Publicado em 30/03/2020

Approval of financial statements, corporate changes and activities of the Commercial Registries

According to the applicable Brazilian corporate laws, during the four months following the end of the fiscal year, the shareholders or quotaholders must hold an annual shareholders’ meeting or quotaholders’ meeting, as applicable, to, among other matters, (i) discuss the management accounts and the financial statements of the company; (ii) decide on the allocation of profits or losses of the year; and (iii) appoint the members of the company’s management.

For those companies which corporate year ended on December 31, 2019, the meetings must be held on or before April 30, 2020. For such purpose, the management of the companies must provide to their quotaholders or shareholders, prior to such date, the balance sheet and other financial statements of the company, as well publish such statements (along with the management report concerning the business of the company and the auditors’ report, if applicable) in the Official Gazette and another local newspaper of broad circulation, given that the provisions of Provisional Measure No. 892, of August, 2019 (which exempted the publication in newspapers), are no longer in force.

While there are different interpretations concerning the requirement for publication of the financial statements of limited liability companies considered as large-size companies, Dias Carneiro’s corporate team may analyze the specific situation of each company to instruct you appropriately.

Additionally, we inform that, due to the COVID-19 pandemic and the preventive measures adopted to avoid the propagation of the disease, most of the Commercial Registries in Brazil suspended in-person services and kept only part of their electronic services active – which may preclude the filing for registration of the minutes of meetings, amendments to articles of organization and other documents of the companies that cover relevant matters for their operations, such as transfer of quotas, changes to management, capital increases, among others.

This is the case, for instance, of the State Commercial Registry of São Paulo, which activities are suspended up to April 30, 2020 or until the COVID-19 pandemic situation is contained. During this period, only the electronic services related to incorporation of companies, search and consultation of corporate names, obtainment of scanned documents, certificates and excerpts shall be maintained.

Notwithstanding the above and the discussions around a possible provisional measure relating to the potential change to the legislation applicable to the annual shareholders’ meetings – which would postpone to September the deadline for holding the meetings–, it is advisable that the companies continue with the regular schedule for releasing the financial statements to quotaholders and shareholders, as well as for publishing the financial statements (as applicable), relevant notices and for holding the meetings.

Other Commercial Registries and public authorities (such as the Brazilian IRS, the State Revenue Offices, public registries of deeds and documents, among others) also had their activities suspended or are operating in restricted hours – which might affect, directly or indirectly, your company’s operations.

Dias Carneiro Advogados is entirely available to provide any clarifications and to assist with this matter.