A recent amendment to Law 6,404 of 1976 (the "Brazilian Corporations Law") included a new section 136-A in the Withdrawal Rights of shareholders. The new article 136-A establishes that:
- If the shareholders general meeting decides to include an arbitration convention in the bylaws of the company, the convention will bind all shareholders;
- Dissenting shareholders will have the right to withdraw from the company and receive reimbursement for their shares in accordance with the provisions of section 45 of the Brazilian Corporations Law;
- The arbitration convention will become effective only after 30 days as of the publication of the corresponding shareholders general meeting;
- The withdrawal right will not be applicable if the arbitration convention: (i) was inserted in the bylaws as a condition for securities issued by the company being listed in a trading segment requiring minimum dispersion of 25% of the shares of each type or class; and (ii) is included in the bylaws of a publicly held corporation whose shares have liquidity and dispersion in the market, as defined by section 137 of the Brazilian Corporations Law.
- This new amendment to the Brazilian Corporations Law will become effective on July 27, 2015.
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