In line with Amec’s request, CVM does not approve changes to the rules on BM&F Bovespa’s differentiated segments

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In October, the Brazilian Securities and Exchange Commission – CVM – decided to bar the change proposed by BM&F Bovespa – the Brazilian Stock Exchange – to the rules on the differentiated corporate governance regulations, which would allow companies with super preferred shares to register in Levels 1 and 2.
After a detailed study on the topic, CVM board understood that “due to the magnitude and potential impacts of the changes proposed by BM&F Bovespa, the carrying out of a prior public hearing by the regulator is indispensable.”
Amec – the Association of Capital Market Investors – expressed its opinion about the topic directly to CVM and was surprised when it was informed that the changes to Levels 1 and 2 regulations had been applied by BM&F Bovespa on July 15th, 2015, without a public consultation to market players and investors. Supposedly, only the listed companies of such segments were consulted.
BM&F Bovespa has changed the N1 and N2 regulations only to provide a new concept on the minimum free float so that it is based on the quantity of shares of the specific class included in the negotiation, and not on the quantity of shares of the entire equity capital. Such change may eventually accommodate the financial leverage of companies such as Gol and affect the protection to investors.
Click here to access the President Letter 14/2015 – Change to the Regulation of BM&F Bovespa’s Corporate Governance Differentiated Levels.
Click here to access CVM’s decision about the change on Levels 1 and 2.