MANDATORY DISTANCE VOTING FOR PUBLICLY-HELD COMPANIES
]In 2011, Law 12,431 amended articles 121 and 127 of Law 6,404/1976, in order to remedy difficulties faced by publicly-held companies, mainly regarding the participation of foreign shareholders in general meetings, through the implementation of the ‘distance voting paper’ (“voting paper”). In this context, on November 18, 2015, the Securities Commission (“CVM”) published Instruction No. 570 (“CVM 570”) partially amending Instruction No. 561 of April 7, 2015 (“CVM 561”) and postponing the timeframe for the mandatory adoption of the new system for certain publicly-held companies.
By means of CVM 570, the adoption of the voting paper became optional for the meetings held in 2016 and mandatory from January 1st, 2017 to those companies that, on April 7, 2015 held at least one type or class of shares of the indices IBrX-100 and IBOVESPA. As for the companies registered in category A and authorized by a market management entity to negotiate its shares in stock exchange, the adoption shall become mandatory only on January 1st, 2018.
The voting paper consists of an electronic document that must be made available to the foreign shareholder within thirty (30) days before the relevant meeting, by means of which the shareholder shall vote the referred agenda. Pursuant to CVM 561, the voting paper shall initially be used for the meetings of election of members of the board of directors and of the fiscal council and shall contain: (i) the agenda of the referred meeting; (ii) the guidelines for sending back the voting paper and usage of services providers; and (iii) guidance on any formalities required to validate the foreign shareholder distance voting.
The Corporate Department of Kestener, Granja & Vieira Advogados is available to provide any further information required on this subject.
This article is intended exclusively to provide information and does not contain any opinion, recommendation or legal advice from KGV Advogados in relation to the matters herein addressed. Copyrights are reserved to Kestener, Granja & Vieira Advogados.
