Eike Batista Wins Appeal and Avoids R$21 Million Fine

RIO DE JANEIRO, BRAZIL – Entrepreneur Eike Batista was able to reverse the conviction for the use of insider trading in the case of OSX and avoid the fine of R$21 million (US$5 million) that had been imposed by the CVM (Securities and Exchange Commission), in 2017. The favorable decision was granted by the Appeals Council of the National Financial System, an appellate body linked to the Ministry of Economy.

The vote ended up in a tie which was broken by the vote of the chairwoman, Ana Maria Melo Netto Oliveira, according to the advisors of the ministry. The full decision has not yet been published.

The case dates back to the sale of shares of OSX, a company of Group X that would build oil platforms. Batista was convicted in the CVM for having sold shares of the company before the publication of a relevant fact to the market on the revision of the business plan. CVM maintained that he knew that changes in the business plan would lead to a devaluation of the company on the stock exchange.

The businessman’s defense stated that Batista sold the shares to meet the commitment to have 25 percent of the company’s shares in circulation in the market (called free float), and also claimed that he suffered an even greater loss, in the order of R$200 million, in the same operation.

This was not the only fine imposed by CVM on him. In more recent cases, he was sentenced to pay R$536.5 million reais for the use of privileged information at OGX in May of this year. In June, the conviction was for the omission of information, with a fine of R$550,000.

Source: Folha de S.Paulo