Starting a Business in Brazil

• Incorporating a company in Brazil will take at least 30 days
• By law, the services of a Brazilian lawyer are required to incorporate a Brazilian company
• Incorporating a Brazilian company and being named its Director or Administrator are two separate things. To be able to be appointed as a Director or Administrator, a foreigner must obtain a permanent resident visa for Brazil (see Visas below)

Starting a Business in Brazil

Both foreign individuals and companies may set up a business in Brazil. The general rule is that such businesses may encompass any legal business objective. However, foreigners may find some restrictions in certain business areas (for example publishing) or if the company's business activities will be carried out in certain geographical areas considered to involve national security (for example borders with other countries or coastline properties).

Visas

A foreigner does not need a Brazilian visa in order to be a shareholder in a Brazilian company. If they intend to appoint a Brazilian resident to be the company's manager and only come to Brazil from time-to-time to oversee the investment, they can do so on a tourist or limited business visa. However, if foreigner intends to move to Brazil in order to personally manage the company, a permanent visa is required. To get the permanent visa, a foreigner needs to prove that they have invested at least R$150,000 in the Brazilian company.

• See AngloINFO INFOrmation page on Permanent Residency in Brazil

Types of Companies

There are two basic types of limited liability company in Brazil:

1. Sociedade Limitada (LTDA): This is the most common form of company in Brazil. It is also the simplest and most flexible and inexpensive type of company to operate. It is governed by a Contrato Social (Articles of Association) and its capital is divided into quotas (shares). There are no minimum capital requirements and the company is managed by one or more Administrators, resident in Brazil and appointed by the quotaholders. To be ensured total control of the company, a quotaholder must own at least 75 percent of its quotas. 
2. Sociedade Anônima (SA): This form of company is not as flexible as a Limitada and is considerably more expensive to operate and more transparent, since all corporate acts and its annual financial statements must be published in newspapers. It is governed by Estatutos (By-laws) and its capital is divided into one or more classes of shares. An SA is managed by a Management Board and a Fiscal Council, each composed of two or more Brazilian residents. If an SA is listed on the stock exchange or has authorised capital, it must also have a Board of Directors, made up of shareholders.

Tax treatment of Limitadas and SAs in Brazil is identical.

Documents Required to Set up a Company

Unless the foreigner intends to be physically present in Brazil when the incorporation documents are signed, they will have to provide their Brazilian lawyer with a Power of Attorney containing powers to incorporate the company in their name. This applies to either foreign individuals or companies.

In addition, foreign companies will also have to provide a copy of their Certificate of Incorporation issued by the competent authority in their country and containing at least the following information:

• Company name
• Registered Office Address
• Corporate Purposes
• Registered or Authorised Capital (and classes of stock)
• Names of Officers (or the name of the incorporators)

The above documents will have to be authenticated at the Brazilian Consulate in the investor's country of origin and then sent to Brazil, where they will be translated into Portuguese by an official translator.

Procedures for Setting up a Company

Before a Brazilian company may be incorporated, the following preliminary matters must be decided upon:

• Name of company: the company name must give an indication of its business area. If a foreign company is the investor, the foreign company's name may be used followed by the words do Brasil (of Brazil). The individual may check the company name with the State Commercial Registry Office (Junta Comercial) to ensure that the name of the company is not already registered (although this is not obligatory)
• Names of quotaholders or shareholders: the identity of the quotaholders, in the case of a Limitada, or shareholders, in the case of an SA, must be known before the company can be incorporated
• Legal address: the company must have a legal address. If a permanent office for staff is not required, the services of a company offering virtual office addresses may be used
• Capital: the initial capital of the company must be decided as well as the period during which it will be paid up, which may be as long as one or two years
• Management: the people who will comprise management must have been identified and named

Once the above has been decided upon, the text of the Articles of Association or By-laws must be finalised with the Brazilian lawyer and the company must be registered with the competent state Commercial Registry or the Civil Registry. This registration will be handled by the Brazilian lawyer.

Steps to be Taken After Incorporation

Once the company has been formally registered by the Commercial Registry or Civil Registry, the following actions should be taken:

• Obtain a Brazilian Federal Tax Number (Cadastro Nactional de Pessoa Juridica - CNPJ), this can be handled by the Brazilian lawyer
• Hire the services of an accountant to keep the company books
• Register for State and Municipal tax: this may be done by either the lawyer or the accountant once the CNPJ has been obtained
• Remit the company's capital to be paid up initially through official banking channels and register the remittance with the Brazilian Central Bank within 30 days of entering Brazil. Registration is necessary to allow the remittance of profits abroad and the eventual repatriation of the investment. Registration is done online
• Obtain the necessary corporate and accounting books: this may be done by the accountant
• Have invoices printed: this will allow the company to start invoicing sales of products or services

Self-employed Workers

People who wish to set up as self-employed need to apply for a CMM number (Cadastro de Contribuintes Mobiliarios). This is the taxpayer's reference number for a person who carries out self-employed work without any relationship to a salaried position. Applications for the CMM are made to the Local Authority (Secretaria de Financas do Municipio de São Paulo). Self-employed workers are referred to as profissionais Autônomos.

An individual (Pessoa Física) or a company director (pessoa juridical) in São Paulo can apply for a CMM online. Once the form has been sent online it must be printed and signed. Then the form must be taken to the Local Authority (prefeitura) within 30 days with identity documents for the application to be successful.

• To apply for a CMM online: Click here
• Secretaria Municipal de Finanças da Prefeitura de São Paulo, Praça de Atendimento (service area)
  At: Vale do Anhangabaú 206 (next to the Galeria Prestes Maia)
  Tel: 156 (free ISS information number 24/7 
  e-mail  
  Open: Monday to Friday 08:00-18:00

Related Information

The Brazilian Chamber of Commerce in Great Britain has comprehensive information from the publication Legal Guide: Business in Brazil available as a downloadable PDF. 

• To download the Legal Guide: Business in Brazil: Click here and select the option "Legal Guide"
• See also, AngloINFO INFOrmation Page Setting up as a Sole Trader or Small Business in Brazil

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Information prepared by Eric Street, Pantaleão Advogados
Rua do Rócio, 423, 5th floor, 04552-000 São Paulo, Brazil
Tel: (11) 5093 4273 (direct line) / (11) 3513 2410 (main switchboard)
e-mail / Website