Capital Markets
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Brazil: Institutional Features
Brazilian Capital Market: Institutional Features
Intermediation System
The distribution and intermediation system of the Brazilian capital market is made up of 566 institutions, of which 227 are brokerage firms dealing in securities, 316 are distributors, 17 are categorized as investment banks and six can be described as development banks. Another three companies are responsible for custody and registration of operations. Bearer shares are not authorized in Brazil and almost all other transactions are registered, a method which demands a high level of operational sophistication from the companies looking after their custody.
All trades on the stock exchanges are made through brokers; that is, even financial institutions must use brokerage services. The commissions levied in Brazil are fixed at competitive rates and all negotiations are performed in the name of the end client.
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Brazilian Securities Commission
Brazil: Capital Markets and the Securities Commission
by Euchério Lerner Rodrigues June, 1996
The CVM was created in 1976 through the Law No. 6,385 with the objective of regulating and disciplining the workings of the Brazilian capital market and, consequently, to fulfil the role of one of the institutions responsible for the process of building up savings and assisting economic development. In this way, by offering investors appropriate security and operational flexibility on the capital market, it contributes towards the process of company capitalization, the dispersion of prosperity and better allocation of productive sector resources.