Approaching deadline for annual Partners Meeting and Annual Shareholders Meeting

17 de March de 2023 | Publications

Annually, in the four months following the end of the fiscal year, the Partners Meetings, in the case of limited liability companies (art. 1.078 of the Civil Code), or the Annual Shareholders Meetings (AGO), in the case of corporations (art. 132 of the Corporations Law) must be held for the following purposes:

1- Take the management accounts, examine, discuss and vote the financial statements;

2- Decide on the allocation of net income for the year and the distribution of dividends; and

3- Elect administrators and members of the Fiscal Council, when applicable.

The call for the meeting and the meetings themselves must be carried out in the manner provided for in the articles of association, the bylaws or the relevant laws, as the case may be, and the management accounts as well as the financial statements must be made available to the shareholders in due time.

Regarding mandatory publications, closely-held corporations with annual gross revenues of up to R$78 million may have their publications made electronically at the SPED´s Balance Sheet Central. Corporations with annual gross revenues of more than R$78 million must have their publications made in a widely circulated newspaper in the location of the company’s headquarter, and with simultaneous disclosure of the documents in their entirety on the same newspaper’s website.

With regard to large limited liability companies (i.e., the company or group of companies under common control that has, in the previous fiscal year, total assets greater than R$ 240 million, or annual gross revenue greater than R$ 300 million, as determined Law No. 11,638/2007), the provisions of the Brazilian Corporations Law on bookkeeping and preparation of financial statements and the obligation of an independent audit by an auditor registered with the Brazilian Securities Exchange Commission (CVM) shall apply. In a recent Official Notice from the National Department of Business Registration and Integration (DREI) (Ofício Circular SEI nº 4.742/2022), the publication of the large limited liability companies financial statements in the Official Gazette and in other widely circulated newspapers, is merely optional.

In relation to associations, the periodicity for approval of the respective accounts as well as the form of convening the deliberative bodies must follow what is established in the respective bylaws.

Finally, we would like to point out that approving accounts is an important element on the companies’ ESG agenda, being a fundamental element of Governance, compliance, accountability, and transparency, and may also be relevant when companies are interested in loan transactions or in participating in bidding processes.

Considering that April 30th, 2023 is the final term for holding the annual Partners Meeting or AGO for companies whose fiscal year ended on December 31st, 2022, we remain available for any clarification or to take any necessary measures as may be required on the subject.