Superintendence Resolution No. 004-2025-SMV/11 — SMV — PE

PERU Ministry of Economy and Finance
SMV
Securities Market Superintendence
Electronically signed document under Law No. 27269, Law of Digital Signatures and Certificates, its Regulations and amendments. The integrity of the document and authorship Superintendence Resolution SMV No. 004-2025-SMV/11 Lima, January 15, 2025 Subject: To sanction Compañía Minera San Ignacio de Morococha S.A.A. with a fine of 5 UIT for having committed one (01) minor infringement, typified in item 3.2 of numeral 3 of letter A) of Annex II of the Sanctions Regulation. Administered Entity: COMPAÑÍA MINERA SAN IGNACIO DE MOROCOCHA S.A.A. Subject: Administrative Sanctioning Procedure of two administrative instances Main Type: Item 3.2 of numeral 3 of letter A) of Annex I of the Sanctions Regulation MINOR INFRACTION File No.: 2024036424 The Adjunct Superintendent of Market Conduct Supervision SEEN:
The administrative file No. 2024036424, containing the administrative sanctioning procedure initiated by the General Intendancy of Conduct Compliance of the Securities Market Superintendence – SMV (hereinafter, the IGCC), against Compañía Minera San Ignacio de Morococha S.A.A. (hereinafter, the Issuer); as well as Report No. 1381-2024-SMV/11.2 (hereinafter, the Report), issued by the IGCC;

That, the IGCC – the instructing body of the administrative sanctioning procedures (hereinafter, the PAS) referred to in this case – has brought to the attention of the Adjunct Superintendence of Market Conduct Supervision of the SMV (hereinafter, SASCM), the PAS of administrative file No. 2024036424 with the aim that it issues a decision as the sanctioning body of the first administrative instance in said PAS. In this way, the SASCM assumes competence in observance of the exercise of the supervision function and the sanctioning power of the SMV established through the Concorded Single Text of its Organic Law, Decree Law No. 26126 (hereinafter, Organic Law of the SMV), and in the Unified Text of the Securities Market Law, Legislative Decree No. 861, approved by Supreme Decree No. 020-2023-EF (hereinafter, TUO of the LMV); as well as by what is provided in the Sanctions Regulation, approved by SMV Resolution No. 035-2018-SMV/01 (hereinafter, Sanctions Regulation) and in articles 42 and 43 of the Organization and Functions Regulation of the SMV, approved by Supreme Decree No. 216-2011-EF (hereinafter, ROF of the SMV), in the sense that it is a specific function of the SASCM, to impose sanctions in the first administrative instance, for the commission of infractions whose compliance control according to its competencies, corresponds to said Adjunct Superintendence.
Likewise, the SASCM has the powers to issue corrective measures aimed at reversing the situation altered by the commission of the infringement;
That, the present PAS corresponds to two (2) administrative instances in accordance with article 15 of the Sanctions Regulation, and what is established in numeral 26 of article 12 of the ROF-SMV, which establish that the Superintendent of the Securities Market resolves appeals against resolutions issued in the first instance by the Adjunct Superintendent of the SASCM, with the exception of single-instance procedures;
II. FACTS, CHARGES, DEFENSES AND ARGUMENTS
2.1 Fact
That, it was evaluated whether the Issuer complied with its obligation to have at all times at least one principal stock representative and one alternate;
2.2 Charge
That, according to the preliminary inquiries communicated by the General Intendancy of Conduct Supervision (hereinafter, IGSC), and after the verifications carried out by the IGCC on the information published on the Institutional Website of the SMV on the Unique Digital Platform of the Peruvian State for Citizen Orientation (hereinafter, Institutional Website of the SMV)
, it was noted that to date the Issuer would not have designated at least one (01) alternate stock representative, as can be seen below in Image No. 1:

