Brazil: Superior Court of Justice (STJ) decides that large-sized Limited liability Companies do not need to publish financial statements

The Superior Court of Justice in Brazil clarified the interpretation of the law nº 11.638/07. It decided that large-sized limited-liability companies, which are those that had, individually or jointly with other companies under common control, in the previous fiscal year, total assets equal to or in excess of R$240,000,000.00 or annual gross revenue in excess of R$300,000,000.00, do not need to publish their financial statements.

Key changes and requirements

According to a decision of the Superior Court of Justice (STJ) in Brazil, under the Special Appeal No. 1824891 – RJ, issued on March 21, 2023 and published on March 23, 2023, publication of financial statements of large-sized limited-liability companies is no longer mandatory but rather an option of the company.   Under the laws of Brazil, large-sized limited-liability companies are those companies that had, individually or jointly with other companies under common control, in the previous fiscal year, total assets equal to or in excess of R$240,000,000.00 or annual gross revenue in excess of R$300,000,000.00.

Since Law no. 11.638/2007, there has been constant and deep discussions about controversial of the wording of its article 3th, whether publication of financial statements of large-sized limited-liability companies is mandatory or not.

Said article 3 of the Law provides that large-sized companies, even if not organized as joint-stock companies, should observe the provisions of Law No. 6.404/76 (Corporation Law) with respect to bookkeeping and preparation of their financial statements, and also, to mandatory conduction of audit by an independent auditor duly registered with the CVM.

In that case, it was discussed if large-sized limited-liability companies are required to publish their financial statements or not (before filing thereof with the commercial registry) in the official gazette and in a newspaper of wide circulation. Thus, Commercial Registries of each State have adopted different positions.

The full bench of the STJ noted that law 11.638/07 only makes reference to mandatory bookkeeping and preparation of financial statements, expressly excluding the word "publication", which was previously included in the bill.

The decision of the STJ settles a discussion that various companies continue to hold with Commercial Registries throughout Brazil, which regulate the matter by requiring business companies deemed large-sized companies to prove prior publication of the financial statements in the Official Press and in a newspaper of wide circulation, for purposes of registration of the corporate acts approving their accounts.

How can we help?

Please contact your dedicated Computershare Relationship Manager or send an email to globalentityservices@computershare.com for more information about how Computershare may assist you in responding to these new requirements.

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