Business societies can be organized under several Corporate types, which gives partners the ability to choose the structure more consistent with their needs and objectives, according to the business model, growth strategies and legal preferences.
In Brazil, the most adopted corporate types are limited companies and corporations. Limited company is a corporate modality in which partners have their responsibility Restricted to the value of their contributions to the capital, protecting their personal heritage from eventual debts of the organization to the limit of their participation. The corporation, in turn, is a type of company in which capital is divided into shares, and the responsibility of shareholders is limited to the price of acquired shares.
In both corporate types pointed out above, Corporate governance plays an essential role for the development, stabilization and management of conflict in business. “Whether in large or small, publicly open or closed societies, with defined control or pulverized capital, either in family societies, or even startups, corporate governance – appropriate to each stage of social development – can be a fundamental instrument for preventing social conflicts ”(1).
Definition and dimensions of corporate governance
According to the Code of Best Practices of the Brazilian Institute of Corporate Governance (IBGC), corporate governance is “a system made up of principles, rules, structures and processes by which organizations are directed and monitored, with a view to generation of sustainable value for the organization, its partners and for society in general ”(2).
The principles of corporate governance apply to every business organization, constituting the basis on which good governance develops, which are: (i) principle of integrity, which aims at the continued improvement of organizational ethical culture; (ii) principle of transparency, which seeks Provide certain and accurate information on the financial and operational financial health of the business; (iii) principle of equity, performing fair and coherent treatment between partners and other stakeholders, in accordance with their rights, duties and needs; (iv) principle of accountability (liability), which corresponds to the duty of the organization to occupy Consider the social, economic and environmental impacts arising from the exercise of their business activity; and (v) principle of sustainability, which is dedicated to understanding that the protection of the financial viability of the organization is directly related to its interdependence with the economic, social and environmental realities that it is inserted (3).
Corporate governance is structured in agents, organs and the relationship between them. This structuring will be more or less complete depending on the size, the stage of evolution and the nature of the business of society, as well as its corporate type.
The agents – and, as a result, the organs – most involved with corporate operations are: (a) the partners, who make up the General Assembly; (B) Administration counselors and inspectors, which are part of the Board of Directors and the Fiscal Council; (c) the directors, who are the members of the Executive Board; and (d) members of advice advice (4).
The rules of governance, therefore, created by their agents, organize the structures (organs) of the organization, so that, through this set of practices, it seeks to optimize The performance of society as they safeguard the interests of the partners and the stakeholders.
Corporate governance and conflicts of interest between members
The harmony between partners is not only beneficial, but vital to the survival and prosperity of the business organization. Thus, the management and administration structure of society (governance) aims to avoid Or, at least to resolve the conflicts of interest between the partners in the best possible way.
Conflicts between partners are especially present in the dimensions of political and economic rights, which must be exercised in accordance with the legal and statutory guidelines to ensure the perpetrator of the long term society.
Regarding political rights, the ability to influence Strategic decisions and participate in company management are often at the heart of disagreements and controversies in corporate environments.
The right to vote, usually expressed in assemblies and meetings, allows the partners to express themselves about the operational procedures to be implemented in the organization. On the other hand, the power of control – whether it is distributed or concentrated -Refers to the ability to exert a predominant influence on administration, leading the guidelines and strategies to be adopted in society.
The incongruity between the aspirations and visions of the partners on the strategic decisions of society can generate strife. When the control power of society is concentrated, minority partners may feel that their interests are suppressed in social deliberations. In organizations where control is distributed, in turn, even though it is assumed that decisions are made through a more collaborative and inclusive procedure, there is also the possibility of arising decision impact that impact the cohesion of business planning.
Members selection for executive and administrative positions can be presented as a field Confidence for conflict hatching, especially when there are disputes related to the control of management and strategic direction of the company.
In addition, it is the subject of corporate conflicts the exclusion or exercise of the right to withdraw the partner. With regard to the right of withdrawal, disagreements sometimes arise in relation to the assessment and the payment of the partner’s shareholding dissident and the conditions on which the exercise of such right is admitted without impairing the company’s operational continuity.
In turn, the exclusion of the partner – whether judicial or extrajudicial – represents a forced dismissal of one of the partners of society. Beyond the relational differences between the parties, there are financial impacts – since the reduction of the capital of society It can undermine investments in the organization -as well as operational, which can lead to disagreement between the remaining partners in relation to the roles to be assumed and decision -making to allow the continuity of the operation.
Regarding equity rights, they are associated with economic benefits derived from the organization’s operations. Therefore, the distribution of profits, the transfer of quotas or actions and aspects related to business succession, which are themes often marked by corporate controversies.
Profit distribution is a fundamental right of partners. The disputes sometimes originate from disagreement regarding the perception of the value and contribution of each partner to the generation of profits obtained. This conception invariably It is confused with the lack of discernment between the partner and administrator’s roles in the organization, which have different functions and responsibilities. Thus, the disparity in expectations regarding the “correct” ideal fraction of participation in results occurs when there is a lack of well -defined guidelines for the remuneration of administrators and distribution of dividends.
Yet, being Of compensation for the partners, in particular in relation to limited companies, much controversy is installed with regard to the conflict between the concepts of profit x pro-labore, regarding the partner who plays the role of administrator. It is very common that, in the absence of clear rules to determine the amount to be paid due to the work commitment in the exercise of the administration, if Dissatisfaction for non -agreement regarding the criteria set (hours of commitment, productivity, percentage of the results earned, among others).
There are also disagreements between partners regarding the share of profit that will be destined for reserve and reinvestment in the organization itself. There are those who see the need to retain a significant part of profits to ensure growth of society, and others who advocate a more robust distribution of dividends.
Regarding the transfer of corporate participation, entry into society of a new partner, foreign to the operation, can significantly alter the dynamics, culture and management of a society. In this context, concerns arise about dilution of control and eventual changes in business strategies, which can result in significant friction, even threatening the continuity of the business.
Finally, business succession is also a very controversial theme. From the death, interdiction or mease of any partners, the admission of their successors, heirs or ex-spouse may endanger the continuity of management, the preservation of organizational culture and, as a result,, consequently, Sustainability of the company.
The interests of the remaining partners can collide with those of the heirs, successors or former spouses, particularly if the latter do not have a prior involvement or knowledge of the business until the moment of succession.
In this scenario, solid corporate governance is fundamental to ensure that the rights of all partners are respected ( principle of equity ) and that decisions made reflect a equitable perspective of the business.
The governance structure, represented by agents and organs, “must ensure that the organization has clear, effective, implemented and properly disseminated policies and processes” (5) to identify and treat social conflicts. As mentioned above, the most present agents and organs and involved in the organization are:
(A) Members, which makes up the General Assembly:
The partners are committed to ensuring the interests of society and, to this end, must deliberate responsibly on matters elementary to proper organizational functioning. The General Assembly or the Meeting of Partners is the moment when the partners, through the vote, have a voice to express your views and decide substantial questions of the organization.
Thus, the establishment, by means of agreements, of clear policies regarding voting procedures are fundamental to the balance of the business.
(b) Counselors, members of the Board of Directors
Counselors in the Board of Directors ensure that operations and strategies of society are aligned with the interests of the partners and the purposes of corporate integrity. The Board of Directors “must be responsible for determining the strategic objectives, directions and risk profile of the organization, (…) related to its culture and identity” (6).
In view of this, it is paramount that the board of directors promote transparency in the decisions and actions of the company. The clear communication of corporate strategies and results strengthens the confidence between partners and other stakeholders, mitigating the perception of any conflicts of partial interests or management.
(c) Counselors, members of the Fiscal Council
The Fiscal Council has “the responsibility to verify that the organization is in Compliance with its principles and values, reflected in internal policies, procedures and standards, and regulatory laws and devices ” (7). In their supervision work, tax counselors must understand the strategy and risks to form opinion on the financial results and statements presented by the Board of Directors to the members in the Assembly General.
(D) Members of the Advisory Committees
Advisory committees are bodies advising the Board of Directors in the “ Control on the quality of financial statements and internal controls, aiming at the reliability and integrity of information to protect the organization and stakeholders” (8). The most common committees are: (i) audit; (ii) risks; (iii) sustainability; (IV) Ethics and Compliance.
