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10 March 2010
On January 26 2010 Decree 7070 was issued, which provides for the federal government's participation in meetings of the Shipbuilding Guarantee Fund, as well as the manner in which its shares in the fund will be paid up.
The Shipbuilding Guarantee Fund was created by Law 11.786/08. Its purpose is to minimize the credit risk of financing operations that involve the construction or production of vessels, and the risk resulting from a Brazilian shipyard's performance.
The fund will be of a private nature and must have its own assets separate from shareholders' assets. It will also be subject to specific rights and obligations.
The decree establishes the specifics of operation of the Committee for Participation in the Shipbuilding Guarantee Fund, whose purpose is to provide guidelines for the government's role in the fund's shareholders' meetings.
In addition, the decree defines that the government will pay up its shares in the fund upon transfer of the shares owned thereby and listed in the decree related to minority interests and interests that exceed maintenance of control in quasi-governmental companies.
Law 11.786/08 establishes that the government's interest in the fund is limited to R1 billion.
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