CVM says that it “causes strangeness” that the Union maintained the indication of names vetoed by Petrobras

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The Securities and Exchange Commission (CVM) stated, in an official letter to Petrobras, that “it is strange” that the Union maintains the nomination of names disapproved by the company’s Eligibility Committee, to compete for vacancies on the oil company’s Board of Directors.

The CVM responded to a question from Petrobras about how to proceed if any appointment to the position of a board member infringes the State-owned company law. The oil company questions whether it should convene the AGA (General Shareholders’ Meeting) “without including the indicated(ies) considered to be included in the aforementioned prohibitions”. And what to do if the first question is confirmed, and “the number of candidates considered as closed by the Board of Directors makes it impossible to fill the available vacancies.”

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To Petrobras, the CVM stated that “if a violation of §1 of art. 147 of Law No. 6,404/76, any responsibilities will be determined by the Superintendence of Corporate Relations”, and concludes by highlighting that “it is surprising that the controlling shareholder has kept the nominations of the two candidates considered ineligible by the Board of Directors.”

“Regarding the first question, the decision is made by the Board itself, and the broader set of information available (bylaws, internal policies, legal opinions, previous cases, among others) must be taken into account, given that the decision must be the same regardless of whether the appointment comes from the controlling shareholder or any other shareholder.”, states the CVM.

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The Petrobras Eligibility Committee (Celeg) pointed out a conflict of interest in two names nominated by the federal government for the Board of Directors: Jonathas Assunção de Castro and Ricardo Soriano de Alencar. Jonathas is Executive Secretary of the Ministry of Civil House, and Soriano is Attorney General of the National Treasury. The reasons for locking the two are different.

The first item of article 147 of the Brazilian Corporations Law determines that “persons prevented by a special law, or convicted of a bankruptcy crime, malfeasance, bribery or bribery, concussion, embezzlement, against the economy people, public faith or property, or a criminal penalty that prevents, even temporarily, access to public office.”

In a note to CNN, the CVM states that it received a specific query from Petrobras, which was answered by the Superintendence of Business Relations (SEP) in an initial analysis on the subject. The issue did not reach the CVM Board. And he points out that “so far, the CVM has not been asked to carry out an examination as to the legality and/or regularity of any of the elements of the specific case.”

“Respecting the specificities in casu that, if demanded, may be examined by this Authority, it should be noted that the General Meeting is the supreme corporate body of corporations, hierarchically superior to the other corporate bodies, which are subject to the resolutions of the General Meeting and that it even has the competence to analyze the legality of the acts performed by the administration.”, he adds.

Source: CNN Brasil

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