(E) Directors, members of the Executive Board
“The board is the executing body of the end of business activity” (9). The directors are responsible for the implementation of all the company’s operational and financial processes, executing the strategies approved by the Board of Directors.
Furthermore, The contract or bylaws must comply with the purpose of establishing the main rules of operation of the company, with the implementation of solid corporate governance practices, which serve to direct, monitor and encourage the organization, minimizing conflicts and protecting the various stakeholders (10).
Rule differences between limited companies and societies Anonymous
Although often convergent legal structures and instruments, they are in some different aspects of their application to limited societies and corporations, especially in relation to political and economic rights:
Political rights present the following distinctions in relation to voting rights, control, withdrawal and exclusion:
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Economic rights present the following distinctions in relation to the corporate types in question:
From the above analytical frameworks, the differences of legal rule to the most sensitive subjects to the relationship between quotists/shareholders are evidenced by comparing corporate models of limited and society by action.
Conclusion
In the light of the main challenges faced by the partners, the structural and legal differences between the Limited societies and stock societies, corporate governance, the reason for the peculiarities of each corporate type, will be exercised through their agents and instruments in different ways. The adequacy to the positive and negative normative specificities of each business type is essential to achieve the best effectiveness.
The differences and controversies pointed out throughout this Article may be mitigated or renewed through legal instruments, such as: (i) the formulation of rules and guidelines provided for in the contract or status, which will have about the functioning of society, with the adoption of corporate governance practices; (ii) the celebration of the agreement of quota holders/shareholders; (III) among other measures that can Contribute to the improvement of management, organization and business development.
Regarding conflicts related to political rights, corporate governance agents will have a vast guiding legal structure at their disposal to find solutions to controversies between the partners. Otherwise, in the context of limited societies the framework Legal is limited, often demanding the challenge of establishing conflict resolution criteria at a time contemporary with its confrontation.
Given the nature of the relations between the partners, in limited societies, based on interpersonality, the performance of the Board of Directors, will face, in theory, greater challenge to objectify the controversies and search for solutions based on Data, since the relationship between partners often transcends the simple merchant objective. On the other hand, in stock companies, as a rule, solutions will be more objectively based and will find a greater number of legal provisions at their disposal, since the normative scope provided for in Law no. 6.404/76. It is much broader.
Still in the exercise of political power, the Board of directors facing greater challenges in limited companies, since the proximity with which partners exercise their right to vote is much greater and representative than in corporations. It is important to remember that, in many cases, the constitution of a board of directors in limited companies is relatively recent.
In another context, however, in societies Limited, the Board of Directors, when dealing with a more restricted membership base, has greater ease and agility in decision making, while in corporations, more analytical decisions are often required and based on robust data, due to the need to justify actions and strategies in the face of a wide number of shareholders and regulators.
The nuances mentioned above are also the subject of attention to the members of the Executive Board, in the execution of the organization’s financial and operational procedures. In limited societies, such as the partners themselves may be involved in business management, organization management is closer and personal. Governance is more flexible and execution of strategies are performed with a greater degree of informality, depending on the agreement established between the partners.
On the other hand, in corporations, the board is farther from shareholders and operates with a more rigorous and formalized governance structure. The directors are in charge of managing the company’s operational and strategic aspects, aligning with the vision and direction established by the Board of Directors and the expectations of shareholders.
Regarding economic rights, corporate governance, through its agents and organs, will face challenges in both limited structures and stocks by action. In the first, the controversies will be oriented to the rules and criteria aimed at the distribution of profits (sometimes disproportionately) and pro-labore receipt of the partner Administrator, while in Mondays the challenges are much more associated with the resource allocation rules: percentage of dividends to distribute, allocation in profit reserve accounts, etc.
Regarding the circulation of quotas or actions, either alienation or in business succession, in both corporate types it is common to exist disagreements between partners/shareholders, as it is necessary Establish rules on the right of preference and settlement of corporate interest, which are applicable to each corporate structure.
In short, corporate governance, for its better effectiveness, should be aware of the context, structure and normativity preceding its implementation in a given organization. It is necessary to establish distinct strategic and tactical planning For each organization, taking into consideration its corporate type and the challenges it intends to resolve.
Bibliographic references
(1) GALLO, Giovanna Mazetto. CHIACHIO, Rafaella. The importance of corporate governance in preventing corporate conflicts. December 23, 2022. Available at: https://www.migalhas.com.br/coluna/migalhas-connsensuals/379078/importancia-da-governanca-corporativa-na-prevencao-de-conflitos . Accessed October 3, 2023.
(2) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 17, 2023.
(3) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 19, 2023.
(4) SILVA, Edson Cordeiro. Corporate governance in Companies: Practical Guidance for Guidance for Shareholders, Investors, Administration and Fiscal Counselors, Auditors, Executives, Managers, Market Analysts and Researchers. 3rd ed., Sao Paulo, SP. Atlas Publisher, p. 32, 2012.
(5) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 21, 2023.
(6) Institute Brazilian Corporate Governance – IBGC. Corporate risk management: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 26, 2017.
(7) Brazilian Institute of Corporate Governance – IBGC. Corporate risk management: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 27, 2017.
(8) Brazilian Institute of Corporate Governance – IBGC. Management of Corporate risks: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 28, 2017.
(9) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 53, 2023.
(10) ANDRADE, Adriana. ROSSETI, José Paschoal. Corporate governance: foundations, development and trends. Altas Publisher. 7th ed. São Paulo, 2014.
Julia Oliveira Andre Teixeira
Lawyer, law graduate from Faculties Milton Campos (2019), registered with the Brazilian Bar Association, Minas Gerais Section (OAB/MG) (2019). Specialist for the L.LM Business Law Program by IBMEC (2021), MBA in high performance law by PUC Minas (2022), expert on contractual law from the Getúlio Vargas Foundation (FGV-RJ) (2023). Author of articles. Member of the Commission of Corporate Law of the OAB/MG (2022), member of the Center for Studies of Lawyers Companies (CESA), Executive Secretary of the State Council of Commercial Affairs of the Federaminas. Advisory Lawyer of Portugal Vilela Advogados.
Leonardo Theon de Moraes
Lawyer, Graduated in Law, with emphasis on Business Law, from the University Presbyterian Mackenzie (2012), registered with the Brazilian Bar Association, São Paulo Section (OAB/SP) (2012). Post Graduate and Specialist in Business Law from the São Paulo Law School of the Getúlio Vargas Foundation (2014), Master in Political and Economic Law from the Mackenzie Presbyterian University (2017), book and articles author, speaker, undergraduate professor, MBA and Executive Education At FIPECAFI, a member of the São Paulo Lawyers Association (AASP), a member of the International Bar Association Business Law and Fuse Committee, member of the São Paulo Lawyers Association (AASP) and president of the Federaminas State Council of Commercial Law. Founding partner of TM Associados. Founding partner of TM Associados
Newsletter | JANUARY 2025
Each month, the team at TM is Associated with brings up a newsletter with topics that are essential to the success of your business. We discuss the practical and objective approach to the key features in Advisory, Litigation, Labor and Tax, can help you make safer decisions and strategies. Don’t miss out on this chance to transform information into a competitive advantage! 📩
Advisory
The limits of the protection of the due when the Paid-in Capital stock to real Estate
The Supreme Federal Court (STF) will examine a critical issue for the sector is real estate: the implementation of the protection of the Tax from the transfer of Immovable Property (due when) on the paid-in share capital of a company whose main activity is the purchase, sale, or lease of real estate. The decision will have a direct impact on the tax structuring the equity of these companies.
To understand the context
The Constitution, in article 156, paragraph 2 (I) provides for the immunity of the due when the transmission of the goods to the built heritage of the legal person for the purposes of paid-in share capital. However, this immunity does not apply in respect of companies whose main activity is the purchase, sale, or lease of real estate.
In the case under consideration by the SUPREME court involves a management company of the property, which calls into question the charges due when the City council of Piracicaba (SP), on the transfer of real property that is used to make capital. The Court of Justice of São Paulo (TJ-SP) was charged on the grounds that the company falls within the exception to the constitutional because of its core business.
Impacts to the real estate industry
The decision of the SUPREME court, which has been under discussion with the general effect is recognized Theme (1.348) promises to bring certainty and consistency in the application of the immunity from taxation. In the trial, you may want to set the exception to this immunity is to be interpreted narrowly, applying only to the specific, such as a merger, consolidation, or division, or in a broad way, for any of the paid-in share capital.
