Law 964 of 2005
Official Gazette No. 45963 of July 8, 2005
Whereby general rules are issued and listed in them the objectives and criteria which must be subject to the National government to regulate the activities of management and investment of resources collected from the public that are made by securities and other provisions. Summary
CONGRESS OF COLOMBIA DECREES
OF THE NATIONAL GOVERNMENT INTERVENTION.
OBJECTIVES AND CRITERIA FOR NATIONAL GOVERNMENT INTERVENTION.
ARTICLE 1o. OBJECTIVES AND CRITERIA FOR INTERVENTION. The national government will exercise intervention in management activities, and investment of resources collected from the public that are made by securities, subject to the following objectives and criteria:
a) Objectives of the intervention:
1. Protecting the rights of investors.
2. Promote the development and efficiency of the market.
3. Prevent and manage systemic risk market.
4. OPERATION preserve the good ent, equity, transparency, discipline and integrity of the market and, more generally, public confidence in it.
B) intervention criteria:
1. The development and democratization of the stock market and its knowledge by the public is promoted.
2. The regulation and supervision of the securities market conform to technological innovations and facilitate the development of new products and services within the framework established in this law.
3. Rules and procedures are agile, flexible and clear, and that administrative decisions are taken within a reasonable time and with the least possible administrative burdens.
4. Costs of supervision and discipline of the market to be efficient and allocated equitably, and that the burdens imposed on market participants are considered, taking into account, to the extent possible, the comparison between profit and the cost thereof.
5. As to avoid prevent or restrict competition.
6. That priority be given to economic and financial sense on how, in determining whether any right or instrument is a value, or if some activity is those requiring approval or registration and, in general, when issued rules aimed at protecting the investor rights.
7. The market is provided with timely, complete and accurate information.
8. To ensure that the operations in the stock market are brought to its timely and accurate clearance and settlement.
9. Propenda that because in the regulation and supervision to avoid arbitration, ensuring that there is uniformity in the rules issued.
THE CONCEPT OF VALUE AND ACTIVITIES OF THE MARKET.
. CONCEPT OF VALUE. For purposes of this law it will be all right negotiable value nature that is part of an issue, as has the purpose or effect of raising funds from the public, including the following:
C) Commercial paper;
D) Certificates of deposit of goods;
E) Any title to or resulting from a securitization process;
F) Any representative title of venture capital;
G) Certificates of deposit;
H) Bank acceptances;
I) mortgage bonds;
J) Any government bond. PARAGRAPH 1.
. values are not considered insurance policies and capitalization securities. PARAGRAPH 2.
. When attending the same issuer qualities of creditor and debtor of certain value, only operate the confusion if the title person was expired or if it was provided for in the relevant prospectus or, failing that, in the contractual conditions of the respective value. PARAGRAPH 3.
. The provisions of this Act and the rules that develop and complement shall apply to financial derivatives such as futures contracts, options and swap contracts, provided they are standardized and capable of being traded on the stock exchanges exchange or other trading systems. The products covered by this paragraph refers to only be offered to the public by registration in the National Registry of Securities and Issuers.
PARÁGRAFO 4o. The Government may recognize the quality of value to financial contracts and derivatives whose underlying electricity or fuel gas, prior information to the Regulatory Commission of Energy and Gas, for which the latter will take into account the impact of such determination in achieving legal targets that corresponds enforced through the functions attributed Laws 142 and 143 of 1994, as well as those that modify, add or replace.
PARÁGRAFO 5O. Values have the features and prerogatives of securities, except action to change it back. Nor shall action claiming, measures to restore law, confiscation and seizure, against the third party to acquire listed securities, provided that at the time of sale acted in good faith free of guilt.
PARÁGRAFO 6o. Public and private companies will issue the securities in this article the terms and conditions established by the National Government refers to.
ARTICLE 3. SECURITIES MARKET ACTIVITIES. Will market activities:
a) The issuance and offering of securities;
B) securities brokerage;
C) The securities fund management, investment funds, mutual funds, ordinary mutual funds and special mutual funds;
D) The deposit and administration of securities;
E) The administration of trading systems or registration of securities, futures, options and other derivatives;
F) The clearing and settlement of securities;
G) The risk rating;
H) Self-regulation referred to in the present law;
I) The provision of information to the stock market, including the collection and processing thereof;
J) Other activities under this law or determined by the National Government, provided they constitute management activities and investment of funds raised from the public that are made by values. PARAGRAPH 1.
. Entities that perform any of the activities mentioned in this Article shall be subject to state supervision. PARAGRAPH 2.
. Only entities incorporated or to be incorporated in Colombia may conduct the activities of the stock market this article, except as provided in subparagraphs a) i), cases in which it will be necessary to establish a company in the country .
The provisions of this paragraph shall be without prejudice to the promotion of services through representative offices or correspondent agreements, in accordance with the relevant standards.
INTERVENTION IN THE STOCK MARKET.
ARTICLE 4. INTERVENTION IN THE STOCK MARKET. Accordance with the objectives and criteria set out in article 1 of this law, the national government will intervene in the activities of the securities market, as well as other activities referred to in this law, through general rules for :
a) Determine activities, in addition to those provided for in this law, they are part of the market to constitute management, use and investment of funds raised through public values and establish its regulation. Also applicable to establish market activities identified in current regulations regulation.
In exercising this authority the National Government will regulate cross-border trade in services of the activities provided for in article 3 of this Act, including the ability to recognize or acknowledge the fulfillment of the requirements for the effect.
