Brazil: CVM Publishes Its Annual Official Letter With Guidelines On Procedures To Be Observed By Publicly-Traded Companies, As Well As Foreign And Incentivated Companies

Last Updated: 18 March 2015
Article by Bruno M. Ferla and Alan Parker
Most Read Contributor in Brazil, October 2018

On February 26, 2015, the Superintendence of Relations with Companies ("SEP") of the Brazilian Securities and Exchange Commission ("CVM") published Official Letter CVM/SEP No.02/2015 ("Official Letter").

The Official Letter, traditionally published on an annual basis before the season of Annual Shareholders' Meetings of publicly-traded companies, establishes guidelines and recommendations from CVM with respect to best corporate governance practices, encourages proper disclosure of periodic and relevant information, as well as equality in the relationship between investors, publicly-traded companies and the general market.

The Official Letter is purely informational, providing orientation for the market. Compliance with the CVM approved guidelines is not mandatory, nor does non-compliance subject companies to penalties in case of breach of the provisions established therein. However, the effective adoption of the guidelines set out in the Official Letter is highly encouraged by the CVM.

Among other changes made in this year's Official Letter, when compared to the Official Letter of 2014, we highlight the following:

  1. The company's Management Report (Relatório de Administração), as provided for in article 133 of Law No. 6,404/76, as amended ("Brazilian Corporations Law"), which is disclosed to shareholders one (1) month in advance of the date of the Annual Shareholders' Meeting, should contain, in addition to all of the information usually found in this Report, information regarding decisions influenced by the controlling shareholder of the company and, as the case may be, description of the main investments made as a result of public policies applicable to the company;
  2. Annual disclosure of the company's Reference Form (Formulário de Referência), as provided for in article 24 of the CVM Ruling No. 480/09 ("ICVM 480"), shall occur, preferably, after the company's Annual Shareholders' Meeting, in a manner where it is possible to include and update certain information, for example information regarding remuneration of company's management in the document. Additionally, CVM also recommended that the Reference Forms should be drafted and elaborated by the in-house technical team of the company, as opposed to outside counsel and advisors;
  3. Although there is no express obligation in the Brazilian Corporations Law, as a way to comply with the diligence duties (dever de diligência) incumbent on company administrators, CVM recommends that the members of the company Board of Directors revise and expressly deliberate on the approval of the quarterly financial statements of the companies;
  4. In the guidelines regarding the Proposal of the Board of Directors to be presented at Annual Shareholders' Meetings of publicly-traded companies category A (CVM Ruling No. 481/09 and its amendments introduced by CVM Ruling No. 552/14), CVM included a new item recommending that the Proposal of the Board of Directors should contain information about potential taxes to be levied in the context of dividend distribution to be deliberated during the Annual Shareholders' Meeting;
  5. A new orientation was also included recommending that call notices of the Shareholders' Meetings of publicly-traded companies should be provided at least thirty (30) days in advance of the proposed date. CVM is suggesting that the meetings should be called concomitantly with the disclosure of the Proposal of the Board of Directors;
  6. CVM confirmed the understanding that, whenever possible, the issuers of securities in Brazil and in more than one jurisdiction must disclose Material Facts Notices (Fatos Relevantes) only after the end of the trading day in all countries where the securities are negotiated. It is worth pointing out that article 5 of the CVM Ruling No. 358/02 ("ICVM 358") provides that the Material Fact Notices must be disclosed, whenever possible, before the opening or after the end of the trading days in all applicable countries. With this understanding, CVM intends to ensure that the market has more time to understand and analyze the impact of the disclosed information;
  7. In the case where the publicly-traded company does not comply or otherwise delays disclosure of periodic or relevant information, the Investor Relations Officer must, without prejudice to any potential investigation and punishment by the CVM, provide an Announcement to the Market (Comunicado ao Mercado) with information on (a) the failure to comply with the terms and deadlines provided for in the Corporations Law; (b) the reasons for the delay in disclosure; (c) the measures being taken to remedy the delay; and (d) the estimated timeline for compliance with this obligation;
  8. CVM formalized its position that, notwithstanding the provisions of article 126, paragraph 1, of the Brazilian Corporations Law, shareholders that are legal entities may be represented in the Shareholders' Meetings of the publicly-traded companies by their legal representatives (as provided for in the By-Laws or Article of Association of the shareholders) or by a duly constituted attorney-in-fact. It is not mandatory for the attorney-in-fact or representative to be a shareholder, administrator or a lawyer;
  9. For purposes of the calculation of the percentages for the election of members of the Board of Directors by the multiple voting (voto múltiplo) mechanics, as established in article 141 of the Brazilian Corporations Law, the shares held by the company itself as treasury shares shall be excluded from the total number of shares and from the total number of voting shares;
  10. Additionally, although it is recommended that the presentation of candidates to the Board of Directors by the minority shareholders (when provided for in the By-Laws of the company) is made in advance, CVM clarified that such "requirement" (presentation of candidates in advance) cannot serve as an obstacle, during the Shareholders' Meeting, to the right of the minority shareholders to indicate or elect members to the Board of Directors of the company;
  11. CVM recommends the elaboration and disclosure of a "Policy of Transactions with Related Parties". These transactions must be analyzed by the Audit Committees (where it exists), or by any other specific board committee responsible for analyzing the conditions of this type of transaction, to guarantee that the transactions are in best interest of the company;
  12. Regarding the Disclosure Policy (Política de Divulgação), CVM's suggests, in addition to the minimum provisions as set out in article 16 of ICVM 358, a company should also establish other criteria, such as the obligation of the Investor Relations Officer to disclose information to the market, supervision of potential leaks of relevant information, proceedings to be adopted in case a Material Fact Notice is disclosed during a trading session, as well as a contingency plan to be adopted in the case of relevant information leaks, among others; and
  13. CVM confirmed its understanding that article 253 of the Brazilian Corporations Law is only applicable to companies converted into wholly-owned subsidiaries (subsidiária integral) as a consequence of a merger of shares (article 252 of the Brazilian Corporations Law). Note that article 253 sets out the rules for admission of a shareholder in a wholly-owned subsidiary and provides that the shareholder can acquire shares of the subsidiary in the same proportion of the shares it holds in the publicly-traded company in case the latter intends to sell the shares. Article 253 also provides that the shareholders may subscribe to a capital increase of the wholly-owned subsidiary if the publicly-traded company (controlling shareholder) is admitting other shareholders in the subsidiary. Moreover, in case the capital stock of the subsidiary is held by two or more shareholders, the provisions of article 253 would only be applied in case the structure is utilized to circumvent the law.

Please note that the information above is highly summarized. Our Capital Markets team is available for any further clarifications regarding CVM's Official Letter of 2015.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions