Resolution CMN No. 2873 — Regulates Swap, Forward, and Options Operations in the Over-the-Counter Market and Contracts Negotiated on Commodities and Futures Exchanges

RESOLUTION NO. 002873

Regulates the conduct of swap, forward, and options operations in the over-the-counter market, as well as contracts negotiated on commodities and futures exchanges and entities authorized by the Central Bank of Brazil or the Securities and Exchange Commission.

THE CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595, of December 31, 1964, makes public that the MONETARY NATIONAL COUNCIL, in a session held on July 26, 2001, considering the provisions of Article 4, item VIII, of the aforementioned law, Law No. 6,385, of December 7, 1976, Decree-Law No. 2,286, of July 23, 1986, Article 27, paragraph 5, of Law No. 9,069, of June 29, 1995, and Article 4 of Law No. 10,192, of February 14, 2001,

RESOLVES:

Article 1. To permit multiple banks, commercial banks, the Federal Savings Bank (Caixa Econômica Federal), investment banks, securities brokerage firms, and securities distribution companies to conduct, in the over-the-counter market, on their own account or on behalf of third parties, swap, forward, and non-standardized options operations, referenced in gold, exchange rates, currency indices, interest rates, commodities, price indices, interest rate indices, shares issued by publicly held companies, share indices, simple or convertible debentures, and promissory notes issued by joint-stock companies, intended for public offering.

Sole Paragraph 1. For the purposes of this Resolution:

I - swap operations are defined as those carried out for settlement on a future date that imply the exchange of financial results arising from the application, on asset and liability values, of rates or indices used as benchmarks;

II - an operation is considered to be conducted in the over-the-counter market if its contracting is not effected through auction or bidding.

Sole Paragraph 2. The price indices mentioned in this article must have a regularly calculated series and be of public knowledge.

Sole Paragraph 3. The prices of shares, gold, and commodities must be those practiced in a trading environment authorized by the Central Bank of Brazil or the Securities and Exchange Commission, or determined as benchmarks through a methodology previously approved by the regulatory bodies.

Sole Paragraph 4. Share indices must be calculated based on share quotations that comply with the provisions of the preceding paragraph.

Article 2. To establish the obligation to register the operations covered by this Resolution in a system administered by stock exchanges, commodities and futures exchanges, or by entities duly authorized by the Central Bank of Brazil or the Securities and Exchange Commission, within their respective areas of competence, to practice such activity, and that meet the needs of supervision and control by these Autarchies.

Article 3. The provisions of items I, II, and VII of Resolution No. 1,645, of October 6, 1989, apply to the entities referred to in the previous article.

Article 4. The practice of the operations covered by this Resolution is conditioned upon the designation, by the institutions referred to in Article 1, of a technically qualified administrator, responsible for them before the Central Bank of Brazil.

Article 5. To amend item I of Resolution No. 1,190, of September 17, 1986, which shall now read as follows:

"I - To determine that:

a) prior to their implementation, the contract models admitted for negotiation on commodities and futures exchanges or in asset trading systems must be submitted for approval by the Central Bank of Brazil or the Securities and Exchange Commission, the latter in the event that the asset subject to negotiation is referenced in a security subject to the regime of Law No. 6,385, of December 7, 1976; (NR)

b) exchanges and entities that administer asset trading systems must immediately inform the Central Bank of Brazil or the Securities and Exchange Commission, depending on the nature of the asset or the modality of negotiation, the occurrence of operations that constitute abnormal market situations or that embody inequitable practices, fraud, or manipulation." (NR).

Article 6. The Central Bank of Brazil and the Securities and Exchange Commission are authorized, within their respective areas of competence, to:

I - adopt measures and issue complementary norms necessary for the execution of the provisions of this Resolution;

II - alter the conditions established for the contracting of the operations referred to in this Resolution;

III - delimit the activities of the institutions mentioned in Article 1 regarding the operations practiced in accordance with this Resolution.

Article 7. This Resolution enters into force on the date of its publication.

Article 8. Resolution No. 2,688, of January 26, 2000, is hereby revoked, and the citation contained in Circular No. 2,583, of June 21, 1995, is hereby replaced by this Resolution.

Brasília, July 26, 2001

Carlos Eduardo de Freitas
Interim President