BM&FBOVESPA publishes the opinions received during the second stage of the Public Hearing on the evolution process of the special segments

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The Brazilian Stock Exchange – BM&FBOVESPA – has published in its website the 17 opinions received during the second stage of the Public Hearing on the evolution process of the special segments (Novo Mercado and Level 2). In addition to these opinions, the BM&FBOVESPA received other comments in its interactions with companies, investors and capital market associations.
On November 7th, 2016, the Stock Exchange decided to extend the discussion stage after receiving, during the Public Hearing, important feedback as part of the several interactions with the market, which resulted in changes to the proposals on the rules of the Novo Mercado and Level 2.
A Restrict Hearing is scheduled to be held from March 15th, 2017 to May 31st, 2017 and the voting period for listed companies will take place from June 1st, 2017 to June 23rd, 2017.
Evolution Process of the Special Segments
In March, 2016, BM&FBOVESPA started a broad discussion with listed companies and market’s participants about the evolution process of the Special Segments (Novo Mercado and Level 2).

 Public Consultation
March 15th to May 16th, 2016
·         Questionnaire in the Stock Exchange’s website about corporate governance practices.
·         Open to all stakeholders.

  • The public hearing will support new discussions and the Stock Exchange’s proposal to the next stage
Public Hearing
June 27th to September 9th, 2016
  • Proposal on changes to the rules of the Special Segments based on the information collected during the first stage of the debates.

·         All stakeholders are allowed to participate.

  • The public hearing will support the final proposal on the changes to the rules.
Second Stage of the Public Hearing
November 7th, 2016 to January 6th, 2017
·         Proposal on changes to the rules of the Special Segments based on the information collected during the previous stages.

  • All stakeholders are allowed to participate.
  • The second stage of the public hearing will support the final proposal on the changes to the rules.
Restricted Hearing
March 15th to May 31st, 2017
·         Final proposals prepared based on the information collected in the Public Consultation and Public Hearing.

  • Only the companies listed in the Special Segments participate and express their opinions about the changes to the respective listing rules.
Voting Period
June 1st to June 23rd, 2017


Background
The Novo Mercado was created in 2000 as a differentiated listing segment for the trading of shares issued by companies committed to the adoption of corporate governance practices beyond those established by the applicable laws.
The basic premise guiding the creation of the Novo Mercado was that the adoption of good corporate governance practices would allow a reduction in investor perceptions of risk. Accordingly, the value and liquidity of the shares would be positively affected if the asymmetry of access to information was narrowed and investors were granted additional rights and guarantees. However, the rules have to evolve on a continuous basis for the premise to remain applicable.
The rules of the Special Segments suffered changes in 2006 and 2011 and, five years after their last revision, BM&FBOVESPA starts a new discussion with the broad participation of the market.