In developing this faculty the Government may also authorize direct access by foreign agents to Colombian securities market and standardize or recognize the fulfillment of the necessary requirements to allow access to the services provided by infrastructure providers Colombian stock market. Effective Notes
Matches Legislation Previous
B) Establishing the regulations applicable to the securities, including recognition of the quality of value to any right to financial content or any financial instrument, provided they meet the characteristics specified in the 1st paragraph of Article 2 of this law; regarding securities transactions, encumber or guarantees about the same or other assets with operations relating to securities and their fungibility; the issuance of securities; dematerialization of securities; promotion and placement distance values; public offerings, its various forms, the rules and the revocation thereof; and determining the activities that constitute securities brokerage.
In exercising this power the national government can only qualify as public offerings that target those people not certain groups or sectors or relevant persons, or carried by some mass media to subscribe for, sell or purchase securities .
In development of this power the national government can not change the rules on securities in the Code of Commerce;
C) establish the rules applicable to entities subject to inspection and surveillance of the Securities including its organization and operation; maintaining adequate levels of equity in accordance with the various risks associated with its activity; definition, general and prior of the constituent practices conflict of interest as well as the mechanisms through which are managed, disclosed or remedied such situations, when it any place; authorization to perform activities that are not currently provided for in the current rules, except those corresponding to the sole purpose of financial institutions and insurance; control and risk management; separation of own assets of third parties; matters relating to the duty to act to customers as prudent and diligent experts; using networks of offices and commercial networks; the acquisition of interests in its property; the investment regime and advertising.
In developing the power under this subparagraph the national government can not change the rules of the Commercial Code on corporate matters or reduce the types of operations currently authorized by current regulations to entities subject to inspection and surveillance of the Securities, or modify the minimum amounts of capital specified in the law.
In exercise of the power under this subparagraph the National Government may authorize centralized securities depositories for custody and administration securities traded in the market for domestic and international securities;
D) determine the cases in which the institutions supervised by the Banking Superintendency may carry new brokerage activities in the securities market, subject to the completion of related operations to its corporate purpose.
In exercise of the power under this section, the Government may determine the cases in which the entities supervised by the Superintendency of Solidarity Economy will conduct brokerage activities in the securities market, subject to the completion of related to its corporate purpose operations.
In developing the power under this subparagraph the national government can not allow institutions supervised by the Banking Superintendency and the Superintendency of Solidarity Economy, operations corresponding to the sole purpose of entities subject to inspection and surveillance of the Securities;
E) Define who will have the quality of customer and investor professional investor considering investment volumes, the regularity, professionalism, expertise and other relevant factors, and the rules applicable to relations between those investors and issuers and intermediaries.
In exercising this authority, the Government shall apply to persons engaged in brokerage activities in the securities market, supplying its customers with the information necessary to achieve greater transparency in their operations, so that allow them to, through elements of judgment and clear objectives, choose the best options in the market and be able to make informed decisions.
In the same way, these people will refer their clients account statements with information and frequency determined by the Government;
F) To establish the rules relating to the organization and operation of the Integrated Information System Securities Market, SIMEV, and establish registration requirements, updating information and voluntary cancellation or office. In development of this ability may, inter alia, order the registration of market participants in the system, exclude from the obligation to register some of the market participants have the delegation in third party management system and establish the information it will part thereof;
G) establish the rules to disclosure of information to be supplied to the Securities, the public, investors or shareholders, as well as those aimed at preserving trade secrets and character information Similarly, and make rules concerning misuse of privileged information aimed at market participants and public servants with access to such information;
H) To issue, subject to this Act, the rules that develop self-regulation Chapter II of Title IV of this Act refers, without prejudice to the autonomy corresponding to the self-regulatory bodies; Effective Jurisprudence
I) Regular activity in the market values of those securities brokerage develop;
J) Regulate the issue, subscription and place tion of public debt;
K) To issue rules related to corporate governance of stock exchanges, the trading systems of the stock futures and options exchanges of goods and agricultural, agro-industrial products or of other commodities, of the centralized securities and central clearing counterparty risk deposits.
In exercising this authority the National Government may establish that the majority of board members, board of directors and / or disciplinary chamber, as appropriate, before such entities, will act as independent.
To this end, the Government will determine the qualifications to be met by such independent members, and the procedure to be followed for election, for which may provide you override the electoral quotient system provided for in Article 436 of the Commercial Code;
L) determine the cases in which securities intermediaries, issuers of securities and collective portfolios must be qualified by an entity previously authorized by the State. The rating should be made public.
The 5th ITEM. LIMITATIONS ON THE POWERS OF INTERVENTION. In exercise of the regulatory powers provided for in this law, the Government may not amend the rules relating to the structure of the stock market and commodities, the constitution, the main object, and partnerships, and causal and dissolution conditions, decision possession and liquidation of entities subject to inspection and surveillance of the Securities.
SUPERVISION OF INTEGRAL INFORMATION SYSTEM MARKET AND CONTRIBUTIONS.
ARTICLE 6o. ADDITIONAL FEATURES the Securities. The Securities shall, in addition to the functions currently assigned to it, the following:
a) instruct the entities subject to inspection and ongoing supervision or control on how the provisions governing must be met its activity in the market, set the technical and legal criteria that facilitate compliance with such standards and outline the procedures for its full implementation;
B) Monitoring compliance with the provisions of the Bank of the Republic in relation to persons subject to inspection and surveillance;
C) suspend any founded preventively when they can cause harm to investors or market, a public offering in any modality fear; negotiating certain value, the registration of securities, or issuers of them in the National Registry of Securities and Issuers; the registration of certain person in the National Registry of Securities Market Agents; the registration of certain person on the National Register of Professional Securities Market;
D) Imposing the precautionary measures set out in the Code of Civil Procedure and other preventive measures set out in this law and the rules that develop, supplement or amend aimed at safeguarding the res valo, financial instruments, managed resources and in general, assets in the possession of persons under investigation when there are reasons that can reasonably be inferred that those assets are at risk and can affect the interest of investors. These measures include ordering the temporary transfer of the assets to a professional manager, similar to those prevailing in the market.
