_ the January │ 2020 edition of our Newsletter has the following highlights:
Provisional Measure No. 892 regarding publications ordered by the Brazilian Corporate Law loses its effectiveness
Brazilian Securities and Exchange Commission amends Instruction No. 361 regarding tender offers
_ Provisional Measure No. 892 regarding publications ordered by the Brazilian Corporate Law loses its effectiveness
The Provisional Measure 892, of September 27th, 2019 (“MP 892”), which granted a new wording to article 289 of Law No. 6.404/1976 (“Brazilian Corporate Law”) by extinguishing the mandatory publications set forth therein in the official press and in mass circulation newspapers, was not converted into a Law by Brazilian Congress within the term established by the Federal Constitution (i.e. 60 days extendable for an additional 60 days) and, therefore, became void.
Pursuant to the Federal Constitution, the publications made during the term of MP 892, and as provided for therein, are still subject to a legislative decree which shall be issued by the National Congress within 60 days from the loss of effectiveness of MP 892, i.e. December 3rd, 2019. If the legislative decree is not issued in such period, the publications made during its term shall remain valid and effective.
In this regards, the Brazilian Securities and Exchange Commission (“CVM”) revoked CVM Resolution No. 829/2019, which regulated the publications set forth in the Brazilian Corporate Law for publicly-held companies after the new wording provided for in MP 892.
Finally, the wording of article 289 of the Brazilian Corporate Law prior to MP 892 shall be maintained and Brazilian corporations shall once again print the publications set forth in the Brazilian Corporate Law in the official press and in mass circulation newspapers.
The declaration of loss of effectiveness of MP 892 can be accessed in Portuguese at:
_ Brazilian Securities and Exchange Commission amends the Instruction No. 361 regarding tender offers
On December 3rd, 2019, the chairman of CVM issued the Normative Ruling No. 616 (“ICVM 616”) in order to amend and add new provisions to CVM’s Normative Ruling No. 361, issued on March 5th, 2002, which regulates on the proceedings regarding tender offers of publicly held companies (“OPA”).
Among the modifications introduced by ICVM 616, are worth stressing:
- the optional publishing of the OPA announcement, except for takeover bids, in which case such publishing remains mandatory;
- in case of combined OPAs, the price submitted must meet the requirements of all OPAs intended to be combined, in such case the offeror may include more than one payment option;
- exclusion of the prohibition to acquire between 1/3 and 2/3 of outstanding shares in case of OPAs arising from the increase of equity participation or from the exit of special listing segment;
- prohibition of buyer interferences during takeover bids, in this case, it is necessary to launch competing offers trhough public announcements.
ICVM 616 came into force and effect on the same date it was published in the Brazilian official press, i.e., on December 4th, 2019.
More information on ICVM 616 can be accessed in Portuguese at: