SUSEP Circular No. 610/2020 System of Registry of Surety bond Operations
On July 8th, 2020, SUSEP published Circular nº 610/2020 which postponed the beginning of the effectiveness of the SUSEP Circular nº 601/2020 from August 3rd, 2020 to November 3rd, 2020.
Below we highlight the provisions of the updated SUSEP Circular No. 601/2020:
SUSEP Circular No. 601/2020
On April 13th, 2020, SUSEP has published Circular No. 601/2020 establishing the conditions for registration of surety bond operations on systems homologated and managed by registry entities authorized by SUSEP.
As there are uncountable particularities in surety bond operations, including among its modalities, the insurer shall certify a uniformity of concepts of the information that must be recorded. The lack of uniformity of these may cause divergences in communication.
Please find below a summary of the most relevant provisions of the SUSEP Circular:
Electronic System of Registry of Transactions
Supervised Companies must register their operations through an electronic system previously homologated by SUSEP.
The electronic systems will be managed by Registration Companies accredited by SUSEP, according to the procedure established by SUSEP Circular No. 599/2020, published on April 1st, 2020.
Deadlines for the registry of operations performed after the SUSEP Circular come into effect
The surety bond operations shall be registered within a period of 02 (two) business days after the following triggering events:
· Issuance of surety bond policies and endorsements
· Settlement of insurance premium, commissions, expenses and claims
· Registry of claim notice
· Conclusion of the initial, partial or final evaluation of a claim by the supervised company.
Furthermore, the renewal of a surety bond policy will be considered by SUSEP as the issuance of a new surety bond policy for the effectiveness of the deadline abovementioned.
Moreover, events, other than those aforementioned, shall be registered within of 15 (fifteen) business days from its occurrence.
Registry of information regarding to surety bond operations
The basic information regarding to surety bond operations that shall be submitted to registry is described on the SUSEP Circular Attachment.
Also, according to the rule, the supervised companies shall register information related to judicial constraint or encumbrance that may fall upon the surety bond policy.
Deadline for the registry of information described on the SUSEP Circular Exhibit
The information described on the subitems “h” and ”i” of the item “VI”; item “ VIII” and subitems “l”, “n”, “p” and “q” of the item “IX” of the article No. 1 shall be registered within a period of 180 (one hundred and eighty) days after the SUSEP Circular comes into effectiveness.
Deadline for the registry of operations related to policies in force on the date SUSEP Circular come into effect
The surety bond operations related to policies in force on August 3rd, 2020 shall be registered within a period of 30 (thirty) business days after the SUSEP Circular comes into effectiveness.
Deadline for the registry of operations related to policies which validity period ended before the SUSEP Circular come into effect
The surety bond operations shall be registered within a period of 10 (ten) business days counted from the first claim development occurred.
Penalties for non-compliance with SUSEP Circular deadlines
The SUSEP Circular did not determinate penalties for non-compliance with deadlines hereto stipulated. In this sense, may be applicable the penalty foreseen in Article No. 70 of the CNSP Resolution No. 243/2011.
The SUSEP Circular comes into effect on November 3rd, 2020