1 www.gob.pe/smv

2 Article 37.- Moment and efficacy of Notifications “37.1 The Electronic Notification procedure is initiated by the SMV with the deposit of the administrative act or administrative action in the Electronic Mailbox of the Users of the SMV Virtual. The SMV Virtual automatically generates the Electronic Notification Certificate. Likewise, the SMV communicates to the email and cell phone of the Users of the SMV Virtual, the data of the validly made notification.
37.2 The Users of the SMV Virtual must carry out the confirmation of receipt through the Acknowledgment of Receipt Certificate during the first five (05) business days following the validly made notification. The Electronic Notification produces legal effects at the time it is recorded as having been received by the User of the SMV Virtual, according to the date and time registered in the Acknowledgment of Receipt certificate self-generated by the SMV Virtual.
37.3 However, if the User of the SMV Virtual does not access the message deposited in their Electronic Mailbox within a period of five (05) business days from the Electronic Notification being made, it produces legal effects from the next business day after the expiration of this period.
37.4 Exceptionally, as determined by the organs or organizational units of the SMV, acts or administrative actions can be notified in cases where greater speed in the processing of the notification is required, through personal notification, in addition to notification via electronic mailbox. In these cases, the notification that first proves effective will prevail, according to law.”
(underlining added).

PERU Ministry of Economy and Finance
SMV
Securities Market Superintendence
Electronically signed document under Law No. 27269, Law of Digital Signatures and Certificates, its Regulations and amendments. The integrity of the document and authorship was validly notified on November 14, 2024 via the MVNet System, as verified from the receipt acknowledgment that is in the log of the MVNet System; likewise, on November 19, 2024, additionally, it was notified personally via physical means. However, to date the Issuer has not presented arguments regarding the Report;
III. QUESTIONS TO DETERMINE
13. That, in the present PAS it corresponds to determine the following:
(i) Whether the Issuer incurred or did not incur the infringement indicated in the Charge Office and Report; (ii) Whether it corresponds or does not correspond to impose a sanction on the Issuer;
IV. ANALYSIS
4.1 Applicable Normativity
14. That, article 13 of the TUO of the LMV, establishes that:
“(…) Legal entities registered in the Registry and issuers of securities registered are obliged to present the information that this law and other general provisions establish, being responsible for the truthfulness of said information.”;
15. That, regarding the obligation to have at all times at least one principal stock representative and one alternate, numeral 20.2 of article 20 of the Regulation on Material Facts and Reserved Information, approved by SMV Resolution No. 005-2014-SMV/01 (hereinafter, Regulation on Material Facts), provides:
“20.2. The Issuer must have at all times at least one principal stock representative and at least one alternate. The Issuer is responsible for the acts of its stock representatives in the exercise of their functions as such.”;
16. That, for its part, numeral 21.1 of article 21 of the Regulation on Material Facts, establishes that the Board of Directors is the social body in charge of designating the stock representatives;
17. That, regarding the infringing type, it must be noted that according to what is provided in numeral 3.2 of article 3 of Annex II of the Sanctions Regulation, it constitutes a minor infringement: “Not having a principal stock representative and an alternate, or designating or maintaining persons who do not meet the requirements and conditions established in the regulation of the matter to exercise the function of stock representative.” (Underlining added);
18. That, according to what is provided in article 35 of the Sanctions Regulation, minor infractions are sanctionable with a reprimand or fine not less than one (1) UIT and up to twenty-five (25) UIT;
4.2 Evaluation of the case
19. That, file No. 2024036424 which contains the documentation of the present PAS, it is appreciated that via Memorandum No. 292-2024-SMV/11.1 of January 19, 2024 (File No. 2024002377), the IGSC – the body of

3 In article 245 of the TUO of the LPAG it is indicated as forms or modes in which the auditing activity could conclude the following: 1) Certificate of conformity of the activity developed by the administered entity; 2) Recommendation of improvements or corrections of the activity developed by the administered entity; 3) The warning of the existence of non-compliances not susceptible of meriting the determination of administrative responsibilities; 4) The recommendation of the start of a procedure to determine the administrative responsibilities that correspond; 5) The adoption of corrective measures and 6) Other forms as established by special laws. 4 Article 9.- PRELIMINARY INQUIRIES AS A CONSEQUENCE OF SUPERVISION ACTIONS (…) When said bodies conclude that there are sufficient indications of possible administrative infractions they send the corresponding reports to the General Intendancies of Compliance, which determine whether it corresponds to start or not an administrative sanctioning procedure. If so, the General Intendancies of Compliance may carry out additional inspections or investigations of the reported indications. In the case of possible infractions in the scope of the Regulation of the Participatory Financial Financing Activity and its Managing Societies, the preliminary inquiries are carried out by the General Intendancy of Investigation and Innovation, a dependency that if there are sufficient indications of possible administrative infractions will determine whether it corresponds to start or not an administrative sanctioning procedure. (…).

