CVM Resolution 204, of June 4, 2024 (“Resolution 204”), which will come into force on January 2, 2025, brings changes to participation and remote voting at Shareholders’ Meetings, thus amending CVM Resolutions 80 and 81, both from March 29, 2022, which deal with the topic.

Prior to its publication, the CVM submitted the draft Resolution 204 to public consultation, at which point several market agents were able to speak out and contribute their experiences to modernize and improve the procedure for participation and remote voting at shareholder meetings.

Among the various changes to Resolution 204, we highlight three as the main ones, namely:

• Extend remote voting rules to all shareholder meetings;
• Reduce the universe of companies subject to mandatory remote voting (except in the case of contrary manifestation from shareholders representing at least 0.5% of the company’s share capital); and
• Promote adjustments in the transmission flow of voting instructions in order to allow shareholders to send their votes less in advance of the meeting date.

Regarding the extension of remote voting rules (previously such rules were restricted to ordinary meetings and some cases of extraordinary meetings), during the public consultation, statements from investors were received to the effect that, with certain meetings being able to be held without the remote voting mechanism, the non-resident investor (or their custodian agents) would have to maintain the same structure, necessary for in-person voting. With the maintenance of this structure, costs related to translations, grants and renewals of powers of attorney, among others, would also be maintained.

In relation to the reduction in the universe of companies subject to full compliance with the remote voting rules, this is due to the observation that around 1/3 of the companies that provide the remote voting form do not receive remote votes at their ordinary general meetings, tending this group of companies to be the same each year, incurring such companies in costs without any investor benefiting in return.

Concerning the adjustments to the transmission flow of voting instructions, the period was reduced from 7 to 4 days, with central depositories and bookkeepers transmitting the information in a parallel and simultaneous manner directly to the company, making it no longer meaningful for the company to immediately disclose the information. passed on by the bookkeeper, as previously provided.

As to the other changes brought about by Resolution 204, we mention, among others (a) the 21-day deadline for presenting the remote voting form, for general and extraordinary meetings, except in specific and exceptional cases; (b) the provision that requests sent via remote voting form for the adoption of multiple voting are void if there are no candidates other than those nominated by management or the controlling shareholder;  (c) requirement for the presence of the chairman, the secretary and at least one administrator when the meeting is in person or hybrid; and (d) mandatory justification by the company regarding the type of meeting chosen.