January/February 2024

_The January – February│2024 edition of our Newsletter has the following highlights:

– CVM absolves accused of fraud in acquisition operation of controlling interest in a publicly traded company

– Google Trends helps identify errors or fraud in financial statements of Publicly Traded Companies

– Request for Suspension of Public Tender Offer for Acquisition of Shares due to alleged inconsistencies in the Appraisal Report is denied by CVM

– CVM releases new regulation on the disclosure of information related to diversity and inclusion support practices by publicly traded companies

_ CVM absolves accused of fraud in acquisition operation of controlling interest in a publicly traded company


The Brazilian Securities and Exchange Commission (“CVM“) unanimously decided to absolve shareholders of a publicly traded company (“Company“) from charges related to alleged fraudulent practices arising from an operation that secured control of the Company to one of the shareholders.


The shareholders were accused of colluding to transfer control of the Company to one of the shareholders through buying and selling ordinary shares directly on the stock exchange, so as to appear that an original acquisition of control had taken place, in order to avoid triggering protective measures and the obligation to make a public offer for shares (“OPA“), as stipulated by the Company’s Bylaws. The accusation was based on the premise that some of the shareholders held the controlling power.


The CVM found that there were not sufficient elements to prove that some of the shareholders indicated by the accusation held the controlling power – and consequently, they could not have fraudulently alienated it. There were, in summary, four main reasons used by the CVM to support this understanding.


Firstly, one of the shareholders did not have a majority of votes in general assembly deliberations, nor the power to elect the majority of administrators, in addition to evidence showing lack of alignment between such shareholders.


Secondly, both the information regarding the sale of shares held by one of the relevant shareholders and the notifications from the acquiring shareholders to the publicly traded company informing about their share acquisitions and their interest in participating in its administration were public.


Thirdly, the buying and selling operations of the shares were conducted on the stock exchange and, therefore, subject to third-party interference.


And fourthly, in the context of increasing the Company’s share capital, the acquiring shareholder chose to subscribe to a large number of shares issued, while the other shareholders chose not to subscribe to new shares.


In this context, the CVM dismissed the accusation of the obligation to carry out an OPA, since the acquisition of the controlling power in question did not result from a transfer of power by other shareholders, as required by the Brazilian Corporations Law (Law 6.404/76) and suggested by the accusation.


More information can be accessed through the link below:




Google developed the Google Trends platform as a free research tool capable of identifying the popularity of a search term on Google itself and also monitoring in real-time consumers’ online searches for retail products.


Thus, based on the analysis of data collected by Google Trends, researchers from the UCLA Anderson School of Management conducted a study in which they examined the relationship between data on the presence of 1,900 publicly traded companies on Google Trends and the revenues reported in their respective financial reports.


For this purpose, the study analyzed year-over-year variations in the quarterly search volume of products from the analyzed companies and the increase in their sales. Companies categorized as “Low Search-High Revenue Companies” (MUP Companies) were identified as having a 165% higher likelihood of subsequently correcting their sales data. Thus, the study concluded that discrepancies between these metrics could indicate inaccuracies in the accounting data or even fraudulent practices by the companies. In this sense, the research presented examples of retailers with financial difficulties, whose decrease in searches on Google Trends did not match the increases in revenues disclosed in the financial statements, indicating possible irregularities.


The research was also covered by the Wall Street Journal, which highlighted the utility of the metrics used by Google Trends for day traders and other investors to determine how much they should trust the financial reports of the companies. Furthermore, the Journal emphasized that the MUP metric, in particular, could even assist the United States Securities and Exchange Commission (SEC), auditors, and other interested parties in identifying fraudulent reports and data.


More information can be accessed through the link below:




_ Request for Suspension of Public Tender Offer for Acquisition of Shares due to alleged inconsistencies in the Appraisal Report is denied by CVM


An asset manager requested the Brazilian Securities and Exchange Commission (“CVM“), on behalf of the funds under its management, to halt a public tender offer for the acquisition of shares (“OPA“) due to an increase in stake made by a company in which the managed funds were shareholders.