PERU Ministry of Economy and Finance
SMV
Securities Market Superintendence
Electronically signed document under Law No. 27269, Law of Digital Signatures and Certificates, its Regulations and amendments. The integrity of the document and authorship analysis in the present PAS and to the date of imputation of charge, verified that the Issuer only had one (01) principal stock representative omitting its obligation to designate also at least one alternate stock representative in accordance with what is established in the SMV regulations;
25. That, likewise, it is observed that the Issuer to date, has not yet complied with correcting the imputed infringement, since from the review of the Institutional Website of the SMV and the SIRyS, it is verified that the Issuer has not yet designated an alternate stock representative, despite having taken knowledge of the infringing fact through Office No. 1317-2024-SMV/11.2 of April 09, 2024 (File No. 2024002377) through which it was requested to send its comments; as well, through the Charge Office which requested it to send its respective defenses;
26. That, in the same way, it is worth remembering that numeral 21.1 of article 21 of the Regulation on Material Facts, establishes that the Board of Directors is the social body in charge of designating the stock representatives. Being so, from the review of the Institutional Website of the SMV it is verified that the Issuer has a Board of Directors, so there was no impediment for it to comply with its regulatory obligations and designate an alternate stock representative; however, to date the Issuer has not yet done so;
27. That, consequently, having accredited the conduct constitutive of infringement and determined the administrative responsibility of the Issuer, it corresponds to analyze the sanction proposal in attention to what is provided by the principle of reasonableness and to the sanction criteria, which will be evaluated in the subsection of determination of the sanction;
V. DETERMINATION OF THE SANCTION
28. That, having determined the existence of administrative responsibility on the part of the Issuer, for the commission of one (01) infringement typified in item 3.2 of numeral 3 of letter A) of Annex II of the Sanctions Regulation, which states that it constitutes a minor infringement: “Not having a principal stock representative and an alternate, or designating or maintaining persons who do not meet the requirements and conditions established in the regulation of the matter to exercise the function of stock representative.” (Underlining added);
29. That, according to article 35 of the Sanctions Regulation, said infringement is sanctionable with reprimand or fine not less than one (01) UIT and up to twenty-five (25) UIT;
30. That, in that sense, it corresponds to determine the sanction to be imposed on the Issuer considering the sanction criteria established in article 344 of the TUO of the LMV, numeral 3) of article 248 of the TUO of the LPAG and what is provided by article 25 of the Sanctions Regulation, which develop the criteria for the graduation of the sanction, being these: (i) the sanction antecedents of the issuer, (ii) recidivism, (iii) the circumstances of the commission of the infringement, (iv) the economic damage caused and its repercussion in the market, (v) the illicit benefit resulting from the commission of the infringement, (vi) the probability of detection of the infringement, (vii) the gravity of the damage to the public interest and/or protected legal good and (viii) the existence or non-existence of intent in the conduct of the offender (hereinafter, Sanction Criteria);
31. That, regarding the sanction antecedents, the

PERU Ministry of Economy and Finance
SMV
Securities Market
Superintendence
Electronically signed document under the framework of Law No. 27269, Law of Digital Signatures and Certificates, its Regulations and amendments. The integrity of the document and the authorship

a) of article 25 of the Sanctions Regulation establishes that firm sanctions imposed by the SMV within the period of four (4) years prior to the commission of the infringement to be sanctioned (in the present case, January 19, 2024) are considered; notwithstanding this, it is clarified that the commission of the same infringement in the year prior to the infringement to be sanctioned is not considered as a precedent. Regarding this matter, from the verification carried out in the SMV Sanctions System, it has been determined that the Issuer has sanction precedents, as detailed in the Report;

