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more than half the quota capital, as long as the articles of association provide for exclusion for goodcause and with due regard to the legal procedures.3.2.10. Partners’ AgreementThe execution of Partners’ Agreements in LTDAs is also possible, similarly to S/As.3.2.11. Supplementary RegulationIn accordance with the new Civil Code, Law 6,404/76 (Corporation Act) no longer subsidiarily appliesto LTDAs, except when so determined in the articles of association. In cases where the new Code andarticles of association are imperfect and incomplete, the general rules provided in the new Civil Codefor so-called simple companies (companies designed to perform an intellectual activity, of a scientific,literary or artistic nature) will, in principle, be applied.3.2.12. New RulesLaw 11,638/07 determines the application of the aforesaid Law 6,404/76 to large-sized LTDAs, inrespect of matters concerning the recording and preparation of financial statements and therequirement of an independent audit; see the explanation on this matter in the New Rules paragraphof item 3.1. Corporation (S/A). In this context, among the new determinations for large-sized LTDAs,there is some discussion going on as to whether these companies are also required to publish theirfinancial statements, there being conflicting opinions with regards to the interpretation of the rule. Forthe purposes of this new law, large-sized LTDAs are those companies that have total assets, in theprevious year, in excess of R$ 240 million (US$ 110 million) or annual gross turnover of over R$ 300million (US$ 130 million).3.2.13. Adaptation of the Articles of AssociationWith the provisions brought by the new Civil Code, many of the advantages that previously existed forLTDAs have disappeared, notably their structuring flexibility. This should lead to greater reflection withregards to the choice of company type: LTDA or S/A. The choice will depend on each specific case,but by and large, one may say that LTDAs work very well for the operation of subsidiaries whose totalquota capital is held by foreign companies, whereas possible joint ventures in Brazil should elect forthe adoption of a S/A, owing, among other things, to the legal security conferred by the alreadyofficially accepted interpretation of the rules that govern this type of company.21