The request was based, in essence, on the allegation that the appraisal report presented in the context of the OPA did not reflect the fair value of the company, as it was produced based on “assumptions and projections provided by the Company that are blatantly contradictory and inconsistent, leading to a substantial devaluation of the evaluated entity”.


In response to the request, the Technical Area (SRE) concluded, in summary, that it did not identify technical or material errors in the appraisal report that should lead to the requested suspension of the OPA, as it was not within the CVM’s purview to judge the selection of assumptions used in an appraisal report. Shareholders who disagree with the assumptions used in an evaluation of the company subject to the OPA, if they hold more than 10% of the company’s issued shares, should submit a request to the administrators of that company, including evidence that, in their view, demonstrates a flaw or inaccuracy in the appraisal report of that company, requesting that the said administrators convene the special assembly provided for in article 4-A of the Brazilian Corporations Law..


The asset manager appealed to the Collegiate Body of the CVM, which unanimously followed the technical area’s understanding and deliberated against granting the appeal, confirming the understanding that the OPA, whose auction was already scheduled, should not be suspended.


More information about the process can be accessed through the link below:

PROC. 19957.004081/2023-41 (cvm.gov.br)



On February 1, 2024, the Brazilian Securities and Exchange Commission (“CVM“) published Resolution CVM No. 198 (“Resolution CVM 198“), which makes specific adjustments to Resolution CVM No. 80 of March 29, 2022 (“Resolution CVM 80”), to add a section dedicated to disclosing information about the contingent of persons with disabilities (“PwD“) in the Reference Forms (“RF“) of publicly traded companies. This measure aims to expand the set of information provided about diversity in management bodies and human resources departments of publicly traded companies, aligning with CVM’s commitment to promoting an increasingly diverse and inclusive environment in the Brazilian capital market.


Companies can start providing this information immediately, if they wish, however, the detailing about PwD will only be mandatory as of January 2, 2025, to allow for the necessary operational adjustments for the inclusion of this information in the RFs for 2024.


In addition to this specific change, Resolution CVM 198 introduces modifications to the footnotes of the RF that will be effective as of March 1, 2024. These modifications aim to simplify the provision of information by companies applying for registration with the CVM, provided they are not simultaneously conducting a public offering of securities. As a result, companies will be able to present information regarding the last three fiscal years ended and the financial statements of the last fiscal year, without the need to provide information about the current fiscal year and about the accounting information disclosed after the end of the fiscal year..


To access the full text of CVM Resolution No. 198, dated January 31, 2024, simply follow the link below:


March 2024

_ Brazilian Capital Abroad – Deadline for submitting periodic statements to the Central Bank in 2024


Individuals or legal entities resident, domiciled or headquartered in Brazil and holders of values, assets, rights, and assets of any nature abroad (“Brazilian Capital Abroad“) are required to periodically submit to the Central Bank statements on such Brazilian Capital Abroad, subject to the following framework rules:


  • Annual Statement of Brazilian Capital Abroad: applicable to holders of Brazilian Capital Abroad in an amount equal to or greater than US$1,000,000.00 (one million United States dollars) or its equivalent in other currencies, on the base date of December 31 of the immediately preceding year. In the year 2024, this annual statement (with a base date of 12/31/2023, therefore) must be provided between 02/15/2024 and 04/05/2024.


  • Quarterly Statement of Brazilian Capital Abroad: applicable to holders of Brazilian Capital Abroad in an amount equal to or greater than US$100,000,000.00 (one hundred million United States dollars) or its equivalent in other currencies, on the base dates of March 31, June 30 and September 30 of each year. In the year 2024, these quarterly statements must be submitted according to the schedule below:


Base DateShipping Deadline
31/03/2024From 30/04 to 05/06/2024
30/06/2024From 31/07 to 05/09/2024
30/09/2024From 31/10 to 05/12/2024



_ Foreign Capital in Brazil – Deadline for submitting periodic statements to the Central Bank in 2024


Entities incorporated or organized in Brazil under Brazilian law, with or without profit, with or without legal personality, and which are recipients of foreign direct investment (“FDI Recipients“) are required to periodically submit to the Central Bank statements on such investments. The rules regarding such declarations have been updated in recent years, especially through BCB Resolutions No. 278/2022 and 281/2022, amended in the last quarter of 2023 by BCB Resolution No. 348/2023.