As for the TM Members can assist you?
Our team is an advisory that is ready to guide you to your company and, to the reflections of this decision, and upon the very best strategies for estate planning and tax law.
We follow closely the progress of this trial, and we are available to provide support to the legal personnel.
Follow us for updates and be ready to adapt your business strategy in the face of changes in the legal landscape.
Get in touch with the mt-Associated, and to ensure legal certainty for your business.
Litigation
Credit repair Strategies for the Business to Anticipate and to Demand the Debt
To maintain the financial health of your business is the key to growth is to be sustainable. The credit repair is a process that is essential to recover the amounts owed by customers with outstanding debts. This process can be carried out in an out-of-courtthrough negotiation and amicable settlements or court, with the assistance of the Judicial branch in order to ensure the fulfillment of the obligation.
Documentation is Essential in order to Prevent the Default
Effective management begins with the organization of the documents confirming the relationship. They are critical.
These documents are essential, both in order to prevent defaults and basis for any charges.
Tips to Prevent bad Debt
As to how to Proceed in the Event of a Default?
Charging out-of-Court (without legal action):
Charged in Court (legal action):
You can count on the TM Associated to Recover on their Claims
Our team of experts is ready to guide you to your business at every stage of the claims for payment from the settlement to legal action. We guarantee that our solutions and strategy tailored to protect the financial health of your business.
Don’t leave it to the default commit to the growth of your business. Contact us to learn how we can help you.
Labor
The Ordinance 3.665/2023 and the changes in the work-free Sundays, and holidays
The Ordinance 3.665/2023′, published in November 2023 by the Ministry of Labour and Employment, has an Ordinance 671/2021, bringing important changes to the rules for working on Sundays and public holidays, had a positive impact on companies, industries such as retail, fish, meat, fruits, and vegetables, in addition to the activities at the ports, airports, roads, hotels, wholesalers, and distributors.
In the face of these changes, there is a need to revisit the scene of normative prior to the effective date of the new Ordinance.
The amendment to the Ordinance 671/2021
Prior to the entry into force of the Decree 3.665/2023), the rules of work on Sundays and public holidays, they were all based on articles 67 to 70 of the Consolidation of Labor Laws (CLT), and at the entrance to 671/2021, as follows:
Article 67 of the AND allows you to work on Sundays, provided that the employer is to ensure a weekly rest and paid (RSD) for 24 hours at a time. with The Article 70 of the AND prohibits the employment in a civil or religious holiday, except where authorized by agreement or collective bargaining agreement, and the payment for the work-these days, to be made into a double, or offset in the play.
However, the legal rules that were eased by a Decree 671/2021, which allowed for the direct negotiation between the employers and the employees, to allow work on Sundays and holidays, by means of its formalization by means of a contract of employment.
In addition, the ordinance provided for individual agreements to define the scales of the work, and in some cases, he pointed out that a list encompassing the activities, that is, the various sectors of the economy could operate on Sundays, and on holidays-without the need for a collective bargaining process, making it easier for the organization of the conference.
On the face of it, there was a greater flexibility in the areas of trade and services, that you had more freedom to operate on Sundays and public holidays, provided they respect the labour rights in general.
What has changed is the Ordinance 3.665/2023?
With the new Ordinance, the rules have become more stringent, and centralized the right to collective bargaining, with a direct impact on various economic activities.
When do these changes go into effect?
The new rules are effective from the 1st of January, in the year 2025.
What is the practical impact?
How your business can prepare for it?
Conclusion: get Ready for the year 2025!
The Ordinance 3.665/2023 in terms of balancing the rights of the workers with the business needs of the companies. However, it requires care and planning to ensure regulatory compliance.
If you need assistance with how to interpret the new rules, or to adapt the operation of its business, (click here to receive guidance!
[1] PORTARIA MTE Nº 3.665, NOVEMBER 13, 2023
Changes to the Concierge/MTP, no. 671, November 8, 2021. (Case no. 19964.203605/2023-95).
The MINISTER OF STATE for LABOUR AND EMPLOYMENT, in the use of the award conferred on him by the art. 87, paragraph one, sub-paragraph II, of the Constitution, art. 10, paragraph one of the Law 605, January 5, 1949, and in art. 154, paragraph 4, of legislative Decree no. 10.854, November 10, 2021, and in view of the provisions of art. 6 of the Act 10.101 as of December 19, 2000 it states that, ‘it is permitted to work on holidays in the activities of trade, provided that it is authorized in the collective bargaining agreement and, subject to the legislation of municipal council, in accordance with art. 30, paragraph I, of the Constitution, which addresses:
Art. 1 to Repeal the section 1, 2, 4, 5, 6, 17, 18, 19, 23, 25, 27 28 of the item (II – Trade in Annex IV of the executive order/TRANSFER no. 671, November 8, 2021.
Art. 2. The sub-item 14, item II – Trade in Annex IV of the executive order/TRANSFER no. 671, November 8, 2021, shall be in force with the following wording:
’14) trade-free,’
Art. 3. This executive order shall enter into force on the date of its publication.
Tax
The expansion of the tax incentives that are subject to the DIRBI
On December 27, 2024, the Federal Revenue of Brazil (RFB) published Normative Instruction RFB no. 2.241/2024, while promoting significant changes in the Statement of Incentives, Waivers, Benefits, and Immunities of the Nature of a Tax (DIRBI), to broaden the tax incentives that are subject to this statement, and determine a new deadline for delivery, third-party payers.
Background IN the RFB number 2.241/2024
The regulations replace the Attachment IN the RFB number 2.198/2024, and increases the incentives, waivers and tax incentives that should be provided in DIRBI.
New items introduced to understand the incentives of the numbers 44 and 88, covering the program, such as: incentives for cultural and artistic activities, and programs, to support the innovation, the technology, the benefits for exports, incentives for research and development, special systems, infrastructure, and tax breaks tax for the agricultural sector.
Time limits and Liabilities
Please be aware that there are 45 new and the tax incentives that are included in the list IN the RFB number 2.241/2024 and must be accounted for in the DIRBI back. This means that the incentives are related to the time of the investigation, from January to December 2024 and later, must be told, or made right up to the 20th day of march, in the year 2025.
Impact on Businesses
This extension aims to promote greater transparency and control over the tax incentives that are used by companies in many different industries. However, it imposes new challenges of compliance, requiring a higher level of accuracy in the collection and reporting of this information.
The presentation of DIRBI, or delivery outside of the time limit established by the subject of a legal person, the following penalties are calculated per month, or fraction thereof, levied on the gross income for the period:
The fine shall be limited to 30% of the value of the tax benefits gained.
In addition, the presentation of the DIRBI, with omissions, or inaccuracies and may result in a fine of 3% on the value of missing, false or inaccurate, not less than$ 500.00.
Therefore, it is essential for your business to comply with the time limits, and for ensuring the accuracy of the information declared in the DIRBI, to avoid financial penalties.
As the TM is Associated with can help you with?
Our team of tax that is ready to help you and your company for the revision of the tax incentives that are applicable, as well as the correct formulation and delivery of DIRBI, and ensuring compliance with the new regulations.
For more information, or to schedule a consultation, please get in touch with the mt-Associated, and keep your company in compliance with the requirements of current tax.
Tax reform: new Rules and New Opportunities for Your Business
On the 16th of January, in the year 2025, in a milestone for the brazilian taxation system was established, with the sanction of the Law Supplement no. 214/2025. This new law, which governs the Tax Reform, brings about profound changes in the way the tax is calculated and paid in the country.
What are the changes with Tax Reform?
The main novelty is the introduction of two new taxes: a Tax on Goods and Services (LBS) and Social Contribution on Goods and Services (CBS). These taxes are to replace other forms of indirect taxation, such as ICMS, ISS, PIS and Cofins tax rates, simplifying the tax system and promote greater equity.
What are the main impacts on the business?
· The unification of the tax, The creation of IBS and CBS, which simplifies the tax burden, reducing red tape and the cost of operations.
· Rates are unique to The application rates are applicable only to the products and services that makes it easy for the tax planning of companies.
· Non-cumulative nature: The system of non-cumulative nature allows companies to offset the tax paid on the purchases of goods and services, thus reducing the tax burden effectively.