That, regarding the recidivism of the offender, literal b) of article 25 of the Sanctions Regulation establishes that firm sanctions imposed by the SMV within the period of one (1) year prior to the commission of the infringement to be sanctioned are taken into account. In this regard, it has been verified that there is no recidivism on the part of the Issuer;
That, regarding the circumstances of the commission of the infringement, it has been verified that the Issuer only has one (01) titular stockbroker representative, when it should also have designated at least one (01) substitute stockbroker representative, in accordance with the provisions of the SMV regulations. It should be noted that, to date, the Issuer has not complied with correcting the imputed infringement.

Notwithstanding the foregoing, it is worth recalling that according to what is provided in article 22 of the Regulation on Material Events, the functions of the titular stockbroker representative are to communicate to the SMV material events and reserved information of the Issuer, verifying that the documentation through which they are informed comply with the form and content requirements established in the regulation; as well as, to attend to information requests or inquiries made by the SMV, Stock Exchange or entity administering the centralized trading mechanisms.

While regarding the substitute stockbroker representative, numeral 23.1 of article 23 of the Regulation on Material Events provides that this will be the immediate replacement of the titular stockbroker representative in case the latter were absent or had any impossibility of exercising the position.

In that sense, in the present case, it has been verified that the Issuer has a designated titular stockbroker representative (Mr. Portocarrero Carpio Mario Luiggi) in charge of sending information about the Issuer to the SMV in accordance with the provisions of the SMV regulations; however, it cannot be ensured if to date any situation has occurred in which the titular stockbroker representative has not been able to perform his functions, since if that were the case, the Issuer would not have the substitute stockbroker representative enabled or designated as a replacement for this, a situation that would affect the compliance with obligations regarding the submission of information to the market;

That, regarding the economic harm and its repercussion on the market, it has not been evidenced that the non-compliance has produced a quantifiable harm, understood as an economic damage caused to one or several investors;
That, regarding the illicit benefit resulting from the commission of the infringement, regarding the illegally obtained benefit, in the present case, there are not sufficient elements to indicate that the Issuer obtained an illegal benefit as a consequence of the commission of the infringements under evaluation;

That, regarding the probability of detection of the infringement committed, it must be noted that the probability is high, due to the fact that this type of non-compliance is corroborated by the SMV itself through periodic control actions;
That, regarding the gravity of the damage to the public interest and/or the protected legal interest, that the Issuer has at least one titular stockbroker representative and one substitute is indispensable to comply with its obligations regarding the submission of information to the market, in that way strengthening the transparency of the securities market, which constitutes the protected legal interest, in that way market participants can make their investment decisions adequately informed, so its non-compliance represents an affectation to the transparency of the market;
That, regarding the existence or non-existence of intent in the offender's conduct, it can be noted that there are not sufficient elements to indicate that the Issuer acted with intent in the commission of the infringements, so this criterion would not have been configured. However, it is necessary to indicate that despite there being no indications to suggest that the Issuer acted with intent, it can be affirmed that the Issuer's conduct was negligent, by not acting with diligence regarding obligations already known by the Issuer;
That, in that sense, in application of the Sanction Criteria previously developed, it is observed that the infringement committed has not caused concrete harm to investors, the Issuer has not obtained a benefit from its illegal conduct, nor has it been proven that it acted with intent and it is not a recidivist. However, the Issuer has one (01) sanction precedent.

Likewise, it must be taken into account that the Issuer has not yet complied with correcting the infringement subject of imputation in the present case;

That, considering what has been stated above, it is necessary to impose a fine on the Issuer for the non-compliance committed, according to the Sanction Criteria analyzed in this Resolution, as well as from the evaluation carried out by this Adjunct Superintendence, it corresponds to impose on the Issuer a fine of 5 UIT equivalent to S/ 25,750.00 (Twenty-five Thousand Seven Hundred and 00/100 Soles), according to article 35 of the Sanctions Regulation, and;