The function provided for in this literal may be exercised only against entities subject to inspection and surveillance of the Securities;
E) To exercise, only in terms of its intermediation, against intermediaries who are not subject to inspection and surveillance, assigned the same functions with regard to the entities listed in paragraph 1 of the 3rd paragraph of Article 75 of this law. Jurisprudence
ARTICLE 7. INTEGRAL INFORMATION SYSTEM MARKET. Integral Information System Market, SIMEV, is the set of human, technical and management will use the Securities to allow and facilitate the provision of information to the market and will be composed as follows:
a) National registry of securities and Intermediaries, which will aim to enroll classes and types of securities and issuers thereof and the emissions that they made, and certify related to the registration of such issuers and classes and types of securities .
Public offerings of securities should be preceded by registration in the National Registry of Securities and Issuers. PARAGRAPH 1.
. The National Government will establish the terms, conditions and procedures for the approval of records values of other countries. PARAGRAPH 2.
. The Government may authorize the commission brokerage firms conducting transactions in securities issued abroad that are not registered in the National Registry of Securities and Intermediaries, under the terms and conditions it determines.
Likewise, it may authorize exchanges and trading systems values so that through them securities issued abroad not registered are on the National Register of Securities and Issuers traded through systems quotes foreign securities in the terms and conditions determined by the Government. Effective Notes
. The Financial Superintendence of Colombia will not exercise functions of inspection, supervision or control over foreign securities markets and their agents or foreign issuers whose securities are listed on stock quotes systems abroad. This is without prejudice to the powers in the area of competence respect of any systems stock quotes from abroad and the respective managers of these. Effective Notes
B) The National Registry of Securities Market Agents, which shall lead to the registration of entities subject to inspection and surveillance of the Superintendency of Securities and the other determined by the National Government, except issuers securities in their securities issuance activity. This record will be provided to act on the market and develop activities that article 3 of this Act, except as provided for in paragraph a) of that provision refers to;
C) The National Register of Professional Securities Market, which shall lead to the registration of natural persons who hold the positions or duties of treasurer or his substitute, natural persons conducting operations on tables money, natural persons who gerencien or manage securities funds, investment funds and mutual funds, individuals who exercise functions related to the operations performed at the cash tables, as well as other natural persons performing the positions or functions determined by the National govern- Gob in entities that carry out the activities provided for in article 3 of this Act, except as provided for in paragraph a) of that provision. Enrollment in this record will be provided to act on the market.
. The national government will signal the regime of registration in the National Register of Agents Securities Market and the National Register of Professional Securities Market of entities subject to inspection and surveillance of the Banking Superintendency to develop some of the activities planned the article 3 of this Act, except as provided for in paragraph a) of that provision, and natural persons who provide services in these. PARAGRAPH 2.
. The information kept in the SIMEV be public. Consequently, any person may consult, observing the rules established for this purpose. PARAGRAPH 3.
. The accuracy of the information kept in the SIMEV, and the effects that occur as a result of the disclosure shall be the exclusive responsibility of those who provide the system.
PARÁGRAFO 4o. Registration in the National Registry of Securities and Issuers not imply qualification or liability by the Superintendency of Securities on the natural or legal persons registered or on the price, kindness or marketability of the value, or the respective issue, or on the creditworthiness of the issuer.
PARÁGRAFO 5O. Under social risk and public interest of the activities regulated by this law, the treasurer or his substitute, persons performing operations on cash tables, people gerencien or manage securities funds, investment funds , mutual funds, ordinary mutual funds and special mutual funds, and persons exercising functions related to the operations performed at the cash tables, must pass tests of suitability to enroll or stay in the National Register of Professionals Stock market. Those who have passed the suitability tests must submit updated exams at intervals determined by the National Government. Similarly, those who intend to develop different functions to those who exercised at the time of approval of examinations and which are part of the set forth in this paragraph, you will also have to submit the relevant examination. Such reviews may be applied by persons exercising functions of self-regulation by the exchanges, by union or professional organizations or institutions of higher education authorized by the Icfes, which must be approved for the purpose by the Superintendency of Securities. The Securities ensure compliance with the provisions hereof for which approve the content and scope of examinations to administer the above persons.
PARÁGRAFO 6o. Those acting or purporting to act as managers, directors and statutory auditors of entities subject to inspection and surveillance of the Superintendency of Securities and people gerencien or manage securities funds, investment funds and mutual funds, they must prove to this who enjoy good moral and professional reputation and those required by the regulations for the specific case of statutory auditors.
Article 8. CONTRIBUTIONS. Registration fees in the Integrated Information System Securities Market, SIMEV, referred to in this Act and the fees to be paid to the Securities will be settled and paid as provided in this article. For this purpose the Superintendency calculate and collect the respective contributions determined by the total amount of the operating budget and investment of the entity in the respective year net surplus of contributions from the previous period. Rights public offering will be charged only once and is calculated as a percentage of the value of the issue.
