上海交通大学：《外国法专题（比较公司法）》课程教学资料（学生展示）Regulatory Dualism

Regulatory Dualism in Brazil Cai Zhenzhen,Wang Xinyue

Cai Zhenzhen, Wang Xinyue Regulatory Dualism in Brazil

What's Regulatory Dualism? Concept of the reform o It aims to establish a new and more rigorous shareholder protection regime which operates parallel to the existing one. And it is open to any new or existing firms that wish to make use of it

What’s Regulatory Dualism?

Cost of the reform Comprehensive brings a direct transfer of corporate Reform wealth and power to public Shareholders. The advantages of the Regulatory Dualism: Regulatory 1)It avoids the costs of blocking all reform; Dualism 2)It dilutes the costs of sweeping legal changes; 3)It reduces the political pressure for more comprehensive reform. No Reform blocks all reform which can be very expensive. What's Regulatory Dualism?

Regulatory Dualism No Reform

What's Regulatory Dualism? Regulatory Competition V.S Regulatory Dualism Regulatory Competition It creates multiple regulators with overlapping jurisdictions,so that the regulated actors can choose the regulatory regime to which they will be subject. The regulated actors have an incentive to be governed by an efficient regulatory system so that they can attract more patrons such as investors

What’s Regulatory Dualism?

What's Regulatory Dualism? Regulatory Dualism It permits the preexisting system of regulation to be maintained;meanwhile,a second,more efficient system,namely the reformist regime,is created. The two systems are both made available to all actors. The regulatory dualism creates a dynamic in which the choice between two regimes of differing efficiency actually reduces pressure to reform the less efficient (preexisting)regime

What’s Regulatory Dualism?

Why Regulatory Dualism has been produced? The demand of the capital market Economic development receives strong stimulus from an effective capital market, which in return requires a substantial and effective legal infrastructure to protect the interests of minority shareholders in publicly traded business corporations

The demand of the capital market Why Regulatory Dualism has been produced?

Why Regulatory Dualism has been produced? The resistance of the established firms The reform will shift wealth,corporate power,ultimately political power from the controlling owners to public shareholders. Effective shareholder protection will facilitate the financing of potential competitors. Influence on Resistance Incentive political to the process reform

The resistance of the established firms 1 • The reform will shift wealth, corporate power, ultimately political power from the controlling owners to public shareholders. 2 • Effective shareholder protection will facilitate the financing of potential competitors. Incentive Influence on political process Resistance to the reform Why Regulatory Dualism has been produced?

The demand of The resistance the capital of established market firms Regulatory Dualism New Existing firms developing firms

The demand of the capital market The resistance of established firms Regulatory Dualism Existing firms New developing firms

1)It's a listing segment of Sao Paulo Stock Exchange for the trading of shares issued by companies that commit themselves Regulatory voluntarily to adopt corporate governance Dualism in practices in addition to Brazil those are required by law. (complementary to,not competitive with the law) The Novo Mercado (New Market”)

Regulatory Dualism in Brazil The Novo Mercado (“New Market”)

2)It's open,on a voluntary basis,to both new and existing firms that are prepared to comply with Regulatory its requirements. Dualism in Meanwhile,the old regime remains Brazil available to both old and new firms as well. The Novo Mercado (a typical example of ("New Market") Regulatory Dualism)

Regulatory Dualism in Brazil The Novo Mercado (“New Market”)