The Provisional Measure No. 1,040 (“Provisional Measure”) was published in the Federal Official Gazette on March 30, 2021 with the purpose to reduce bureaucracy in the Brazilian business environment, changing several aspects relevant to the operation of companies in the country. Among them, the following stand out:
- Expansion of the competence of companies’ general meetings;
- Extension of the deadline for the first call of general meetings in publicly-held companies, which must of 30 days in advance (the deadline before was 15 days);
- Prohibition of cumulation of positions of chairman of the board of directors and chief executive officer of publicly-held companies;
- Obligation to have the participation of independent directors in the board of publicly-held companies;
- Unification of tax registrations at the federal, state and municipal levels;
- Creation of electronic system for prior research of address and corporate name viability;
- Use, at the state and municipal levels, of the national risk classification of business activities, making it possible to issue a business license and other licenses automatically in the case of companies classified as medium grade in accordance to the aforementioned classification;
- Release of notarization in powers of attorney used in the filing process of acts before commercial boards;
- Reducing bureaucracy in the conduct of foreign trade, through the prohibition of several requirements previously demanded by the government and the institution of a single electronic window for sharing data and documents between exporters and importers;
- Creation of the Integrated Asset Recovery System (“Sira”), which will operate under the governance of the Attorney General’s Office of the National Treasury to facilitate the identification of debtors’ assets, as well as their constriction;
- Establishment of a maximum period of five days for the issuance of a license or authorization regarding the expansion of electric network on urban roads, with a tacit approval in the event of non-manifestation by the competent public agency; and
- Change of the term of the intercurrent prescription, which will now be the same as the prescription of the claim.
The provisions set forth by the Provisional Measure become effective on this date, except for (i) the provisions regarding foreign trade, that will come into force on the first business day of April; and (ii) the change made within the scope of the overlapping positions of publicly-held companies.
Further, in relation to the deadline for the first call of general meetings in publicly-held companies, on this date, the Brazilian Securities and Exchange Commission (“CVM”) published Resolution no. 25 in order to establish a transition period for the publicly-held companies, which will only need to comply with such 30-day deadline for the first call of general meetings as of May 1st, 2021.
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