On August 31, 2021, Resolution No. 50 was published by the Brazilian Securities Commission (“CVM Resolution No. 50/2021“)[1], which revokes Instruction No. 617, published on December 5, 2019 (“CVM Instruction No. 617/2019“)[2]. The new Resolution expanded the scope of the previous Instruction to provide for the prevention of money laundering, terrorism financing and, according to the most recent global nomenclature, also the financing of the proliferation of weapons of mass destruction (collectively “PLD-FTP”[3]).
In addition to the abovementioned scope expansion, the main changes were related to the registration of operations and maintenance of files, and fine-tuning the definitions of Politically Exposed Persons.
Regarding the first point, it is highlighted that scanned images were already accepted by the CVM as substitutes for the original documents referring to transactions involving securities; however, the express need for the procedure to be carried out in accordance with specific legislation and provision that the original document may be discarded was added, unless the digitization presents material damage that impairs its readability. The definition of Politically Exposed Persons was also updated with what was already practiced by the Central Bank and the CGU.
The other changes provided for in CVM Resolution No. 50/2021 address the updates of acronyms referring to the addition of prevention to the financing of the proliferation of weapons of mass destruction, and to the Financial Activities Control Council (“COAF”), which was referred to as a Financial Intelligence Unit in the Instruction as a result of the change that was made in the past.
CVM Resolution No. 50/2021 willbe effective as of October 1, 2021.
[1]https://www.bcb.gov.br/estabilidadefinanceira/exibenormativo?tipo=Resolu%C3%A7%C3%A3o%20BCB&numero=119, access on September 03, 2021, at 1:22 p.m.
[2]https://www.in.gov.br/web/dou/-/circular-n-3.978-de-23-de-janeiro-de-2020-239631175, access on September 03, 2021, at 1:23 p.m.
[3] According to COAF Resolution No. 36/2021 (https://www.in.gov.br/en/web/dou/-/resolucao-coaf-n-36-de-10-de-marco-de-2021-307765911), access on September 03, 2021, at 1:24 p.m.
Authors: partner Bernardo Viana; trainee Matheus Leone