Foreign entrepreneurs who are looking to expand their business presence by setting up a company in Brazil are confronted with different legal questions. In this article, our company formation consultants in Brazil answer a few of the most frequently asked questions.
Investors who want to open a company in Brazil will not only need a business plan and investment opportunity, but they will also need to understand what are the applicable requirements that will apply in their case, as well as the steps they will need to follow in order to start a new business or expand an existing foreign company. Regardless of the chosen investment route, it is only natural for investors to be confronted with different legal questions.
The local legislation confers the legal frame for different legal entities, such as:
Foreign companies usually choose to set up a limited liability company in this country. Our Brazil company formation advisors can assist you to open such a company in Brazil.
It takes several steps to set up a company in Brazil. Briefly, these are:
Our company registration agents in Brazil can offer further details on what these other steps consist of.
Any transfer of the title of the quotas in Brazil necessitates an amendment in the Articles of Incorporation of the legal entity. The local legislation requires the approval of quotaholders which own minimum ¾ of the entire company capital to amend the Articles of Incorporation.
The main rule is that a foreign company can be a partner, investor or shareholder in a local company, making the local entity a subsidiary of the foreign corporation.
To open a branch in Brazil, a more complex procedure is necessary. A foreign company that decides to open a branch in order to establish its activities in the country can rely on our assistance during the setup and registration process. Special authorizations need to be applied for and obtained from the Government in case of branches and the documentation differs according to the field in which the branch activates.
Even though foreigners are able to own legal entities in Brazil, there are certain sectors which are prohibited for foreign investors, such as:
In Brazil, it takes eight weeks to open a corporate bank account which is needed to set up an LLC, a branch or a representative office.
Foreign entrepreneurs who own LLCs or branches in Brazil are able to hire employees in this country. However, this is not possible for the representative offices here.
Generally, there are no set formalities for the execution of deeds or contracts by companies in Brazil. The general regulations of the Civil Code are applied.
Indeed, a company can be 100% owned in Brazil.
For further questions on the company formation procedures in Brazil, or for help to open a company in Brazil, please contact us.
