The Brazilian Monetary Council changes again the rules on Financial Bills

By means of Resolution No. 4123, of August 23, 2012 (Res. 4123/2012), the Brazilian Monetary Council (Conselho Monetário Nacional – CMN) amended and consolidated the rules on the issuance of Financial Bills (Letras Financeiras – LFs) by the authorized financial institutions.

The LF was created by Provisional Measure No. 472, of December 15, 2009, which was approved by the Brazilian Congress and converted into Law No. 12249, of June 11, 2010 (Law 12249/2010), and is also governed by the legislation applied to the other Brazilian credit instruments¹ to the extent that such legislation does not conflict with the provisions of Law 12249/2010. It is a credit document that constitutes a promise of payment in cash, issued in the registered form, which may be transferred to third parties and it is freely negotiable. It must be exclusively issued in book-entry form, through the registration in a registry and financial settlement of assets system authorized by the Central