BRAZIL Law and Practice Contributed by: Thomas Gibello Gatti Magalhães, André Dágola Brostoline and Luisa Grespan Danhoni Neves, Magalhães & Zettel
• credit, financing and investment companies; • real estate credit companies; • micro-entrepreneur and small business credit companies; • bonds and securities distributing companies; • inter-personal loan companies; and • service confederations. Each of these institutions operates in different segments, fulfilling specific roles in the national financial system, according to the activities and services they are authorised to perform by BCB. 3. Changes in Control 3.1 Requirements for Acquiring or Increasing Control Over a Bank Within the Brazilian legislative framework, Law No 4,595/1964 gives BCB responsibility for granting authorisations for the acquisition and/or change of control of financial institu - tions. National Monetary Council Resolution No 4,970/21 regulates the authorisation process related to these institutions, especially in matters of control, with the following definitions. • A controller is a person or group of persons (control group) that holds: (a) in joint-stock companies, the majority of the voting capital; or (b) 75% of the capital stock in limited liability companies. • A control group is a group of persons (indi - viduals or legal entities) bound by a voting agreement or common control, that have control of the financial institution in a direct or indirect manner. • A qualified interest holder is a person (indi - vidual or legal entity) that is not a controller, but holds 15% of the voting capital or 10% of the non-voting capital of a company that
indirectly controls a financial institution, or that holds: (a) direct interest of 15% of the voting capi - tal; or (b) direct interest equivalent to 10% or more of the non-voting capital; or (c) control of a company that holds 15% of the voting capital or 10% of the non- voting capital. The control of financial institutions may only be exercised by individuals, institutions authorised by BCB, foreign financial institutions or national legal entities whose corporate purpose is exclu - sively to hold equity interest in financial institu - tions. The change of control must be previously authorised by BCB, which has up to 360 days to analyse the feasibility of the change of control, based on the following requirements: • a demonstration of the economic and finan - cial capacity of the controllers, individually or jointly, compatible with the capital neces - sary for the structuring and operation of the institution; • the lawful origin of the resources used in the acquisition of control and qualified interest; and • the unblemished reputation of the controllers. In turn, the assumption of the condition of holder of a qualified interest (that is, the direct or indi - rect acquisition of 15% of the voting capital or 10% of the non-voting capital of the financial institution) does not require prior authorisation from BCB. However, it is necessary to report the act within 15 days after the occurrence. The same applies to any change in the corporate composition of financial institutions, which must
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