· Transition to the gradual implementation of the reform will be gradual, with a transition period for companies to be able to adapt to the new rules.
The TM Associates can do for you?
In the face of these changes, it is important to have the support of experts, in order to ensure compliance with the new rules, and to take advantage of the opportunities generated by the reform. The TM Associates offers a full range of services to assist our customers in this process, such as:
· Analysis of the impact of the reform on your business, we have Identified the key changes, and the opportunities for tax optimization.
· Tax planning: We develop tailor-made strategies to minimize your tax burden and streamline your cash flow.
· The implementation of the new system include: Assist in the adaptation of the systems of accounting and tax-related with the new rules.
· Assistance in administrative proceedings: we Represent your interests in administrative and judicial proceedings related to tax reform.
Get in touch with us and schedule a personal meeting.
Best regards,
Team TM Associates
Insurance Coverage and the Duty of Good Faith in Activation
O acionamento de um seguro é um processo fundamental para garantir a proteção e a tranquilidade dos segurados diante de eventos inesperados. No entanto, dentro desse contexto, o acionamento envolve direitos e responsabilidades tanto para o segurado quanto para a seguradora.
A seguradora possui uma série de obrigações legais quando do acionamento do seguro, principalmente, mas não se limitando a isso, quanto ao efetivo cumprimento do contrato, seguindo os procedimentos e condições previamente estabelecidas – e comprimindo os respectivos prazos para tanto, desde que, evidente, o sinistro esteja coberto por ele.
A aprovação do sinistro, quando notificado pelo segurado, deve ser realizada por meio de uma análise formal, justa e imparcial pela seguradora, que avaliará a cobertura contratual e os requisitos necessários para a efetiva indenização, se cumpridos ou não.
Já no âmbito do segurado, para que, no momento oportuno, possa usufruir da cobertura adquirida, deve manter os pagamentos do prêmio de forma sempre adimplente, de acordo com os prazos e formas de pagamento estabelecidos no contrato.
Diante de um evento inesperado, o segurado, munido dos documentos adequados (os quais sempre deverão estar listados no contrato), fornecerá todas as informações para a análise e investigação do sinistro, adequando seus requerimentos dentro do prazo estipulado e cumprindo com todas as determinações da seguradora para o, enfim, acesso ao prêmio final de cobertura.
Cabe aqui ponderar quanto ao dever de mitigação de danos por parte do segurado, porque apesar de a seguradora levar em consideração questões formais e análise prática, não há como ignorar que cabe ao segurado, antes do evento inesperado, a tomada de medidas razoáveis para mitigar os danos e evitar que tais eventos não se concretizem ou ao menos que sua gravidade seja relativizada.
Questões legais podem surgir durante o processo de aprovação do sinistro, como a má-fé e as exclusões de cobertura, que exigem atenção e compreensão de ambas as partes. Em casos de desacordo quanto à indenização, é possível buscar a resolução por meio de métodos alternativos ou mesmo recorrer ao Poder Judiciário, oportunidade em que o juízo determinará se aquele determinado evento danoso se enquadra em alguma hipótese de cobertura.
Posto isto, é fundamental que ambas as partes atuem de acordo com os termos estabelecidos no contrato, agindo com boa-fé e transparência. O segurado tem o direito de receber a cobertura adequada, enquanto a seguradora possui obrigações legais de análise e indenização oportuna, tudo isso, desde que o contrato tenha sido cumprido.
Para ilustrar a aplicação prática do acionamento de seguro, consideremos o exemplo de um segurado que possui um seguro automotivo abrangendo danos materiais. Imagine que o segurado se envolve em um acidente de trânsito, resultando em danos consideráveis ao veículo segurado.
Nesse caso, o segurado deve notificar imediatamente a seguradora sobre o sinistro, fornecendo informações detalhadas sobre o ocorrido, como local, data, descrição dos danos e possíveis testemunhas. A seguradora, por sua vez, deve iniciar a análise do sinistro de forma diligente, verificando se o sinistro está coberto pelo contrato de seguro.
Uma vez que seja confirmada a cobertura, a seguradora pode solicitar documentos adicionais, como boletim de ocorrência policial, laudo pericial e orçamentos de reparo.
Após a conclusão da análise do sinistro, a seguradora deve comunicar sua decisão ao segurado, informando se o sinistro é considerado indenizável e, caso positivo, qual será o valor da indenização. É fundamental que a seguradora cumpra o prazo estipulado no contrato para efetuar o pagamento da indenização ao segurado.
No exemplo mencionado, o segurado cumpriu seu dever de notificar o sinistro e colaborou com a seguradora fornecendo as informações necessárias. A seguradora, por sua vez, seguiu seus deveres de análise imparcial e oportuna, oferecendo a devida indenização ao segurado.
Bárbara Rita Escapin – Advogada, graduada em Direito pelas Faculdades Integradas Rio Branco – Fundação de Rotarianos de São Paulo, inscrita na Ordem dos Advogados do Brasil, Seção São Paulo (OAB/SP) (2019). Formação em Educação Executiva/Compliance pela Fundação Getúlio Vargas (2022). Pós-graduanda em Direito Empresarial pela Fundação Getúlio Vargas. Autora de artigos. Advogada no TM Associados.
Leonardo Theon de Moraes – Advogado, graduado em direito, com ênfase em direito empresarial, pela Universidade Presbiteriana Mackenzie (2012), inscrito na Ordem dos Advogados do Brasil, Seção São Paulo (OAB/SP) (2012). Pós-graduado e Especialista em Direito Empresarial pela Escola de Direito de São Paulo da Fundação Getúlio Vargas (2014), Mestre em Direito Político e Econômico pela Universidade Presbiteriana Mackenzie (2017), autor de livros e artigos, palestrante, professor na graduação, MBA e Educação Executiva na FIPECAFI e membro da Associação dos Advogados de São Paulo (AASP). Sócio fundador do TM Associados.
Ways of Attracting Investment, and Alternatives to the Investment of Capital
There are only a few business owners who know the various ways of attracting investment, which is now on the market and it can be used as an alternative to the investment of their own resources. There is no question that, depending on the circumstances, the allocation of financial resources to own the best solution, but it’s not always the entrepreneur to have such a resource to invest in their business.
Investing through the capital, is known as the equity it can be carried as an increase in the capital stock, is one of the most common ways in which the one(s) of the shareholder(s) will be(will be) give the values will be(will be) your(s) of interest(s) and augmented(s), while the rest of the members, provided that they do not exercise its right of first refusal on the rise in the capital, you will have their holdings diluted, in a proportionate manner. This is a contribution that can occur in a currency (the delivery of the money, in cash, by way of capitalisation of profits or, in fact, of the rights or property liable to assessment in the money, the transfer of ownership of real estate, for example). In these cases, the business owner must be aware of the business can gain from equity investments, there is a difference between the value declared on your tax return, and the value is displayed when the increase of the share capital.
When capitalized, the profit[1], in spite of all the owners have achieved an increase in equity, corresponding to an increase in the value of the shares loans, the increase of capital is not taxed on the income tax return.
The contribution to the increase of the share capital, in connection with any of its terms, you may only have a portion of the amounts converted in the increase of the share capital, with the creation of new shares, while the other is reserved as a capital gain[2] – which is nothing more nor less than the issuance of shares by an amount greater than the par value attributed to them (the one provided in the articles of association).
This is a strategy that is made possible, in any of the transaction to avoid the increase of the capital city, but for some reason, the rest of the members, although it is not part of the rise, they have not agreed to have diluted its stake. In these scenarios, the difference between the total value of the issue and the par value of the shares is to be considered as a capital gain, which, in the case of the issuance of the shares, that is, the S/A’s, it becomes even more attractive for this type of company, given the fact that it is not subject to tax, however, is in the LTDA”s, there is still controversy as to the exemption of tax[3] what can make this is a strategy that is not so attractive, but it is still a perfectly valid one.
The other way, it is also common equity and is the one that can be converted or not, that is, the operations of the loan, in which some values are taken, and then later returned, including inflation and interest rates. Since the mutual convertible loans, which means that once you inadimplida of the bond, and the values of loan may be converted into an increase of the share capital, for the one who has borrowed.
