission, after 30 (thirty) business days from the presentation of the request, will imply approval of the contract model, this period may be interrupted, only once, for an equal period, if additional information or documents are requested.

III - In order to prevent or correct abnormal market situations, especially those that may constitute the creation of artificial conditions of demand or supply, price manipulation, fraud, and the use of non-equitable practices, the Central Bank of Brazil and the Securities and Exchange Commission, each within their sphere of competence, may determine:

a) the suspension, for an indefinite period, of the trading and settlement of contracts admitted to quotation on commodities or futures exchanges, including all those referring to the same commodity subject to transaction;

b) the cancellation or financial settlement of transactions carried out and not yet settled on commodities or futures exchanges.

IV - From this date, commodities and futures exchanges, as well as the participants in the markets administered by them, are obliged to provide the Central Bank of Brazil and the Securities and Exchange Commission with all information necessary for the exercise of the powers conferred upon them by Decree-Law No. 2,286 of July 23, 1986.

V - The Central Bank of Brazil and the Securities and Exchange Commission may issue the rules and adopt the measures deemed necessary for the execution of the provisions of this Resolution.

VI - This Resolution will enter into force on the date of its publication.

Brasília-DF, September 17, 1986

Lycio de Faria
President, in exercise