Privatization: amendments to corporate and capital markets law. On April 10 1997, Congress approved a Bill introducing amendments to Law 6404/76 (Law on Corporations) and 6385/76 (Law on Capital Markets). Rights of minority shareholders have been altered to allow more flexibility in cases of mergers or split-ups. The aim of the Bill is to assist the privatization process.
Penalties under Law 6385/76 have been adjusted to the new reality of the stock market and aim to improve the efficiency of administrative procedures carried out by the Exchange Commission (CVM). These include increased fines and the extension of the CVM's power to temporarily suspend managers. In addition, the CVM has been allowed to enter into agreements with parties involved in illegal transactions in the interests of obtaining evidence of illegal practices.
Telecommunications. On April 7 1997, 15 groups presented proposals for concessions of Band B mobile phone services throughout Brazil (with the exception of the north-western states of Amazonas, Roraima, Amapá, Pará e Maranhão). The Brazilian Ministry of Telecommunications hopes to announce the successful bidders for the first two areas by the beginning of June.
Import financing. Brazilian importers with financing of up to 360 days are now required to enter into exchange contracts for future liquidation. The exchange operation must be contracted six months before the financing maturity. The aim of this is to prevent importers from taking advantage of international interest rates, which are at much lower levels than Brazilian rates. Among exempted transactions are imports of less than US$40,000 from member countries of certain regional trade blocs or supranational dispute resolution mechanisms. The new rules are contained in Provisional Measure 1569, published on March 26, and Central Bank Circulars 2747 and 2479 of March 25 and April 3 1997.
Eliana Maria Filippozzi
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