When carried out at(s) of the person(s) of the shareholder(s), the mutual you should always provide for the return of the value added of inflation and interest rates, so that the operation is not to be confused with that of a single contribution to the increase of the share capital or, in more extreme cases, the operations are simulated so as to hide the confusion associated between a particular asset of the owner and the property of the company.
Mutual is a long-term strategy for the attraction of investment from a third party. The provider does not necessarily have to be a member of the company (borrower) and it is likely that the investment operations of the party to be brought in this way. If it can be converted, when the inadimplida to the obligation of payment by the company to the lender that executes the contract and are entered into the corporate structure.
For these transactions, whether entered into the agreement with a partner or with a third party, it is crucial that you expected to be the trigger for the completion of the conversion of the amounts loaned at interest, as well as why, how can this be done with the indication of the order of the trial and any potential out-of-stake, which the lender may be able to achieve this.
The other point to note relates to the aspect of the tax on these transactions, especially with respect to the payment or non-ADOPTED on all these operations, it will depend on the particular circumstances, and, therefore, should be considered on a case-by-case[4], as well as the impact of taxes on the income (interest) held by the lender because the loan is made[5].
Despite the fact that the conversion to being a safe return to the investor, and is easy to perform, once again joined in the framework of company law, the lender shall share in the risks of the business. Not only that, but in any investment operation that involves, also, the entrance into the corporate structure, will cause the investor to assume all of the rights and obligations inherent in membership and as a result of your sharing of your results, you may be able to do it with you on the amounts originally invested, not to be converted to an income-or even if you are an investor, is now a partner, you have to bear the losses.
One way to invest in, and do not enter into the corporate structure of the company in which you want to be is through the creation of a sociedade em conta de participação[6] this will be used as a sort of bridge to the final destination of the values. This type of company, we have a picture of the ostensible partner-the one who actually runs the company and its values, and the partner-participant, that it has a duty only to the supply of the agreed-upon amount, you will be exempted from any liability, including that of the company, which shall be borne solely and exclusively by the partner programme. In addition to the separation of duties, this is appealing because of the results of the company shall be allocated among the partners programme and the participants.
In spite of being used, for the most part, to the operations of the investment, the capital of the third party, it can also be used for the operations of the equity, we can see that the values contributed by a partner to a participant shall not be subject to the interest that would arise, of course, the operations of the loan.
Another option is a call option, the operation in which they paid a certain amount for a future met certain requirements in order to increase the participation has to be taken or to go in the corporate structure. When, in the exercise of an option to purchase, as it will pay the buyer the amount of the participation purchased. What you pay for in advance, that is, to have the right to be in the future, you have the option to purchase.
From the point of view of tax, the investment can be attracted by the option, the purchase price will be paid when the payment for the home, since joining the company as a receivable, and not as a loan, as well as when you do the exercise, because of the difference between the amount initially paid, and the amount you have paid for the actual purchase of a membership is considered as a capital gain.
More recently, the funding of investments through online platforms vitalizou, the so-called equity crowdfunding,. in Spite of the name, this type of investment that is aimed at raising funds from third parties, and not from its own members. It’s an operation done, as I said, by way of an on-line platform (under the framework of the normative regulations of the CVM 588/2017), in which case the company offers a certain degree of participation in its capital, in return for the investment.
The operation is similar to the well-known great online, but there are some differences, such as the expenditure of funds, and rules, and considering that a great online have rules of their own, while equity crowdfunding is regulated by the securities commission.
For a society to make the investment through equity crowd funding, you must meet a few requirements, such as: (i) the company must be in business[7]; and (ii) have annual gross revenue of R$ 10.000.000,00; (iii) is not listed as an issuer of securities; (iv) the investment shall be limited to R$ 5.000.000,00; (v) the campaign may not last longer than one hundred eighty (180) calendar days.
In addition to all of the ways of attracting the investments listed above, as well as other, non-standard, they are also effective in the promotion of your business. The operations of buying and selling companies, M&A, ipos on the Stock exchange, in the case of joint-stock companies, and the expansion of its activities over the franchise will also show you the strategies that are efficient, although it is not common to attract new investment.
To get to know and make use of all the possible ways of attracting investments, it is of the utmost importance to the health of the business. That’s because they show some great strategies to reduce the debt burden of early society, as well as to mitigate the bootstraping[8], as well as for the growth of the business through the collection of smart money[9].
Leonardo Theon School Law, bachelor of laws, with an emphasis in business law from the University Presbyterian Mackenzie (2012), which was registered at the Ordem dos Advogados do Brasil, São Paulo (OAB/SP) (2012). A post-graduate degree and an Expert in Corporate Law and Mergers and Acquisitions at the Law School of São Paulo da Fundação Getulio Vargas (2014) Master’s degree in Law and Political economics, Universidade Presbiteriana Mackenzie, brazil (2017), the author of many books and articles, a speaker, a teacher at the undergraduate, MBA, and Executive Education in the FIPECAFI, a member of the bar Association of São Paulo (AASP), and the Chairman of the State committee of the Business Law of the FEDERAMINAS. A founding member of the TM is Associated with it.
Anna Paula freely and responsibly on the Pine tree – a Lawyer with a degree in law, with a focus on civil law, from the University Presbyterian Mackenzie (2021), and which is registered at the Ordem dos Advogados do Brasil, São Paulo (OAB/SP) (2021). A post-graduate in Business Law from the Pontifical Catholic University of Rio Grande do Sul (PUC-RS). She is the author of the articles. A member of the State committee of the Business Law of the FEDERAMINAS. A lawyer for the Department and the Advisory have no Members.
[1] The capitalization of interest is in the reinversão in the profits of the company in its own operations, rather than distribute it to shareholders in the form of dividends to shareholders, raising the capital stock and as a result, the value of the shares. [2] The capital stock shall consist of amounts received by the company and that you are not carried forward by the result of the recipes, which relate to the amounts allocated to the strengthening of the capital, without being as the counterparts of any of the company’s efforts in terms of delivery of the goods or for the provision of services to you. Refer to it as such in the reserves, the premium on issue of shares, the sale of the founder shares and the warrants. These are all capital transactions with owners. GELBCKE, Ernesto Rubens; SANTOS, Ariovaldo from IUDÍCIBUS, Sergio de; MARTINS, Eliseu. the Manual of Accounting-a Corporate. 3rd ed. São Paulo: Atlas, The Latest In 2018. p. 383-384. [3] To find out more, please read: if there Carf examines the taxation of the capital gain on the issuance of the shares and the shares [4] Concerns ADOPTED in the operations carried out by a financial institution or factoring”s between a natural person and a legal entity or between legal entities, they have swapping of currencies, which could lead to the transaction of insurance made by the insurance companies, that are related to the values, or the u.s. securities and exchange commission; and that involve financial assets, gold and the resource exchange. The Board of Tax appeals (“CARF”), pursuant to article 19, And to the Act no. 10.522/2002, it held that the mere fact of financial flows between companies of the same economic group is not a “mutual-financial and away from the impact of the financial operations tax (IOF/credit to the Credit of the operation. In this case, the Class took the view that the burden of proof that it is the nature of the loan financial is the responsibility of the supervision, which for this purpose should be to effectively carry out audits of operations, and to demonstrate that the characteristics of the type of the contract are to be found in the present case. In this way, it is not just the mere fact that it was the cash flow of the company autuada, and the rest of the companies of its group, cost-effective, there is also the impact of the IOF tax Credit, because it ensejaria the taxation of the operation, for instance, which is not allowed in our legal system. In the absence of proof to the CARF was understood to terminate the requirement that the IOF tax Credit on such transactions in the current account. Court, n. 3201-009.809) [5] The interest payments on the contracts of the loan are to be taxed as a financial investment in fixed income securities. The tax will be levied at the date of the payment or credit to the income subject to withholding by the borrower, at the rate of: (i) to 22.5% (twenty-two-and-a-half per cent, for a period of up to 180 days only; and (ii) to 20% (twenty per cent, for a period of 181 days up to 360 days, and (iii) to 17.5% (seventeen and one-half percent for a period between 361 days to 720 days; or (iv) 15 percent to fifteen percent, for applications where a longer period of 720 days. (art. 1 of the Law no. 11.033/2004) and art. 46, § § I-IV, and c/c (art. 47 (III) of the Normative Instruction RFB no. 1.585/2015) [6] The society is not personified, who do not have a record in the registrar’s office or the board of trade, but they must have a tax ID (NORMATIVE INSTRUCTION RFB No. 2119/2022). With the exception of, well, the fact is that the taxation of the company in the account will be the same as that of a partner in the surrounding, as well as the inability of a partner, open, owner participant and the company, in the account of the participating operating system of the taxation of a Single Country. [7] Business corporation-is the one who carries on an economic activity is organized for the production and circulation of goods and services, which can operate either in the form of a general partnership, limited partnership, limited liability partnership, simple, and joint stock company. [8] The bootstraping is to start a business is only with his own money without any investment from a third party, or with little to no investment of any third party. [9] The smart money is it’s the one investment that is not the only values that will be collected, but it is especially the baggage that any investor can bring to the business and, because of its extensive and successful career.
