Baker @ MacKenzie: Re-Building the Old World BRIC by BRIC

New Developments Impacting Stock Awards in Europe and Brazil/Russia/China

In order to retain essential professional employees, American multinational corporation  reward them with equity in the company. The idea is to keep those professionals who are most important to the company’s long term success as  the more equity you have and the better the company does and the better you will do.

In order to retain essential professional employees, American multinational corporation  reward them with equity in the company. The idea is to keep those professionals who are most important to the company’s long term success as  the more equity you have and the better the company does and the better you will do.  However, a question can arise as how these employees perceive equity in different countries. “Re-Building the old world BRIC by BRIC- New Developments Impacting Stock Awards in Europe and Brazil?” was the theme of this rainy morning workshop held on  October 3^rd, 2012, at the Baker & Mackenzie law office located in New York City. With partners and lawyers from their Firm’s Global Equity Services, they addressed  legal implications and the most noteworthy issues of  equity compensation, tax issues and enforcement activities for multinationals with employees in the US and abroad and why  dealing with these issues can be a daunting task.

Speaking about Brazil, Hercules Celescuekci, a Baker and Mackenzie partner working in Sao Paulo, explained that granting equity awards to employees by US multinationals is common although this is not often done by  local companies which generally offer stock only to top executives.  Mr. Celescuekci stated that Brazilian SEC rules require grants by local companies to be linked to results/performance and treatment of performance-related amounts as local compensatory/salary.  This can mean significant social charges such as  repercussion on salary, the paying of a 13^th month of salary, vacations, FGTS and other employee’s benefits. It has a significant impact regarding  termination/severance pay, income tax and social security costs.  Labor court precedents and administrative rulings are inconsistent regarding these issues.

To know who are were the speakers go to: http://equitycompensationexperts.groupsite.com/calendar/event/2012/10/3/346744

To read more about the subject, go to Baker and Mackensie website. They have incredible articles/newsletter. Here are some: 
http://www.bakermckenzie.com/files/Publication/bd3b49a7-8fb6-4901-86d2-7eaff3fc13d5/Presentation/PublicationAttachment/bc50b3aa-6af6-4c8f-9d14-82a9d8a2e533/ar_ges_costeffectiveprogram_nov09.pdf
http://www.bakermckenzie.com/nlgesrecentdevelopmentssep12/
http://www.bakermckenzie.com/files/Publication/a77a32d5-0719-49da-9049-6d70b7825c35/Presentation/PublicationAttachment/9c11cdde-4a31-4e9b-bda9-75f410bec78f/ar_us_globalstrategiesespp_sep12.pdf