CVM Issues New Rules On Coercive Fines

After public consultation, on April 30, 2007 the Brazilian Securities Commission (Comissão de Valores Mobiliários – CVM) issued CVM Instruction 452, which revokes CVM Instruction 273/98 and establishes more detailed rules on the application of coercive fines by the Commission.

While the new rules do not change the cases in the CVM may impose coercive fines, they do clarify some of the controversial aspects of the earlier Instruction. Minor changes had been made to CVM Instruction 273/98 in 2004 and 2007, but those amendments were not sufficient to resolve the various controversies that arose during the time Instruction 273/98 was in force, and were resolved on a case-by-case basis by decisions issued by the full Commission.