Participation of the Foreigner in a Limited Liability Company in Brazil
Brazil has been a popular destination for foreign investment, and many entrepreneurs are interested in establishing companies in the country. In this context, the following question arises: can a foreigner participate in a company in Brazil?
Yes, a foreigner can participate in a company in Brazil. In this article, we will outline the necessary steps for the constitution or entry of a foreigner as a partner in a limited liability company (LTDA) in Brazil.
First, it is necessary to determine who the company’s partners will be, the capital that will be invested, the activity that will be carried out, the location, among others relevant to the business.
It is necessary (legal obligation) that the foreign partner appoint an individual resident in Brazil, as its legal representative in the country, granting this person powers to receive summons.
This power of representation must:
For both, the power of attorney, must be registered in the registry office of deeds and documents in Brazil and at the board of trade of the state in which the company its filed.
We emphasize that Brazil is a signatory of the Hague Convention, so that, for documents authenticated in other countries that are also signatories, it is enough for the notary to issue the document with the Apostille of the Hague Convention and consularization will not be necessary. However, the other steps mentioned above will continue to be necessary.
The personal documents of foreign members must be legalized in the country of origin (similar to a certified copy) and consularized at a Brazilian embassy or consulate located in the country where they are legalized. If the country is also a signatory of the Hague Convention, the same rule as for the power of attorney applies. Then, these documents must be translated by a sworn translator in Brazil and registered in a notary of titles and documents.
Foreign partners need to register with the Federal Revenue of Brazil, both as Individuals (CPF) and as Legal Entities (CNPJ). The registration of legal entities will be done through registration at the Central Bank of Brazil, through CADEMP within the system called: SISBACEN.
The initial address of the company’s headquarters needs to be defined and a lease agreement or another, as the case may be, entered into.
The first step is to carry out a search and query of the business name at the Board of Trade, in order to ensure that the name chosen for the company is available and can be used. Next, you need to determine the extent of the administrator’s powers. Finally, it is necessary to determine the address and object of the company, that is, where the company will be located and what its field of activity will be.
Hiring an accountant is mandatory for companies in Brazil. The accountant will be responsible for assisting in the preparation of financial statements, calculation of taxes, among other accounting issues.
After preparing and registering the articles of incorporation with the Board of Trade, it is necessary to register the company with the Brazilian Revenue Service. For this, it is necessary to provide information about the company and, after analyzing the documentation, the Brazilian Revenue Service will issue the CNPJ.
A registration with the Central Bank of Brazil (BACEN) for a limited liability company is necessary when the company intends to carry out operations involving exchange, such as imports, exports and transfers of funds between Brazil and other countries. Registration of investments between legal entities at BACEN (this operation is carried out by partners when they contribute capital to a company) is done through the System of Registration of Foreign Direct Investment (RDE-IED) and is mandatory for all companies that fall under the activities subject to this regulation.
To open a bank account in the name of the company, it is necessary to have the CNPJ and the articles of incorporation registered within the Board of Trade. In addition, it is important to verify the documents required by the bank, such as a proof of address, and the documents of the company’s legal representative.
Registration with the State Revenue Service is mandatory for companies that carry out sales of products or services subject to ICMS (similar to IVA). To apply for registration, it is necessary to present the documentation required by the state body, which may vary according to the state in which the company operates.
Registration with the Severance Indemnity Fund (FGTS) and the National Institute of Social Security (INSS) is mandatory for companies that have registered employees.
Municipal registration is mandatory for companies that have activities subject to municipal taxation, such as the Tax on Services of Any Nature (ISS). To apply for registration, it is necessary to present the documentation required by the municipal body, which may vary according to the city where the company operates.
Depending on the company’s activity, it may be necessary to obtain licenses and permits from specific bodies, such as:
In addition to the legal procedures, foreigners must also be aware of some limitations when it comes to investing in Brazil. For example, there are restrictions in certain sectors such as mining services, hydropower, and telecommunications.
Once regulatory procedures have been overcome, with Brazil’s economic growth, the incorporation of a limited liability company can be an excellent option for foreigners looking to start a business in the country.
Sabrina de Melo
Leonardo Theon de Moraes
Sample Letter of Objection to the breakdown of the Contributions to the Union
The Supreme Court was approved, in the 2nd last week 11/09/2023), the legality of the rate of compulsory contribution to charity for the trade unions, which is similar to the old tax of the union.
Thus, it is a constitutional institution that, by agreement or contract, collective bargaining, contributions, and assistance will be enforced for all employees in the category, even though it did not join a trade union, provided that it ensured the right to object.
So, right now, to any one trade union may call a meeting of shareholders each year, regardless of the number of workers, it will be possible to set up to charge a compulsory contribution of social services, both for members of the trade union as well as for non-union members.
In this sense, is not to focus on the discount rate as a compulsory contribution of assistance, if any, established by the union of the class, each employee is expected to explicitly express interest in collaborating with this help of assistance”.
Thus, it follows the template of the opposition at the breakdown of contributions to the trade union is to be used for all of the workers, especially those new to futures and contractors:
Sample letter of objection to the breakdown of the contributions to the union:
[inserir data]
Union [o]
Subject: HELP CONFEDERATIVA/CONTRIBUTION by the UNION of DISCOUNT and COMPULSORY
I [o], holder of license no. [o], regularly registered at the company [o], tax ID no. [o], with registered office at [o]no. [o], neighborhood [o], non-union, MANIFESTO of the OPPOSITION TO payroll deduction FOR PAYMENT of THE CONTRIBUTION CONFEDERATIVA, trade UNIONS, OR in-kind CONTRIBUTIONS ON BEHALF of THIS BODY. I missed that such action is warranted by the applicable legislation, in accordance with the law 13.467, de on July 13, 2017 (art. 579 and art. 611 (A), clause (XXVI).
Best regards,
________________________________
The signature of the employee
The corporate governance committee and the resolution of conflicts among the members of the differences between Limited liability Company
Business societies can be organized under several Corporate types, which gives partners the ability to choose the structure more consistent with their needs and objectives, according to the business model, growth strategies and legal preferences.
In Brazil, the most adopted corporate types are limited companies and corporations. Limited company is a corporate modality in which partners have their responsibility Restricted to the value of their contributions to the capital, protecting their personal heritage from eventual debts of the organization to the limit of their participation. The corporation, in turn, is a type of company in which capital is divided into shares, and the responsibility of shareholders is limited to the price of acquired shares.
In both corporate types pointed out above, Corporate governance plays an essential role for the development, stabilization and management of conflict in business. “Whether in large or small, publicly open or closed societies, with defined control or pulverized capital, either in family societies, or even startups, corporate governance – appropriate to each stage of social development – can be a fundamental instrument for preventing social conflicts ”(1).
Definition and dimensions of corporate governance
According to the Code of Best Practices of the Brazilian Institute of Corporate Governance (IBGC), corporate governance is “a system made up of principles, rules, structures and processes by which organizations are directed and monitored, with a view to generation of sustainable value for the organization, its partners and for society in general ”(2).
The principles of corporate governance apply to every business organization, constituting the basis on which good governance develops, which are: (i) principle of integrity, which aims at the continued improvement of organizational ethical culture; (ii) principle of transparency, which seeks Provide certain and accurate information on the financial and operational financial health of the business; (iii) principle of equity, performing fair and coherent treatment between partners and other stakeholders, in accordance with their rights, duties and needs; (iv) principle of accountability (liability), which corresponds to the duty of the organization to occupy Consider the social, economic and environmental impacts arising from the exercise of their business activity; and (v) principle of sustainability, which is dedicated to understanding that the protection of the financial viability of the organization is directly related to its interdependence with the economic, social and environmental realities that it is inserted (3).