Each contribution is calculated based on the limit established in the preceding paragraph, as follows:
A) In the case of brokering activities of securities or futures, options and other derivatives, the clearing and settlement of securities or futures, options and other derivatives, the management activities trading systems securities or futures, options and other derivatives, the activities of the trading systems forex activities registration systems of securities, foreign exchange or futures, options and other derivatives, the activities of chambers Central counterparty risk and the activities of the management companies of clearing and settlement currency, each agent will be charged a fee that is calculated as a percentage of the total value of transactions from their activity during the previous fiscal year. The same rule to agricultural or agroindustrial bags and other entities that manage specialized forums negotiation commodities transaction will be applied;
B) In the case of fund management activities securities, investment funds and mutual funds a fee that is calculated as a percentage of the total value of assets that constitute the respective funds will be charged;
C) For the activity of securities depository, a fee will be calculated as a percentage of the total amount of securities held in the respective deposit will be charged;
D) In the case of securitization companies a fee is charged for the inspection and supervision fee calculated as a percentage of the assets of the respective company;
E) In the case of securities issuance activity fee will be calculated as a percentage of the value of the assets of the relevant issuer or, failing that, of its annual budget will be charged. For purposes of this subparagraph to securitization companies you will be charged a fee on the volume of securitized assets the previous fiscal year;
F) In the case of securities rating activities a fee that is calculated as a percentage of revenue from the respective rating agency during the previous fiscal year you will be charged;
G) For other than those mentioned in paragraphs preceding that must be registered in the National Register of Market Agents a fee that is calculated as a percentage of gross receipts of the corresponding legal persons will be charged market activity of the respective legal entity during the previous fiscal year.
When the taxpayer does not remain under supervision throughout the term, its contribution is proportional to the period under supervision. When the fact that a supervised not maintain this condition throughout the term and a budget that requires remedied defe cts is generated, the Superintendent may liquidate and other taxpayers require the respective amount at any time during the relevant year. PARAGRAPH 1.
. The resolution issued by the Superintendent of Securities to set annual fees, shall indicate minimum and maximum, the frequency of payment and different rates for those who are in bankruptcy proceedings, liquidation, restructuring or similar process. In any case, this resolution will not be submitted for approval by any other authority.
The Securities may reassess the fees based on the latest information in their possession when, at the date of initial settlement, the respective required has not complied with the duty to update the financial information. PARAGRAPH 2.
. In setting tariffs the Superintendent of Securities should consider the actual cost of supervision exercised on each of the different types of entities mentioned in the previous paragraphs. PARAGRAPH 3.
. Resources from taxes that are not paid within the deadlines set by the Superintendency, cause the same interest on arrears applicable to income tax and complementary.
PARÁGRAFO 4o. Nation-Ministry of Finance and Public Credit is not subject to the payment of contributions.
PARÁGRAFO 5O. In the event provided for in Article 74 of this Law, contributions and other resources available to the Securities for the exercise of its functions they will be transferred without any authorization from the entity responsible for advancing the functions assigned to the monitoring and control entity, or that resulting from the respective merger, integration or reorganization.
SYSTEM OF CLEARING AND SETTLEMENT OF OPERATIONS AND DEPOSIT OF SECURITIES.
ACTIVITIES OF CLEARING AND SETTLEMENT.
Article 9. CLEARING AND SETTLEMENT SYSTEMS. For purposes of this law are clearing and settlement of transactions all activities, agreements, agents, rules, procedures and mechanisms aimed at confirmation, clearing and settlement of securities transactions. To be recognized as clearing and settlement systems such activities, agreements, rules, procedures and mechanisms shall be recorded in regulations previously approved by the Superintendency of Securities.
Can they manage clearing and settlement of transactions entities constituted exclusively for that purpose, the central clearing counterparty risk, stock exchanges, exchanges of goods and agricultural, agroindustrial commodities or other products, the Bank the Republic, the central securities depositories and other entities authorized by the national government.
The regulation applicable to the clearing and settlement should provide mechanisms for managing credit risk, liquidity, operational, legal and systemic.
They will have as participants in a clearing and settlement system entities authorized by the national government through general. For purposes of access to clearing and settlement systems, such systems should incorporate in their objective and equitable criteria for participation in these regulations.
PARÁGRAFO. For purposes of the provisions of this law means c OMPENSATION the process by which securities delivery obligations and transfer of funds of participants in a clearing and settlement system, arising from securities transactions are established. How to establish the obligations of participants may be made from bilateral or multilateral mechanisms that incorporate or not the net value of these obligations. The obligations thus laid down must be met under the terms stated in this law.
Liquidation means the process by which the obligations arising from an operation on values, where part delivery values and the other makes the transfer of funds or securities are definitely met.
ARTICLE 10. PRINCIPLE OF PURPOSE IN SECURITIES TRANSACTIONS. Orders transfer of funds or securities derived from securities transactions and any act which, under the terms of the regulations of a system of clearing and settlement operations to be performed for compliance, be firm, irrevocable, enforceable and opposable against to third parties from the time such orders have been accepted by the clearing and settlement system. It is understood
order the unconditional transfer instruction given by a participant through a clearing and settlement system of securities for delivery of a security or securities is made, or a certain amount of funds to a designated beneficiary such instruction.
For purposes of this law, it is understood that a transfer order has been accepted when it has met the requirements and risk controls established in the regulations of the respective clearing and settlement system, adopted in accordance with the relevant provisions. Such regulations must be approved by the Securities. PARAGRAPH 1.
. Once a transfer order has been accepted by the system of clearing and settlement in the terms stated in this law, values and their respective funds shall not be subject to judicial or administrative measures including interim or similar measures, withholding orders, as well as those derived from rules of insolvency nature, takeover, dissolution, liquidation, or global agreements on debt restructuring, which seek to prohibit, suspend or otherwise limit the payments to be made through the system. Accepted transfer orders, acts required for compliance and those operations are derived not be challenged, declared invalid or declared ineffective. These measures will only have its effects regarding transfer orders not accepted from the time they are notified to the system administrator in accordance with the applicable rules. In the case of measures derived from nature bankruptcy rules, takeover, dissolution, liquidation, or global debt restructuring agreements such notification should be made personally to the legal representative of the system administrator.
