SAO PAULO, June 11 Wed Jun 11, 2014 10:06pm EDT

(Reuters) – Brazil’s government next Monday is expected to announce new measures to help small and mid-sized companies tap the capital markets through mechanisms other than traditional share and bond offerings, according to a person familiar with the plans.

The measures, which have long been awaited by Brazilian markets, would also include tax breaks for companies and investors who take part in the offerings, the person said.

The changes will be announced by Finance Minister Guido Mantega at an event in São Paulo by stock exchange operator BM&FBovespa, the person added.


The person, who was not authorized to speak publicly about the plans, asked not to be named.

Following months of discussions between the government and market entities, the measures are designed to help companies with annual revenues of up to 400 million reais ($179 million), many of whom are too small to use more conventional market offerings.

It is unclear whether the measures would satisfy all the requests by market operators, however.

BM&FBovespa, for example, has proposed that investors who take part in offerings by qualifying companies enjoy a 15 percent tax break on capital gains and that some tax breaks for individual investors last as long as 20 years.

To facilitate share offerings, the exchange operator will ease rules for the minimum free float, the person said.

At the event on Monday, Mantega is also expected to announce new regulations for fixed-income exchange traded funds.


$1 = 2.23 Brazilian reais