Companhia Paranaense de Energia COPEL : Notice to the Market 05/21 - Clarifications

Notice to the Market - 05/21

Clarifications on questions from CVM/B3

Companhia Paranaense de Energia - COPEL, a company that generates, transmits, distributes and trades energy, with shares listed on B3 (CPLE3, CPLE5, CPLE6), NYSE (ELPVY, ELP) and LATIBEX (XCOP), hereby clarifies the news article published by Forbes Brasil, on January 22, 2021, under the headline "Copel views dividends within the limits of a new policy despite a request from the state government", requested through Official Letter 16/2021/CVM/SEP/GEA-1, issued on January 25, 2021 by the Securities and Exchange Commission ("CVM"), as transcribed below.

____________________________________________________

Rio de Janeiro, January 25, 2021.

To Mr.

Adriano Rudek de Moura

Investor Relations Officer of

CIA PARANAENSE DE ENERGIA - COPEL

Rua Coronel Dulcídio, 800 - 3º andar

Batel, Curitiba - PN

CEP: 80210-220

E-mail: [e-mail]

c/c:[e-mail]

Subject: Request for clarification on news item.

Dear Sir.

1. In response to the news article published electronically by Forbes Brasi in its News section on January 22, 2021, under the headline: "Copel views dividends within the limits of a new policy despite a request from the state government", in which the following statements were made:

State-owned company Copel will propose dividends within the limits of the Company's recently approved dividend policy, even after the state government requested that the dividend distribution this year be the "highest possible amount" to shareholders, stated the Company's CEO to Reuters today (22).

1. In this regard, we request that the Company state whether the news item is true, and if so, that the Company also explain the reasons why it did not consider it a material fact and comment on other relevant information related to this topic.
2. The Company should respond through the Empresa.NET system, category: Notice to the Market, type: Clarifications on questions from CVM/B3, subject: News Published in the Media, which must include the transcript of this letter. Compliance with this request for a pronouncement through a Notice to the Market does not exempt the Company from the responsibility for the untimely disclosure of a Material Fact, pursuant to CVM Instruction 358/02.
3. We emphasize that, pursuant to article 3 of CVM Instruction 358/02, the Investor Relations Officer is responsible for disclosing and communicating to the CVM any material facts related to its business and for ensuring their wide and immediate dissemination. The Investor Relations Officer must also question the

Company's management and controlling shareholders, as well as other persons with access to material acts or facts in order to ascertain if they are cognizant of information that should be disclosed to the market, pursuant to the sole paragraph of article 4 of the above-mentioned rule.

5. Please note that, as determined by the Superintendence of Corporate Relations, in the exercise of its duties, and pursuant to item II of article 9 of Law 6,385/76 and CVM Instruction 608/19, a punitive fine will be imposed on the Company, in the amount of one thousand reais (R$1,000.00), without prejudice to other administrative sanctions, due to non-compliance with the demand contained in this official letter, which was exclusively sent via email, by January 26, 2021, notwithstanding the sole paragraph of article 6 of CVM Instruction 358/02.

Sincerely,

____________________________________________________

In response to the request, the Company clarifies that, as disclosed through Material Fact 01/21, sent through the Empresas.NET system at 6:33 pm on January 8, 2021, according to protocol 014311IPE080120210104420411-71 ("MF 01/21"), the controlling shareholder had asked Management to assess the possibility of maximizing dividend distributions "from the profit reserves account reported in Copel's annual or half-yearfinancial statements" (not the original wording).

On January 20, as disclosed in Material Fact MF 04/21, sent through the Empresas.NET system at 9:14 pm on January 20, 2021, according to protocol 014311IPE200120210104421612-77 ("MF 04/21"), the Board of Directors approved a new dividend policy applicable to all earnings distribution to be made thereafter, as stated in item 9 of the new policy, which is available in the Empresas.NET system under the category "Dividends Policy", sent at 8:43 a.m. on January 21, 2021, according to protocol 014311IPE200120210104421705-49 ("New Policy"):

"This version of the Policy was approved at the 210th Meeting of the Company's Board of Directors, held on January 20, 2021, and its provisions will be valid for all proposals related the payment of earnings to be prepared by management as of the date of its approval" (not the exact wording).

To avoid misunderstandings that, in the Company's Management's assessment regarding the maximization of dividends from its profit reserves, under the terms requested by the Controlling Shareholder and object of material fact MF 01/21, the parameters of the New Policy will apply to the proposal to be subsequently made by Management, the Company included in material fact MF 04/21 the following explanation:

"In this way, the Company informs that the dividend distribution proposals to be made by Management, including the profit reserves stated in material fact MF 01/21 released on January 8, 2021, will follow the parameters established in the New Policy" (not the exact wording).

Although already mentioned in MF 04/21, the request by the controlling shareholder that dividends be distributed from the profit reserves account was discussed the conference call with shareholders and investors, held on January 21, 2021, and must comply with the parameters of the new policy, as expressly mentioned in MF 04/21.

The Company issued an invitation to the market to participate in this conference call, by means of a call notice through the Empresas.NET system at 9:41 p.m. on January 20, 2021, according to protocol 2

014311IPE200120210104421613-42. The presentation material for the conference call was sent in advance to investors through the Empresas.NET system at 10:07 p.m. on January 20, 2021.

Therefore, the information contained in the news article released on January 22, 2021 only reiterates that the New Policy will be applicable to all earnings distributions that will be made or proposed by Management and that has already been widely disclosed by the Company, including through MF 04/21.

Curitiba, January 26, 2021.

Adriano Rudek de Moura

Chief Financial and Investor Relations Officer

For further information, please contact the Investor Relations team:

[e-mail] or (41) 3331-4011

3