. The provisions of this Article shall be without prejudice to any action that may assist the special agent, liquidator, bankruptcy bodies, relevant authorities or any creditor to demand, if any, compensation corresponding to or the responsibilities that come, by an unlawful or for any other reason, those who had made such performance or unduly would result beneficiaries of transactions performance. PARAGRAPH 3.
. The provisions of this Article shall apply to operations carried out both counter market as those made in the systems of trading, from the time they have been accepted by the system of clearing and settlement.
ARTICLE 11. GUARANTEES GIVEN ON BEHALF OF THE PARTICIPANTS. The guarantees given on behalf of a participant to a system of clearing and settlement operations, their own or a third party, which are subject to compliance with operations or orders accepted by the system transfer as well as clearing and settlement arising of these, shall not be subject to claim, seizure, garnishment or other precautionary measure similar administrative or judicial, pending the obligations arising from such transactions or orders are fully met.
Acts by virtue of which constitute, increase or replace the guarantees referred to in the preceding paragraph shall be irrevocable and may not be challenged, declared invalid or declared ineffective.
The guarantees given on behalf of a participant in a system of clearing and settlement operations may be applied to the settlement of the secured obligations even in the event that the grantor is the subject of bankruptcy proceedings or liquidation or agreement restructuring. It will be understood, however, that the surplus resulting from the liquidation of the corresponding obligations under those guarantees will be part of the assets of the grantor for the purposes of the respective process.
The guarantees which this article refers to may be made effective without any judicial process, according to the regulations of the corresponding system of clearing and settlement operations. PARAGRAPH 1.
. In the book-entry may register garments with or without holding securities and other aimed at ensuring or ensure compliance with legal obligations business. PARAGRAPH 2.
. The guarantees given to the Bank of the Republic to ensure compliance of operations conducted by the Bank in carrying out its functions, have the powers set out in this article.
Book entry and securities transactions.
ARTICLE 12. BOOK ENTRIES. It shall mean the record book entry that is made of the rights holders or balances in deposit accounts, which will be led by a central securities depository.
The book-entry shall constitute the respective right. Consequently, the creation, issue or transfer taxes and precautionary measures to be submitted and any other measures affecting the rights contained in the respective value circulating through book entry will be improved by the entry form.
Who appears on the seats of the electronic record is the holder of the value to which such registration relates and may require the issuer to perform on his behalf the benefits due to the aforementioned value.
The National Government to issue regulations to develop the provisions of this Article shall take into account the principles of priority, praying, fungibility, good faith registration and successive chain of the corresponding record.
PARÁGRAFO. In the case of deposits of interconnected values prevail book entry on balances managed in the warehouse where the account opened in the name of a direct participant under the contract securities deposit is located.
ARTICLE 13 PROBATION AND AUTHENTICITY OF THE certificates issued by central securities depositories VALUE. The certificates issued by a central securities depository shall state the rights represented by book-entry. These certificates lend executive merit but can not move or serve to transfer the ownership of securities. It also corresponds to the central securities issue certificates that will be worth to exercise political rights that grant the securities depositories.
ARTICLE 14. REPO TRANSACTIONS, simultaneous operations, SECURITIES EXCHANGE SECURITIES AND TRANSFER TEMPORARY. Repo operations, simultaneous operations of securities, securities exchange and temporary transfers of securities and other to be determined in accordance with article 4 of this law, held in accordance with applicable regulations, involving the transfer ownership of securities delivered.
The legal effects of the repo and simultaneous operations to which this article refers shall be:
a) Once the term or condition that the initial purchaser of the securities is agreed fulfilled shall return the property the same to whom he transferred them. If the titles originally used in the operation were sold, it must deliver others of the same species, kind and amount;
B) If the person who initially transfers the values defaults on its obligation to pay the repurchase price, its counterpart retain the right of ownership over them and therefore can definitely keep them, have them or cash them at maturity. However, in this case the party retains ownership title shall deliver to its counterpart in a period not exceeding five (5) working days from the date of default the resulting difference between the agreed price and the price market value on the date of the breach;
C) If the person who initially acquires the values fails to make retransferirlos, its counterpart will have no obligation to pay a price for them. The counterpart initially gave the title shall be entitled to have it delivered within a period not exceeding five (5) working days from the date of default, the resulting difference between the agreed price and the market price value on the date of default.
In securities exchanges and temporary transfers of securities if the person is bound to restore the value to its counterparty defaults that obligation, the counterparty retain the right of ownership of securities initially delivered to them and therefore can keep definitely have them or cash them at maturity. If there is any difference between the market price of the title received and the market price title delivered valued at the date of default, the party that originally surrendered the value with the highest price at the date of default, shall be entitled to be paid within a period not exceeding five (5) working days from the date of default, the difference between the prices of the two values, by delivering cash or securities of the isma m class, as agreed the parts. PARAGRAPH 1.
. When pending compliance of the operations referred to in this article and present a bankruptcy proceeding, taking possession for liquidation or global agreements on debt restructuring, with respect to the parties involved in it will by early completion of the operation from the date of the respective decision has been taken.
In this case, it proceeds as provided in this Article according to the position of the respective operation unfulfilled part. In the case referred to in subparagraph c) the party transferred the securities entitled to be recognized a credit for an amount equal to the difference between the value of the obligation at the respective date and price of market value the day the declaration of the bankruptcy process. In the case of stock exchanges and temporary transfers of securities, if the counterparty to the entity for which a bankruptcy process began delivered securities with a higher market price, shall be entitled to be recognized a credit for a sum equivalent to the price difference between the two values. These credits are not part of the assets of the bankruptcy process and must be met as soon as possible. PARAGRAPH 2.
. For purposes of the provisions of this Article the Government shall regulate the manner of determining the market prices of the securities. PARAGRAPH 3.