VI. APPLICATION OF CORRECTIVE MEASURES

That, having been determined in the present PAS that the Issuer has affected the transparency of the securities market information and the protection of its investors, it is necessary to dictate administrative measures, in addition to the imposition of a sanction for the determined infringement. This additional measure must have the purpose of correcting, repairing or trying to repair the altered situation;
That, in accordance with article 1 of both the LOSMV and the LMV, it is the purpose and duty of the SMV "to ensure the adequate protection of investors". Thus, article 1 of the LOSMV provides:

5 Decree Supreme No. 309-2023-EF fixed the UIT for the 2024 exercise at S/ 5,150.00.

"Article 1. Definition, purpose and functions of the Securities Market Superintendence (SMV) The Securities Market Superintendence (SMV) is a specialized technical body attached to the Ministry of Economy and Finance whose purpose is to ensure the protection of investors, the efficiency and transparency of the markets under its supervision, the correct formation of prices and the dissemination of all information necessary for such purposes, through regulation, supervision and promotion. It has legal personality of internal public law and enjoys functional, administrative, economic, technical and budgetary autonomy, constituting a budgetary item. Its operation is governed by the provisions contained in this Law and its organization and functions regulation. The functions of the Securities Market Superintendence (SMV) are the following: (…)" (Underlined and emphasis added).

43. That, in article 1 of the LMV it is established:
"Article 1.- Purpose and Scope of the Law.- The purpose of this law is to promote the orderly development and transparency of the securities market, as well as the adequate protection of the investor.
(…)"

44. That, regarding the function and responsibility of the SMV, it is necessary to take into account that article 7 of the LMV provides:
"Article 7.- Control and Supervision.
The Securities Market Superintendence (SMV) is the public institution in charge of the supervision and control of compliance with this law. (…)" (Underlined and emphasis added);

45. That, regarding the SMV's faculty to dictate corrective measures, what is provided in article 352 of the LMV is considered:
"Article 352.- Precautionary, provisional and corrective measures The SMV is empowered to dictate precautionary, provisional and corrective measures regarding natural or legal persons under its competence, regardless of whether a sanctioning procedure has been initiated or not. (…)" (Underlined and emphasis added);

46. That, likewise, regarding the competence or faculty of the SASCM to dictate corrective measures, numerals 12 and 13 of article 43 of the ROF-SMV establish:
"ARTICLE 43°.- Specific functions of the Adjunct Superintendence of Market Conduct Supervision:
(…)
12. Dictate, modify or revoke, precautionary, corrective and/or provisional measures, ex officio or at the request of a party, in cases submitted to its knowledge; (…)".
(Underlined and emphasis added).
13. Within the scope of its competence, impose sanctions in the first administrative instance for the commission of infringements whose compliance control corresponds to the Adjunct Superintendence of Market Conduct Supervision, with the exception of infringements to the norms on timeliness in the presentation of periodic or eventual information. The respective sanction resolution may dispose the application of corrective measures aimed at reversing the situation altered by the commission of the infringement; (…)" (Underlined and emphasis added);

47. That, regarding the definition or scope of corrective measures, what is established in article 19 of the Sanctions Regulation is considered:
"Article 19.- DEFINITION.- Corrective measures are those mandates oriented to restore, reverse, repair, or restore that situation altered by the non-compliance of the regulations under the supervision of the SMV. These measures can be dictated prior to the start of an administrative sanctioning procedure or at the moment of the determination of administrative responsibility. Corrective measures may consist of obligations to give, do and not do, and must establish in a precise and indubitable manner the task assigned to the regulated party, identifying those obliged to comply with them. Corrective measures must be dictated through a duly motivated decision and observing the principles of Proportionality and Reasonableness." (Underlined and emphasis added);

48. That, likewise, regarding corrective measures, it is necessary to refer to what is provided in article 251 of the TUO of the LPAG:
"Article 251. -Determination of responsibility
251.1 The administrative sanctions imposed on the regulated party are compatible with the dictation of corrective measures conducive to ordering the restoration or repair of the situation altered by the infringement to its previous state, including that of the affected goods, as well as with the indemnification for damages and losses caused, which are determined in the corresponding judicial process. Corrective measures must be previously typified, be reasonable and adjust to the intensity, proportionality and needs of the legal interests protected that are intended to guarantee in each concrete case. (…)" (Underlined and emphasis added).