In general terms, and following the regulations in force, the rules regarding periodic declarations applicable to FDI Recipients, specifically for the year 2024, are:


  • Quarterly Statement of FDI Recipients: applicable to FDI Recipients that, on the base dates indicated below, have total assets in an amount equal to or greater than R$300 million, according to the schedule below:


Base DateShipping Deadline
31/12/2023From 01/01 to 31/03/2024
31/03/2024From 01/04 to 30/06/2024
30/06/2024From 01/07 to 30/09/2024
30/09/2024From 11/11 to 31/12/2024


The Quarterly Declarations must be provided in the Foreign Direct Investment Foreign Capital Information System (SCE-IED), through the functionality of economic-financial declarations.


  • Annual Statement of FDI Recipients: applicable to FDI Recipients who, on the base date of 12/31/2023, have net equity equal to or greater than the equivalent of US$100 million, according to the dollar exchange rate released by the Central Bank of Brazil on 12/31/2023, i.e., R$484,070,000.00.


The Annual Statement must be provided through the Foreign Capital Census system, within the deadline between 07/01/2024 and 6 pm on 08/15/2024.


  • Five-Year Declaration of FDI Recipients: The base date of this declaration is December 31 of a calendar year ending in 0 (zero) or 5 (five), and must be provided by FDI Recipients who, on the base date of reference, have total assets in an amount equal to or greater than R$100,000.00 (one hundred thousand reais). In 2024 there will be no delivery of the five-year declaration.



_ CVM publishes an annual circular letter with general guidelines on procedures to be observed by publicly held companies in 2024


On March 7, 2024, the Brazilian Securities and Exchange Commission (“CVM“) released the CIRCULAR/ANNUAL-2024-CVM/SEP letter, which updates the general guidelines on procedures to be observed by publicly held companies (“Annual Letter“).

As usual, the Annual Letter brings together the main obligations of publicly held companies and reflects regulatory changes, in addition to highlighting important decisions of the CVM board.

This year, among the highlights of the Annual Letter, is the inclusion of a specific annex containing the “Panel of Companies with ESG Aspects”. The inclusion was certainly due to the entry into force of CVM Resolution No. 59/21 in 2023, which requires publicly held companies to include indicators related to Environmental, Social and Governance (“ESG“) practices in their reference forms. Thus, the Annual Letter compiled the ESG information of the forms delivered from 2023 to January 2024, revealing a significant number of incorrect and/or incomplete fillings, leading the CVM to implement notices in the online system to warn about inappropriate fillings and reinforcing the importance of the matter.


The Annual Letter also highlighted the guidelines on the reporting of financial information related to sustainability, based on the international standard issued by the International Sustainability Standards Board (“ISSB“) implemented by CVM Resolution No. 193/23. As highlighted in the Annual Letter, CVM Resolution No. 193/23 allows companies, securitization companies and investment funds to voluntarily disclose the fiscal years 2024 and 2025 and, for publicly held companies, such measure becomes mandatory, and no longer optional, as of the fiscal years starting on or after January 1, 2026.

Another clarification made by the Annual Letter is the definition of “corporate demands” provided for in article 33 of CVM Resolution No. 80/22, which obliges issuers to communicate such demands under the terms and deadlines established in Annex I of that Resolution. As clarified in the Annual Letter, “corporate claims” are any judicial or arbitration proceeding whose requests are, in whole or in part, based on corporate or securities market legislation, or on the rules issued by the CVM. In the specific case of initiation of an arbitration proceeding, the issuer must communicate its initiation or receipt of the initiation within seven (7) business days from the sending/receipt of the initiation.