. The provisions of this Article shall apply in the event that there is a different provision in the contracts or in the respective regulations.
CENTRAL CHAMBERS counterparty risk.
ARTICLE 15. CENTRAL CHAMBERS counterparty risk. Chambers of Central Counterparty Risk will have the sole purpose of providing the service as a central counterparty clearing operations, in order to reduce or eliminate the risk of breach of the obligations arising therefrom. In the exercise of that object will develop the following activities:
a) To become as asset and liability reciprocal rights and obligations arising from transactions which previously shall have been accepted for clearing and settlement, in accordance with the provisions of the approved regulations by the Superintendencia de Valores, assuming such a character against the parties to the transaction irrevocably, who in turn will keep the legal relationship with the central counterparty instead of each other;
B) Manage clearing and settlement of transactions;
C) require, receive and manage the guarantees provided for the proper functioning of the Chamber of Central Counterparty Risk;
D) require persons who will act as their counterparts in respect of the operations in which it is established as reciprocal creditor and debtor, moneys, securities or assets that enable the fulfillment of the obligations of those against the same, in accordance with the provisions authorized by the Superintendency of Securities regulation;
E) Issue certificates of acts performed in the exercise of their functions. Certifications of their records in stating the breach of its counterparts towards society lend executive merit, provided they are accompanied by the documents stating the obligations which they arose.
Chambers of Central Counterparty Risk will be required to include in its name and trademark the name "Chamber of Central Counterparty Risk", followed by the abbreviation SA No other person or entity may use such names or any other that confusingly with the same or perform the activity under paragraph a) of this Article.
Chambers of Central Counterparty Risk can only perform tasks that paragraph a) of this Article in relation to counterparties that meet the requirements set by the national government, who will participate on their own account or concerns third. PARAGRAPH 1.
. The Government may set only once the minimum capital of the Chambers of Central Counterparty Risk. PARAGRAPH 2.
. The provisions of Articles 10 and 11 of this Act shall apply to transactions clearing and settlement of Chambers of Central Counterparty Risk.
PARTNERS. They may be members of the Chamber of Central Counterparty Risk securities intermediaries, credit institutions, insurance companies, the financial services companies, capitalization companies, management companies trading systems, stock exchanges, bags of agricultural, agro-industrial products or other commodities, the latter intermediaries and central securities depositories. The Government may establish a general way that other people, in addition to those identified in this article may be members of the Chamber of Central Counterparty Risk.
May also be members of the Chamber of Central Counterparty Risk, foreign entities whose activity is equal to or similar to those mentioned in the preceding paragraph, whose participation is authorized by the Securities.
No person may be beneficial for a number of shares representing more than ten percent (10%) of the capital of a Chamber of Central Counterparty Risk. The National Government may bring the exceptional cases in which a person may have a share that exceeds the previous limit. Editor's Notes
ARTICLE 17. COMPENSATION. The obligations Chambers of Central Counterparty Risk have with their debtors and creditors reciprocal, be extinguished by compensation to the relevant amount.
ARTICLE 18. GUARANTEES
DELIVERED TO CENTRAL CHAMBERS counterparty risk. The assets of the Chambers of Central Counterparty risk will preferentially affect the fulfillment of the obligations assumed by the own Chamber of Central Counterparty Risk.
The assets and rights pledged as security in favor of the Chamber of Central Counterparty Risk shall not be subject to claim, seizure, retention or other similarly precautionary measure or measures resulting from the application of rules of nature concursal or takeover, liquidation or restructuring agreement. Such guarantees are settled in accordance with the regulations of the Chamber of Central Counterparty Risk, without any judicial process.
The assets and guarantees granted to the Chambers of Central Counterparty Risk is settled in accordance with their rules of operations, which must be authorized by the Superintendency of Securities.
PARÁGRAFO. The proceeds from the realization of the rights guaranteed by the partners of the Chambers of Central Counterparty Risk and the securities or any other asset to clearing and settlement will be allocated to the settlement of the obligations undertaken within the scope of the Chambers of Central Counterparty risk. The balance, when it exists, will be delivered to the relevant counterparty.
ARTICLE 19 REFERRAL REGULATIONS. Transfers of funds and / or currency through payment systems shall be governed by the same provisions applicable to clearing and settlement defined in this Title, under the terms regulating the national government and the Bank of the Republic values according to their skills.
TITLE IV. OPERATION
GENERAL PROVISIONS APPLICABLE TO ENTITIES SUBJECT TO INSPECTION AND PERMANENT SURVEILLANCE the Securities.
disabilities. The disqualifications under the current rules for managers of the stock exchanges will be extended to the directors of the management companies Trading Systems and administrators of the bags of agricultural and agroindustrial products or other commodities.
Managers of brokerage firms and their partners or shareholders as the case may not be directors or statutory auditors of companies whose shares or securities are registered in the National Registry of Securities and Intermediaries, except bags securities, management companies of securities trading systems or commission their own society. However, they may be part of their boards of directors of the parent or their legal representatives.
Intermediaries bags agricultural and agroindustrial products or other commodities and their managers may not be directors or statutory auditors of companies whose shares or securities are registered in the National Registry of Securities and Intermediaries, except with respect to the bags agricultural, agro-industrial or other commodities broker or your own products.
For all purposes, they shall be construed as incorporated in this law the provisions of Article 22.214.171.124 of Resolution 400 of 1995 in relation to the inabilities of rating securities firms.
The incompatibilities and disqualifications under the current rules for managers, statutory auditors and brokers of the stock exchanges shall also apply to the directors and statutory auditors of the bags of agricultural, agro-industrial or other commodities and intermediate products.