49. That, regarding the typification of corrective measures in Annex XX of the Sanctions Regulation it is established:
"ANNEX XX
On Corrective Measures
According to what is established in article 21 of the Regulation, the SMV, upon determining administrative responsibility, may dictate the following corrective measures:
(…)"
27) Other measures that relate directly to the compliance with the infringed norms.
(…)" (Underlined and emphasis added);

That, in that sense, based on what has been exposed in this Resolution, and in observance of the principles of proportionality and

reasonableness, it must comply with the purpose of the SMV and of the LMV to ensure the adequate protection of investors and the transparency of the market, it corresponds to dictate the corrective measure consisting of ordering the Issuer to comply with designating at least one (01) substitute stockbroker representative within the period of thirty (30) business days counted from the day following the notification of this sanction resolution;

That, the IGSC, being the organ of the SMV that has the function of supervising material events and other information that Issuers must disseminate in the securities market, in accordance with what is indicated in article 45 and numerals 17 and 43 of article 46 of the ROF-SMV, is who must verify the compliance with what ordered to the Issuer, and;
That, finally, being to what is provided in numerals 12, 13 and 36 of article 43 of the Regulation of Organization and Functions of the SMV, approved by Supreme Decree No. 216-2011-EF;

RESOLVES:

Article 1º.- Declare that Compañía Minera San Ignacio de Morococha S.A.A. has incurred one (01) infringement of a minor nature, typified in clause 3.2 of numeral 3 of literal A) of Annex II of the Sanctions Regulation, approved by SMV Resolution No. 035-2018-SMV/01, for not complying with its obligation to have at all times at least one substitute stockbroker representative in accordance with what is established in the regulations of the Securities Market Superintendence.

Article 2º.- Sanction Compañía Minera San Ignacio de Morococha S.A.A. with a fine of 5 UIT equivalent to S/ 25,750.00 (Twenty-five Thousand Seven Hundred and 00/100 soles), for what is provided in article 1° of this Resolution.

Article 3º.- Dictate as a corrective measure that Compañía Minera San Ignacio de Morococha S.A.A., in accordance with article 21 and numeral 27 of Annex XX "On Corrective Measures" of the Sanctions Regulation, approved by SMV Resolution No. 035-2018-SMV/01, comply with designating at least one substitute stockbroker representative within the period of thirty (30) business days counted from the day following the notification of the sanction resolution.

Article 4º.- Dispose that the General Superintendentate of Market Conduct Supervision of the SMV verify the compliance with the corrective measure established in article 3° of this Resolution, in accordance with what is indicated in the considerations thereof, and that in accordance with the exercise of its competencies and taking into account the applicable regulatory framework, inform the competent organ of the SMV, regarding the compliance with the dictated corrective measure.

Article 5º.- This Resolution does not exhaust the administrative route, this being able to be challenged before this Adjunct Superintendence of Market Conduct Supervision by filing the reconsideration or appeal resource, administrative resources recognized in article 218 of the Single Ordered Text of the General Administrative Procedure Law – Law No. 27444, approved by Supreme Decree No. 004-2019-JUS, within the period of fifteen (15) business days, counted from the day following its notification. In case the

present Resolution is not challenged, it may avail itself of the regime of reduction of the corresponding sanction.

Article 6º.- In case that this Resolution is not subject to challenge, it must be published in the "Institutional Page of the SMV on the Unique Digital Platform of the Peruvian State for Citizen Orientation (www.gob.pe/smv)", in observance of what is provided by numeral 1 of article 7 of the "Policy on diffusion of normative projects, general character legal norms, early agenda and other administrative acts of the SMV", approved by SMV Resolution No. 014-2014-SMV/01, and by what is provided in the last paragraph of article 14 of the Sanctions Regulation, approved by SMV Resolution No. 035-2018-SMV/01.

Article 7º.- Transcribe this Resolution to Compañía Minera San Ignacio de Morococha S.A.A.

Carlos Rivero Zevallos
Adjunct Superintendent
Adjunct Superintendence of Market Conduct Supervision

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