Corporate governance is structured in agents, organs and the relationship between them. This structuring will be more or less complete depending on the size, the stage of evolution and the nature of the business of society, as well as its corporate type.
The agents – and, as a result, the organs – most involved with corporate operations are: (a) the partners, who make up the General Assembly; (B) Administration counselors and inspectors, which are part of the Board of Directors and the Fiscal Council; (c) the directors, who are the members of the Executive Board; and (d) members of advice advice (4).
The rules of governance, therefore, created by their agents, organize the structures (organs) of the organization, so that, through this set of practices, it seeks to optimize The performance of society as they safeguard the interests of the partners and the stakeholders.
Corporate governance and conflicts of interest between members
The harmony between partners is not only beneficial, but vital to the survival and prosperity of the business organization. Thus, the management and administration structure of society (governance) aims to avoid Or, at least to resolve the conflicts of interest between the partners in the best possible way.
Conflicts between partners are especially present in the dimensions of political and economic rights, which must be exercised in accordance with the legal and statutory guidelines to ensure the perpetrator of the long term society.
Regarding political rights, the ability to influence Strategic decisions and participate in company management are often at the heart of disagreements and controversies in corporate environments.
The right to vote, usually expressed in assemblies and meetings, allows the partners to express themselves about the operational procedures to be implemented in the organization. On the other hand, the power of control – whether it is distributed or concentrated -Refers to the ability to exert a predominant influence on administration, leading the guidelines and strategies to be adopted in society.
The incongruity between the aspirations and visions of the partners on the strategic decisions of society can generate strife. When the control power of society is concentrated, minority partners may feel that their interests are suppressed in social deliberations. In organizations where control is distributed, in turn, even though it is assumed that decisions are made through a more collaborative and inclusive procedure, there is also the possibility of arising decision impact that impact the cohesion of business planning.
Members selection for executive and administrative positions can be presented as a field Confidence for conflict hatching, especially when there are disputes related to the control of management and strategic direction of the company.
In addition, it is the subject of corporate conflicts the exclusion or exercise of the right to withdraw the partner. With regard to the right of withdrawal, disagreements sometimes arise in relation to the assessment and the payment of the partner’s shareholding dissident and the conditions on which the exercise of such right is admitted without impairing the company’s operational continuity.
In turn, the exclusion of the partner – whether judicial or extrajudicial – represents a forced dismissal of one of the partners of society. Beyond the relational differences between the parties, there are financial impacts – since the reduction of the capital of society It can undermine investments in the organization -as well as operational, which can lead to disagreement between the remaining partners in relation to the roles to be assumed and decision -making to allow the continuity of the operation.
Regarding equity rights, they are associated with economic benefits derived from the organization’s operations. Therefore, the distribution of profits, the transfer of quotas or actions and aspects related to business succession, which are themes often marked by corporate controversies.
Profit distribution is a fundamental right of partners. The disputes sometimes originate from disagreement regarding the perception of the value and contribution of each partner to the generation of profits obtained. This conception invariably It is confused with the lack of discernment between the partner and administrator’s roles in the organization, which have different functions and responsibilities. Thus, the disparity in expectations regarding the “correct” ideal fraction of participation in results occurs when there is a lack of well -defined guidelines for the remuneration of administrators and distribution of dividends.
Yet, being Of compensation for the partners, in particular in relation to limited companies, much controversy is installed with regard to the conflict between the concepts of profit x pro-labore, regarding the partner who plays the role of administrator. It is very common that, in the absence of clear rules to determine the amount to be paid due to the work commitment in the exercise of the administration, if Dissatisfaction for non -agreement regarding the criteria set (hours of commitment, productivity, percentage of the results earned, among others).
There are also disagreements between partners regarding the share of profit that will be destined for reserve and reinvestment in the organization itself. There are those who see the need to retain a significant part of profits to ensure growth of society, and others who advocate a more robust distribution of dividends.
Regarding the transfer of corporate participation, entry into society of a new partner, foreign to the operation, can significantly alter the dynamics, culture and management of a society. In this context, concerns arise about dilution of control and eventual changes in business strategies, which can result in significant friction, even threatening the continuity of the business.
Finally, business succession is also a very controversial theme. From the death, interdiction or mease of any partners, the admission of their successors, heirs or ex-spouse may endanger the continuity of management, the preservation of organizational culture and, as a result,, consequently, Sustainability of the company.
The interests of the remaining partners can collide with those of the heirs, successors or former spouses, particularly if the latter do not have a prior involvement or knowledge of the business until the moment of succession.
In this scenario, solid corporate governance is fundamental to ensure that the rights of all partners are respected ( principle of equity ) and that decisions made reflect a equitable perspective of the business.
The governance structure, represented by agents and organs, “must ensure that the organization has clear, effective, implemented and properly disseminated policies and processes” (5) to identify and treat social conflicts. As mentioned above, the most present agents and organs and involved in the organization are:
(A) Members, which makes up the General Assembly:
The partners are committed to ensuring the interests of society and, to this end, must deliberate responsibly on matters elementary to proper organizational functioning. The General Assembly or the Meeting of Partners is the moment when the partners, through the vote, have a voice to express your views and decide substantial questions of the organization.
Thus, the establishment, by means of agreements, of clear policies regarding voting procedures are fundamental to the balance of the business.
(b) Counselors, members of the Board of Directors
Counselors in the Board of Directors ensure that operations and strategies of society are aligned with the interests of the partners and the purposes of corporate integrity. The Board of Directors “must be responsible for determining the strategic objectives, directions and risk profile of the organization, (…) related to its culture and identity” (6).
In view of this, it is paramount that the board of directors promote transparency in the decisions and actions of the company. The clear communication of corporate strategies and results strengthens the confidence between partners and other stakeholders, mitigating the perception of any conflicts of partial interests or management.
(c) Counselors, members of the Fiscal Council
The Fiscal Council has “the responsibility to verify that the organization is in Compliance with its principles and values, reflected in internal policies, procedures and standards, and regulatory laws and devices ” (7). In their supervision work, tax counselors must understand the strategy and risks to form opinion on the financial results and statements presented by the Board of Directors to the members in the Assembly General.
(D) Members of the Advisory Committees
Advisory committees are bodies advising the Board of Directors in the “ Control on the quality of financial statements and internal controls, aiming at the reliability and integrity of information to protect the organization and stakeholders” (8). The most common committees are: (i) audit; (ii) risks; (iii) sustainability; (IV) Ethics and Compliance.
(E) Directors, members of the Executive Board
“The board is the executing body of the end of business activity” (9). The directors are responsible for the implementation of all the company’s operational and financial processes, executing the strategies approved by the Board of Directors.
Furthermore, The contract or bylaws must comply with the purpose of establishing the main rules of operation of the company, with the implementation of solid corporate governance practices, which serve to direct, monitor and encourage the organization, minimizing conflicts and protecting the various stakeholders (10).
Rule differences between limited companies and societies Anonymous
Although often convergent legal structures and instruments, they are in some different aspects of their application to limited societies and corporations, especially in relation to political and economic rights:
Political rights present the following distinctions in relation to voting rights, control, withdrawal and exclusion:
Economic rights present the following distinctions in relation to the corporate types in question:
From the above analytical frameworks, the differences of legal rule to the most sensitive subjects to the relationship between quotists/shareholders are evidenced by comparing corporate models of limited and society by action.
Conclusion
In the light of the main challenges faced by the partners, the structural and legal differences between the Limited societies and stock societies, corporate governance, the reason for the peculiarities of each corporate type, will be exercised through their agents and instruments in different ways. The adequacy to the positive and negative normative specificities of each business type is essential to achieve the best effectiveness.
The differences and controversies pointed out throughout this Article may be mitigated or renewed through legal instruments, such as: (i) the formulation of rules and guidelines provided for in the contract or status, which will have about the functioning of society, with the adoption of corporate governance practices; (ii) the celebration of the agreement of quota holders/shareholders; (III) among other measures that can Contribute to the improvement of management, organization and business development.
Regarding conflicts related to political rights, corporate governance agents will have a vast guiding legal structure at their disposal to find solutions to controversies between the partners. Otherwise, in the context of limited societies the framework Legal is limited, often demanding the challenge of establishing conflict resolution criteria at a time contemporary with its confrontation.