ARTICLE 21. Compliance Officer. The brokerage firms must have a Compliance Officer, who shall be an independent person appointed by the board of the society. The Compliance Officer shall attend meetings of the board of the company with voice but no vote and will have at least the following functions:
a) Establish procedures to ensure compliance with laws, regulations, statutes and, in general, all the regulations and internal practices of good corporate governance, codes of ethics, good conduct and commercial transparency which relate to the activities of the entity;
B) propose to the Board the establishment of measures to ensure ethical behavior and transparency in business and personal activities of its officials and related parties, to prevent conflicts of interest, ensure accuracy and transparency in financial disclosure, avoid misuse of nonpublic information;
C) Report and document to the Board of irregularities that may affect the healthy development of society;
D) Other established in the bylaws.
The functions of the Compliance Officer shall be exercised without prejudice corresponding to the auditor and the internal auditor, in accordance with applicable law.
PARÁGRAFO. The Government may establish an obligation for other entities subject to inspection and supervision should have a Compliance Officer.
ARTICLE 22. APPLICATION OF ORGANIC STATUTE OF THE FINANCIAL SYSTEM. In the constitution of the entities referred to in this title shall apply under Article 53 of the Organic Statute of the Financial System provided it is not contrary to the special provisions on the subject. Articles 72, 73, 74, 81, 88 and 102 to 107 of the Organic Statute of the Financial System and the rules that modify, replace or supplement them equally be applicable to such entities.
The Financial Superintendence of Colombia may take such measures that Article 108 of the Organic Statute of the Financial System in respect of those persons performing activities under this Act without proper authorization concerns.
The causal origin of the measure and other rules planned for the inauguration, administrative compulsory liquidation and institutes for rescue and protection of public trust under the Organic Statute of the Financial System shall apply to the Financial Superintendency Colombia and entities subject to inspection and surveillance, as they are compatible with their nature.
The merger, conversion, acquisition, sale of assets, liabilities and contracts of the entities identified in this chapter shall be governed, as appropriate, by the provisions of the Organic Statute of the Financial System and the rules amending , replace or supplement.
In addition, such entities shall apply the provisions of paragraph 4 of Article 98 and paragraph 1 of Article 122 of the Organic Statute of the Financial System.
The provisions of paragraph 8 of Article 326 of the Organic Statute of the Financial System, shall apply to the Financial Superintendence, as does their monitored or controlled, in order to ensure that the supervision can develop a consolidated basis, protect investors and preserve the stability and integrity of the market. However, the Superintendency may promote mechanisms for exchange of information with supervisory bodies of other countries and international organizations grouping together these supervisory agencies. When the information supplied is confidential, the Financial Superintendence of Colombia can deliver with the same commitment that is kept by the supervisory authority or international organization that groups with such a character. Editor's Notes
The provisions of paragraph 2 of Article 118 of the Organic Statute of the Financial System, shall apply to entities subject to inspection and surveillance of the Financial Superintendence as does the possibility of new operations in the Stock Market .
In addition, the provisions of paragraph i) of paragraph 2 of Article 326 of the Organic Statute of the Financial System shall apply to the Financial Supervisory respect of the entities subject to inspection and surveillance. Effective Notes
ARTICLE 23. RIGHTS ON SECURITIES SETTLEMENT IF. Whenever initiated a procedure aimed at the liquidation of one of the entities provided for in this title, securities, property or money received from third parties for safekeeping, administration or transfer of, or for the execution of business or orders are deemed as not part of the liquidation process and must be returned to such third parties as soon as possible.
OF SELF-REGULATION AND ITS MARKET DISCIPLINE.
ARTICLE 24. THE SCOPE OF SELF-REGULATION. Self-regulation includes the exercise of the following functions:
a) regulations Function: Consistent in adopting rules to ensure the proper functioning of the intermediation activity;
B) monitoring function: Consistent in verifying compliance of market regulations and self-regulation;
C) disciplinary Function: Consisting of sanctions for breach of the rules of market regulations and self-regulation.
. These functions must be met by those authorized to act as self-regulatory bodies, under the terms and conditions determined by the national government entities. In exercising this authority, the national government should propender because arbitrations entities must comply with the self-regulatory obligations under this Act and establish measures for the proper government of the self-regulatory avoid. PARAGRAPH 2.
. The provisions of paragraph a) of this Article is without prejudice to the power they have bags regulate trading and transactions entered into by them and the actions of its members. Effective Jurisprudence
ARTICLE 25. OBLIGATION OF SELF-REGULATION. Those engaged in securities trading are required to self-regulate the terms of this chapter. These obligations must be addressed through specialized bodies for that purpose. They may act as self-regulatory bodies the following entities:
a) constituted exclusively for that purpose Organizations;
B) Professional organizations or unions;
C) Stock exchanges;
D) bags agricultural, agro commodities or other products;
E) Management Companies Trading Systems covered by this law. PARAGRAPH 1.
. The entities referred to in this Article may exercise some or all of the self-regulatory functions under Article 24, under the terms and conditions determined by the Government. Until the contrary is established, the stock markets continue to exercise through their bodies functions that Article 24, in the terms that currently meet concerns. PARAGRAPH 2.
. The role of self-regulation does not have the character of public service. PARAGRAPH 3.
. Self-regulatory bodies in this article refers to civilly liable only when there is gross negligence or willful misconduct. In these cases challenging processes be processed by the procedure laid down in Article 421 of the Code of Civil Procedure and only be proposed within the month following the date of the decision to ultimately resolve the respective process. Editor's Notes
PARÁGRAFO 4o. The Superintendencia de Valores, under the terms established by this law, will oversee the proper functioning of self-regulating bodies.
