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The method of adaptation to the new system has not yet been defined for (i) Conversion Funds -Foreign Capital, (ii) Privatization Funds - Foreign Capital, (iii) Mutual Investment Funds in EmergingCompanies - Foreign Capital, and (iv) Capital investments made between the MERCOSUR signatorycountries.In addition, all natural persons and corporate entities domiciled, resident or based abroad that haveinvestments in the Brazilian financial and capital markets are required to register in the FederalRegister of Individual Taxpayers - CPF (in the case of individuals) or Federal Register of CorporateTaxpayers - CNPJ (when involving corporate entities).With respect to the taxation applicable to investments in the financial market please refer to paragraph6.1.1.3 above.17. REMITTANCE OF PROFITS AND DIVIDENDS TO INVESTORS DOMICILED ABROADOnce the foreign capital has been registered with Central Bank of Brazil (BACEN), profits may befreely remitted to the foreign investor abroad, in proportion to its holdings in the paid-up capital of theBrazilian company and always limited to the stake registered with SISBACEN, RDE-IED Module.Remittances must also have their movement registered with BACEN and will be exempt from anytaxation, except the rate of 0,38% corresponding to the IOF – Tax on Financial Operations levied onthe amount to be remitted abroad.18. REPATRIATION OF INVESTMENTCapital and reinvestments registered with BACEN may be repatriated to the investor's country withoutincurring income tax, up to the total foreign currency amount stipulated in the Consolidated InvestmentStatement available on the BACEN RDE-IED System.Therefore, with due observance of the ownership interest of the foreign investor in the capital stock ofthe Brazilian company, the allocation of resources determined in the sale of ownership interests,reduction of capital for the reinstatement of shareholders or liquidation of companies, shall beregistered with BACEN.The differences in excess of amounts registered as brought into the Country - such as the case of apremium verified on the sale of shares or quotas - will be considered “capital gain” and, as a rule, besubject to the levy of income tax at the rate of 15%.94