Given the nature of the relations between the partners, in limited societies, based on interpersonality, the performance of the Board of Directors, will face, in theory, greater challenge to objectify the controversies and search for solutions based on Data, since the relationship between partners often transcends the simple merchant objective. On the other hand, in stock companies, as a rule, solutions will be more objectively based and will find a greater number of legal provisions at their disposal, since the normative scope provided for in Law no. 6.404/76. It is much broader.
Still in the exercise of political power, the Board of directors facing greater challenges in limited companies, since the proximity with which partners exercise their right to vote is much greater and representative than in corporations. It is important to remember that, in many cases, the constitution of a board of directors in limited companies is relatively recent.
In another context, however, in societies Limited, the Board of Directors, when dealing with a more restricted membership base, has greater ease and agility in decision making, while in corporations, more analytical decisions are often required and based on robust data, due to the need to justify actions and strategies in the face of a wide number of shareholders and regulators.
The nuances mentioned above are also the subject of attention to the members of the Executive Board, in the execution of the organization’s financial and operational procedures. In limited societies, such as the partners themselves may be involved in business management, organization management is closer and personal. Governance is more flexible and execution of strategies are performed with a greater degree of informality, depending on the agreement established between the partners.
On the other hand, in corporations, the board is farther from shareholders and operates with a more rigorous and formalized governance structure. The directors are in charge of managing the company’s operational and strategic aspects, aligning with the vision and direction established by the Board of Directors and the expectations of shareholders.
Regarding economic rights, corporate governance, through its agents and organs, will face challenges in both limited structures and stocks by action. In the first, the controversies will be oriented to the rules and criteria aimed at the distribution of profits (sometimes disproportionately) and pro-labore receipt of the partner Administrator, while in Mondays the challenges are much more associated with the resource allocation rules: percentage of dividends to distribute, allocation in profit reserve accounts, etc.
Regarding the circulation of quotas or actions, either alienation or in business succession, in both corporate types it is common to exist disagreements between partners/shareholders, as it is necessary Establish rules on the right of preference and settlement of corporate interest, which are applicable to each corporate structure.
In short, corporate governance, for its better effectiveness, should be aware of the context, structure and normativity preceding its implementation in a given organization. It is necessary to establish distinct strategic and tactical planning For each organization, taking into consideration its corporate type and the challenges it intends to resolve.
Bibliographic references
(1) GALLO, Giovanna Mazetto. CHIACHIO, Rafaella. The importance of corporate governance in preventing corporate conflicts. December 23, 2022. Available at: https://www.migalhas.com.br/coluna/migalhas-connsensuals/379078/importancia-da-governanca-corporativa-na-prevencao-de-conflitos . Accessed October 3, 2023.
(2) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 17, 2023.
(3) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 19, 2023.
(4) SILVA, Edson Cordeiro. Corporate governance in Companies: Practical Guidance for Guidance for Shareholders, Investors, Administration and Fiscal Counselors, Auditors, Executives, Managers, Market Analysts and Researchers. 3rd ed., Sao Paulo, SP. Atlas Publisher, p. 32, 2012.
(5) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 21, 2023.
(6) Institute Brazilian Corporate Governance – IBGC. Corporate risk management: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 26, 2017.
(7) Brazilian Institute of Corporate Governance – IBGC. Corporate risk management: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 27, 2017.
(8) Brazilian Institute of Corporate Governance – IBGC. Management of Corporate risks: evolution in governance and strategy. Sao Paulo, SP. IBGC, p. 28, 2017.
(9) Brazilian Institute of Corporate Governance – IBGC. Code of best corporate governance practices. 6th ed. Sao Paulo, SP. IBGC, p. 53, 2023.
(10) ANDRADE, Adriana. ROSSETI, José Paschoal. Corporate governance: foundations, development and trends. Altas Publisher. 7th ed. São Paulo, 2014.
Julia Oliveira Andre Teixeira
Lawyer, law graduate from Faculties Milton Campos (2019), registered with the Brazilian Bar Association, Minas Gerais Section (OAB/MG) (2019). Specialist for the L.LM Business Law Program by IBMEC (2021), MBA in high performance law by PUC Minas (2022), expert on contractual law from the Getúlio Vargas Foundation (FGV-RJ) (2023). Author of articles. Member of the Commission of Corporate Law of the OAB/MG (2022), member of the Center for Studies of Lawyers Companies (CESA), Executive Secretary of the State Council of Commercial Affairs of the Federaminas. Advisory Lawyer of Portugal Vilela Advogados.
Leonardo Theon de Moraes
Lawyer, Graduated in Law, with emphasis on Business Law, from the University Presbyterian Mackenzie (2012), registered with the Brazilian Bar Association, São Paulo Section (OAB/SP) (2012). Post Graduate and Specialist in Business Law from the São Paulo Law School of the Getúlio Vargas Foundation (2014), Master in Political and Economic Law from the Mackenzie Presbyterian University (2017), book and articles author, speaker, undergraduate professor, MBA and Executive Education At FIPECAFI, a member of the São Paulo Lawyers Association (AASP), a member of the International Bar Association Business Law and Fuse Committee, member of the São Paulo Lawyers Association (AASP) and president of the Federaminas State Council of Commercial Law. Founding partner of TM Associados. Founding partner of TM Associados
It is void Postal Service of natural person if warrant was received by third party
The understanding of the 3rd Class of the STJ is that the possibility of the citation letter being received by a third person only occurs when the Citing is a legal entity.
The rapporteur, Minister Marco Aurélio Bellizze, explained in the vote that the citation of an individual by mail occurs with the delivery of the citation letter directly to the citing, whose signature must appear in the respective receipt notice, under penalty of nullity of the act, in accordance with the provisions of CPC/15.
Bellizze pointed out that the fact that the postal Service was sent to the commercial establishment where the appellant carries out its activities is not sufficient to depart from the procedural norm, especially since there is no way to be sure that the defendant has actually taken notice of the injunction filed against him.
“The possibility of the citation letter being received by a third person only occurs when the Citing is a legal entity, in accordance with the provisions of paragraph 2 of Article 248 of the CPC/2015, or in cases where, in condominiums or allotments with access control, the delivery of the warrant is made to the official of the ordinance responsible for receiving the correspondence, as established in paragraph 4 of said legal device, hypotheses, however, that do not subsume the present case.”
Marcus Aurelius Bellizz
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CPC, CLT and CF now indicate jurisprudence in the articles!
The CPC, CLT and CF have been updated on the plateau website!
Now it is possible to find the jurisprudence of the articles by clicking on the “🔨” little hammer” next to the device.
This is another measure of cooperation between the government and the judiciary to integrate three databases with information on the Constitution, ordinary law and jurisprudence!
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IN Nº 81 of DREI-consolidation of Public Registry of companies
Norms for the process of opening, modifying and closing companies were consolidated with the entry of IN nº 81 of the DREI.
The National Department of Business Registration and integration – DREI, part of the Ministry of Economy, published normative Instruction No. 81, of June 10, 2020 (DOU of 06/15/2020), updating and consolidating, in a single standard, the rules applicable to the public registry of companies.
To achieve this scope, a total of 56 other norms were repealed by the new normative instruction, 44 normative instructions and 12 circular letters, all now gathered in the new legal text.
IN nº 81 of the DREI brings together the norms linked to the process of opening, modifying and closing of Individual entrepreneur, Individual Limited Liability Company (EIRELI) and business and Cooperative Societies, eliminating the various guidelines that were dispersed in the legislation.
The initiative is part of the simplification and de-bureaucratization process implemented by The Economic Freedom Law (Law No. 13,874/2019) and, more specifically, meets the provisions of Decree No. 10,139/2019, which provides for the review and consolidation of federal regulatory acts lower than decree.
Some news that we highlight important:
News taken from IN.
When will the rules take effect?
As a rule, July 01, 2020, with the exception of the new rules regarding the automatic filing of acts amending and terminating an Individual entrepreneur, EIRELI and a limited company, as well as establishing a cooperative, which come into force after 120 (one hundred and twenty days) from the date of publication of the instruction.
WE SUGGEST READING THE ENTIRE IN, AS SEVERAL STANDARDS HAVE BEEN CHANGED!
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