PARÁGRAFO 5O. The Securities may enter into agreements or memoranda of understanding with self-regulatory bodies in order to coordinate efforts in disciplinary matters, monitoring and research. Effective Jurisprudence
ARTICLE 26. REQUIREMENTS. The Securities may grant permission to a self-regulatory body when it meets the following requirements:
a) Have the minimum number of members determined by the national government and demonstrate its importance to the market;
B) Have adequate mechanisms to enforce by its members and persons associated with them laws and market rules and regulations issued by the same entity;
C) Have a mechanism of registration of legal and natural persons to be members of the self-regulatory body;
D) Show that its regulations provide mechanisms for the different organs of the self-regulatory body adequate representation of its members is assured, notwithstanding that in them a majority share of external or independent members is established;
E) Demonstrate that the rules of self-regulatory body will provide an adequate distribution of charges, fees and other payments between its members;
F) Ensure that the rules of self-regulatory body are designed to prevent tampering and fraud in the market, promote coordination and cooperation with the agencies responsible for regulating and enable the clearing and settlement processes, information processing and facilitate transactions, as well as remove barriers and create conditions for the operation of free and open to national and international markets and in general, to protect investors and the public interest;
G) Ensure that discrimination between members is prevented, and establish rules to avoid agreements and actions that violate the spirit and purpose of the rules of the market;
H) Show that the rules of self-regulatory body will provide the ability to discipline and punish its members in accordance with the regulations of the securities market and its own regulations. Disciplinary sanctions may take the form of expulsion, suspension, limitation of activities, functions and operations, fines, censures, warnings and others deemed appropriate and that no legal squabble with the law.
ARTICLE 27. MEASURES. Self-regulatory bodies should ensure mechanisms for the exercise of disciplinary functions, acceptance or rejection of its members and the provision of services self-regulatory body.
PARÁGRAFO. In this context, self-regulatory bodies should not impose unnecessary burdens on the development of competition. Effective Jurisprudence
ARTICLE 28. REGULATIONS. Self-regulatory bodies should adopt a set of rules that must be fulfilled by people over which they have jurisdiction. This body of rules should be expressed in regulations to be previously authorized by the Superintendency of Securities, shall be mandatory and are presumed known to those who are subjected to them. Effective Jurisprudence
ARTICLE 29. DISCIPLINARY
FUNCTION. In exercise of the disciplinary function should be established procedures and initiate its own initiative or upon request disciplinary action for breach of the rules of self-regulation and standards market, decide on disciplinary penalties and inform the Superintendency of values on decisions in disciplinary matters.
Who exercise disciplinary functions may decree, practice and evaluate evidence, assess the possible disciplinary responsibility of persons under investigation in disciplinary proceedings, impose disciplinary sanctions established in the regulations, guaranteeing in all cases the right of defense and due process.
The evidence collected by the person exercising disciplinary functions may be transferred to the Securities exercising its sanctioning power. Similarly, the evidence gathered by the Securities may move to the person exercising disciplinary functions, without prejudice to the right of contradiction.
Processes and disciplinary action may be directed to both intermediaries market as natural persons associated with them.
PARÁGRAFO. The disciplinary function referred to in this article may continue to be exercised through disciplinary chambers in the terms and conditions determined by the Government. Effective Jurisprudence
ARTICLE 30. MERGERS. The Securities may promote and arrange mergers, strategic alliances and other arrangements of self-regulatory bodies in order to protect the public interest and competitiveness of the Colombian stock market.
PARÁGRAFO. The currently prescribed standards for these organizations also apply to entities arising from mergers and agreements mentioned.
ARTICLE 31. PROHIBITION. No self-regulatory body accepted as one of its members to a legal or natural person who under the terms of the law is not registered as an intermediary in the stock market.
Notwithstanding the above, the natural persons associated with an ad entid to conduct brokerage activities in the market that have registered to a self-regulatory body, will be subject to disciplinary rules, even if such persons are not found previously registered on the National Register of Professional Securities Market.
ARTICLE 32. DISCIPLINARY PROCESS. When you are in a disciplinary process, the self-regulatory body exercising disciplinary functions, must submit the charges, notify the member and give the opportunity to exercise the right of defense. Similarly, it should lead a process memory.
All disciplinary proceedings shall be supported by:
a) The conduct that the member and / or persons associated with this developed;
B) The market standard or regulation that specifically breached the self-regulating;
C) If there is, the sanction imposed and the reason for it.
PARÁGRAFO. In any case the disciplinary process that advance self-regulatory bodies in the exercise of its disciplinary functions, shall observe the principles of opportunity, economy and speed, and shall be governed exclusively by the principles and procedure contained in this law and other rules that develop. Effective Jurisprudence
ARTICLE 33. ADMISSION. The self-regulatory body may deny membership to people who do not meet the standards of financial suitability or ability to operate or standards of experience, skills, training that have been duly established by the agency.
The self-regulatory body shall verify the eligibility conditions, history and character of its members and may request that officials thereof are registered with the agency.
ARTICLE 34. REGISTRATION APPLICATIONS. The self-regulatory body may refuse the application for registration, where the information required or made in the rules of that body is not provided, or when the applicant does not meet the qualifications to be part of it, in accordance with the requirements laid down in its rules .
Similarly, the self-regulatory body may refuse the application for registration to those who do not carry out the activities set out in its rules or persons, by virtue of the number of operations that take place.
Article 35 Decision-making criteria. In cases where registration is denied or the provision of a service to one member, the self-regulatory body shall notify the person of the reasons for this decision and given the opportunity to submit its explanations denied.
ARTICLE 36. DENIAL OR CANCELLATION OF REGISTRATION. The self-regulatory body may deny or cancel the registration of persons who have been expelled from any exchange or other self-regulatory bodies or member to present financial difficulties or do practices that endanger the safety of investors in danger, other agents the same market or self-regulatory entity. In these events should first inform the Securities.