The Annual Letter can be accessed through the link below:



_ Season of Annual General Meetings and Annual Meetings of Members


In the coming months, corporations and limited liability companies must disclose their financial information, as well as convene and hold the Annual General Meetings (“AGM“) or the annual meetings of their shareholders (“Meeting“) for the fiscal year ending December 31, 2023.


Deliberations and Preparatory Procedures for the AGM and the Meeting


As provided for in article 132 of the Brazilian Corporations Law, all corporations, both open and privately held, must hold, in the first 4 months following the end of each fiscal year, an AGM to: (i) take the accounts of the managers, examine, discuss and vote on the financial statements; (ii) to resolve on the allocation of net income for the year and the distribution of dividends and (iii) to elect the management and members of the fiscal council, if applicable.


In addition, corporations must prepare the documents indicated in article 133 of the Brazilian Corporations Law and publish a notice informing their shareholders that such documents are available for consultation at the company’s headquarters; in the case of publicly-held companies, the documents must also be made available on the company’s websites, CVM and B3 S.A. – Brasil, Exchange, Counter (“B3“). The publication of the notice is waived if the companies publish their financial statements up to 1 month before the date scheduled for the AGM or when the AGM meets all shareholders.


Notwithstanding, companies must publish their financial statements prior to the AGM, provided that:


  • those whose annual gross revenues are equal to or less than R$78 million may do so electronically through the Central Balance Sheet of the Public Digital Bookkeeping System – SPED, according to article 294, item III, of the Brazilian Corporations Law and, under ME Ordinance No. 12,071/2021 and ME Ordinance No. 10.031/2022.


  • publicly held companies whose individual gross revenues earned are less than R$500 million in the last fiscal year, considered to be smaller under the terms of article 294-B of the Brazilian Corporation Law and CVM Resolution No. 166/2022 (“RCVM 166“), may do so electronically through the Empresas.NET system; and


  • for other companies, the publication must be made in a newspaper of wide circulation, which may be carried out in a summarized form, in compliance with the provisions of the Brazilian Corporate Law and CVM Guidance Opinion No. 39, applicable to publicly-held companies, with simultaneous disclosure of the full documents on the website of the same newspaper, which must provide digital certification of the authenticity of the documents kept on the proper page issued by a certifying authority accredited within the scope of the Brazilian Public Key Infrastructure (ICP-Brasil).


Concerning limited liability companies, as provided for in article 1,078 of the Civil Code, also in the first 4 months following the end of the fiscal year, a Meeting shall be held to (i) take the accounts of the managers and deliberate on the balance sheet and the economic result and (ii) appoint managers, when necessary. The meeting is dispensable if all the members deliberate in writing on the matters that would be the subject of it.


Financial Statements of Large Companies


Under Law No. 11,638/2007, limited liability companies, or a group of companies under common control, that registered in the fiscal year 2023 total assets greater than R$ 240 million or annual gross revenue greater than R$ 300 million, must (a) prepare their financial statements by the rules applicable to corporations; and (b) submit the financial statements to an independent auditor registered with the Brazilian Securities and Exchange Commission.


After the publication of SEI Circular Letter No. 4742/2022/ME by the DREI (National Department of Business Registration and Integration), the understanding that the publication of financial statements is optional was confirmed, and the Boards of Trade are advised to comply with this guideline, so that the filings of corporate acts of such companies are not required, nor are they rejected,  alleging that the aforementioned publications were not substantiated.


AGOs and Digital Meetings


According to Law No. 14,030/2020, AGMs and Meetings may be held partially or exclusively digitally and must comply with the applicable rules established by CVM Resolution No. 81/2022, as amended, in the case of publicly held companies, and/or those of the National Department of Business Registration and Integration (“DREI”), in the case of privately held corporations and limited liability companies.

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