Passed by the Brazilian Senate's plenary on March 27, 2019, Senate Bill No. 286 of 2015 ("Bill 286/15," the Senate version of Chamber of Representatives Bill No. 7.609/2017) intends to amend Law No. 6.404 of December 15, 1976 ("LSA") regarding mandatory annual publications by Brazilian corporations. Bill 286/15 would revise, in particular, the provisions under articles 289 and 294 of the LSA.
Bill 286/15, which still requires President Jair Bolsonaro's signature and then publication in the Brazilian Federal Registry (Diário Oficial da União), alters publications' requirements for corporations, with new wording saying that publications must be disclosed in summarized form in a newspaper of wide circulation and in full form on the Internet on a web page showing digital certification of the authenticity of the documents.
Bill 286/15, if approved, would change the wording of article 289 of the LSA to say that:
- Publications must be disclosed in summarized form in a newspaper of wide circulation in the location where the company is headquartered and in full form on the newspaper's website, with digital certification, issued by a certification authority registered within the Brazilian Public Keys Infrastructure (ICP-Brasil), of the documents' authenticity.
- For financial statements, the summarized publication must contain: (i) in comparison with the previous fiscal year, overall figures for the year for each group and its respective classification of accounts or records and (ii), if applicable, reports of independent auditors and the supervisory board and related explanatory notes.
In summary, Bill 286/15 would eliminate corporations' current obligation to disclose the documents in their full form in print; sufficing that such documents be disclosed in abbreviated form in print.
Additionally, Bill 286/15 proposes to amend the wording of article 294 of the LSA in a way that the requirements applicable to privately held corporations with less than 20 shareholders and a net equity of less than R$ 1,000,000 (1 million Reais) will be expanded to apply to privately held corporations with less than 20 shareholders and with net equity of less than R$ 10,000,000 (10 million Reais).
Finally, it should be noted that if Bill 286/15 is enacted:
- The new rules of article 294 would come into force on the date when the new law is published.
- The new rules of article 289 will be in effect as of January 1, 2022.
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